This is what you need to know:.
Closed banquet hall in San Francisco. Pandemic-related restrictions have cost many hospitality workers their jobs. credit Jim Wilson/The New York Times
A new snapshot of the labor market and the state of the economic recovery will be released Thursday when the Labor Department releases its weekly unemployment claims report.
With the number of coronavirus cases steadily declining, economists believe that new government claims for benefits fell again last week, although they remained exceptionally high. The economic crisis may have passed its peak, but the long-term damage to the labour market is uncertain. This may become clearer in the coming months.
Unemployment claims have been at very high levels for some time, said Diane Swank, chief economist at the accounting firm Grant Thornton. Will they eventually fall, or are there longer term problems?
One indicator that economists are watching is the number of people applying for extended benefits, which indicates that they have used up their normal unemployment benefits, which last 26 weeks in many states.
We are concerned that more and more people who do not enjoy regular entitlements are turning to extended entitlements, said Gregory Dako, chief US economist at Oxford Economics. That’s not a good sign.
Congress continues to work on the $1.9 trillion bailout plan. In addition to the $1.5 billion proposed by President Biden, other unemployment benefits are set to expire in mid-March. Mr. Biden’s proposal would extend it to September.
The labour market has sent out a number of positive signals in recent days. Retail sales rose 5.3% in January, more than expected, likely due to the latest round of stimulus measures.
AnnElizabeth Konkel, career economist at Indeed, reported that retail job openings in February 2020 were 2.6% higher than in February of the same year. In total, the number of vacancies on the website increased by 3.9%.
But the economy is still weak. The Department of Labor’s January employment report, which reported only 49,000 jobs, reaffirmed the devastating effects of the pandemic. Of the 22 million jobs lost, about 10 million more will be lost.
Parliamentarian Alexandria Ocasio-Cortez called Robinhold’s decision to restrict GameStop trading over Anna Moneymaker’s credit unacceptable to the New York Times.
Thursday’s hearing on the latest GameStop shopping spree, hosted by the House Financial Services Committee at noon, is expected to generate populist anger on both sides, both against the popular Robinhood shopping app and short sellers targeting the video game retailer.
Representative Alexandria Ocasio-Cortez, a New York Democrat and member of the Financial Services Committee that held the hearing, called Robinhood’s decision, made amid an uproar to terminate certain GameStop deals, unacceptable. Democratic Representative Rashida Tlaib of Michigan, who is also on the committee, called the decision absurd and accused the application of blocking trading capacity to protect hedge funds.
Discontent with Robinhood and hedge funds reflects a national reaction against the power of the country’s largest corporations. Over the past decade, a growing number of lawmakers from both political parties have accused American businesses of shortchanging their constituents, leading to a political vendetta from Wall Street to Silicon Valley.
The anger against Robin is bipartisan. Senator Ted Cruz, a Republican from Texas, supported Ocasio-Cortez’s comments in January. Senator Marsha Blackburn, a Republican from Tennessee, said in a tweet that she had cleared traders on @RobinhoodApp.
Come back at noon to watch the video and live stream from the audience.
The idea that I used social media to promote GameStop stock to unsuspecting investors is absurd, Keith Gill said Thursday during a hearing in the House.Credit…via Youtube
Keith Gill, the former MassMutual welfare education director who lobbied for GameStop stock in his spare time, will testify Thursday before a House committee that he never gave advice on profitable investments and never asked anyone to buy or sell stock for their own profit.
The statement did not mention that Gill was a registered stockbroker and a certified financial analyst when he wrote about GameStop online under the pseudonym Jealous Kitty and another pseudonym that contained vulgarities.
In a five-page statement, Gill described himself as a strong supporter of the fate of video game retailer GameStop and stated that his online publications about the company had nothing to do with his work at MassMutual. The company pretended to be a one-man operation that toyed with wealthy hedge funds, some of which had sold GameStop shares short and bet on its collapse.
The idea that I used social media to promote GameStop stock to inexperienced investors is absurd, Gill said in a statement his attorney filed with the House Financial Services Committee prior to Thursday’s hearing on speculative and aggressive trading in GameStop stock last month. It was very clear to me that my channel was for educational purposes only and that my aggressive investment style was probably not appropriate for the majority of viewers who watched the channel.
He said he had shared his investment ideas online because he had reached a point where I felt that sharing them publicly could help others.
Gill described himself as an average guy with a modest income who actually didn’t work for two years before entering Massachusetts College in April 2019. The statement talks about the money he made trading GameStop stock, although at one point he told his family we were millionaires. Nor did he mention that regulators in Massachusetts are investigating whether his social media postings violated securities industry rules and regulations.
On Tuesday, Gill and his former employer were named as defendants in a class action lawsuit alleging he misled retail investors who bought GameStop shares during the stock’s 1,700% rise, only to suffer losses when the stock quickly gave back most of its gains. The lawsuit alleges that MassMutual and its brokerage did not properly supervise Mr. Gill, who until a few weeks ago was an employee.
Mr Gill’s lawyer, William Taylor, declined to comment on the trial. A MassMutual spokesman said the company is working with Mr. Gill on the issue.
Gill is one of six witnesses who will testify at the hearing, which will focus on the impact of short selling, social media and hedge funds on retail investors and market speculation.
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