Live Economy Updates: Trump Nominee Confirmed to Federal Reserve

Credit…Chia Bella James/Warner Bros.

Every movie on the 2021 Warner Bros. release calendar — including big-budget extravaganzas like “Suicide Squad 2,” “Godzilla vs. Kong,” “Dune” and “The Matrix 4” — will arrive simultaneously in theaters and on the HBO Max streaming service in the United States, WarnerMedia said on Thursday. HBO Max subscribers will get instant access to 17 movies in total, a slate that easily represents more than $1 billion in production costs.

In explaining why an entire year’s worth of movies would not receive exclusive runs in cinemas (a significant break from Hollywood’s traditional business model), WarnerMedia, which is owned by AT&T, pointed to the coronavirus pandemic. Even with a widely deployed vaccine, which is expected in the coming months, the company does not believe that moviegoing in the United States will recover until at least next fall, a gloomy assessment that stands in sharp contrast with what other major movie studios have signaled.

“We know new content is the lifeblood of theatrical exhibition, but we have to balance this with the reality that most theaters in the U.S. will likely operate at reduced capacity throughout 2021,” Ann Sarnoff, the chief executive of the WarnerMedia Studios and Networks Group, said in a statement. “We can support our partners in exhibition with a steady pipeline of world-class films, while also giving moviegoers who may not have access to theaters or aren’t quite ready to go back to the movies the chance to see our amazing 2021 films.”

She called it a “unique one-year plan.”

But it will likely be impossible to go back to the old way of doing things. For a start, audiences trained to expect immediate gratification may not want studios to return to the days of giving theaters roughly 90 days of exclusive playing rights. AT&T also wants to continue growing HBO Max. Two weeks ago, the company said that “Wonder Woman 1984” would simultaneously arrive in domestic theaters and on HBO Max on Christmas Day, a move that many analysts saw as a crossing-the-Rubicon moment.

“Our content is extremely valuable, unless it’s sitting on a shelf not being seen by anyone,” Jason Kilar, WarnerMedia’s chief executive, said in a statement. “We believe this approach serves our fans, supports exhibitors and filmmakers, and enhances the HBO Max experience, creating value for all.”

The 17 movies will receive traditional theatrical releases outside of the United States, where HBO Max is not yet available. In addition to big-budget movies, Warner’s 2021 slate includes “The Little Things,” a thriller starring Denzel Washington; “In the Heights,” a musical from Lin-Manuel Miranda; Clint Eastwood’s “Cry Macho”; “The Conjuring: The Devil Made Me Do It”; and a “Sopranos” prequel called “The Many Saints of Newark.”

Mr. Waller, currently the research director at the Federal Reserve bank of St. Louis, is the more conventional of President Trump’s picks for the Fed board.
Credit…Erin Schaff/The New York Times

Christopher Waller, a regional Federal Reserve official nominated by President Trump to the central bank’s seven-member Board of Governors in Washington, was confirmed to the post by a narrow margin on Thursday, as Republicans scramble to fill open slots before President-elect Joseph R. Biden Jr. comes into office.

Mr. Waller, a conventional choice, had been up for Senate confirmation alongside Judy Shelton, an unorthodox economist whose long-held preference for the gold standard and apparent skepticism of Fed independence hurt her chances of confirmation. Mr. Waller made it through, but just barely, with a vote of 48-47.

Mitch McConnell, the Senate majority leader and a Republican of Kentucky, tried but failed to bring Ms. Shelton’s nomination to a vote in recent weeks. Her path to confirmation became less likely after Mark Kelly, the newly elected Democrat from Arizona, was sworn in earlier this week — she already faced opposition from several Republicans, and Mr. Kelly’s likely “no” vote could kill her razor-thin chance of passing.

Ms. Shelton’s confirmation is “unlikely” after the changeover, Senator John Thune told reporters Thursday.

Mr. Waller’s confirmation passed by the narrowest margin of any Governor going back to at least 1980, based on data collected by George Washington University professor Sarah Binder, and probably the narrowest ever.

Mr. Waller is a seasoned economist who has worked in academia and, most recently, as research director at the Federal Reserve Bank of St. Louis. His nomination was first announced in the summer of 2019, and he was confirmed to an unexpired 14-year term that stretches through early 2030.

