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The World
Dow Slides Nearly 1,300 Points on High Inflation Reading: Market has worst day since 2020 as core price pressures remain strong. U.S. stocks tumbled after August data showed that inflation was more stubborn than investors anticipated, denting hopes that central bankers may ease their course of aggressive interest-rate increases. (Wall Street Journal)
Consumer Prices Remain Elevated: Consumer prices rose 8.3% last month from a year earlier, holding near a four-decade high despite lower gasoline prices. The core consumer price index increased 6.3% on the year and 0.6% on a monthly basis—double July’s pace. (Wall Street Journal)
Americans’ Incomes Fail to Grow for Second Year in a Row: Median household income of about $70,800 in 2021 wasn’t different in a significant way from the inflation-adjusted 2020 estimate, the Census Bureau said. (Wall Street Journal)
The United States is considering options for a sanctions package against China to deter it from invading Taiwan, with the European Union coming under diplomatic pressure from Taipei to do the same, according to sources familiar with the discussions. (Reuters)
The US Senate foreign relations committee is poised to vote on a bill that would finance weapons exports to Taiwan for the first time and dramatically reshape relations with Taipei amid rising pressure from China. The Taiwan Policy Act contains dozens of measures designed to boost Taiwanese security and deter any attack by China. It would also force the White House to imposes sanctions on big Chinese financial firms in response to any “escalating hostile actions in or against Taiwan”. (Financial Times)
Russia spent millions in secret global political campaign, U.S. official says. Russia has funneled at least $300 million to foreign political parties and candidates since 2014 to shape political events beyond its borders, according to a U.S. review. (Washington Post)
Jump in long-term illness removing millions from the workforce: Hundreds of thousands more UK people are out of work because of long-term illness than before the pandemic. The number not working nor able to work, and therefore considered “economically inactive”, has risen by 352,011 in the three months to July compared with the quarter ending February 2020, according to figures published by the Office for National Statistics (ONS). It is now at 2.46 million, or about 27 per cent of the inactive population. (The Times)
World heading into ‘uncharted territory of destruction’, says climate report. The world’s chances of avoiding the worst ravages of climate breakdown are diminishing rapidly, as we enter “uncharted territory of destruction” through our failure to cut greenhouse gas emissions and take the actions needed to stave off catastrophe, leading scientists have said. Despite intensifying warnings in recent years, governments and businesses have not been changing fast enough, according to the United in Science report published on Tuesday. The consequences are already being seen in increasingly extreme weather around the world, and we are in danger of provoking “tipping points” in the climate system that will mean more rapid and in some cases irreversible shifts. (The Guardian)
Mudslides hit Los Angeles mountain area as thousands told to evacuate: Heavy rains are remnants of tropical storm that brought badly needed rainfall to drought-stricken southern California last week. (The Guardian)
Mountain glacier in Chile's Patagonia collapses amid high temperatures. (Reuters)
Economy
JPMorgan warns of up to 50% drop in investment banking fees. Daniel Pinto, JPMorgan president and head of the corporate and investment bank, said he expected third-quarter investment banking fees to be down 45-50 per cent on the $3.3bn achieved a year earlier, having fallen 44 per cent in the first six months of 2022. The bank will announce its results on October 14. The gloomy forecast for the largest US bank by assets, which is an industry bellwether, underscores the anxiety on Wall Street over a dealmaking slowdown amid economic uncertainty, the war in Ukraine and unsupportive debt markets for leveraged buyouts. (Financial Times)
U.S. Banks Lost a Record $370 Billion in Deposits Last Quarter: The deposit outflows will fuel a debate about how the Fed’s moves to tighten monetary supply and slow the pace of inflation are going to play out in a banking system flooded with liquidity. (Wall Street Journal)
A national railroad strike could derail critical deliveries of chlorine to wastewater treatment plants and coal to utility plants, among other potentially crippling disruptions, prompting senior White House aides to review contingency options for protecting the nation’s drinking water and energy supply. White House aides are looking at how to ensure essential products carried by rail — such as food, energy and key health products — could still reach their destinations, even in the event of a strike. Senior officials have looked at how highways, ports and waterways can be used to offset any damage caused, while also talking to top officials in the shipping, freight and logistics industries. (Washington Post)
Gas prices are dropping for nearly everyone in the country but remain stubbornly high in California, where state officials are blaming oil companies and reminding voters that relief is on the way in the form of tax rebates scheduled to arrive in weeks. Experts say factors to blame for the high cost of gas in California — now more than $5 a gallon — include problems at refineries that supply the state as well as higher taxes, more regulations and the same global issues driving the overall U.S. market. (Politico)
Technology
Apple plans to sell ads in new spots in the App Store by year-end: Apple is planning to release new ad “placements” as soon as the holiday season. The new ad units represent a significant expansion in Apple’s advertising inventory, which is focused on its App Store. The expansion comes as the tech giant’s advertising business is under increasing scrutiny. (CNBC)
Why Toyota – the world’s largest automaker – isn’t all-in on electric vehicles: Toyota, the king of hybrid vehicles, has come under scrutiny by some environmentalist groups for its cautiousness on investing in fully electric vehicles. The company doesn’t believe battery-electric vehicles are the only solution to producing more sustainable vehicles and achieving carbon neutrality. Toyota has a goal to produce 3.5 million electric vehicles by 2030, which would be more than a third of its current sales, while rival automakers promise to exclusively offer such vehicles. (CNBC)
Twitter’s protection of users’ sensitive data is so lax that just about anyone with an account has reason to fear for the security of their accounts — even members of the Senate, the company’s former chief security officer told lawmakers. It’s “not far-fetched to say that employees inside the company could take over the accounts of all of the senators in this room,” Peiter “Mudge” Zatko testified to the Senate Judiciary Committee during the latest in a long round of hearings focused on Silicon Valley’s alleged failings. (Politico)
Paramount Explores Merging Showtime Streaming Service Into Paramount+. Meanwhile, Warner Bros. Discovery CFO says company’s streaming services are ‘underpriced’. (Wall Street Journal, CNBC)
Smart Links
Debt monsters: a look at companies flashing warning signals. (Financial Times)
Suns owner banned for one year, fined $10 mln over workplace conduct. (Reuters)
Schultz vows Starbucks rebound after coffee chain ‘lost its way’. (Financial Times)
Billionaire MacKenzie Scott just donated two Beverly Hills mansions worth $55 million to fund affordable housing in LA. (CNBC)