Member BriefingMay 29, 2024

Posted By: Harold King Daily Briefing,

Top Story

US Consumer Confidence Rises for First Time in Four Months

A bounce in May consumer confidence follows three consecutive monthly declines. While the outcome is better than expected, it still marks the second-lowest reading of the past year and a half. As we detail below, there were some mixed messages from the labor market. Analysts are sometimes left to guess what factors could be playing a role in determining how consumers are feeling. Helpfully, the press release from the Conference Board cited some write-in responses from survey participants: "consumers cited prices, especially for food and groceries, as having the greatest impact on their view of the U.S. economy."

Little surprise then to see the 12-month inflation expectations rose to 5.4% from 5.3% previously (chart). The labor differential continues to show workers are growing less confident in their position in the labor market. Following a rebound in January, the labor differential, or those who view jobs as 'plentiful' less those who view them as 'hard to get', has steadily trended down over the past four months. Some specific survey questions revealed that consumers are simultaneously upbeat about the stock market even as a growing share see a recession as more likely.

Read more at Wells Fargo

Chicago Fed Index Shows National Economic Activity Slowing

Economic growth in the U.S. slowed last month according to the Chicago Fed National Activity Index. The CFNAI dropped from -0.04 in March to -0.23 in April. Three of the four main indicator categories showed declines, contributing negatively to the index. The three-month moving average rose slightly, however, to +0.01 from -0.17. The CFNAI Diffusion Index also improved marginally to -0.07 from -0.08. Of the 85 indicators, 20 had a positive impact, while 65 had a negative impact.

Thirty indicators improved over the month, 54 worsened and one remained unchanged. Production indicators saw a notable decline; sales, orders and inventories showed a slight improvement; and both employment and personal consumption and housing indicators declined.

Read more at The Chicago Fed

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Policy and Politics

GOP Tempers Expectations on Appropriations Bills

House Republicans are pressing forward with aggressive plans to mark up and pass their 12 annual funding bills for fiscal 2025 before the August recess, but some are dialing back expectations after intraparty divisions over spending plagued the process last year. House Republicans took a key step this week in passing legislation out of committee to fund military construction and the Department of Veterans Affairs for most of next year.

The bill marked the first of the 12 partisan funding plans for fiscal 2025 that Republicans hope to move out of committee and across the floor by the end of July — when Congress gears up to take its monthlong August recess. The proposed schedule was detailed by House GOP leadership to members earlier this week. But despite optimism from parts of the conference, some are tempering expectations given the late start. “If we don’t hit any speed bumps, it could work,” Rep. Andy Harris (R-Md.), chair of the funding subcommittee that oversees dollars for the Department of Agriculture, said this week when asked about leadership’s proposed floor schedule. “But we usually hit speed bumps.”

Read more at The Hill

Embattled New York Cannabis Chief Chris Alexander Resigns

Chris Alexander, the embattled head of New York’s Office of Cannabis Management, is stepping down, Spectrum News NY1 has learned. The executive director of the Office of Cannabis Management announced his resignation on Friday via email, according to a copy obtained by NY1. His resignation follows Gov. Kathy Hochul’s announcement on May 12 that she would not reappoint Alexander to his job at the end of his three-year term in September. He was appointed to the job in September 2021, and before that, he worked on the legislation that eventually made cannabis sales legal in New York.

Alexander and the Office of Cannabis Management have come under fire for a slow rollout of the legal industry plagued by thousands of illegal shops selling illicit product. Also on May 12, a bombshell state Office of General Services report blamed the Office of Cannabis Management for much of the dysfunction in the state’s legal cannabis market, citing inexperienced staff and confusing rules that have left prospective cannabis entrepreneurs frustrated and out of cash.

