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.
Wall Street kicks back into gear Monday after mixed economic news on Friday. The economy slowed at the end of last year, once again unable to sustain 3% growth for very long in a trend that has plagued the recovery from the Great Recession. Still, it marked another solid quarter in one of the longest economic expansions in U.S. history, even if it fell short of President Trump’s promise of much faster growth.
Last hurrah: Federal Reserve Chairwoman Janet L. Yellen presides over her final monetary policy meeting Wednesday before being replaced by Jerome Powell when her term ends Saturday. Fed officials are expected to leave their benchmark short-term interest rate unchanged.
Big dogs: Tech firms have led the market’s big gains since the start of 2017, and that will be put to the test when four of Silicon Valley’s biggest companies release their fourth-quarter earnings reports. Facebook’s and Microsoft’s announcements are set for Wednesday, while Apple and Alphabet Inc., Google’s parent company, will release their earnings a day later.
Toy story: Struggling Mattel reports its fourth-quarter results Thursday. The El Segundo toy giant already has said it expects to post lower sales compared with a year earlier, and it’s expected to discuss how Toys “R” Us’ plan to close 182 U.S. stores could further hurt Mattel’s business.
Jobs data: The Labor Department will release the latest jobs report Friday. Analysts expect the economy added 165,000 jobs in January, rebounding somewhat from a disappointing 148,000 the previous month. The unemployment rate is forecast to hold steady at 4.1%, the lowest level since 2000.
Game time: The Super Bowl is Sunday, which means businesses will be duking it out for best-commercial bragging rights. Advertisers see the Super Bowl as their one annual chance to make a big statement that reaches around 40% of the country in one shot. As a result, NBC’s telecast is close to sold out at roughly $5 million for a 30-second spot, about the same as last year.
When Janet Yellen steps down as chairwoman of the Federal Reserve, she’ll depart with the economy in strong shape and monetary policymakers armed with more options than they’ve had in years, should it falter. But the soft-spoken former UC Berkeley economist also leaves some important unfinished business after an unusually short four-year stint as leader of the world’s most influential central bank — stubbornly low inflation, regulatory reform and how to craft monetary policy in an era of slower growth.
Here are some of the other stories that ran in the Times Business section in recent days that we’re continuing to follow:
Trade dispute: U S. trade officials rejected a complaint by Boeing Co. that it was harmed by the alleged dumping of regional jets made by Canadian rival Bombardier — a surprising conclusion to a trade dispute that has stirred up rancor between the two nations. The decision highlights the institutional constraints that the president faces as he pursues his “America First” policy.
Tourist destination: Los Angeles, known for bucking many a national trend, is charting its own course when it comes to tourism. The county set a record of 48.3 million visitors in 2017, marking the seventh straight year it topped the previous record for both domestic and international visitors. The increase comes as fewer foreign travelers are coming to the U.S. as a whole.
Box office gold: Even as the U.S. box office slumps, Universal Pictures showed how good films can still drive moviegoers to the theater. The Universal City-based studio had its most profitable year ever in 2017, driven by such hits as “Fate of the Furious,” “Despicable Me 3” and “Get Out.” The Comcast Corp. company recorded $1.28 billion in profits, an increase of 83% from 2016.
Playing monopoly: European Union regulators fined Qualcomm Inc. $1.2 billion for making payments to Apple Inc. in exchange for exclusively using the San Diego company’s smartphone radio chips in iPhones from 2011 to 2016. Qualcomm, in a fierce legal battle with global antitrust regulators over its business practices, said it will immediately appeal the decision.
Reduced penalties: A Los Angeles federal judge ordered CashCall to pay $10.3 million for violating consumer protection laws — a fraction of the $287 million sought by the Consumer Financial Protection Bureau. CashCall was found guilty of unfair, deceptive and abusive acts for making personal loans at interest rates often topping 100%, but the judge said the regulator had failed to prove its case for the higher penalty.
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Not so happy: The Orange County Register spotlights Disneyland workers who wonder if one-time $1,000 bonuses represent a fair share of the Republicans’ tax cuts. Disney “is getting a $2 billion-a-year tax cut, and they are only giving out $125 million to employees, a one-time thing,” one union leader said.
Heads up: A Tesla Model S in Autopilot mode slammed into the back of a stopped firetruck on the 405 Freeway in L.A. County. Wired asks the obvious question: “How is it possible that one of the most advanced driving systems on the planet doesn't see a freaking firetruck, dead ahead?”
Low pay: The New York Times asks why pay is lagging for many American workers. The answer, it says, may be a wave of mergers in the heartland. “In the past few years, a growing chorus of economists has expressed concern that consolidation among companies, often considered a problem for consumers, may be limiting workers’ employment options and holding their wages down as a result.”
Bad bet: Add casino mogul Steve Wynn to the growing list of powerful men accused of very bad behavior, says the Wall Street Journal. Dozens of people “told of behavior that cumulatively would amount to a decades-long pattern of sexual misconduct by Mr. Wynn. Some described him pressuring employees to perform sex acts.”
For the latest money news, go to www.latimes.com/business. Mad props to Laurence Darmiento for helping put this thing together.
Until next time, I'll see you in the Business section.