Wal-Mart to cut 7,000 back-office store jobs
Wal-Mart is eliminating 7,000 positions in its back offices across the U.S., spokeswoman Deisha Barnett confirmed to CNBC on Thursday.
The cuts, first reported by The Wall Street Journal, affect employees working in accounting and invoicing positions. The reductions will be rolled out over the next few months, and employees will be given the option to move into more customer-facing roles, Barnett said.
Wal-Mart has been looking for ways to put more employees on the sales floor, as it seeks to improve its customer service and keep its fresh foods in-stock. Operating faster and cleaner stores is a crucial part of the company's U.S. turnaround strategy.
Earlier this year, Wal-Mart eliminated accounting and invoicing roles at approximately 500 locations in the Western United States. Those two to three employees per store were likewise offered the opportunity to work in another part of the company that dealt more directly with customers.
ADP Predicts Solid Jobs Increase
The ADP National Employment Report predicts that the growth from previous months will continue in August. ADP predicted an increase of 177,000 jobs in August. Most of these jobs come from the service-providing sector, with an increase of 183,000, followed by professional and business with 53,000, trade, transportation and utilities with 26,000 and financial activities at 15,000.
On the other hand, the goods-producing sector pulled against the increase with its drop of 6,000. Construction also showed a decrease of 2,000. Manufacturing came in flat.
Job openings for construction jobs are high today with hours worked at their highest ever, said Logan Mohtashami, AMC Lending Group senior loan manager. In fact, San Francisco’s competitive employment market is causing many construction companies to lose workers and driving a trend towards more expensive housing.
That being said, ADP’s predictions have not proven to be very accurate over the past few months. After three months of striking out, could this be the month that ADP hits the target?
Harley-Davidson plans to lay off 200 employees
Approximately 200 Harley-Davidson Inc. employees could face layoffs this fall as the company adjusts motorcycle production following recent slower sales.
Union sources said many of the layoffs will take place at Harley’s assembly plant in York, Pa., but that some will occur at the engine plant in Menomonee Falls, where the company employs approximately 1,000 people, and in Tomahawk.
Harley-Davidson and other makers of cruiser and touring motorcycles have seen their sales fall in recent months. The U.S. market was far weaker than expected, Harley CEO Matt Levatich said following the company’s recent second-quarter earnings announcement.
The company declined to give specifics on the layoffs Wednesday. But in an email, spokeswoman Maripat Blankenheim said: "The company continually reacts to industry and market changes to provide the best products and services to our customers.
'Around 200' layoffs at Fort Myers-based Chico's Clothing
Chico's faces another round of layoffs for Southwest Florida employer. The international company's headquarters is off Metro Parkway in Fort Myers.
The Chico's spokesperson said in a statement, "We have reduced layers by eliminating positions where we believe we can operate more efficiently with fewer resources." One source says around 200 employees were laid off, but the company won't confirm that figure as not to disrespect those who've lost their jobs.
They said that certain corporate and field leadership positions have been eliminated, including IT employee Mike Ristic. "They take you away individually so you don't have much time to react or look at anybody else's face. You just kind of get escorted out the door," he said.
"It's a lot different than it was last time... Last time they had rows of HR people that you knew were out there firing people." Yet this time, not only was it more subdued, employees, both fired and currently working, say they were told to keep this wave of firings "on the down low." "These are corporate decisions, they happen," said Jim Wall with CareerSource Southwest Florida. "Whenever there's a change at the board level, CEO level, it's not unexpected that action follows."
Economic Recovery 'Sufficiently' Taking Root; What It Means For Gold?
Alaska Air warns Virgin employees of about 225 layoffs
Alaska Air Group has warned management employees at Virgin America that about 225 will be laid off between October and June once Alaska completes its planned $2.6 billion acquisition. Seattle-based Alaska notified employees at Virgin’s headquarters in Burlingame, Calif., earlier this month that layoffs could begin as soon as Oct. 11.
Company spokeswoman Halley Knigge said in an email that “the 225 positions are all back-office management positions (nonunion), and represent about 8 percent of the Virgin America workforce.”
She added that Alaska has been “committed to preserving the jobs of all customer-facing and front-line Virgin America teammates,” and also has offered jobs to more than 300 Virgin management employees.
