Economy & Business

Why it matters: Despite murmurs of an impending economic crash, the U.S. has seen strong job growth and record low unemployment as trade wars, sweeping technological change and new media consumption habits are changing the American economy.

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Brooks Brothers files for bankruptcy

Photo: Andrew Chin/Getty Images

Clothing brand Brooks Brothers on Wednesday filed for bankruptcy, per Marketwatch, becoming the latest retail giant to topple amid the coronavirus pandemic.

Why it matters, via Axios' Dan Primack: Brooks Brothers is the poster child for the retail apocalypse. Legacy retail brands were already struggling before the pandemic, facing the death of brick-and-mortar stores as shopping shifts online. The company, which has relatively little debt and no private equity owners, still generated around 80% of its sales in physical stores that have been mostly shuttered for months — as demand for business attire has cratered with consumers working from home.

Updated 1 hour ago - Politics & Policy

Coronavirus dashboard

Illustration: Eniola Odetunde/Axios

  1. Global: Total confirmed cases as of 9 a.m. ET: 11,856,991 — Total deaths: 544,871 — Total recoveries — 6,473,170Map.
  2. U.S.: Total confirmed cases as of 9 a.m. ET: 2,996,333 — Total deaths: 131,481 — Total recoveries: 936,476 — Total tested: 36,878,106Map.
  3. Public health: Deaths are rising in hotspots — Déjà vu sets in as testing issues rise and PPE dwindles.
  4. Travel: How the pandemic changed mobility habits, by state.
  5. 🎧Podcast: A misinformation "infodemic" is here.

The myth of closing the racial wealth gap through entrepreneurship

Entrepreneurship or starting a business has often been heralded as a way to reduce the U.S. racial wealth gap. However, Black Americans' attempts at entrepreneurship are often foiled by an initial lack of capital and an inability to obtain financing, especially through government programs.

The big picure: This was most recently evidenced when Black-owned small businesses were largely shut out of financing from the SBA's Payroll Protection Program.

More than a quarter of Americans are spending less because of China tariffs

Data: CivicScience; Chart: Axios Visuals

While the U.S.-China trade war has drawn fewer headlines in recent months, nearly seven in 10 Americans say they are concerned about how tariffs are impacting the cost of things they purchase. That's the same number registered in March when the coronavirus pandemic began to escalate.

Why it matters: Despite record low interest rates and trillions of dollars in stimulus from Congress and the Fed, everyday Americans say they are pulling back spending, with 28% saying they are buying less than they used to because prices had increased.

What China's uneven recovery means for the U.S.

China and much of Southeast Asia look to be bouncing back strongly from the coronavirus pandemic as stock markets and much of the country's economic data are returning to pre-pandemic levels.

What's happening: "Our tracking points to a clear V-shaped recovery in China," economists at the Institute of International Finance said in a note to clients Tuesday, predicting the country's second-quarter growth will rise above 2% after its worst quarter on record in Q1.

New York Fed index shows decline in recent economic data

Data: New York Fed; Chart: Axios Visuals

The New York Fed's collection of real-time data indicators contributing to U.S. GDP growth showed a decline, reaching -7.35% for the week ended July 4, down from -6.81%.

What it means: The WEI is an index of ten daily and weekly indicators of real economic activity, scaled to align with the four-quarter GDP growth rate, according to the New York Fed. It follows a string of real-time data analysis from investment banks and asset managers that shows economic data stalling or declining since mid-June.

Spotify and Omnicom strike $20 million podcast advertising deal

Illustration: Sarah Grillo/Axios

Spotify and Omnicom Media Group, one of the world's largest global ad agencies, announced Wednesday a deal that will see Omnicom spend $20 million on podcast ads in the second half of this year.

Why it matters: Most podcasts are typically bought and sold on a per-show or per-episode basis. A big agency's commitment to spending lots of money on podcast ads upfront, like they do with television, is a signal that the industry is growing.

3 hours ago - Sports

Networks fear a fall without the NFL

Photo: Robin Alam/Icon Sportswire via Getty Images

While all major sports scramble to rescue their seasons, the networks are fixated on the NFL, which accounted for 41 of the 50 top-rated telecasts of any kind in 2019, per the Washington Post.

Why it matters: The NFL made up 39% of all ad revenue for Fox last year, 24% for CBS, 21% for NBC and 17% for ESPN (including ABC playoff simulcasts). "It’s practically the only thing on the minds of the networks," John Kosner, a former ESPN executive who is an industry consultant, told the Post. "If you lost an NFL season, you’re looking at a financial hemorrhage."

13 hours ago - Podcasts

Facebook boycott organizers share details on their Zuckerberg meeting

Facebook is in the midst of the largest ad boycott in its history, with nearly 1,000 brands having stopped paid advertising in July because they feel Facebook hasn't done enough to remove hate speech from its namesake app and Instagram.

Axios Re:Cap spoke with the boycott's four main organizers, who met on Tuesday with CEO Mark Zuckerberg and other top Facebook executives, to learn why they organized the boycott, what they took from the meeting, and what comes next.

