Date: 2024-07-17 Page is: DBtxt003.php txt00021764
MEDIA HEADLINES
21 HATS
Some headlines for February 25th 2022 and an analysis looking at the economic effects of the invasion and offering three possible scenarios.
21 HATS
Some headlines for February 25th 2022 and an analysis looking at the economic effects of the invasion and offering three possible scenarios.
Original article:
Burgess COMMENTARY
Peter Burgess
Here's an analysis looking at the economic effects of the invasion and offering three possible scenarios.
Loren Feldman ...21 Hats <21hats@substack.com>
February 25th, 2022 ... 9:48 AM
Good morning!
Here are today’s highlights:
- American tech companies are trying to support their staffers in Ukraine.
- Early returns suggest the American Rescue Plan did what it was supposed to do.
- There are four Kmarts left in the U.S.
The Russian invasion is not going to help with inflation: “Oil’s surge past $100 a barrel after Russia’s attack on Ukraine intensifies the economic troubles confronting President Biden, whose administration has been struggling for months to reel in rising inflation. Benchmark U.S. oil futures ended higher Thursday, settling at $92.81, up 0.8 percent on the day. With prices at their highest since 2014, Mr. Biden said he was prepared to release more oil from the government’s Strategic Petroleum Reserve if necessary.”
“Oil prices have been trending upward for months, and analysts say Mr. Biden has limited options for a quick fix given the complexities of supply and demand.”
What exactly is the economic impact likely to be? “Just how big a blow the conflict ends up delivering to the global economy will depend on its length and scope, the severity of Western sanctions, and the possibility that Russia might retaliate. There’s the potential for other twists too, from an exodus of Ukrainian refugees to a wave of Russian cyber attacks. Bloomberg Economics has captured some of those effects in three scenarios that examine how the war could impact growth, inflation and monetary policy.”
“In the first, a swift end to fighting prevents a further upward spiral in commodity markets, keeping U.S. and European economic recoveries just about on track. Central bankers would have to tweak their plans, not scrap them.”
“A worst-case outcome would see Europe’s gas supply cut off, triggering a recession, while the U.S. would see significantly tighter financial conditions, a bigger hit to growth, and a markedly more dovish Fed.”READ MORE
Mortgage rates stay around 4 percent but are likely to fall: “Mortgage rates hovered just below 4 percent for a second week, maintaining stress on potential buyers facing high prices and low inventory. The average rate for a 30-year fixed-rate loan was 3.89 percent, mortgage-finance giant Freddie Mac said Thursday, down slightly from 3.92 percent last week. At the beginning of the year, the average rate on America’s most popular home loan was 3.22 percent.”
“The Russian invasion of Ukraine stands to push down mortgage rates as investors flock to U.S. Treasurys, widely seen as safe investments during times of political instability, economists said.”
“Mortgage rates are closely tied to yields on the 10-year U.S. Treasury, which fell near their lowest levels this month on Thursday.”
“The monthly payment on a $375,000 home with an interest rate of 4 percent is $220 higher than the payment on a similarly priced home in December 2020, when the average mortgage rate was below 3 percent, according to Realtor.com data.” READ MORE
Early returns on the American Rescue Plan are looking positive:
Twitter avatar for @Markzandi Mark Zandi @Markzandi Our full report can be found here: moodysanalytics.com/-/media/articl… Gene Sperling@genebsperling
Moody’s analysis today: American Rescue Plan led to: — 4 million additional jobs — 2% lower unemployment —- 5.7% GDP instead of 3% — Only .35% incremental inflation increase Without ARP: — risk of Spring 2021 double-dip recession — far higher unemployment due to Delta
February 24th 2022
18 Retweets37 Likes
HUMAN RESOURCES
Tech companies are trying to support their staffers in Ukraine: “The country is a well-established hub for engineers and tech talent, as startups and corporates hired English-speaking talent for lower wages than in San Francisco or London. The country is estimated to have around 200,000 tech specialists. Popular neo-bank Revolut, money-transfer app Wise, plus bigger firms including Google, Snap, and Oracle all have technical staff across the country, LinkedIn data shows. As yet, internet and mobile services in Ukraine have not been disrupted. But a number of firms are offering financial or practical assistance to staff in the country, as the conflict escalates.”
“Estonian ride-hailing and food-delivery startup Bolt employs more than 100 people across a range of areas in the country, including operations, copywriting, and software development.”
“Tutoring startup Preply, whose founding team is Ukrainian, is moving staff outside the country where possible. CEO Kirill Bigai said: 'It's a devastatingly sad day in Ukraine and our thoughts are wholeheartedly with everybody who is affected.”
“Grammarly, an AI-driven grammar and punctuation tool based in both the U.S. and Ukraine, said it had already implemented ‘contingency plans’ to ensure its team members and their families remained safe.”
