Welcome to California Inc., the weekly newsletter of the L.A. Times Business Section.
I’m Business columnist David Lazarus, and here’s a rundown of upcoming stories this week and the highlights of last week.
The Dow slipped a bit Friday, but its flirtation with 20,000 will make Wall Street particularly interesting this week. “I think the market is just going through a period of rational exuberance,” says Brian Jacobsen, chief portfolio strategist at Wells Fargo Funds Management. Meantime, California employers added 13,600 jobs in November, nudging the state’s jobless rate down to 5.3%.
Holiday shipping: Mailing your Christmas gifts Monday? Be ready for long lines. The Postal Service says Monday will be the busiest shipping day for holiday packages and cards, while Thursday will be the busiest delivery day. In all, the Postal Service is projecting about 750 million packages will be delivered this holiday season, a 12% increase in volume compared to last year.
Growing pot: On Tuesday, the Lynwood City Council will consider allowing businesses in that community to grow medical marijuana. If the measure passes, the city of 70,000 would be among the first in Los Angeles County to issue such permits. Two weeks ago, the council gave initial approval to the ordinance that would permit commercial cannabis producers to cultivate and manufacture marijuana in industrial areas.
Power plan: The California Energy Commission will hold a public hearing in Long Beach on Tuesday to consider plans by energy company AES to build a new power plant in the city. The new facility, which would be called the Alamitos Energy Center, is intended to replace the aging Alamitos Generating Station on the eastern edge of the city. The Los Cerritos Wetlands Land Trust is opposed to the project, fearing it will damage neighboring marshlands.
Movie debuts: Two highly promoted films hit theaters in wide release Wednesday, as studios make their best play for audiences during the lucrative Christmas moviegoing season. In “Assassin’s Creed,” from 20th Century Fox, Michael Fassbender plays a man who learns he is descended from a secret society. In “Passengers,” from Columbia Pictures, Jennifer Lawrence and Chris Pratt play interstellar commuters traveling to a far-off planet. A third film, “Patriots Day,” from Lionsgate, looks at the 2013 Boston Marathon bombing and opens in limited release in Los Angeles, New York and Boston, qualifying it for the upcoming Academy Awards.
Christmas trips: Thursday and Friday will be the busiest travel days of the holiday season, according to Airlines for America, the trade group for the nation’s airlines. A stronger economy and lower airfares are expected to increase the number of holiday air travelers 3.5% this year. The busiest airports during the holiday period will be Hartsfield-Jackson Atlanta International Airport, Chicago O’Hare International Airport, Los Angeles International Airport and Dallas/Fort Worth International Airport.
Monday’s Business section explores the challenge of keeping jobs in the United States. President-elect Donald Trump has strongly criticized jobs migrating abroad and has threatened “consequences” for companies that ship factory work out of the country — among those, possible tariffs on bringing goods back into the U.S. But experts say it’s difficult, and costly, for companies to fight changes taking place in the global economy.
Here are some of the other stories that ran in The Times’ Business section in recent days that we’re continuing to follow:
Slippery business: As CEO of Exxon Mobil, Rex Tillerson has led a vast energy juggernaut, roaming the globe in search of multibillion-dollar deals, working with despots as well as democrats. If Tillerson is confirmed as Trump’s secretary of State, however, he may find that his 41-year career at the world’s largest publicly traded oil and gas company could hamper his ability to freely conduct foreign policy as America’s top diplomat.
Rate hike: Federal Reserve officials inched up a key short-term interest rate for the first time in a year and projected three more small increases in 2017 as policymakers moved to keep inflation under control amid improving economic conditions and anticipated stimulative policies from the incoming Trump administration. It was only the second increase in more than a decade and another small signal that the economy is returning to normal.
Viacom change: Media mogul Sumner Redstone no longer will hold a voting role on Viacom Inc.’s board of directors, according to a regulatory filing. Redstone still will serve as chairman emeritus, but he is stepping down from the Viacom board. Redstone, who has been in deteriorating health, is 93. The Redstone family still controls nearly 80% of the voting interest in Viacom through its movie theater chain and investment vehicle, National Amusements Inc.
DeVry settlement: DeVry University and its parent company, DeVry Education Group, have agreed to pay $100 million to settle a Federal Trade Commission lawsuit alleging that the for-profit college misled potential students with ads about its post-graduation success rates. As part of the settlement, DeVry will pay $50.6 million in debt relief, which includes $30.4 million to cover the total unpaid student loans issued to undergraduates, and $20.3 million to cover other student debt obligations.
Bank sanction: Wells Fargo was sanctioned by federal regulators who determined the bank has not prepared a “living will” adequate to ensure it could continue operating smoothly after a bankruptcy and without a taxpayer bailout. The decision did not reflect the bank’s current financial health, but rather a determination that if the economy were to falter and Wells were to go bankrupt, its operations could not quickly or easily be broken up or sold off.
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Having Trump’s ear: Quartz checks out how Goldman Sachs’ Gary Cohn became Trump’s top economic advisor. “His backers say his leadership style … frequently characterized as brash and domineering, but still suited to a partnership culture … may be exactly what Trump’s government of billionaires needs to stay solvent.”
Somebody’s watching me: Reveal from the Center for Investigative Reporting pokes holes in Uber’s claim that it protects users from spying. “Thousands of employees throughout the company … could get details of where and when each customer travels.”
Looking after doctors: Scientific American says that “in picking Tom Price to be secretary of Health and Human Services, Trump has chosen an orthopedic surgeon who in his congressional career, has loyally promoted the interests of the medical profession — its freedom and importantly, its financial interests.”
Dave’s not here: An interesting take from Rolling Stone on how states can do more to share the wealth of emerging cannabis industries with African Americans. “The people most likely to be victims of marijuana prohibition are the least likely to profit in its aftermath.”
Just plain evil: Wired reports on a particularly devious ransomware that lets you go free without paying if you successfully infect two other people. “If two of your victims pay up, the attackers give you the key to decrypt your data.”
That nasty ransomware story got me thinking about the best movies about con artists. “American Hustle” was a recent entry in the genre. There also was the trickery of “The Brothers Bloom,” “Catch Me If You Can” and “The Grifters.” But the mother of all swindle flicks, now and forever, remains “The Sting.”
For the latest money news, go to www.latimes.com/business. Until next time, I’ll see you in the Business section.