Remote work’s digital divide exacerbates racial inequality at work

Illustration: Sarah Grillo/Axios

Remote work and remote learning look likely to continue through the end of the year or longer, potentially exacerbating inequalities in the workplace and at schools.

Why it matters: The coronavirus has laid bare how unequal access to technology divides us. And the longer-term implementation of telecommuting could make these issues, which disproportionately harm Black and Hispanic Americans, much worse.

U.S. tech and financial hubs see large declines in job postings

Seattle after sunset. Photo: Karen Ducey/Getty Images

Contrary to what you might expect, it's actually America's tech and finance hubs — where the most jobs can be done remotely — that are seeing the biggest declines in job postings amid the coronavirus pandemic.

What they're saying: "Job postings in these in-person service sectors — retail, food preparation, sales, and beauty & wellness — have fallen more in metros where people are more likely to work from home, like San Francisco, Washington, Boston, and Seattle," Jed Kolko, Indeed's chief economist, writes.

The pandemic exposed workers' lack of power

Workers in California protest Amazon's pandemic-era policies. Photo: Valerie Macon/AFP via Getty Images

The coronavirus is spotlighting longstanding shortcomings in worker power at big companies — and that could lead to lasting change, experts say.

What's happening: "When the pandemic hit us and the protests emerged, it just illustrated that workers don’t have a voice," Tom Kochan, a professor of industrial relations, work and employment at MIT, tells Axios.

The coronavirus is ushering in a new era of surveillance at work

Illustration: Sarah Grillo/Axios

As companies continue to prepare for the return of their employees to the workplace, they're weighing new types of surveillance in the name of safety.

Why it matters: Just as the coronavirus pandemic has acted as an accelerant for the adoption of remote work, it has also normalized increased surveillance and data collection. In the post-pandemic workplace, our bosses will know a lot more about us than they used to.

18 hours ago - Podcasts

What Ghislaine Maxwell might know

New York regulators on Tuesday fined Deutsche Bank $150 million for its dealings with Jeffrey Epstein. This came five days after the arrest of Epstein confidant Ghislaine Maxwell on sex trafficking charges.

Axios Re:Cap digs into what secrets Maxwell might know about Epstein's business dealings, and why it's causing some sleepless nights in the Hamptons, with Business Insider's Meghan Morris.

Deutsche Bank pays New York $150 million for dealings with Jeffrey Epstein

Photo: Stephanie Keith/Getty Images

Deutsche Bank has agreed to pay the state of New York a $150 million penalty for "significant compliance failures" related to its dealings with now-dead convicted sex offender Jeffrey Epstein, the State Department of Financial Services announced Tuesday.

Why it matters: Deutsche Bank "failed to properly monitor account activity conducted on behalf of the registered sex offender despite ample" public information about Epstein's criminal history, according to regulators. It's the first time any financial institution has been penalized for its dealings with Epstein.

Conservatives hunt for their own social network

Data: SimilarWeb; Chart: Axios Visuals

There has been a big uptick in traffic to conservative social media networks like Parler, thedonald.win and Gab over the past few months, according to data from SimilarWeb.

Why it matters: Conservatives are looking to build their own social media platforms, where they can escape from what they feel is baseless censorship of their viewpoints from mainstream social media networks.

24 hours ago - Health

Trump administration invests $2 billion in coronavirus drugs

A Novavax researcher prepares to test the vaccine. Photo: Andrew Caballero-Reynolds/AFP via Getty Images

The Department of Health and Human Services and Department of Defense have awarded $1.6 billion to Novavax and $450 million to Regeneron Pharmaceuticals as part of the federal government's efforts to speed up the development of coronavirus treatments.

The bottom line: Federal scientists are holding out hope that these companies' treatments, along with other vaccines in development, will snuff out the spread of the coronavirus.

Breaking down the PPP disclosure debacle

Illustration: Eniola Odetunde/Axios

The U.S. Treasury Department Monday morning released the names of over 660,000 small businesses that received Paycheck Protection Program loans of at least $150,000, per its recent compromise with Congress. Well, at least that's what we thought Treasury did.

What happened: Within hours, several well-known companies and investment firms on the list denied that they had ever applied for PPP loans, let alone received them.

Weibo parent company Sina gets $2.6 billion buyout offer from CEO's company

Illustration: Rebecca Zisser/Axios

Sina Corp. (Nasdaq: SINA), parent company of Chinese social media platform Weibo (Nasdaq: WB), received a $2.68 billion takeover offer led by company chairman and CEO Charles Chao.

Why it matters: This comes in the context of the White House talking about strengthening rules on foreign tech companies listed on U.S. exchanges, and a new threat from Secretary of State Pompeo to ban Chinese social media apps like TikTok from operating in the United States.

Chinese tech and business coverage surges amid Hong Kong crackdown

Illustration: Sarah Grillo/Axios

As tensions between the U.S. and China escalate, more U.S. media companies like The Information, Politico and The Wire China are looking to invest in coverage of the country and its technology and business boom.

