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The Federal Deposit Insurance Corporation (FDIC) is considering a stricter framework for how large asset managers can prove they are not influencing banks where they hold large stakes. The FDIC voted to advance a proposal that would see the agency exert more influence over whether asset managers or other firms building large stakes in banks should receive stricter regulation and oversight. The proposal would remove an existing exemption in which the agency does not review new large investments in banks, so long as the Federal Reserve signed off on that approach. "It is highly inappropriate for the FDIC to abdicate the responsibility Congress entrusted to us to safeguard the ownership and control of the banks we supervise," said Rohit Chopra, director of the Consumer Financial Protection Bureau and an FDIC board member.

 

Reuters

Boeing has announced that Kelly Ortberg will replace Dave Calhoun as chief executive. Ortberg, the former CEO of aerospace supplier Rockwell Collins, will step into the role on August 8. He joins the plane maker as it looks to move on from a turbulent period that saw aircraft grounded in the wake of a midair blowout in January. Steven Mollenkopf, the chair of Boeing’s board, said Ortberg “is deeply respected in the aerospace industry, with a well-earned reputation for building strong teams and running complex engineering and manufacturing companies.” Ortberg, a former Chair of the Aerospace Industries Association trade body, said: “There is much work to be done, and I’m looking forward to getting started.”

 

CNBC

The Government Accountability Office (GAO) has called on the Administrative Office of the U.S. Courts to take stronger action against workplace misconduct. The GAO's report revealed over 500 allegations of misconduct, including nearly 200 cases of discrimination, within the court system between 2020 and 2022. The report highlighted the need for improved data collection, better identification and addressing of misconduct, and equal treatment of complaints. Representative Norma J. Torres emphasized the importance of holding the federal Judiciary to high standards of integrity and ethical conduct. The report also criticized the court system's policies for not aligning with recommended practices to prevent harassment. The GAO's findings have prompted calls for change and increased efforts to protect the over 30,000 employees within the federal Judiciary.

 

Washingtonpost.com

A federal judge in Pennsylvania has dismissed a lawsuit against Uber, ruling that drivers for the company's high-end taxi service, Uber Black, are properly classified as independent contractors. The judge's decision comes after two separate juries were unable to agree on the classification of the drivers. The ruling means that Uber can continue to classify these drivers as independent contractors, who are not entitled to the same minimum wage and overtime pay as employees. Attorneys representing the drivers have stated that they will appeal the decision. The ruling is expected to have implications for other gig economy companies such as Lyft. The case has been ongoing for over eight years and is likely to be appealed.

 

Bloomberg Tax

UBS has filed a lawsuit against Bank of America, seeking $200m in legal costs related to risky mortgages issued before the 2008 financial crisis. The Swiss bank bundled mortgages from Countrywide Financial, which Bank of America acquired in 2008, into securities and claimed that Countrywide had agreed to indemnify it against claims of poor underwriting or fraud.

 

Reuters

Federal Reserve Chair Jerome Powell said officials could cut interest rates at their meeting in September, moving closer to a new phase that seeks to avoid weakness in the labor market in the midst of signs inflation is heading lower. “The broad sense of the committee is that the economy is moving closer to the point at which it will be appropriate to reduce our policy rate,” he said at a news conference on Wednesday. “A reduction in the policy rate could be on the table as soon as the next meeting in September.” While Wednesday’s decision to leave rates in a range between 5.25% and 5.5%, a two-decade high, was unanimous, Mr. Powell suggested that at least one official had argued in favor of lowering rates at this week’s meeting. He added that inflation has come down notably in recent months, adding, "It's just a question of seeing more good data."

 

USA Today

CNBC

Washington Post

Wall Street Journal

Recurring stress from political and economic insecurity have created “resigned” consumers, according to Kearney’s most recent Consumer Stress Index. The index, which is conducted by the strategy consultancy’s internal think tank Kearney Consumer Institute (KCI), is published quarterly and draws on a calibrated set of macroeconomic data and consumer input. The U.S. consumer stress index was up 2.3% in Q2 24 from Q1 24. The index’s consumer tracking is calculated from two elements: consumer flexibility, or agency in terms of perceived optionality and ability to impact conditions; and consumer sensitivity, or what issues are top of mind/how consumers are feeling. “Our research found that two-thirds of Americans are living paycheck to paycheck—amid this, they need a source of reliability and consistency,” said Kearney's Katie Thomas. “Rather than contribute to uncertainty through practices like shrinkflation, brands have the ability to lend a sense of clarity and stability to our 'resigned' consumer." That could mean delivering consistency and clarity in packaging, pricing, and marketing. It could also mean avoiding messaging that exacerbates politics- or technology-related stress.