Read more at New York State of Politics

State Releases Details of $239 Billion Budget

The official size of this year’s state budget is $239 billion, according to the state Division of the Budget, which shared the official spending plan last Friday, complete with tabulations and estimates for the upcoming fiscal year and beyond. The $239 billion figure is a bit larger than initially thought; when the budget was passed earlier this month, its size was reported as $237 billion. But there are often discrepancies between the two figures.

The Division of the Budget reported that during the course of budget negotiations between Gov. Kathy Hochul and legislative leaders, $3.1 billion in expenditures were added to the budget – which included $2.4 billion of one-time costs, such as $1.1 billion to stabilize the healthcare industry in New York and $350 million for the Supplemental Child Tax Credit. This year’s budget also includes $1.5 billion for the state’s reserves, bringing the state’s total reserves to $21.1 billion in preparation for possible economic downturns. The Citizens Budget Commission, a fiscally conservative watchdog group, believes that the projected budget gaps mask even greater financial concerns for the state. In a Tuesday report, it said that the state’s structural deficit could exceed $16 billion in the 2028 fiscal year, after accounting for debt pre-payments, temporary tax increases and rolled over resources.

Read more at City & State

Health and Wellness

ADHD Looks Different in Adults: How to Recognize the Symptoms and Get a Diagnosis

ADHD is the same condition in children and adults, but it can present differently in grown-ups, says Joshua M. Langberg, PhD, a licensed clinical psychologist in the Rutgers Graduate School of Applied and Professional Psychology and director of the Center for Youth Social Emotional Wellness. “ADHD in childhood is often characterized by high levels of inattention, hyperactivity, and impulsivity,” he says. “In contrast, ADHD in adulthood is primarily defined by difficulties with inattention, concentration, organization, and time-management.” People with inattentive ADHD may struggle with these tasks, according to NIMH:

  • Paying close attention to details
  • Paying attention for long tasks, like preparing reports, completing forms, or reviewing long papers
  • Listening closely when spoken to directly
  • Following instructions and finishing duties at work
  • Organizing tasks and activities
  • Managing time
  • Doing tasks that require sustained attention

Read more at Fortune Well


The Governor updated COVID data for the week ending May 24th.


  • Weekly: 12
  • Total Reported to CDC: 83,324


  • Average Daily Patients in Hospital statewide: 498
  • Patients in ICU Beds: 47

7 Day Average Cases per 100K population

  • 3.5 positive cases per 100,00 population, Statewide
  • 3.9 positive cases per 100,00 population, Mid-Hudson

Useful Websites:

Election 2024


Industry News

Global Steel Output Drops Again in April

Global steel production fell -3.5% from March to April, totaling 155.7 million metric tons to start the second quarter of 2024. That result reflects month-to-month output reductions in all of the top steel-producing nations, and places the April figure at -5.0% less than April 2023. For the January-April period, global production stands at 625.4 million metric tons, which is nearly even (-0.9%) with the four-month total for steel output in 2023.

According to the forecasters, weakness in global steel demand is paired with market volatility thanks to the lagging effects of monetary tightening, high prices, and high geopolitical uncertainties. The April production totals apparently reflect steelmakers efforts to counter those factors. In China, the world’s largest steelmaking nation, April output of 85.9 million metric tons is a -2.8% drop from March and a -7.2% decrease from the April 2023 result. For the current year to-date, Chinese producers account for 343.7 million metric tons of raw steel – more than half of the total produced worldwide, and yet =3.0% less than their January-April 2023 performance. Indian steelmakers produced 12.1 million metric tons during April, -5.0% less than during March. Japan’s steel industry produced 7.1 million metric tons of raw steel during April, -1.4% less than in March and -2.5% less than in April 2023. U.S. steelmakers produced 6.7 million metric tons (7.4 million short tons) of raw steel during April.

