Newsletter: California Inc.: The clock is ticking on the holiday shopping season
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.
Investors are hoping this week will be better than last for Wall Street, which has been pounded in recent days. Friday’s losses were exacerbated by news that job growth slowed significantly in November. Employers added 155,000 jobs, well below analyst expectations and a steep decline from October’s strong 237,000 figure.
Eye on CBS: CBS Corp. holds its annual meeting with shareholders in New York on Tuesday. The event was delayed twice earlier this year due to turmoil within the company. A 59-page report detailing alleged sexual misconduct by former CBS CEO Leslie Moonves is expected to be presented to the board.
Consumer prices: The latest pulse reading of inflation comes out Wednesday with the release of the consumer price index. In October, consumer prices increased by the most in nine months amid gains in the cost of gasoline and rents. The CPI was up 0.3% after edging 0.1% higher in September.
Jobless claims: Weekly jobless claims arrive Thursday, providing a glimpse of how the labor market is faring after last week’s weaker-than-expected monthly stats. Overall, the jobs market is strong, economists say, but a slowdown in hiring would signal trouble on the horizon.
Retail sales: How are holiday sales looking? We’ll get a better sense of the bigger picture when retail sales for November are released Friday. Foot traffic was down at traditional retailers on Black Friday but preliminary data indicate online sales continued to grow. In the prior month, sales were up sharply as purchases of vehicles and building materials surged, likely driven by Hurricane Florence rebuilding efforts.
New flicks: Among movie releases of note this week, “If Beale Street Could Talk,” based on the James Baldwin novel, marks the return of “Moonlight” director Barry Jenkins. Or you can catch big cities rolling around and doing battle in the sci-fi extravaganza “Mortal Engines.”
Former Army helicopter pilot Tyler Merritt runs a clothing company that has earned profits picking a side in this polarized moment in American politics. When Nike launched its controversial Colin Kapernick ad campaign, he countered with a T-shirt emblazoned with the pithy slogan “Just Stand.” Those kind of in-your-face designs have propelled Nine Line Apparel to some $25 million in annual revenue and 180 employees.
Here are some of the other stories that ran in The Times Business section in recent days that we’re continuing to follow:
Bulls and bears: The blue-chip Dow Jones industrial average plunged 4.5% for the week, ending with a 559-point rout Friday that left the index in negative territory for the year. So is the long bull market over? No one’s really sure, given the trends that are sparking volatile trading, including the trade war, rising interest rates and President Trump’s mercurial tweets.
Consumer chief: The Senate, in a party-line vote, confirmed White House aide Kathy Kraninger to head the Consumer Financial Protection Bureau. Experts predicted a continuation of the industry-friendly shift the agency has taken since Trump installed White House budget chief Mick Mulvaney as acting director last year.
Facebook stumble: A British lawmaker alleged the social network maintained “whitelisting agreements” that gave select companies preferential access to valuable user data several years ago. The allegations stem from a trove of legal documents seized by British authorities related to an app developer’s lawsuit. Facebook, already roiled by user-privacy scandals, denied the allegations.
Compensation adjustment: Under fire from shareholders, Walt Disney Co. changed Chairman and CEO Bob Iger’s stock-based compensation to better reflect the success of the Burbank media giant’s share price. Shares will now have to outperform the bottom 65% of the firms on the Standard & Poor’s 500 index in order for him to receive more than $100 million in stock units.
Cannabis cowboys: Altria Group Inc. is taking a $2.4 billion, or 45%, stake in Cronos Group, a Toronto medical and recreational marijuana producer. The Marlboro cigarette maker will pay an additional $1.4 billion for warrants that, if exercised, would give Altria a 55% ownership stake. That would make the deal similar in scale to the $4 billion spent by Constellation for a stake in another Canadian pot producer.
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Facing the music: The New Yorker looks at how things are growing steadily worse for Facebook. Internal documents “show, irrefutably, that the company did indeed whitelist a number of lucrative business partners, including Netflix, Lyft, and Airbnb, allowing them continued and unfettered access to the accounts of Facebook users and their friends after the company claimed that it had stopped the practice.”
A better way: The New York Times chats with a California-born entrepreneur who says he can protect millions of Africans from toxic smoke in their homes. Eric Reynolds says “the company he is building across Rwanda, Inyenyeri, aims to replace Africa’s overwhelming dependence on charcoal and firewood with clean-burning stoves powered by wood pellets.”
Housing bill: The Orange County Register casts an eye on new legislation that would boost California’s housing supply. The More H.O.M.E.S. Act “requires developers to provide affordable housing as long as the local jurisdiction doesn’t already have rules in place requiring that. It also prohibits the demolition of existing rental units and gives low-income communities more time to implement the bill.”
Tariff man: The Atlantic wonders if President Trump even understands how tariffs work. “The tariffs are acting, as one would expect them to act, as a tax on American consumers, raising domestic prices and slowing the domestic economy. (They’re slowing the global economy, too.)”
Ones to watch: Bloomberg Businessweek is out with its second annual list of the 50 people “in business, entertainment, finance, politics, and technology and science whose 2018 accomplishments were particularly noteworthy.” Ryan Coogler, director of “Black Panther,” is on it. So are Michael Gelband, co-founder and CEO of ExodusPoint Capital Management, and Rep.-elect Alexandria Ocasio-Cortez. A certain consumer columnist? Maybe just an oversight.
Want to live on the starship Enterprise? Check out this video from the Wall Street Journal showcasing a $10-million home in Silicon Valley’s Los Altos Hills. Architect and homeowner Malika Junaid has come up with a dining room that seems to float in the air, a kitchen with moving walls and storage space, and, coolest of all, an elevator modeled on “Star Trek” transporters. Beam us up!
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.
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