Top economist Ed Hyman, who has not been predicting a recession, acknowledged the strange mix of data, concluding, “We have never seen anything like this. And it is true that having GDP growth turn negative when hiring is still positive is unusual. There were many red flags that the Fed missed, including that consumers were flush with government largesse and buoyed by rising stock and home prices.įor sure, the pandemic threw all economic calculations and expectations off course. This Fed has been spectacularly late to the party on anticipating and diagnosing inflationary pressures, and even more sluggish in responding to soaring prices. The Federal Reserve System, with its $5 billion budget and tens of thousands of employees, is meant to be ahead of the news, not behind it. Last week, claims surprised economists by jumping to the highest level since last November.
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Meanwhile, the four-week moving average of unemployment claims has been trending higher. Employers were struggling to find workers few dared decrease their ranks. Remember: Layoffs were virtually non-existent just six months ago. There have also been quite a few that have announced letting workers go. Over the past three months, there has been a slow but steady increase in the number of companies that have slowed or stopped hiring. Yes, the labor market has been strong, but there is every indication that we are at an inflection point, and the next direction is down. Which makes one wonder whether Powell reads the news. I would point to the labor market in particular.” And the reason is, there are just too many areas of the economy, performing too well.
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Powell, answering reporters’ questions on the heels of a 75 basis-point rate hike, also demurred when asked if the U.S. President Biden assumed the Oval Office amid a vibrant, broad recovery damaging policies like his war on fossil fuels and excess federal spending have now spurred inflation and torched our growth.īut it was Federal Reserve Chairman Jerome Powell’s comments the day before the GDP release that attracted our attention and rang alarm bells. “By delaying his disclosure of his stake in Twitter, Musk engaged in market manipulation and bought Twitter stock at an artificially low price,” the lawsuit says.That the White House would adopt this bury-your-head-in-the-sand approach is understandable. Musk benefited by more than $156 million from his failure to disclose his increased stake on time, since Twitter's stock price could have been higher had investors known Musk was increasing his holdings, the lawsuit claims. But the lawsuit says Musk did not disclose the stake within the timeframe required by the Securities and Exchange Commission.Īnd the lawsuit says his eventual disclosure of the stake to the SEC was “false and misleading” because he used a form meant for “passive investors” - which Musk at the time was not, because he had been offered a position on Twitter's board and was interested in buying the company. Twitter's shares closed Thursday at $39.54, 27% below Musk's $54.20 offer price.īefore announcing his bid to buy Twitter, Musk disclosed in early April that he had bought a 9% stake in the company. "In doing so, Musk hoped to drive down Twitter’s stock price and then use that as a pretext to attempt to re-negotiate the buyout,” according to the lawsuit. In response to the plunging value of Tesla’s shares, the Twitter shareholders' lawsuit claims Musk has been denigrating Twitter, violating both the non-disparagement and non-disclosure clauses of his contract with the company. To fund some of the acquisition, Musk has been selling Tesla stock and shares in the electric carmaker have lost nearly a third of their value since the deal was announced on April 25. District Court for the Northern District of California claims the billionaire Tesla CEO has sought to drive down Twitter’s stock price because he wants to walk away from the deal or. The lawsuit filed late Wednesday in the U.S. Twitter has also disclosed its bot estimates to the Securities and Exchange Commission for years, while also cautioning that its estimate might be too low. Twitter shareholders have filed a lawsuit accusing Elon Musk of engaged in unlawful conduct aimed at sowing doubt about his bid to buy the social media company.
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The company paid $809.5 million last year to settle claims it was overstating its growth rate and monthly user figures. In addition, the problem of bots and fake accounts on Twitter is nothing new.
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That means he waived his right to look at the company’s non-public finances. The lawsuit notes, however, that Musk waived due diligence for his “take it or leave it” offer to buy Twitter. Musk last month offered to buy Twitter for $44 billion, but later said the deal can’t go forward until the company provides information about how many accounts on the platform are spam or bots.