Alaska clinched the deal for Virgin in April after a robust bidding war with JetBlue. If the deal gains antitrust approval from federal regulators, it’s expected to close early in the fourth quarter. Alaska and Virgin then expect to get a single operating certificate from the Federal Aviation Administration in the first quarter of 2018.
Deutsche chief calls on more banks to merge, but denies his will
Deutsche Bank chief John Cryan on Wednesday called for more mergers among European banks, but denied speculation that the lender plans to pursue a tie-up with smaller German rival Commerzbank.
Cryan, speaking at a Frankfurt financial conference, said European banks face a “fundamental dilemma” rooted in too much competition, economic headwinds and broadly lower profits. Banks are less risky than before the financial crisis but “far less profitable,” he said.
Deutsche Bank’s home market itself has too many banks that make too little money for the industry to be sustainable in Germany in its current form, Cryan said. The saturation of Germany’s retail-banking market is a perennial topic in that country, and low and negative interest rates have squeezed profits further this year.
Cryan said as part of his conference talk that a merger with Commerzbank — a subject of consistent speculation among bankers and investors — wasn’t an option for Deutsche. In response to a question about whether the option is on the table, he said he didn’t think so. Asked whether Deutsche Bank is looking for partners in the German market with which to combine, he said no.
American malls are dying faster than you think — and it's about to get even worse
America's most iconic retailers are closing stores, and it's left many speculating about the future of shopping malls. Macy's recently announced it is closing 100 stores, following similar announcements from Sears, Gap, and Abercrombie & Fitch.
The decline in traffic has been stunning: In 2010, there were 35 million visits to malls, according to the real-estate research firm Cushman and Wakefield. By 2013, there were 17 million visits — a 50% decline.
Analysts expect upcoming data will show an even steeper drop in mall traffic. "The shift in how people are shopping means the future of retail fulfillment is no longer just about more stores or shopping centers," Cushman and Wakefield analysts wrote, adding that stores would need to invest in online options.
About 15% of malls will disappear in the next decade, according to a study by Green Street Advisors. There are numerous reasons for the brick-and-mortar apparel industry's decline. Americans are increasingly choosing to spend on technology and experiences like vacations, leaving less money for apparel. This has led to a spike in discount retailers like TJ Maxx. When people do shop at traditional full-price retailers, they increasingly prefer to do so online. Moody's Investors Service says that closing stores is a necessary step for Macy's.
John Rubino-Negative Rates Phenomenally Good for Gold and Silver
China Enters World Money Machine
Why the political urgency to include the yuan in the special drawing rights (SDR) if China does not meet the usual requirements? The answer is that a new global financial panic comes closer by the day. These panics happen every five–eight years almost like clockwork. Look at the financial panics in Mexico (1994), Russia/LTCM (1998), Lehman/AIG (2008) and you get the idea. Another panic in 2018, if not sooner, is a near certainty.
The next panic will be bigger than the central banks’ ability to put out the fire. The only source of bailout cash will be the SDR. But a massive issuance of SDRs will require cooperation by China. This is not because of International Monetary Fund (IMF) voting (China’s vote is not that large). It’s because SDRs are useful only if they can be swapped for other reserve currencies to prop up banks and liquidate panicked sellers of stocks. (The IMF runs a secret trading desk where these SDR swaps are conducted.)
When your neighbors are in full panic mode, they won’t want SDRs from Citibank; they’ll want dollars. But who will swap dollars for the SDRs printed by the IMF? The answer is China. The PBOC and SAFE would love to dump dollar assets in exchange for SDRs. But there’s a catch. China will only engage in SDR/Dollar swaps if the yuan is included in the SDR. China does not want to pay club dues unless it’s a member of the club.
The rush to include China in the SDR should be seen as global monetary elites getting their ducks in a row before the next panic comes to destroy your portfolio. In the 1960s, hippies had an expression to describe membership in a small group. They said, “You’re either on the bus or off the bus.” Well, the IMF wants China on the bus before the next panic hits. When trillions of SDRs are issued in the next panic, China will dump its dollars for SDRs (with the yuan inside).
Bill Gross Says the Fed Has Mastered 'Market Manipulation'
Bond investor Bill Gross ramped up his criticism of the Federal Reserve on Wednesday, characterizing chair Janet Yellen and her predecessors and contemporaries at other central banks of mastering “the art of market manipulation.”
