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The Week in Business: Blistering Job Growth

    Analysts had forecast an increase of 250,000 jobs in July. And so it was a shock when the Department of Labor report showed that more than double that number – 528,000 – added last month. The blazing pace of growth brought aggregate employment back to prepandemic levels, a confusing measure given other recent signs of a slowing economy, including declining gross domestic product and a more sedate housing market. Indeed, this latest jobs report raises more questions than answers about the state of the U.S. economy: What drives employers’ confidence in the workforce when many fear a recession? Why is the labor market so resilient when the economy appears to be more depressed? These are apparent contradictions that Federal Reserve officials will weigh as they consider the path to follow.

    Citing the crash of the cryptocurrency market along with inflation and the deteriorating economic outlook, trading app Robinhood announced on Tuesday layoffs of 23 percent of its staff, the second round of job cuts in just a few months. It’s still dealing with the fallout from last year’s “meme stock” frenzy, when investors conspired to boost shares of struggling companies like GameStop and AMC, ultimately resulting in lawsuits, a Securities report said. and Exchange Commission and congressional hearings for Robinhood, which became a major player in commerce. But also disastrous for the company was its exposure to the crypto market, which analysts said led many companies, such as cryptocurrency exchange Coinbase, to over-employment in the market’s heyday and then cut staff when it opened. collapsed. Robinhood’s CEO Vlad Tenev said the company misjudged the economy and trading activity. “As CEO, I approved our ambitious staffing journey and took responsibility – this is up to me,” he wrote in a blog post.

    In his first comprehensive response to Twitter’s indictment against him, Elon Musk accused the social media company of fraud and reiterated arguments that it was hiding the true number of spam and bot accounts on its platform. in a legal filing made public Thursday, Mr. Musk’s attorneys claimed the proportion of those accounts was closer to 10 percent, while Twitter claimed it was less than 5 percent. His lawyers also accused Twitter of hiding the number of users who see ads. Twitter continues to say the numbers are correct. The two sides still plan to resolve their disputes in Delaware’s Court of Chancery in October, when a judge will decide whether Mr. Musk’s claims that Twitter is withholding information about spam accounts on the site are legitimate or whether he is still to complete the $44 billion deal.

    The Walt Disney Company’s bold subscriber ambitions can be checked in its quarterly report on Wednesday. The company has surpassed analyst expectations for its streaming platform Disney+ so far this year, announcing in February that it had 11.8 million subscribers and then 7.9 million more in May for a total of 138. million. But it has an aggressive target of reaching 230 million to 260 million Disney+ subscribers worldwide by 2024, and analysts have said the expectation will be lowered on Wednesday. They predict that Disney will instead focus on making the streaming site profitable. These aren’t the only challenges Disney faces: its stock price has fallen this year, the company has fired its top executive for television content, and while its theme parks have recovered in the United States, they’ve struggled in China due to pandemic restrictions.

    This week’s Consumer Price Index may send out a somewhat confusing message. Analysts expect inflation to slow both year-on-year and month-to-month, but “core” inflation – the measure that excludes volatile gas and food costs – will accelerate year-on-year. Gas prices, which have fallen sharply from recent highs, would likely be the cause of a slowdown in headline inflation. Still, policymakers worry about how much and how quickly aggregate price increases will cool. Federal Reserve officials are planning another major rate hike in September, but watch for signs of moderation in the economy as they set the pace of the hikes. In the White House, President Biden is pushing for the Inflation Reduction Act as the government’s tool to lower prices, though it’s uncertain how effective the legislation will be at that task.

    In April, the New York Times transportation reporter asked, “Air travel is back. Can the sector keep up?” The answer seemed to be recently: No. To address the increase in delays and cancellations this year – especially acute during busy holiday weekends this summer – the Transportation Department has proposed a rule that will provide more options for passengers who experience significant disruption to their travel plans, including major changes to flight schedule, route or the seats. Airlines that have received pandemic assistance from the government are also required to issue full refunds to passengers who change their mind about travel for Covid-related reasons. However, if it goes into effect, it won’t be in time for your August trip to Italy – the agency has opened a 90-day public comment period and will make a decision after that.

    Stephen King testified in the Justice Department’s antitrust case to prevent Penguin Random House from buying Simon & Schuster. Walmart lays off 200 company employees. OPEC Plus approved a small increase in oil production.