Economic and jobs news thread

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wjfox
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caltrek
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U.S. Employers Add 311,000 Jobs as Hiring Hot Streak Rolls On
by Kevin Lessmiller
March 10 , 2023

Introduction:
(Courthouse News) — The U.S. economy gained 311,000 jobs in February, a sign the labor market has been unfazed by the government’s attempt to slow economic growth through higher interest rates.

While the increase is a drop from the revised 504,000 jobs added in January, payroll growth is continuing to beat expectations. Economists surveyed by Dow Jones had predicted about 225,000 new jobs last month.

The unemployment rate, meanwhile, ticked up from a half-century low of 3.4% to 3.6%, according to a Labor Department report released Friday morning.

“The labor market continues to defy expectations as employers add jobs at a rapid pace and unemployment remains low,” wrote Nick Bunker, economic research director for North America at career site Indeed. “Today’s report is chock full of data showing a labor market with high levels of demand for workers and historically low levels of joblessness.”

The jobs market has remained strong over the past year despite the Federal Reserve raising its benchmark interest rate eight times in a desperate bid to cool down the economy in the face of high inflation. The central bank is expected to hike rates again when it meets at the end of the month.

Read more here: https://www.courthousenews.com/us-empl ... rolls-on/

caltrek’s comment: If technologically created unemployment is a real problem, it sure seems to be taking a long ting to actually manifest itself. Perhaps it is more an issue of individual jobs being replaced by robots and automation and not so much a problem that affects global numbers, at least not yet. Perhaps offsets are more than compensating. Examples include efforts to bring jobs back home to lessen dependency on foreign countries, not to mention to help in creating domestic jobs. Also, government stimulus programs, especially under a Democratic administration. Unfortunately, this also includes military spending in response to the attempted invasion of the Ukraine and to the ongoing conflict there.
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California Starts Year with Nearly 97,000 Jobs Added
by Natalie Hanson
March 10, 2023

Introduction:
SACRAMENTO, Calif. (Courthouse News) — California Governor Gavin Newsom revealed a powerful picture of the job market in January — California led the nation in new jobs created.

The Golden State added 96,700 new jobs in January, a gain that accounted for nearly 19% of the nation's 517,000 new jobs added.

Eight of California’s major industry sectors saw hiring gains in January. The state also outpaced the nation in year-over-year job growth, adding 559,500 jobs. That’s an increase by 3.5%, outpacing the nation’s year-over-year growth rate of 3.3%.

The governor also reported the state’s unemployment rate rose by 0.1% to 4.2%, slightly higher than the nationwide unemployment rate of 3.4%.
Read more here: https://www.courthousenews.com/califor ... bs-added/

caltrek’s comment: But hey, everybody knows that left coast liberals don’t know anything about running an economy with their excess in taxes and regulations and all. Right.
Last edited by caltrek on Sun Mar 12, 2023 5:00 pm, edited 1 time in total.
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wjfox wrote: Sat Mar 11, 2023 11:59 am Image
More on that:

March 10, 2023

Introduction:
(Jake Johnson) Santa Clara-based Silicon Valley Bank, a major lender to technology startups, collapsed on Friday after its emergency attempts to raise money and find a potential buyer failed, forcing regulators to step in and take over the institution.

The speed of SVB's collapse, the largest since the fall of Washington Mutual in 2008, stunned observers and rattled Wall Street, with bank stocks selling off heavily since news broke Wednesday that the California bank was in serious financial trouble.

Earlier this week, the SVB announced that it sold $21 billion worth of investments and moved to sell its stock in a last-ditch effort to raise funds. Those financial maneuvers sparked a bank run as panicked depositors rushed to pull their money, compounding the firm's crisis.

As late as Thursday afternoon, SVB Financial Group CEO Greg Becker was telling clients to "stay calm" and continue to support the bank, which was the 16th largest in the U.S. at the end of last year and had branches in California and Massachusetts.

The Financial Times reported Friday that SVB's failure stemmed from "a decision made at the peak of the tech boom to park $91 billion of its deposits in long-dated securities such as mortgage bonds and U.S. Treasuries, which were deemed safe but are now worth $15 billion less than when SVB purchased them after the Federal Reserve aggressively raised interest rates."
Read more here: https://www.commondreams.org/news/sili ... collapses
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And remember my friend, future events such as these will affect you in the future
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The Federal Deposit Insurance Corp. and the Federal Reserve Considering Creation of a Fund to Backstop Deposits If More Banks Fail
March 11, 2023

Introduction:
(Bloomberg) The Federal Deposit Insurance Corp. and the Federal Reserve are weighing creating a fund that would allow the regulators to backstop more deposits at banks that run into trouble following Silicon Valley Bank’s collapse.