In his latest Investment Outlook, Gross wrote: “All have mastered the art of market manipulation and no – that’s not an unkind accusation – it’s one in fact that Ms. Yellen and other central bankers would plead guilty to over a cocktail at Jackson Hole or any other get together of Ph.D. economists who have lost their way.”
Gross added: “With Yellen, there is no right or left hand – no ‘on the one hand but then on the other’ – there are only decades of old orthodoxy that follows the tarnished golden rule of lowering interest rates to elevate asset prices, which in turn could (should) trickle down to the real economy.”
Gross has been lambasting ultra-loose central bank policies for hindering, not helping, global economies by keeping so-called “zombie” corporations alive and inhibiting “creative destruction.” For several years, Gross and others have warned that zero and negative interest rates not only fail to provide an easing cushion should recession occur, but they destroy capitalism’s business models. Those business models are dependent on a yield curve spread or an interest rate that permits a legitimate return on saving, as opposed to an incentive for spending, he said.
Over 50? Here's why you'd better not lose your job
Sometimes layoffs happen to even the most dedicated or qualified of workers. No matter your industry, you just never know when you might suddenly find your job on the line. But while recovering from a layoff can be difficult for everyone, it's especially tough for the over-50 set.
According to research from Boston College, unemployed workers 55 and up are less likely to find new jobs than unemployed younger workers. Following the 2008-2009 recession, the average length of unemployment for those 55 and up was 40.6 weeks, compared with 31.6 weeks for younger job searchers. A 2012 study by the Urban Institute furthers this point: Despite their experience, workers in their 50s are 20% less likely to find new jobs than workers aged 25 to 34. While getting laid off is clearly never a good thing, it can be especially detrimental to older workers and their long-term financial health.
Many workers who get laid off in their 50s (particularly their late 50s) fall into a trap of sorts — they're not old enough or ready to retire, yet companies don't want to invest in them, for fear of seeing them up and leave after just a few years' time. According to Boston College's research, many older workers point to age discrimination as a major deterrent to reemployment following a layoff. But since age discrimination is a tough thing to definitely prove, those who fall victim to it often have no choice but to pick up and move on in their search for employment.
Losing a job can have serious financial consequences no matter your age, but those repercussions aren't just short-term. According to a 2014 Rutgers University study, 50% of workers who are unemployed for six months or longer claim it will take anywhere from three to 10 years to recover financially. Meanwhile, 55% of those who remain out of work for six months or longer say they'll need to postpone retirement as a result. Since it tends to take older Americans longer to find work after getting laid off, losing a job later in life could wind up derailing your retirement efforts.
Homeland Security To Save Us From 'Rigged Elections'?
The U.S. Economy: Bad Moon Rising
April 1969 saw the release of what would soon become Credence Clearwater Revival’s second gold single. Bad Moon Rising’s popularity quickly secured it a permanent spot in rock history. But it was also headed somewhere else, if not everywhere else, to places the young rockers never saw coming. In hindsight, it can only be said that while their music was great, their lawyer was lousy.
Why is that? Because, for years now, writers for both the big and small screen and all manner of productions have found the song’s addictive rhythm and lyrics impossible to resist and as a bonus, easy picking. Listen and you’ll hear it in An American Werewolf in London, My Fellow Americans, Twilight Zone: The Movie, Blade, Sweet Home Alabama, My Girl, Man of the House, Mr. Woodcock and (in the personal favorite department), The Big Chill. As for television, you’ll recognize the tune in Supernatural, Cold Case, Northern Exposure, The Following, The Walking Dead, Teen Wolf, and not to be relegated to the back of the line, Alvin and the Chipmunks, who belt out their own immensely irritating rendition.
There’s no doubt about it. John Fogerty hit a home run when he wrote Bad Moon Rising. As to why he wrote it and its meaning, he’s been quoted as calling it a description of, “the apocalypse that was going to be visited upon us.” And what of all those bad scenes visited upon Fogerty’s lyrics?
“We had no power in our contracts to veto where our music went. It was everywhere,” lamented Fogerty on the ubiquity of the song in a 2014 interview. “For every good movie you’ve heard it in – for example An American Werewolf in London, which was a pretty cool movie – there were at least 10 more that were awful.” To this day, it’s hard to predict just where that bad moon might next be rising.
