🐂 Tech Turmoil

Markets

Stocks rebounded last week after a volatile beginning to the year, and the S&P 500 is on the verge of reaching a new record high. However, Tesla's growth story is facing significant challenges, with a series of negative headlines causing the electric vehicle maker to lose over $94 billion in market value in 2024. This marks Tesla's worst start to a year since becoming a public company. Notably, the stock won't experience any movement today as the stock market is closed for the federal holiday.

Economy

So many layoffs

Tech companies seem to have made a collective New Year's resolution to streamline operations, as the first two weeks of 2024 have witnessed a notable surge in layoff announcements, reminiscent of the sweeping job cuts in 2023. In this period, 46 tech companies have laid off approximately 7,500 employees, according to layoffs tracker Layoffs.fyi. Some significant announcements include Google cutting around 1,000 employees across its Google Assistant, core engineering, and hardware teams, Amazon reducing staff in its Audible, Twitch, MGM Studios, and Prime Video units, Discord slashing 17% of its workforce, and Apple shutting down a 121-person AI team in San Diego.

The trend extends beyond tech, with Citigroup planning to cut its global workforce by 10% (20,000 employees) over the next two years, and BlackRock intending to lay off 600 workers, constituting about 3% of the total workforce.

However, experts suggest that despite the wave of layoffs, the situation is not a repeat of 2023. Last year, tech companies cut nearly 263,000 jobs, acknowledging that the exceptional growth during the pandemic was a Covid/low-interest-rate anomaly. The current job cuts in 2024 are seen as different and less ominous. Rather than broad cost-cutting measures, many layoffs reflect relatively healthy tech companies adjusting their priorities in the face of increasing interest in generative AI. While this might not be reassuring for concerned employees, historical data indicates that layoffs often peak around the fiscal year-end in December and January. Moreover, hiring across the US economy remains robust, with the unemployment rate declining to 3.7% in December.

Politics

Election season officially kicks off

The race for the Republican presidential nomination kicks off today with the Iowa caucuses. According to a Des Moines Register/NBC News poll, Donald Trump holds a commanding lead at 48%, surpassing rivals Nikki Haley (20%) and Ron DeSantis (16%). Both Haley and DeSantis will aim to demonstrate their ability to regain support from the former president in upcoming primaries. Weather conditions may significantly impact the process, as the state is experiencing extremely cold temperatures (with a wind chill potentially dropping to between –35 and –45 degrees Fahrenheit), potentially affecting in-person voting turnout. A noteworthy detail from CNN: Only two non-incumbents who won the GOP Iowa caucus have gone on to become the party's nominee; the majority of others who won went on to secure victory in New Hampshire.

Media

Business Insider says Neri Oxman reports were fair

Business Insider and its parent company, Axel Springer, reaffirmed their support for BI's reports on plagiarism allegations against Neri Oxman, an academic and the wife of hedge fund billionaire Bill Ackman. BI had exposed Oxman for allegedly plagiarizing sections of her MIT dissertation. In response, Ackman criticized BI's reporting process, accusing the publication of political bias. Following an internal review, BI CEO Barbara Peng stated in a memo that there was no unfair bias or personal, political, or religious motivation in pursuing the stories. In reaction, Ackman declared on X, "Business Insider is toast."

World

Where does all this come from?

The question on many minds arises as four out of the six dams along the Klamath River, spanning Oregon and Northern California, are set to be removed by the end of the year, marking the most extensive dam removal project in U.S. history. A significant milestone was reached last Friday when the water behind three of these dams was allowed to flow freely for the first time in a century.

The decision to dismantle the dams was approved by regulators in 2022, a move applauded by Native American tribes and environmentalists. The dams had been severely impacting the salmon population crucial to the Karuk, Klamath, Hoopa, and Yurok Tribes. A 2022 study revealed that 90% of juvenile salmon tested positive for a disease linked to low river flow, a situation that will be rectified with the removal of the dams.

This initiative aligns with a broader goal set in 2023 by the advocacy group American Rivers, aiming to remove 30,000 dams across the U.S. by 2050. The Klamath River project is anticipated to inspire similar efforts, further accelerated by the Infrastructure Investment and Jobs Act of 2021, which allocated funding for the removal of at least 54 dams.

Sports

Buffalo Bills hiring fans to shovel

The Buffalo Bills took an innovative approach to deal with a severe blizzard at Highmark Stadium, offering fans $20 per hour to shovel snow and ensure the venue was ready for their playoff game against the Steelers, which had to be rescheduled from Sunday to today. This wage represents a 33.3% increase from the $15 per hour offered for similar shoveling tasks after a snowstorm in 2022. The move exemplifies how wage growth is surpassing inflation in the current economic landscape.

In November, around 60% of Americans experienced an increase in their earnings compared to the previous year, adjusting for inflation, as highlighted by Brendan Duke of the Center for American Progress. This positive trend in wage growth extends even to unique scenarios like the Buffalo Bills' "shirtless shoveling mafia."

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