Newsletter: California Inc.: Pot shops do big business, but where to put all that cash?
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 president of the Federal Reserve Bank of New York tried to ease investors’ interest-rate concerns on Friday, but U.S. stocks closed out their worst week since August 2011 and fell to a 19-month low. John Williams said the Fed will listen to financial-market signals in setting interest rates, though the outlook for more gradual hikes next year is guidance, not a commitment.
Ho ho ho: Tuesday is Christmas. Markets and most businesses will be closed. Give your family and friends a hug.
Back at work: Weekly jobless claims will be released Thursday. The number of Americans filing applications for jobless benefits rose marginally last week from near a 49-year low. Initial claims rose by 8,000 to a seasonally adjusted 214,000 for the week ended Dec. 15.
Feeling groovy? December’s pulse reading of consumer confidence will be made public Thursday. Consumer confidence dipped in November but still remained near historically strong levels, according to the Conference Board.
Pot bank: The California Treasurer’s Office will release a report Thursday looking at the feasibility of opening a state-owned bank that could serve the state’s cannabis industry. The businesses struggle to get accounts at banks due to federal drug laws.
Home sales: Pending home sales in November comes out Friday. Pending homes sales declined 2.6% in October from a month earlier, according to the National Association of Realtors. Sales were down 6.7% compared with October 2017.
Monday’s Business section delves into a possible bankruptcy filing by the Boy Scouts of America amid litigation fueled by the organization’s own meticulous records of thousands of sexual-abuse and misconduct allegations. Chief Scout Executive Michael Surbaugh says the group is “exploring all options available” to ensure that scouting programs continue uninterrupted.
Here are some of the other stories that ran in the Times Business section in recent days that we’re continuing to follow:
Fed decision: Federal Reserve officials raised their key benchmark interest rate a quarter percentage point on Wednesday, but signaled a slower path of increases in the coming year. However, investors clearly have had enough of rising rates, even though the policy action fell in line with most economists’ expectations. The already downward sloping Dow plummeted 352 points on the news.
Booming economy: Trade tensions and stock market volatility loom over the nation, but California’s job market powered forward in November as employers added 30,700 positions, accounting for nearly a fifth of the nation’s new jobs last month. The growth — to a total of 17.27 million — came on top of October’s 36,400 gain. The state’s unemployment rate held steady at 4.1%, the lowest rate in over four decades.
Wage increase: Agricultural conglomerate Wonderful Co., which sells Halo mandarins, pistachios and other popular products, will raise the minimum hourly wage for its full-time permanent workers to $15 next month. The move comes amid a tight U.S. labor market made even more challenging by stricter immigration enforcement and a healthier Mexican economy sending fewer farmworkers northward.
Launch ticket: Swarm Technologies Inc. was fined $900,000 by the Federal Communications Commission after launching four tiny satellites without permission. The Menlo Park, Calif., manufacturer plans to use its satellites for such jobs as earth imaging and broadband internet. The fine sends a message that Silicon Valley’s ethos of begging for forgiveness rather than asking for permission won’t play in space.
Fox boycott: Tucker Carlson will be off the air this week on a planned Christmas vacation amid an advertisers exodus that threatens his top-rated Fox News program. More than two dozen advertisers have pulled ads from “Tucker Carlson Tonight” following pressure from liberal groups upset over his on-air comments describing mass immigration as making the U.S. country “poorer and dirtier and more divided.”
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Getting real: The New Yorker takes a look at how President Trump’s trade wars are playing out in small-town America, where factory jobs are on the line. “People think I’m a dumb hick white boy who voted for Trump, and that I’ll get what I deserve,” one worker says. “But I’m not some redneck hick. There are going to be some jobs lost. But, still, factories are opening.”
Help not wanted: The Wall Street Journal eyes the challenge of finding sufficient employment opportunities for older workers, even with the unemployment rate at just 3%. “Nearly 8 million older Americans are out of work or stuck in low-quality jobs that offer little opportunity to prepare for retirement.”
Tough love: One place you may not want to work, says Wired, is Tesla. “A large number of high-ranking executives have left in the past two years, and Tesla has stumbled over basic tasks like delivering its cars. Working at the firm has been an agony and ecstasy, some say — sometimes toggling between both extremes in a single day.”
Baring fangs: The New York Times unties the story of the Kiini, an itsy-bitsy, tenny-weenie, very litigious bikini. “In fashion, there is a fine, sometimes indistinguishable line separating inspiration and theft. Most apparel companies try not to get distracted by items that are derivative of their own.”
Delighting in debt: Looking to get rich? According to Bloomberg, you should be in the business of collateralized loan obligations. “Meet the new aristocrats of debt — the people and companies cashing in on a record boom in these once-marginal investments whose relatively high returns have attracted yield-hungry investors.”
The Atlantic spotlights a visit by filmmaker David Freid to the U.S.-Mexico border, which is the object of so much attention from a certain White House occupant. “Freid’s short documentary, “Ferryman at the Wall,” is the story of two countries that, for the most part, peacefully coexist where it matters most: at the dividing line.”
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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