Why it matters: "It's coverage you have to have if you're a serious tech or business news operation," says Bill Bishop, author of the Sinocism newsletter.

U.S. e-commerce adopts a social network strategy from China

Illustration: Rebecca Zisser/Axios

Verishop, the luxury e-commerce site created by former Snapchat Chief Business Officer Imran Khan, expects to sell $50 million of gross merchandise volume in 2020, sources tell Axios. It's also launching a social-shopping experience that will include influencers and a personalized feed of content.

Why it matters: Social media apps like Instagram, Facebook and Snapchat have made efforts over the past few years to offer users a better shopping experience. Verishop is doing the opposite by launching a trusted marketplace first and a social media experience around it second.

Rising coronavirus cases pause U.S. economic recovery

People eat at the outdoor dining area of a restaurant in New York City. Photo: Wang Ying/Xinhua via Getty Images

Given the reporting lag for most traditional economic indicators, investors have turned to real-time data to assess the U.S. economy. Almost all of which shows business activity stalling or declining.

What's happening: Economists at Jefferies write in a note to clients that their in-house economic activity index has "flat-lined" and "has now been moving sideways for the past three weeks."

The myth of closing the racial wealth gap with financial literacy

A recent CNBC article suggests financial literacy is the "critical link" that could "help bridge America’s racial wealth gap."

Reality check: Increased financial knowledge is likely to help improve the lives of individuals, however even widespread increases in financial literacy would do little to close the racial wealth gap.

Sunrun's deal for Vivint brings significant consolidation to U.S. solar

Solar panels are installed on a roof in Washington, D.C. Photo: Michael S. Williamson/The Washington Post via Getty Images

Sunrun, the largest U.S. home solar provider, is buying rival Vivint Solar in a $3.2 billion all-stock transaction, the companies announced Monday.

Why it matters: The deal between major players brings new consolidation to the U.S. solar sector, a growing market that has been hindered by the coronavirus pandemic.

Facebook to meet virtually with boycott groups

Illustration: Aïda Amer/Axios

Facebook CEO Mark Zuckerberg and COO Sheryl Sandberg, facing an ad boycott by more than 500 brands, will hold virtual meetings on Tuesday with civil rights groups who have been key organizers of the #StopHateforProfit campaign.

The state of play: Sandberg will say in a post later that she, Zuckerberg and other execs "are meeting with the organizers of the Stop Hate for Profit campaign followed by a meeting with other civil rights leaders ... including Vanita Gupta from the Leadership Conference on Civil & Human Rights [and] Sherrilyn Ifill from the NAACP Legal Defense Fund."

Sports media's race reckoning

Illustration: Annelise Capossela/Axios

The national conversation about systemic racism has found its way to the sports media world, forcing companies to address their shortcomings around coverage of race and their own internal diversity.

Why it matters: Sports leagues, teams and athletes have been thrust into the cultural spotlight in recent weeks, as they often are. Now, the publications that cover sports have turned the camera on themselves.

Glover Park Group merges with two global advisory giants

Illustration: Aïda Amer/Axios

The Glover Park Group (GPG), the D.C.-based public affairs firm founded by former Clinton-Gore aides in 2001, is merging with two other global advisory firms.

  • Finsbury is based in the UK and Hering Schuppener is based in Germany. The combined firm, launching in 2021, will be called Finsbury Glover Hering (FGH).

Why it matters: The deal formalizes a years-long partnership between the three groups, which all focus on different aspects of corporate branding, reputation and advocacy communications and public relations.

"Hamilton" is a streaming hit for Disney+

Data: Google Trends; Chart: Andrew Witherspoon/Axios

The debut of "Hamilton" on Disney+ last Friday sent downloads of the app soaring over the weekend.

Why it matters: With theaters closed until 2021, "Hamilton" is the biggest litmus test for whether Broadway will ever be able to successfully transition some of its iconic hits.

Wall Street is no longer betting on Trump

Illustration: Sarah Grillo/Axios

Betting markets have turned decisively toward an expected victory for Joe Biden in November — and asset managers at major investment banks are preparing for not only a Biden win, but potentially a Democratic sweep of the Senate and House too.

Why it matters: Wall Street had its chips on a Trump win until recently — even in the midst of the coronavirus-induced recession and Biden's rise in the polls.

Jul 7, 2020 - Health

Hospitals, doctors are major recipients of PPP loans

Physicians' offices applied for PPP loans to help offset patient volumes that stopped. Photo: John Moore/Getty Images

Small hospitals, physician clinics, surgery centers, dental offices and other health care businesses were among the most common recipients of loans under the Paycheck Protection Program, according to data released by the federal government on Monday.

The big picture: Medical facilities had to halt routine procedures in the early days of the coronavirus pandemic as a way to prevent spread of infection and keep hospital beds open. PPP loans saved some, but certainly not all, of the jobs that are dependent on those routine procedures.

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