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The Wall Street Journal reports that the Trump administration’s cuts to IRS staffing and enforcement are weakening audits, collections, and deterrence, while encouraging riskier taxpayer behavior. Enforcement staff are projected to fall below 30,000, audits of people earning at least $10m are dropping sharply, and lawyers say some taxpayers now assume they can evade scrutiny. Carolyn Schenck, former IRS national fraud counsel, said: “The IRS isn’t going to catch me” is becoming a broader mindset. Officials argue AI and digital tools can offset losses, but critics warn of lower revenue, weaker oversight of complex taxpayers, leadership instability, and lasting institutional damage that could take years to reverse.

 

Wall Street Journal

JPMorgan Chase and Netflix are set to kick off the earnings season, providing crucial insights for investors eager for corporate guidance. This reporting period is significant as it sets the tone for market expectations, with JPMorgan's performance often seen as a bellwether for the financial sector. The focus will be on how these companies navigate current economic challenges, including interest rate fluctuations and consumer spending trends. Analysts will closely watch Netflix's subscriber growth and content strategy, which are pivotal for its revenue trajectory. The outcomes of these reports could influence investor sentiment and market dynamics in the coming weeks.

 

CNBC

Accountants are increasingly adopting artificial intelligence (AI), drones, and automation, but one of the most unpleasant parts of auditing - physically counting inventory - remains largely manual, requiring auditors to endure harsh, messy, and sometimes dangerous conditions. From climbing grain bins and wading through fertilizer to counting livestock, frozen goods, or construction materials, auditors - often junior staff - must still verify inventory in person due to regulatory requirements and technological limitations. While tools like drones and AI are improving efficiency in some areas, they struggle with obstacles such as indoor environments, hidden items, or extreme conditions, and auditing standards still mandate human verification. As a result, despite hopes that advancing technology will eventually replace these tasks, inventory counting continues to be widely viewed within the profession as the most grueling and outdated aspect of auditing.

 

Wall Street Journal

The Wall Street Journal looks at how surging demand for agentic AI is creating a severe shortage of computing power, straining developers, raising costs, and hurting reliability. GPU rental prices have jumped sharply, data-center capacity and power are constrained, and companies are making trade-offs about which products to support. Anthropic has faced repeated outages and usage limits as demand accelerates, while OpenAI has reportedly redirected resources away from some products.

 

Wall Street Journal

U.S. Rep. Ritchie Torres, D-N.Y., is calling on the Securities and Exchange Commission and the Commodity Futures Trading Commission to investigate trades in the oil and equity futures markets ahead of a pause in hostilities in Iran last month. Billions of dollars in futures changed hands shortly before Donald Trump announced the postponement. Financial contracts tied to at least six million barrels of oil were sold in a two-minute period. “What kind of trader would make a massive trade at 6:49 a.m., 15 minutes before a market-moving presidential announcement with billions of dollars at stake and without a hedge?” Torres said. “The only plausible answer to that question is an insider trader. Any other alternative is a statistical impossibility.”

 

Bloomberg

CNBC

NPR

IBM has agreed to pay roughly $17m to resolve allegations of illegal diversity, equity and inclusion (DEI) practices. The DOJ had said the company “knowingly” made “false claims” about its hiring and employment practices in its federal contracts. IBM allegedly identified “diverse” candidates for hiring or promotions, while developing race and sex demographic goals. “IBM is pleased to have resolved this matter,” an IBM spokesperson told CNN. “Our workforce strategy is driven by a single principle: having the right people with the right skills that our clients depend on.”

 

CNN

CBS News

Elon Musk’s xAI has filed a lawsuit challenging Colorado’s state-level initiative to impose protections against “algorithmic discrimination” in AI systems. The lawsuit, ‌filed in U.S. District Court in Colorado, challenges Senate Bill 24-205, which imposes disclosure and risk-mitigation requirements on developers ​of so‑called "high‑risk" AI systems used in decisions involving employment, housing, ​education, health care and financial services. The law is scheduled to take effect on June 30. "Government regulation that is ​applied at the state level in a patchwork across the country ​can have the effect to hamper innovation and deter competition in an open market," ‌xAI ⁠said.