 

Consulting

Microsoft has revealed that the service outage on Tuesday was caused by a cyber attack. The tech giant stated that the initial problems on its Azure cloud platform were triggered by a distributed denial-of-service (DDoS) attack. Microsoft confirmed that an error in the rollout of its own defences amplified the impact of the attack. The company resolved the issue by making network configuration changes. The incident affected various Microsoft services, including Microsoft Teams and Xbox Live.

 

Forbes

As the presidential election approaches, business leaders are cautiously optimistic that Kamala Harris might dial back some of the Biden administration’s regulation-heavy agenda while worrying about her undefined stances on tax, trade, and antitrust issues. Harris's track record from her time as California attorney general and U.S. senator reveals her active involvement in technology sector policies, such as privacy enforcement and AI safety. Despite this, there are uncertainties regarding her positions on broader business policies. Executives expect Harris to largely continue Biden’s policies but hope for a more entrepreneur-friendly approach given her California and Silicon Valley connections. Business leaders are particularly interested in how she will navigate the balance between supporting innovation and maintaining necessary regulations. Harris's candidacy is seen as a potential opportunity for the Democratic party to embrace business and technology more directly, addressing the current hyper-regulatory environment that has posed challenges for venture capital and other sectors.

 

CFO Journal

Businesses concerned about the cost of a federal requirement to report their owners' identities are looking to a lawsuit as a possible blueprint to escape enforcement. Senate Budget Committee Chair Sheldon Whitehouse insists that the concerns are misplaced, as the law targets money laundering and tax evasion through anonymous shell companies. However, business associations across the country argue that their members are being caught in the crossfire. The Corporate Transparency Act (CTA) mandates reporting for about 32.6m businesses.

 

Bloomberg Law

Bloomberg Tax

The International Accounting Standards Board (IASB) has proposed guidance on how companies can better disclose the impact of climate change on their financial performance. The proposed guidance seeks to address concerns raised by investors about insufficient or inconsistent information on climate-related uncertainties in financial statements. The IASB has launched a consultation on the proposed guidance, which aims to help companies apply existing rules for reporting climate change impacts in their financial statements.

 

ESG Today

Workers at Amazon's only unionized warehouse in the U.S. have elected new union leaders. A slate of candidates led by former Amazon worker Connor Spence received the most votes. Spence, a prominent organizer, aims to secure a contract with Amazon, which has resisted unionization efforts. The election comes after the warehouse voted to affiliate with the Teamsters union. The Amazon Labor Union, chartered as an "autonomous" local Teamsters union, will organize Amazon warehouse workers across New York City. Ruth Milkman, a sociologist of labor, believes Amazon will fight the unionization efforts. Spence takes over from Chris Smalls, who spearheaded the first successful union organizing effort at the warehouse in 2022. The new leaders will be sworn in on Wednesday.

 

AP News

A new study conducted in Texas suggests that dairy workers in the state have shown signs of prior bird flu infections that were not previously counted. The study, led by infectious disease researcher Gregory Gray, found that the surveillance for bird flu among farmworkers has been poor, leading to underreporting of cases. The researchers detected signs of prior bird flu infections in workers from two dairy farms in Texas, indicating a hit rate of nearly 15%. The study highlights the need for better surveillance and testing among farmworkers to prevent the spread of the virus. Health officials warn that if the virus were to become more contagious, the current surveillance system may be too slow to contain it. The study also raises concerns about the lack of protective gear and healthcare access for farmworkers.

 

NPR / National Public Radio

Match Group, the parent company of Tinder, plans to cut about 6% of its staff as it discontinues live-streaming services on its dating apps. This decision comes after three activist investors urged for changes at the company. Despite a decline in paying users, Match Group beat revenue estimates for the second quarter. Match Group is also testing product changes for Tinder, including more inclusive gender identities. The company's second-quarter revenue reached $864m, and it expects revenue of $895m to $905m for the third quarter.

 

Reuters