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 still digesting news that the nation’s economic growth declined at the end of last year for the second straight quarter, denying President Trump the 3% annual increase he had promised his tax cuts would create. And growth this year and next won’t hit that level either, economists say. Total economic output rose 2.9% in 2018. File that under Close but No Cigar.
Beige Book: The latest Beige Book from the Federal Reserve comes out Wednesday. The anecdotal report on economic conditions helps guide policymakers’ decisions. The last such report found that “many” Federal Reserve districts “had become less optimistic” in response to a variety of factors, including increased market volatility and rising interest rates.
Consumer credit: The busy beavers at the Fed will be releasing stats on consumer credit on Thursday. In December, consumer credit rose above $4 trillion for the first time ever. With low unemployment and steady income growth, consumers have been tapping into credit lines, economists say.
Job market: The latest stats on the labor market will be revealed Friday. Hiring in January topped all forecasts, although wage gains eased and the partial government shutdown caused the unemployment rate to hit 4%.
Here she comes: “Captain Marvel” hits movies screens on Friday. The first Marvel flick to center on a female superhero, “Captain Marvel,” starring Brie Larson, has received positive early buzz and is said to be full of both action and heart (and a scene-stealing cat). Also arriving Friday is “The Kid,” the latest retelling of the Billy the Kid story, with a cast that includes Dane DeHaan, Ethan Hawke, Vincent D'Onofrio and Chris Pratt.
Monday’s Business section looks ahead to the day that self-driving cars are capable of pulling over for the police. It’s a key development. Robots can’t take control of the roads until automakers, engineers, lawmakers and police work through a series of thorny problems: How can a cop pull over an autonomous car? What should robot drivers do after a collision? How do you program a vehicle to recognize human authorities?
Here are some of the other stories that ran in the Times Business section in recent days that we’re continuing to follow:
All Musk: It was a week of low lows and thrilling highs for Elon Musk. First, the Securities and Exchange Commission said it would seek to have Musk held in contempt for tweeting about Tesla car sales in violation of an agreement requiring his tweets to be vetted by company attorneys. Then, the L.A. billionaire announced Tesla was finally taking orders for a $35,000 Model 3 but closing most retail stores in favor of online sales, which sent shares plummeting. Finally, his SpaceX rocket company successfully launched an uncrewed capsule in preparation for ferrying astronauts to the International Space Station.
HBO shakeup: Richard Plepler is stepping down as chairman and CEO of the premium cable network after spending 27 years molding it into the industry’s tastemaker with such shows as “Game of Thrones” and “Last Week Tonight With John Oliver.” Plepler’s exit follows AT&T’s takeover last year of HBO parent Time Warner Inc. The Dallas telecommunications giant is moving quickly to put its own stamp on the company.
Sliding sales: The sluggish Southern California housing market took another hit in January, with home sales plunging 17% from a year earlier, according to CoreLogic. The six-county region’s median price rose only 2% from January 2018 to $505,000 — reflecting high prices that have put homes beyond the reach of many buyers.
Accelerating losses: Potential investors in Lyft Inc.’s initial public offering got their first look at the ride-hailing company’s financials. Lyft’s revenue is exploding, but so is its net loss. Like many other IPO candidates, the San Francisco company has never turned a profit. Lyft lost $991 million in 2018 — up 32% from the year before — even as revenue for the same period doubled.
Luxe Caruso: L.A. billionaire developer Rick Caruso debuted his newest project: the Rosewood Miramar Beach, a 161-unit resort in Montecito that dials up the luxury with gourmet dining and rooms that cost more than $800 a night on the low end and reach $5,575 for a grand suite. The sprawling beachside property features a main house, two pools and bungalows on the site of a historic resort that closed in 2000.
What we’re reading
Some recent stories from other publications that caught our eye:
The watchers: Who moderates content on Facebook? The Verge found that it’s often contractors working for other companies under nasty conditions. “It is an environment where workers cope by telling dark jokes about committing suicide, then smoke weed during breaks to numb their emotions. It’s a place where employees can be fired for making just a few errors a week — and where those who remain live in fear of the former colleagues who return seeking vengeance.”
Crypto ambitions: Big-name tech companies are hoping to succeed at cryptocurrencies where bitcoin failed, the New York Times reports. The companies “are planning to roll out new cryptocurrencies over the next year that are meant to allow users to send money to contacts on their messaging systems, like a Venmo or PayPal that can move across international borders.”
Smile, honey: A lot of work goes into being a “child influencer” — that is, a kid with the social-media clout to sway others on Instagram — but much of the heavy lifting is being done by Mom and Dad. As the Atlantic says, “All these young Instagram celebrities’ success comes as a result of their parents calling the shots and running the business behind the scenes.”
Hot shot: The Wall Street Journal spotlights technology that helps build better basketball players, such as 11-year-old Lanie Grant. “This fearless, 5-foot-nothing point guard, who occasionally wears her braids like she’s Princess Leia, is a perfect example of how the latest basketball technology is beginning to make players better faster than ever before.”
No sale: From Newsweek, a gallery of stark photos from dead shopping malls taken by Seph Lawless. “His images of eerily empty hallways, vandalized escalators and snow-filled concourses are a poignant illustration of the decline of traditional shops.”
Vaccines are safe and save lives, yet some parents persist in believing claims that vaccines can cause autism and other disorders. This video from Time magazine Editor-at-Large Jeffrey Kluger addresses those concerns. “Vaccines do not cause autism,” he observes. “They never have. They never will.” The reason for all this uncertainty? A fraudulent 1998 study. “The study was later retracted,” Kluger notes.
For the latest money news, go to www.latimes.com/business. Mad props to Laurence Darmiento for helping put this thing together.