Mr. Waller’s research has covered topics including central bank independence — “the key tool to ensure a government will not misuse monetary policy” — and he has laid out a rationale for keeping borrowing costs cheap when prices are increasing slowly, as they have been in recent years. The Fed raises or lowers interest rates to slow or speed up the economy, hoping to keep inflation slow and stable while maximizing employment.

Before joining the Fed in 2009, Mr. Waller was a professor in the economics department at Notre Dame. He has a doctorate from Washington State University.

The Senate’s move to confirm Mr. Waller during a presidential transition period is historically unusual. He is the first Fed nominee to be confirmed during a so-called lame-duck session, the stretch of time after a presidential election but before the new administration takes the White House, according to the Fed historian Peter Conti-Brown.

His selection means that Mr. Biden will take office with a Fed stocked with picks from Mr. Trump, who has now chosen five of the central bank’s six sitting governors, including appointing Jerome H. Powell, as its chair.

Delta will ask all passengers flying into the United States to voluntarily provide contact information.
Credit…Chang W. Lee/The New York Times

Delta Air Lines said Thursday that it will assist federal coronavirus contact tracing efforts, becoming the first airline to do so after the industry spent years resisting government requests for help.

Starting Dec. 15, Delta will ask all passengers flying into the United States to voluntarily provide their names, email addresses, destination addresses and phone numbers — information that it will share with the Centers for Disease Control and Prevention.

“We want customers to feel safe when they return to travel, and this voluntary program is another way we can provide additional reassurance to customers and employees alike,” Bill Lentsch, Delta’s chief customer experience officer, said in a statement.

For more than a decade, the U.S. government has pressured airlines to collect such information to help contain contagious viruses. But the industry has consistently rebuffed those requests, saying that it would be too expensive and time-consuming. Earlier this year, airlines helped to thwart a Trump administration effort to require such collection even as Congress approved $50 billion in aid for passenger airlines.

At the start of the pandemic, the United States had few known cases and government officials were most focused on keeping the virus from getting into the country. But with millions infected and the virus spreading widely, it’s unclear how useful the information collected voluntarily, only from international arrivals and by a single airline will be.

Ryanair, the low-cost European airline, expects to start taking deliveries of the Boeing 737 Max this spring.
Credit…Ints Kalnins/Reuters

Boeing said on Thursday that it had struck a deal to sell 75 of its 737 Max jets to Ryanair, the low-cost European airline, weeks after a global ban on the plane came to an end. The sale is the biggest vote of confidence in the troubled plane since it was grounded early last year.

Ryanair expects to start taking deliveries of the Max this spring and aims to have 25 to 30 of the jets on hand by next summer, when it hopes a travel recovery will be underway. The plane offers the airline better fuel efficiency and more seats over its existing fleet, Michael O’Leary, Ryanair’s chief executive, said at a news conference Thursday.

“This aircraft is going to transform Ryanair’s future, it’s also going to transform short-haul flying in Europe,” he said. “Our customers are going to love this aircraft.”

The Max was grounded worldwide in March 2019 after 346 people were killed in crashes. The Federal Aviation Administration last month became the first major regulator to allow the plane to fly again. It has since been joined by regulators in Brazil, and the European aviation authority recently signaled its intent to lift its ban within weeks.

The grounding dealt Boeing a devastating blow and led to the ouster of its chief executive, several contentious congressional hearings and intense scrutiny from aviation authorities around the world. The end of the ban allows Boeing to start delivering and selling the plane again. Last week, Alaska Airlines said it would lease 13 Max jets.

Ryanair operates an all-Boeing fleet and is one of the manufacturer’s largest customers. It has ordered and is awaiting the delivery of 210 planes in total from the company. When the airline announced a large Boeing 737 order after the Sept. 11 terrorist attacks, Mr. O’Leary joked that the deal was so good, “I wouldn’t even tell my priest what discount I got.” When asked on Thursday what markdown he received this time, Mr. O’Leary said “not enough.”

At Thursday’s news conference, he expressed confidence in the safety of the plane, calling it “the most scrutinized, most audited aircraft in history.” He also voiced optimism that travel demand would recover soon because of the distribution of coronavirus vaccines, which will begin this month in the United States, Britain and elsewhere.

American Airlines is expected to be the first U.S. carrier to put the Max back in circulation, with plans to use the plane for a week’s worth of daily round trip flights from Miami to New York’s La Guardia Airport, starting on Dec. 29. Gol, a Brazilian airline, said it plans to begin using the Max in the coming weeks.

