Are you prepared?
The rage of those who ignored the signs & the quiet contentment of those who saw it coming.
Goood afternoon! Everyone is still freaking out. Some more than others. Here are today’s thoughts.
Daily quote:
“I am not fully healed. I am not fully wise. I am still on my way. What matters is that I am moving forward.”
— Young Pueblo
Jobs.
There has been a significant halt to hiring. Expected in the economic downturn. Perhaps off-setting the effects of the great resignation. So this is actually quite timely. There were nearly twice as many open jobs compared to available workers and inflation is accelerating.
So how will the supply of workers interact with the demand for them? What are the reasons behind payroll cuts? Even though jobs are being cut, labor force participation rate is still increasing.
A cut in wages is also a positive thing in face of inflation and is the way the market can naturally heal itself. Lower wages mean that workers have lower disposable incomes, which mean they can afford less, which means that businesses need to lower prices in order to attract enough customers. The market is really a self-healing mechanism. Ah the beauty of capitalism.
In reality, the hiring slowdown is doubtful to be negative expect on paper.
No figure can be looked at in isolation.
Tesla.
Elon’s “super bad feeling” about the economy has led him to suggest cutting 10 percent of Tesla jobs. He sent an email to executives titled “pause all hiring worldwide.”
Also, what the fuck is with this ultimatum for his employees to either return to the office for at least 40 hours a week or lose their job? uhhhh Please don’t accuse your employees of "trying to avoid going to work at all.” This does not sound like a very forward-thinking move there man.
This definitely feels like him acting out after deviating his our attention away from Tesla the past months. Trying to compensate huh?
Too many companies, including banks like JPMorgan and Goldman Sachs are trying to pin their current problems with employees not being in-office. I have a feeling you’re not getting to the root man. People are getting mad though. CEOs are finding anything to blame for their current problems. I sense rage.
Crypto.
New York passes a crypto mining moratorium. This bans specific bitcoin mining operations and is an effort to curb the state’s carbon footprint. If the bill is signed into law, New York would become the first state to ban blockchain technology infrastructure.
Crypto has also slowed hiring. They were recruiting left and right: developers, lawyers, lobbyists. I guess rash actions lead to rash endings.
Coinbase is indefinitely extending a hiring freeze. It was extreme enough to include any job offerings already made recently. They are “tak[ing] stronger action to manager [their] expenses” apparently :/
Gemini lays off 10% of staff and referring to the season as “crypto winter,” the Winklevoss twins blogged about it. This comes on top of accusations of misleading statements about a proposed crypto product in 2017. Ah the crypto advertising scam hunts continue…
This gives crypto exchanges who were uncommonly smart with their spending in the last years, a time to take the incumbents over. Sam Bankman-Fried of FTX gave a hint of this to the New York Times. The youngster who reportedly sleeps on a beanbag in the office surely hasn’t been on the spending spree others have been on.
And damn is he smart. Purposefully slowing down growth 6 months ago, they definitely saw this coming earlier on. Ahead of the game champ! This is all on top of the fact that they are also profitable. They get the chance to speed up hiring again soon while everyone else is forced to slow down.
Always go against the tide. Always go against the tide.
Sheryl bidding against Meta for a while now.
Sheryl Sandberg has been selling Meta stock over the last decade. She only has a quarter of her Meta stock remaining. But made $1.7 bn cash. Getting out early.
Weirdly this feels kinda like insider trading in principle lmao Like she must have thought beforehand that Meta was going downhill? Anyway. Damn does this add to the long and drawn-out-ness of her departure.
Coming together.
In order to push the merger along, Frontier offered a $250mn breakup fee in case regulators don’t approve the merger. Spirit was advised to vote against the merger with Frontier in favour of an offer from JetBlue instead. Frontier still goes up against JetBlue’s offer of a $200mn breakup fee.
Ford.
Seeming to be one of the only ones in the news not cutting jobs, Ford is adding 6,200 union manufacturing jobs in Michigan, Ohio and Missouri. This comes with a $3.7bn investment into its US factories to build electric vehicles. Ah Tesla, more competition is coming. And ah Rivian, I hope you’re still okay. Also, what’s up with that lawsuit now?
Guns.
Biden has called for a ban on assault weapons. This has been done again and again each time there is a shooting. God knows if this will materialise into anything. If it even seems like it could, a lot fight will be ahead. Biden has also told Congress to expand background checks.
That’s all folks! Have a blast today!
With love,
Angeline
Resources:
“The Asymmetry of Focus.” Brain Food, Farnam Street, June 5, 2022.
“The rebellion.” The Bloomberg Open, Europe Edition, Bloomberg, June 6, 2022.
Frank, Robert. “Sheryl Sandberg sold $1.7 billion worth of Facebook stock over the last decade.” Wealth, CNBC, June 2, 2022.
Sorkin, Andrew Ross. “Office monsters.” DealBook, The New York Times, June 4, 2022.
Sorkin, Andrew Ross. “Why economists are rooting for a slowdown.” DealBook, The New York Times, June 3, 2022.