READ MORE
Google is easing Covid protocols and reviving old perks: “Google Real Estate and Workplace Services VP David Radcliffe wrote an email to San Francisco Bay Area employees this week explaining that the company is relaxing some rules around vaccines, testing, social distancing and masks. Separately, a Google spokesperson told CNBC that the company has reversed course and will not require vaccinations as a condition of employment for U.S. workers, but declined to offer further details. Radcliffe’s note also said that perks such as massages and access to informal spaces in the office will be returning. In the past, Google has been able to attract talent with fun office amenities, but many of those were suspended during the pandemic.”
“The moves come as the company prepares to require most employees to come into physical offices at least three days a week for a ‘hybrid’ work model, while some other Bay Area tech companies are offering fully remote work options.”
“Google has had to delay its office return several times amid various Covid-19 variant surges, and another surge could change these latest plans once again.”
READ MORE
Corporate execs are saying the return to the office is real this time: “The two-year mark since many American businesses sent their office workers home is approaching, and some antsy executives have delivered a long-delayed message: Return-to-office plans are real this time (fingers crossed). Managers are hanging up welcome balloons and dusting off monitors with a sense of confidence. Coronavirus tests are widely available, including some provided by employers. Many businesses know the majority of their employees are vaccinated. Many workers have recovered from Omicron and are resuming indoor social activities.”
“‘It was like back-to-school week, quite frankly,’ said Chris Glennon, the vice president of global real estate and workplace at Intuit, who visited the company’s San Francisco office last week.”
“Intuit fully reopened its offices on a voluntary basis on Jan. 18 and is continuing to weigh timing for a required return.”
“At Meta, employees have until March 14 to decide if they want to go back to the office or request to work from home either permanently or temporarily for three to five months.”
“Meta requires anyone entering the office to be vaccinated and wear a mask, and booster vaccination shots will be required starting March 28 for those who are eligible.”
READ MORE
Subscribe now
STARTUPS
Zoom is launching a video-based call-center service: 'Zoom wants potential contact center customers to think of the new service as a natural extension of the company's leadership in remote work, collaboration and communications. The company hopes to engage current Zoom clients who may be looking to add contact center capabilities, but don't want another vendor in their tech stack. While the initial release of Zoom contact center won't have all the features of the traditional players, the company plans to add new features and capabilities over time.'
“Even still, Zoom's video prowess could prove to be a differentiator in the market, especially when it comes to servicing high-touch customer interactions like those in wealth management or specialty retail.”
READ MORE
RETAIL
There are four Kmarts left in the U.S.: “On a busy stretch of Route 35 near Rahway, [New Jersey], one of the nation’s last Kmart stores looks like a relic from the past. Its big red K is faded and cracked. Inside this most American of retail stores, popular for K Cafe luncheonettes and Bluelight Specials, a sign promotes 60 percent off clothing. A dining-room table was on clearance for $89, while Route 66 jeans went for $10.99 and pink ladies’ neck sweaters for $12.49. But a spacious parking lot was mostly empty with a handful of bargain shoppers scurrying into the store over a couple of hours. Some came out empty-handed. A woman said her elderly mother walks the shopper-barren Kmart aisles for safe exercise. She was checking on her.”
“Another shopper, Grace Celauro, 69, said, ‘I came here out of boredom.’ She bought two winter coats for her grandchildren.”
“At its peak in the 1990s, Kmart operated about 2,400 stores and employed 350,000 in the United States and Canada. Its brands once included PayLess Drug Stores, the Borders bookstore chain, and Sports Authority.”
“‘It’s amazing to remember that [Kmart] started out the same year as Walmart and Target in 1962.’” READ MORE
THE 21 HATS PODCAST
We Don’t Have a Brand: This week, Paul Downs talks about why furniture makers traditionally have not stamped their names prominently on their work—and why he’s rethinking that now. That change of heart is the direct result of Paul’s unlikely experience connecting two very different businesses: One a Mennonite company manned by master craftsmen, and the other a startup manned by tattooed hipsters with a mastery of Kickstarter. In this conversation, Paul explains what he’s up to and also talks about how close his business came to failing, how he plans to double his revenue, why he’s thinking about trying TikTok, and how he feels about his son’s success in the alternative reality of venture-backed startups.
You can subscribe to the 21 Hats Podcast wherever you get podcasts.
Listen to the Podcast
If you see a story that business owners should know about, hit reply and send me the link. If you got something out of this email, you can click the heart symbol, you can click the comment icon below, and you can share it with a friend. Thanks for reading, everyone. — Loren
Like CommentComment ShareShare You’re a free subscriber to The 21 Hats Morning Report. For the full experience, become a paid subscriber.
Subscribe
© 2022 Loren Feldman
26 Harriet Drive, Princeton, N.J. 08540