 

The HIll

Financial Times

Reuters

The Guardian

A Chicago jury has said Abbott Laboratories must pay $53m in compensatory damages to a group of families that had accused the company of failing to warn that its formula for premature infants can cause a potentially deadly bowel disease. The verdict ​is the latest among hundreds of lawsuits alleging that Abbott's ‌cow's milk-based formula products for preterm infants can cause necrotizing enterocolitis (NEC). Abbott has denied that the products, which it says ​are essential for premature babies when their mothers cannot produce enough breast milk, cause NEC. The disease is often fatal in babies born prematurely. Four families’ lawsuits were consolidated for trial.

 

Chicago Tribune

Kraken’s newly approved Federal Reserve master account has sparked concern among regulators and banks over potential risks to financial stability, transparency, and oversight as crypto firms gain closer access to core payment infrastructure. The account, granted by the Kansas City Fed with restrictions such as limited balances and no access to interest or emergency lending, allows Kraken to process payments directly through Fedwire, bypassing traditional banks, but critics warn this could introduce operational vulnerabilities, money-laundering risks, and reduce deposits in the banking system. Lawmakers have questioned the opaque approval process and are seeking further details, while experts caution that extending Fed access to lightly regulated crypto firms, despite safeguards, may expose the financial system to new and largely untested risks.

 

Reuters

The National Association of Manufacturers (NAM) supports removing regulations that classify certain partnership related-party basis adjustment transactions as transactions of interest. This change is expected to reduce compliance costs associated with reporting 10,000 basis adjustments. The NAM raised concerns about the compliance burden of the previous regulations. The removal aligns with pro-growth tax policies and deregulatory efforts under Executive Order 14219. The NAM said it looks forward to collaborating with the Department of the Treasury to maintain favorable tax policies for U.S. manufacturing. 

 

Tax Notes

U.S. inflation accelerated sharply to 3.3% in March, marking its highest level in two years, driven primarily by a surge in energy costs following the Iran war. Energy prices rose 12.5% year-over-year, with gasoline up 18.9% and fuel oil soaring 44.2%, pushing up transportation costs and contributing to broader price pressures, while core inflation, excluding food and energy, increased a more moderate 2.6%. Despite some easing in areas such as used-car prices and grocery inflation, rising costs in categories like apparel and airline fares, alongside falling real wages, highlight growing pressure on household finances, while economists warn that higher energy and input costs may continue to feed through into the wider economy in the coming months. The data presents a challenge for the Federal Reserve, as persistent inflation combined with a slowing labor market complicates decisions on interest rates, particularly amid concerns that businesses may continue passing higher costs on to consumers. 

 

Bloomberg

CNBC

Washington Post

Wall Street Journal

U.S. factory orders remained flat at 0.0% in February, outperforming expectations for a 0.3% decline and signaling resilience in the manufacturing sector despite ongoing economic pressures. The unchanged reading, matching the previous month, suggests stable demand across both durable and non-durable goods, even as factors such as supply chain disruptions and global uncertainty continue to weigh on the industry. While the data points to a more stable outlook than anticipated, analysts view it as a neutral signal for the broader economy, with attention now turning to upcoming indicators to assess whether manufacturing strength can be sustained.

 

Investing

The Commerce Department has reported that U.S. wholesale inventories rose 0.8% in February, marking the largest monthly increase in 13 months and rebounding from a 0.3% decline in January, driven by gains in professional equipment and a 1.5% surge in electrical goods. On an annual basis, inventories increased 1.8%, and if sustained, could contribute positively to first-quarter GDP growth. Wholesale sales also strengthened, rising 2.7% in February, reducing the inventory-to-sales ratio to 1.22 months from 1.25, indicating improved demand alongside stock rebuilding.

 

Reuters

RTT News