Read More at American Machinist

Dallas Fed: Texas Manufacturing Activity Ticked Down in May

The Texas Manufacturing Outlook Survey fell to minus 19.4 in May from minus 14.5 in April, weaker than expectations of minus 15 from economists polled by The Wall Street Journal. The survey's production index slipped minus 2.8 in May from a positive reading of 4.8 last month, though the survey's index for new orders inched up a little on month, the data said. Elsewhere, capacity utilization and shipments indexes slipped back into negative territory, after positive turnouts last month.

Measures of employment suggested modest declines, with 9% of firms reporting net hiring, and 14% net layoffs, the Dallas Fed said. Upward pressure on prices and wages continued in May, it added, with raw-materials prices especially accelerating compared with last month. The weaker overall reading of activity comes despite a slight uptick in manufacturing activity in May, as measured by a purchasing managers’ survey last week.

Read more MarketWatch

Weight-Loss Drug Forecasts Jump to $150 Billion as Supply Grows

As millions seek access to weight-loss drugs from Novo Nordisk, and Eli Lilly, increasing supplies, possible wider usage and a growing number of would-be rivals are leading some experts to raise annual global sales forecasts for the treatments to about $150 billion by the early 2030s. A year ago, top sales estimates were in the $100 billion range. "It is very unusual to have a medicine that is capturing the imagination of millions of people," said Michael Kleinrock, senior research director at healthcare analytics firm IQVIA Institute for Data Science.

Global spending on obesity medications totaled $24 billion last year, IQVIA estimated in its latest five-year outlook, and could reach $131 billion by 2028. That 27% annual growth estimate compares with a prior projection of 13%. Shortages that capped sales in 2023 are being resolved, he said, although sales are still limited in large part only by manufacturing capacity. "There's consumer demand and the unmet medical need," said David Song, portfolio manager of the Tema Obesity & Cardiometabolic ETF "A 100 million plus Americans are obese, and even more are overweight. Worldwide, there are estimates out there of close to a billion who are obese." Sales of the new medications, which have U.S. list prices of over $1,000 a month, have lifted Lilly and Novo into the ranks of the world's most valuable companies. Shares in Lilly are up 36% so far this year, while Novo has gained 33%.

Read more at Reuters

America Is Getting Ready for Space Warfare

The satellites central to national defense and global communications have long faced threats from the ground, such as signal jamming and missile attacks. Orbital menaces are the next frontier. Intelligence disclosures about Russia’s interest in antisatellite weapons and satellite launches from China have energized U.S. efforts to defend its interests hundreds and even thousands of miles above the Earth’s surface.

Defense companies are developing systems ranging from satellites that can chase other satellites in orbit to protecting ground stations that can beam signals to space. Those protections are critical as mobile navigation services and some television and internet services rely on equipment in orbit. Commercial startups are working on technologies, including orbital capsules, sensors and satellite structures, that could have military applications. Pentagon officials are also doing something unusual: talking more publicly about the weapons that hostile nations might use in space to engage in warfare. Gen. Chance Saltzman, the Space Force’s top operational leader, said adversaries are trying every day to restrict access that the U.S. and its allies have in space.

Read more at The WSJ

Meet the Shirt Maker Who Loves U.S. Tariffs

Joseph Ferrara says tariffs on Chinese goods have helped resuscitate flailing business at his apparel manufacturing company in New York City. Ferrara Manufacturing makes dress shirts, jackets and other apparel for major U.S. brands, among other products. That private-label business has been reeling over the past two decades from low-price competition by Chinese manufacturers exporting goods to the U.S. 

The tariffs that then-President Donald Trump started increasing in 2018 on a range of goods have helped Ferrara Manufacturing compete on price, reviving the private-label business, said Ferrara, the company’s chief executive. “The private-label business was once a very strong, thriving business for us, and we’re starting to see that return because of duties and tariffs,” Ferrara said.