Regulators discussed the new special vehicle in conversations with banking executives, according to people familiar with the matter. The hope is that setting up such a vehicle would reassure depositors and help contain any panic, said the people. They asked not to be identified because the talks weren’t public.

A representative for the Federal Reserve declined to comment. Representatives at the FDIC didn’t immediately respond to a request for comment.
The vehicle is part of the agency’s contingency planning as panic spreads about the health of banks focused on the venture capital and startup communities.
Read more here: https://www.bloomberg.com/news/article ... fy%20wall
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SVB’s Debacle Is Causing Panic In China’s Startup Industry
by Rita Liao
March 10, 2023

Introduction:
(TechCrunch) The panic sparked by the collapse of Silicon Valley Bank is spreading to China, the world’s second-largest venture capital market. Across social media platforms, investors and startups are rushing to share news articles on the fiasco and thoughts on how to prevent such a catastrophic moment. For some companies, however, the impact is tangible.

When China was still new to venture capital in the late 1990s, SVB was among the first financial institutions to start serving the country’s startups, while traditional, risk-averse banks avoided them. Over time, the bank has become a popular option for China-based startups fundraising in USD as well as some China-focused USD venture capital firms.

In the U.S., VCs have been urging their portfolio companies to withdraw money from SVB as soon as the bank announced that it intended to sell shares in pursuit of more capital. Investors are advising the same to Chinese startups exposed to the bank, according to three founders and two investors TechCrunch talked to.

“People realized that things weren’t right after seeing SVB’s shares were down 30% in premarket trading,” said one of the Chinese founders, whose app targets North American users. “I immediately told other Chinese peers after my American investors told me [to withdraw money from SVB].”

SVB’s localized effort in China appears unaffected, for now. According to its website, SVB first began operating in China in 1999. In 2012, it formed a joint venture with Shanghai Pudong Development Bank, the first Sino-U.S. joint venture bank to obtain a license since 1997.
Read more here: https://techcrunch.com/2023/03/10/sili ... industry/
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Billionaire investor Bill Ackman says feds 'screwed up' handling of Silicon Valley Bank collapse, warns they have '48 hours to fix a soon-to-be-irreversible mistake'

Aaron McDade
Mar 11, 2023, 8:28 PM

Billionaire investor Bill Ackman is calling on the federal government to intervene in the collapse of Silicon Valley Bank after the once-trusted bank of tech and startup founders was shutdown by regulators on Friday.

"The gov't has about 48 hours to fix a-soon-to-be-irreversible mistake," Ackman tweeted in a lengthy post Saturday morning.

SVB became the second-largest bank failure in the US, after its stock price cratered by about 86% this week, prompting the Federal Deposit Insurance Corporation to take over. Ackman warned that if the government or another large bank like J.P. Morgan or Bank of America fails to take over SVB, it may lead to similar bank runs at other small financial institutions, as anxious clients move to pull uninsured deposits.

In Ackman's view, this could lead to the collapse of several other smaller banks around the country.

The billionaire founder and CEO of hedge fund Pershing Square Capital Management argued that a lack of more immediate federal intervention earlier in SVB's collapse could have larger, disastrous effects for the banking industry and the economy at large.

https://www.businessinsider.com/billion ... pse-2023-3
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Oh look. How about we "roll back those burdensome regulations" (which are clearly socialist and unamerican).

https://www.theguardian.com/business/20 ... ations-svb
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Contagion.

-----

‘We can’t make payroll’: scores of London tech firms in cash crisis amid Silicon Valley Bank collapse

14 hours ago

The UK startup ecosystem is under immense strain today after the collapse of Silicon Valley Bank has prevented scores of startups from accessing the cash to pay staff.

The Bank of England today announced the UK arm of Silicon Valley Bank was set to enter insolvency after the demise of its US parent yesterday afternoon.

The Bank said eligible depositors would only be paid out up to the protected limit of £85,000 or up to £170,000 for joint accounts, under the Financial Services Compensation Scheme, with the rest of the assets owned by SVB to be distributed by liquidators in due course. The move means many tech firms with large deposits with SVB may be frozen out of their accounts, leaving them without access to the cash needed to fund employee payrolls.

Matt Clifford, co-founder of venture capital business Entrepreneur First, said: “[The] most common phrase in my inbox right now is ‘we can’t make payroll with the insured amount’.”

He told the Standard: ”The core question is just what happens to those who cant’t access to money they need. A bunch of them will not make payroll and a bunch of them will go under.”

https://www.standard.co.uk/business/we- ... 66554.html
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