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First Republic Bank seized, sold in fire sale to JPMorgan
NEW YORK (AP) — Regulators seized troubled First Republic Bank early Monday, making it the second-largest bank failure in U.S. history, and promptly sold all of its deposits and most of its assets to JPMorgan Chase in a bid to stop further banking turmoil that has dominated the first half of this year. It’s the third midsize bank to fail in less than two months. The only larger bank failure in U.S. history was Washington Mutual, which collapsed at the height of the 2008 financial crisis and was also taken over by JPMorgan in a similar government-orchestrated deal.
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Fed is set to raise rates yet again. After that, then what?
WASHINGTON (AP) — The Federal Reserve is on track to raise its benchmark interest rate for the 10th time Wednesday, the latest step in its yearlong effort to curb inflation with the fastest pace of hikes in four decades. Yet economists and Wall Street traders will be more interested in what the Fed and Chair Jerome Powell signal in a statement and at a news conference about a bigger question: What comes next? And on that note, they may be disappointed. Economists say Powell will likely hint that the Fed is edging closer to a long-awaited pause in its rate increases. Yet he won’t necessarily send a clear sign that this week’s hike will be the Fed’s last.
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Attacks on delivery drivers add fears among gig workers
Ride-hailing and food delivery companies say extreme violence is rare among the millions of trips completed each week by gig workers. But three attacks in Florida last month sent ripples of fear among some app-based drivers, who have long demanded better protection from companies whose safety policies they say are more geared toward customers than workers. Ride-hailing and delivery driving are among the deadliest occupations in the country, according to occupational fatalities and injury data from the U.S. Bureau of Labor Statistics. While most deaths and injuries are from traffic accidents, the data also shows drivers are more at risk of assaults than other occupations.
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Pilots at American, Southwest, ratchet up strike threats
Pilots at American Airlines have voted overwhelmingly to authorize a strike, and pilots at Southwest are starting to vote on a potential strike at their airline. That doesn’t mean pilots at either airlines are going to walk off the job anytime soon, but it does aim to put more pressure on the airlines to reach new contracts with pilots’ unions. The pilots’ union at American said Monday that almost all its members took part in the voting, and that 99% of those who voted authorized the union to call for a strike. Federal law makes it very difficult for airline unions to conduct legal strikes.
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FDIC recommends raising insured deposit limit for businesses
NEW YORK (AP) — The Federal Deposit Insurance Corp. is recommending the U.S. rethink its decades-old policy of insuring only as much as $250,000 in bank deposits. In a report released Monday, the FDIC suggests insuring business accounts at higher levels than it has previously. The proposed change would require congressional approval. It appears to openly acknowledge that the FDIC is looking for ways to calm both depositors and markets as the agency contends with the third U.S. bank failure this year. First Republic Bank became the second largest failure in history Monday when regulators seized it and JP Morgan Chase stepped up as a buyer.
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May Day: World’s workers rally, France sees pension anger
PARIS (AP) — Workers squeezed by inflation and demanding economic justice marked May Day with rallies around the world. They called Monday for higher salaries, reduced working hours and better working conditions. May Day is observed in many countries as a day to celebrate workers’ rights. This year’s events had bigger turnouts than in previous years as COVID-19 restrictions were loosened and opposition centered on how governments’ economic plans will affect workers. In France, unions organized large protests against President Emmanuel Macron’s recent move to raise the retirement age. In Indonesia, rally-goers demanded the government repeal a job creation law they argue would benefit business at the expense of workers and the environment.
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Environmental groups sue FAA over SpaceX Texas rocket launch
CAPE CANAVERAL, Fla. (AP) — The Federal Aviation Administration is being sued by wildlife and environmental groups over SpaceX’s launch of its giant rocket from Texas. The lawsuit was filed Monday in federal court in Washington. SpaceX’s Starship soared 24 miles high before exploding over the Gulf of Mexico over a week ago. The rocket’s self-destruct system caused the nearly 400-foot rocket to blow up, as it spun out of control. The groups say the FAA failed to fully consider the environmental impacts of the Starship program near Brownsville, Texas. The FAA declined comment on the lawsuit.
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Yellen says US could hit debt ceiling as soon as June 1
WASHINGTON (AP) — Treasury Secretary Janet Yellen has notified Congress that the U.S. is projected to reach its debt limit as early as June 1, if the body does not raise or suspend the debt limit before then. In a letter Monday to House and Senate leaders, Yellen urged Congress “to protect the full faith and credit of the United States by acting as soon as possible” to address the $31.4 trillion limit on its legal borrowing authority. Treasury also said Monday it plans to increase its borrowing during the April to June quarter of this year.
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Lordstown warns it may fail as investor Foxconn gets jumpy
Lordstown Motors says it is in danger of failing because Foxconn is looking to back away from an agreement to invest up to $170 million in the commercial electric vehicle startup. Lordstown said in a regulatory filing on Monday that it received a letter from Foxconn Ventures on April 21 saying that the company was in breach of the investment agreement because it had received a delisting warning from the Nasdaq stock market. Foxconn also said that it would look to end the investment deal if the breach wasn’t resolved within 30 days.
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The S&P 500 fell 1.61 points, or less than 0.1%, to 4,167.87. The Dow Jones Industrial Average fell 46.46 points, or 0.1%, to 34,051.70. The Nasdaq composite fell 13.99 points, or 0.1% to 12,212.60. The Russell 2000 index of smaller companies rose 0.22 points, or less than 0.1%, to 1,769.21.
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