Boeing’s stock price was up more than 7 percent Thursday afternoon.




‘Compromise Is Within Reach,’ McConnell Says of Stimulus Talks

Senator Mitch McConnell said negotiations on a new round of coronavirus relief were closer to agreement, but did not endorse a $908 billion compromise measure embraced by Democratic leaders.

“It has always been about policy differences. We have two sides with two different visions for the best way to support our nation through what we hope will be the last chapter of the pandemic. Now that isn’t new. We have disagreements all the time. Our system can handle disagreements. But both sides have to be willing to compile their commonalities and make law here. Our people are hurting. But they’re ready to finish this fight. Congress should not keep them waiting for reinforcements that should have arrived, literally, months ago. So compromise is within reach. We know where we agree, we can do this. Let me say it again, we can do this and we need to do this. So let’s be about actually making a law.” “Speaker Pelosi and I made a new offer to Leader McConnell and Leader McCarthy on Monday in hopes of jumpstarting serious negotiations, and Leader McConnell responded by circulating another version of a partisan Republican-only draft. So in the spirit of compromise, Speaker Pelosi and I believe the bipartisan framework introduced by a group of eight senators on Tuesday should be used as the basis, the framework, for immediate bipartisan, bicameral negotiations. The need to act is urgent, and we believe that with good faith negotiations we could very well come to an agreement. We are already much closer to an agreement because of the bipartisan talks these eight senators have done — have created. And we can build off their momentum.”

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Senator Mitch McConnell said negotiations on a new round of coronavirus relief were closer to agreement, but did not endorse a $908 billion compromise measure embraced by Democratic leaders.CreditCredit…Al Drago for The New York Times

Speaker Nancy Pelosi of California and Senator Mitch McConnell of Kentucky, the majority leader, talked on Thursday about reaching agreement on must-pass government funding legislation and on another coronavirus relief package, amid pressure from rank and file members for a bipartisan compromise.

A spokesman for Ms. Pelosi, Drew Hammill, said the conversation early Thursday afternoon focused on “their shared commitment to completing an omnibus and Covid relief as soon as possible.”

Mr. McConnell has been largely removed from discussions with Ms. Pelosi over another stimulus bill since the two chambers enacted a sweeping $2.2 trillion stimulus law in March. Instead, as he has worked to wrangle Republican support behind a series of targeted bills, Trump administration officials have led discussions with Ms. Pelosi over a possible deal.

The phone call between the two congressional leaders came after Mr. McConnell left the door open to reaching a deal on a new round of stimulus to address the pandemic, but stopped short of endorsing a $908 billion compromise plan Democrats embraced on Wednesday, saying it did not represent a genuine concession.

Mr. McConnell said it had been “heartening to see a few hopeful signs” this week in stimulus relief negotiations.

“Compromise is within reach,” Mr. McConnell said in a speech on the Senate floor. “We know where we agree. We can do this. Let me say it again: We can do this, and we need to do this. So let’s be about actually making a law.”

But Mr. McConnell appeared to be referring to a much smaller stimulus proposal he began circulating earlier this week that he said would be able to secure President Trump’s signature, not the compromise measure being developed by a group of moderate senators in both parties.

Mr. McConnell admonished lawmakers to focus on policy provisions where there was substantial agreement, signaling that he would not be quick to move off his targeted proposal.

Mr. Trump, asked Thursday whether he agreed with Mr. McConnell that pandemic relief was “in sight” and whether he would support “this bill,” answered affirmatively. While it was initially unclear which bill Mr. Trump was willing to sign, the White House later clarified that it was the smaller Republican bill, which Mr. McConnell is backing.

“I will, and I think we are getting very close,” Mr. Trump told reporters.

Mr. McConnell’s plan is a nonstarter for Democrats, given that it would not provide funding for state and local governments or a revival of lapsed federal unemployment payments and would include a sweeping liability shield they have long resisted.

Democrats, who initially unveiled a $3.4 trillion proposal in May but later scaled back their proposal by about $1 trillion, argued that Mr. McConnell must drop his demand for a narrow package and consider the compromise plan centrists in both parties have proposed.

The bipartisan framework would restore lapsed federal jobless benefits, providing $300 a week for 18 weeks; would include $288 billion for struggling small businesses, restaurants and theaters and $160 billion for fiscally strapped cities and states; and would create a temporary liability shield for businesses operating amid the pandemic.