Gold hits two-month low, but portfolio manager sees a rebound ahead
Gold has struggled to maintain its levels during the summer as the market has remained flat, but one portfolio manager has a way to play the yellow metal in today's market environment. Chad Morganlander, portfolio manager at Stifel Nicolaus, encourages investors to look at the gold-tracking ETF (GLD).
"We believe that it will continue to go higher and for the short run," he said Wednesday on CNBC'S "Power Lunch." GLD is up 23 percent year-to-date, rallying as gold surged throughout the year.
Morganlander remains bullish on gold overall, as he believes the metal is a "great hedge against market volatility as well as equity risk." Ironically, though gold is often considered a likely casualty of the Fed's rate hike, he says such a move would help the yellow metal.
"We believe that it will continue to go higher and for the short run," said Morganlander. "We do believe that gold will start to rally again after the Federal Reserve comes in and repositions for the next interest rate hike, which we're expecting at the end of the year."
Aeropostale Gets Bid From Mall Group to Keep 229 Of The 800 Stores Open
Aeropostale Inc., the bankrupt teen clothing chain, says a group including mall operators General Growth Properties Inc. and Simon Property Group Inc. has bid for “substantially all” its assets with an eye toward keeping at least 229 stores open.
The so-called going concern bid would also cover expenses including Aeropostale’s bankruptcy financing, the company said in a filing late Tuesday in Manhattan federal court. The amount of the bid wasn’t disclosed. Lawyers for Aeropostale updated the bankruptcy judge on the auction Wednesday afternoon, saying they were working on documentation for the group’s offer, while also evaluating other bids. The auction should conclude Thursday, attorney Ray Schrock told U.S. Bankruptcy Judge Sean Lane on a conference call. He said the parties worked through the night.
“We have an energized but weary group,” Schrock said. New York-based Aeropostale filed for Chapter 11 protection in May, joining other mall-based retailers that have struggled to compete with big-box chains, online merchants and “fast fashion” rivals.
The company, which had about 800 locations in the U.S. and Canada before filing Chapter 11, accused lead lender Sycamore Partners of using a supplier it controlled to steer the chain into bankruptcy and buy it on the cheap. Last week, Lane shot down that contention and said Sycamore could take part in the auction, bidding with about $150 million in debt it is owed in lieu of putting up cash. A lawyer for Sycamore said Wednesday that the private equity firm hasn’t yet decided whether it will support the going concern bid, or whether it will pursue an offer of its own. It needs to figure out how the mall group’s bid will affect its recoveries before deciding what to do, the lawyer said.
Obama’s pledge to reduce emissions by 80% by 2050 would cost $5.3 trillion, a new study shows
President Barack Obama’s pledge to slash U.S. greenhouse gas emissions by 80% from 2005 levels by 2050 might cost more than $5 trillion over three decades, according to a new analysis. More than 190 countries announced similarly ambitious targets in Paris in December, but none included estimates of the costs.
For the U.S., they’re huge: up to $176 billion a year, or $5.28 trillion over 30, according to Columbia Business School economist Geoffrey Heal. His new paper breaks down the costs of the most important prerequisite for achieving the target: making electricity generation carbon-free. The costs aren’t a line item in the federal budget, but would largely be picked up by utilities, which would pass on the capital costs to consumers.
“The short answer is: You and I will be paying,” Mr. Heal said in an interview. That estimate includes savings from not having to buy as much gas and coal (sunshine and wind are free), or replace existing fossil fuel power stations. It doesn’t calculate potential environmental benefits, such as avoiding flooding, air pollution or damage to farmland.
Even under Mr. Heal’s most optimistic assumptions about the development of battery technology, the cost of meeting the president’s pledge would be $42 billion a year. The need to store energy for days when the sun and wind aren’t performing crimps the economic case for renewable energy, making up 70% of the total cost. To store a day’s power output from a single wind turbine, for instance, costs $7.8 million, or more than twice the cost of the turbine.
Dead Govt Workers Get $1.7 Million From Social Security
The Social Security Administration (SSA) paid more than $1.7 million in benefits to dozens of dead federal government employees, according to an audit report released by the Office of Inspector General.
The Washington Free Beacon reported that the SSA failed to cross-check its death records with the Office of Personnel Management (OPM), the agency charged with management of federal government employees. Thirty-five deceased employees were paid an average of $49,156 in Old Age, Survivors and Disability Insurance (OASDI) over the course of an average of 84 months.
