The Week in Business: Choosing the Same Path
President Biden opted for continuity at the Fed, nominating Jerome Powell to a second four-year term. And it’s that time of year — for travel and shopping.
What’s Up? (Nov. 21-27)
Four More Years
On Monday, President Biden announced that he was renominating Jerome H. Powell for another four-year term as chair of the Federal Reserve, resisting pressure from progressive Democrats who wanted a change at the top of the Fed and instead choosing policy continuity. But in a move that could appease some of those progressives, Mr. Biden said he would nominate Lael Brainard as vice chair. The role could give her the power to influence everything from the cost of money to the future of digital cash. Mr. Powell, who is expected to receive bipartisan support for his Senate confirmation, will face the task of dismantling the extraordinary efforts the Fed took last year to keep the economy going during the depths of the pandemic. Now, the Fed will need to determine how to start raising interest rates, which have been just above zero since March 2020, without sending the economy into a recession.
Trying to Ease the Pain at the Pump
President Biden ordered the Energy Department on Tuesday to tap into 50 million barrels of crude oil from the Strategic Petroleum Reserve in an effort to help curb rising gas prices. Five other nations — Britain, India, Japan, South Korea and China — also announced that they would tap into their oil stockpiles. Mr. Biden had unsuccessfully called for Russia and members of the Organization of the Petroleum Exporting Countries to increase oil production. High gas prices have been hitting Americans hard, leading some to cancel plans to travel to see family during the holidays.
About That Holiday Travel
High costs aren’t deterring everyone from traveling over the holidays. The Transportation Security Administration said it planned to screen 20 million passengers at airports from the Friday before Thanksgiving through the Sunday after — a figure almost as high as prepandemic levels. The surge will be the airline industry’s biggest test since the pandemic began. Even with coronavirus cases increasing in several parts of the country, widely available vaccines seem to have helped ensure that this Thanksgiving is different from last year’s, when the country was experiencing an explosion in virus cases.
What’s Next (Nov. 28-Dec. 4)
A Snapshot of the U.S. Economy
On Friday, the Labor Department will release its report on jobs in November, a key measure of the strength of the U.S. economy. The most recent report showed that the economy added more than 500,000 jobs in October after months of disappointing job figures. Economists will be watching to see if this trend continues in what would be a sign that the pandemic’s impact on the economy might truly be fading. Even so, 4.2 million fewer Americans were working in October compared with before pandemic lockdowns, and the unemployment rate, while currently 4.6 percent, doesn’t take into account the millions of workers who have left the labor force. The end of expanded unemployment benefits doesn’t seem to have encouraged as many Americans to return to work as some economists and politicians had predicted.
Trial for Theranos Founder Continues
Elizabeth Holmes, the founder of the blood testing start-up Theranos, will continue to testify as she defends herself from fraud charges. In three days of testimony last week, she painted herself as someone whose best intentions were misinterpreted. She presented herself as a dedicated start-up founder who believed in the company’s technology and suggested that she had been too trusting of employees at Theranos.
Cyber Monday and Giving Tuesday
Americans returned to in-person shopping with gusto on Black Friday, the day after Thanksgiving, even amid the specter of shortages. But as Wirecutter notes, many shopping deals will extend through Monday, known as Cyber Monday. If you’ve got your heart set on any gadgets this holiday season, it is probably better to act quickly rather than wait for deals. And for those who are more inclined to spend their extra income on charitable causes, there’s Giving Tuesday, introduced nearly a decade ago. Last year, Americans gave $2.5 billion on Giving Tuesday, a 25 percent increase from 2019.
Stocks tumbled on Friday after reports of a new coronavirus variant in South Africa. Jamie Dimon, the chief executive of JPMorgan Chase, said the bank would outlast the Chinese Communist Party, then quickly regretted his comment. Samsung will build a $17 billion semiconductor factory in Texas, a boost to bipartisan efforts to persuade chip makers to build more components in the United States. A fourth wave of coronavirus infections in Europe is expected to hurt the region’s fragile economic recovery.