An outdoor dining area was taped off in Norwalk, Calif., in compliance with a temporary ban. Curfews and other restrictions on business activity have prompted new layoffs.
Credit…Jae C. Hong/Associated Press

Nearly 714,000 people filed initial claims for state unemployment insurance, compared with 836,000 in the prior week, before statistical adjustments. With seasonal swings factored in, the figure was 712,000, a drop of 75,000, the Labor Department reported Thursday.

The decline came after two consecutive weekly increases, though the level of claims remained at levels unseen in previous recessions.

The numbers are likely to have been artificially depressed by the Thanksgiving holiday, said Diane Swonk, chief economist at the accounting firm Grant Thornton in Chicago. “People don’t apply as much when there are holidays,” she said. “There is a natural falloff that occurs, but we just don’t know how big it was.”

She compared the effect to the drop in hospitalization data for the coronavirus that has been noted on Sundays and holidays. Although the decline in the claims number was seemingly good news, the Thanksgiving-related drop could cause a measure of catch-up when next week’s numbers are released.

“It’s still bad,” she said, noting that 25 states reported more than 1,000 layoffs each last week. “They are broad-based and concentrated in the same sectors we saw when people pulled back in March — food services, health care, retail and hotels.”

Almost 289,000 new claims were tallied under the Pandemic Unemployment Assistance program, which provides support to freelancers, gig-workers, the self-employed and others not ordinarily eligible for unemployment insurance.

Pandemic Unemployment Assistance is one of two emergency federal jobless benefit programs set to expire at the end of the month. Millions will be scrambling to make up for the lost funds, even as the absence of those dollars in consumers’ pockets dampens overall economic growth.

Republicans and Democrats on Capitol Hill continue to spar over the size of any new stimulus package, with G.O.P. leaders opposed to the kind of multitrillion-dollar relief effort envisioned by Democrats.

The prospect of vaccines to combat the virus is a hopeful long-term signal, but the economy will face serious challenges until inoculations can begin on a mass scale in the spring, said Michael Gapen, chief U.S. economist at Barclays.

He is looking for a U.S. economic growth rate near zero in the first quarter, followed by a rebound later next year as consumer spending picks up.

“I think the economy is on a solid footing, but we may just hit a couple of bumps between now and the end of the first quarter,” Mr. Gapen said. “Stimulus would be helpful, of course.”

A Topshop store in Liverpool, England. Its parent company, Arcadia Group, filed for bankruptcy protection earlier this week.  
Credit…Phil Noble/Reuters

As stores reopened in England following a monthlong lockdown, shoppers at one of the country’s biggest retailers have been met with an unwelcome surprise.

Arcadia Group, which filed for bankruptcy protection on Monday, restricted the value of its gift cards to no more than 50 percent of a total purchase. So a £10 card would be worth only £5 when making a £10 purchase, or up to £10 when making a £20 purchase. Any balance can be used another day.

People shopping online are further out of luck. Arcadia, which owns fashion brands including Topshop, Miss Selfridge and Burton, told customers that it wasn’t able to redeem gift cards online. “We hope to be able to offer this in the near future,” a notice on Topshop’s website read on Thursday.

Arcadia has 444 stores in Britain and said on Monday that they would be open while Deloitte, acting as administrators, seeks to rescue to the company. The company has blamed the pandemic and the forced store closures for its financial troubles.

The restrictions have left customers upset and searching for advice from Martin Lewis, a popular personal finance journalist.

Just three weeks before Christmas, what is normally an easy gift has become more trouble than it is worth. Owners of gift cards from any troubled retailer are being urged to spend the vouchers as quickly as possible.

Debenhams, a venerable department store chain that began closing down on Tuesday after failing to secure a buyer while under bankruptcy protection, said it was still accepting gift cards as a method of payment online and in stores, but not selling new ones. It will keep selling to clear out stock and its 124 stores will probably close early next year. Since the announcement, the Debenhams website has become overwhelmed with some shoppers unable to complete purchases and others having to wait in long virtual waiting lines.

Senator Mitch McConnell and Vice President Mike Pence on Wednesday at the Capitol. Mr. McConnell repeatedly reiterated that President Trump’s support would be needed for any coronavirus relief deal.
Credit…Al Drago for The New York Times

Independent economists overwhelmingly favor the passage of more stimulus money before the end of the year — and the prospects for such a bill seem to be improving.