In one of the 35 cases, an Ohio man who died in November, 2011 continued to receive OASDI benefits until October, 2015. The SSA paid $37,126 to the deceased worker before the SSA terminated the payments.
The report also revealed the SSA paid six additional workers after their deaths, a problem that could have been prevented had the SSA used the death records from OPM. In these six cases, the SSA relied on other sources for the death information instead of OPM. While the SSA terminated benefits once it learned of the workers’ deaths, it was delayed because of the sources it used.
College Students Support Kaepernick, But Don't Know The National Anthem
More Americans Behind on Car Payments as Sales Near Peak
Auto sales, though still flirting with the possibility of another annual record, have begun to level off as consumers satisfy much of the pent-up demand that swelled during the recession. Another sign the market may be reaching its peak: more Americans are falling behind on their car payments.
As U.S. sales growth slows in 2016, summer demand is falling short of last year’s blockbuster numbers. Industry-wide sales ticked 0.7% higher in July compared to the same month a year ago, according to Autodata. In July 2015, automakers reported a 5.3% increase in deliveries. General Motors (GM), Ford (F) and their fellow manufacturers will release August sales results on Thursday.
The slowing pace of sales has come at a time when loan delinquencies are on the rise in the $1 trillion auto-loan market. For subprime auto loans, delinquencies extending beyond 60 days jumped 17% last month, Fitch Ratings said in a recent report Opens a New Window. . The upswing is more pronounced for prime delinquencies, which were up 21% versus July 2015.
These trends haven’t gone unnoticed by the banking industry. Speaking at a financial conference in June, J.P. Morgan Chase (JPM) CEO Jamie Dimon referred to auto lending as “a little stretched,” adding that his bank takes a careful approach to the market.
A Cashless World - India’s Payments Revolution
The Unified Payment Interface that went live last week is likely to be a runaway success, thanks both to its pathbreaking and innovative technology, as well as the rapid increase in the adoption of smartphones by the country’s mobile phone users. In the era of cashless payments, UPI — enabling as it does seamless and instantaneous transfer of funds with only a tap on the smartphone — is a vast improvement over existing digital payment technologies. Money transfer in the physical world through negotiable instruments such as cheques has already largely been replaced by electronic fund transfer through the Real Time Gross Settlement (RTGS) or the National Electronic Funds Transfer (NEFT) systems, though both still have limitations in terms of transaction value and processing time.
Filling these gaps, the UPI is also a step ahead of the Immediate Payment Service (IMPS) that enables instant transfer of money through mobile phones. Doing away with the need to disclose sensitive information such as bank account numbers and mobile numbers, the beauty of the UPI interface, built on the IMPS platform, is that it dishes out all the information at the back-end, and only requires a virtual address, one that can be linked to multiple bank accounts.
For online purchases too, UPI has all the makings of a revolutionary platform. Its simplicity and security are likely to lure even jittery buyers, who up until now have preferred the ‘cash on delivery’ route, rather than paying with plastic. Digital wallets, enabling purchases on the go, without using bank accounts or cards directly, while addressing some of these security concerns, lacked interoperability.
UPI not only ensures this — any bank’s UPI app can be used to access the accounts of other banks — but also offers consumers a wider basket for their online purchases. Customers can access merchants tied up with any of the 21 banks under the UPI interface.
Canada's economy takes largest hit since 2009
The Canadian government said gross domestic product (GDP) in the second quarter shrank by 1.6%, its largest loss since 2009. The Canadian economy was hit hard by wildfires in its oil sands region, reducing its production.
In the first quarter of the year, Canada's economy grew by 2.5%. The recent drop in GDP was larger than analysts had projected, but not far off the predicted 1.5% loss.
"[The figure] could have been worse, given the hit from the wildfire, and clearly confirms the disappointing downward trend in exports over the last few months," said Sal Guatieri, senior economist at BMO Capital Markets. In May, wildfires devastated the parts of northern Alberta where much of Canada's oil and natural gas is produced.
The fire burned 2,300 sq miles (5,957 sq km) of land and caused nearly $6bn ($4.5bn) in damages. Economic growth is expected to pick up in the later half of the year as oil production gets back on track. But the decline in global oil prices will continue to weigh on the country's growth.