Democratic leaders in Congress yesterday signaled their openness to a bipartisan $908 billion stimulus package. Democrats would prefer a bigger package, like the $3 trillion bill that the House passed in May. But House Speaker Nancy Pelosi and Chuck Schumer, the Senate Minority Leader, released a statement saying that the bipartisan plan should become “the basis for immediate bipartisan, bicameral negotiations.”

The next move is up to Mitch McConnell and other Senate Republicans, some of whom have previously supported a $500 billion bill. There are political reasons that both sides want to appear responsive to Americans’ economic pain: The Senate runoff elections in Georgia on Jan. 5 will determine which party controls the Senate.

The economy already seems to have slowed in recent weeks, as virus caseloads have risen. And the situation will probably worsen if Congress does not pass another stimulus. Many provisions enacted since the spring are set to end on Dec. 31. Among the effects:

  • About seven million freelancers, contract workers and other Americans who don’t qualify for traditional jobless benefits will lose their emergency aid. On average, it now equals $1,058 a month.

  • Close to five million more people who have been out of work for at least six months will also be cut off from aid — which now averages $1,253 a month. The usual limit on jobless benefits is 26 weeks, and a provision that extended it to 39 weeks is expiring.

  • A tax credit that has given more than 125,000 companies an incentive not to lay off workers will expire. Companies will also lose the ability to defer payroll taxes and take deductions for business losses.

  • Aid to state and local governments — $150 billion — will expire. Without more aid, those governments will likely need to make cuts to schools, police forces, health care and other programs.

Many homeowners at risk of foreclosure can breathe a little easier — for another month, at least.

The Federal Housing Finance Agency, the regulator that oversees federally-backed mortgages, said on Wednesday that single-family homeowners with loans backed by Fannie Mae or Freddie Mac will be protected from foreclosure through at least Jan. 31, 2021. The moratorium had been scheduled to expire at the end of this month.

People living in properties that either Fannie or Freddie has taken over because the owner couldn’t pay the mortgage also received relief: The regulator extended its moratorium on evictions as well.

“This extension gives peace of mind to the more than 28 million homeowners with an enterprise-backed mortgage,” said Mark Calabria, director of the Federal Housing Finance Agency, referring to the two so-called government-sponsored enterprises.

Fannie and Freddie, which buy many loans from lenders and package them into investments, are not the only government affiliated organizations that have enacted moratoriums for loans associated with their work. The Federal Housing Administration, which often insures loans to borrowers who put less money down, has a foreclosure and eviction moratorium through Dec. 31. A spokeswoman for the agency said it is assessing its next steps.

The regulator overseeing Fannie and Freddie said providing the pandemic-related relief to both borrowers and renters was already expected to cost $6 billion because of loan defaults, foreclosures and related losses. The one-month extension will add to that.

Homeowners can find out who owns their mortgage by entering their address on various government websites.

By: Ella Koeze·Source: Refinitiv

  • Stocks on Wall Street rose, and European indexes drifted lower on Thursday, in a second day of quiet trading.

  • The S&P 500 climbed about 0.3 percent. The Stoxx Europe 600 index was flat, while Britain’s FTSE 100 rose slightly. In Asia, the Nikkei 225 in Japan closed little changed, while the Hang Seng Index in Hong Kong rose 0.7 percent.

  • Boeing was up more than 6 percent after it said Ryanair, the low-cost European carrier, would purchase 75 of its 737 Max jets.

  • Chevron said on Thursday that it would further tighten its belt next year by slashing its exploration and production budget through 2025, and by 26 percent next year alone. The announcement came only days after Exxon Mobil made a similar announcement as the coronavirus spreads widely, reducing demand for oil and natural gas. It’s shares rose about 0.8 percent.

  • The S&P 500 has climbed about 1 percent this week, after the index rallied nearly 11 percent in November, its best monthly showing since April and one of its best months of the past three decades.

  • Initial claims for state unemployment benefits in the United States dipped last week, after rising for two consecutive weeks as a surge in virus cases prompted curfews and other social restrictions across the country. Nearly 714,000 people sought government assistance for the first time last week, highlighting the ongoing economic crisis and adding pressure on Congress to deliver a fiscal relief package soon, as President-elect Joseph R. Biden Jr. has urged.

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