Read more at the WSJ

Virginia Technology Company to Pay Civil Penalty Over Discriminatory Job posting, According to DOJ

A Virginia company will pay a $7,500 civil penalty after being fined by the Department of Justice over a discriminatory job posting. According to the DOJ, in March of 2023, Arthur Grand Technologies Inc., an information technology services firm based in Ashburn, Virginia, posted a job advertisement for a business analyst position. The posting was shared on a public online hiring website and read “Only US Born Citizens [white] who are local within 60 miles from Dallas, TX [Don’t share with candidates].” The post prompted the DOJ and Labor Department to launch investigations.

“Arthur Grand Technologies vehemently denies any guilt or wrongdoing in relation to the discriminatory job posting that appeared in March 2023,” said Arthur Grand Technologies CEO Sheik Rahmathullah in an email to CNN. “This unauthorized posting was made by an upset employee on a Performance Improvement Plan (PIP) from their personal email address and account. Upon discovering this, we took immediate and decisive action to ensure that this type of incident will never happen again, including the immediate termination of the responsible employee.” As part of the Labor Department’s conciliation agreement, signed by Arthur Grand’s CEO, Sheik Rahmathullah, the company will also pay compensation to individuals who filed complaints with the Office of Federal Contract Compliance Programs (OFCCP).

Read more at CNN

Hess Shareholders Approve Merger With Chevron

Hess Corp on Tuesday approved the company's $53 billion merger with the No. 2 U.S. oil company Chevron, according to preliminary results of the vote. The merger required a majority vote to approve the deal by a majority of Hess' 308 million shares outstanding to pass. The company did not immediately provide the vote tally. Chevron offered to acquire Hess last October in a move to gain a foothold in oil-rich Guyana's lucrative offshore fields. The deal has been stalled by an ongoing review by the U.S. Federal Trade Commission and clouded by an arbitration claim filed by Hess' partner in Guyana, Exxon Mobil and CNOOC

The result is a win for Hess CEO John Hess and puts to rest claims by some shareholders who wanted additional compensation for the delay in closing the sale. Exxon's arbitration could push the deal's closing into 2025. "Assuming Chevron wins the arbitration from Exxon or finds a settlement, the transaction is now going to happen," said Mark Kelly, an analyst with financial firm MKP Advisors.

Read more at Reuters

Oil Up on OPEC+ Meeting, Summer Driving Season and Weaker US Dollar

Oil prices gained more than $1 a barrel on Tuesday on the expectation that OPEC+ will maintain crude supply curbs at its June 2 meeting, while the start of U.S. summer driving season and a weaker dollar also boosted the commodity. Brent crude futures for July delivery settled up $1.12, or 1.4% at $84.22 a barrel. U.S. crude ended at $79.83 a barrel, gaining $2.11, or 2.7% from Friday's close, having traded through Monday's U.S. mark Memorial Day holiday without a settlement.

"Despite the indisputably brighter mood seen in the last two days, interest rate concerns will most plausibly act as a (brake) on further attempts to send oil prices meaningfully higher in the immediate future," said Tamas Varga of broker PVM. Air travel data also helped to buoy oil prices, with U.S. seat numbers on domestic flights for May rose by 5% month on month and almost 6% year on year to slightly above 90 million, data from flight analytics company OAG showed, surpassing 2019 levels.

Read more at Reuters

Elon Musk’s xAI Valued at $24 Billion After Latest Fundraising Round

Elon Musk’s xAI said it raised $6 billion in its latest fundraising round, as the OpenAI rival looks to invest more in research and development amid fierce competition in the burgeoning sector. The funding round brings the valuation of the year-old startup to $24 billion, including the newly raised funds, making it the second-most valuable AI startup outside of OpenAI. The money will be used to take “xAI’s first products to market, build advanced infrastructure and accelerate research and development of future technologies,” xAI said.

The round is double the initial target set by Musk’s team. Investors had been talking about raising $3 billion at an $18 billion valuation, including the new cash, The Wall Street Journal reported last month. Musk’s team raised the target in light of strong demand, according to people familiar with the matter. Investors in the round include brand-name Silicon Valley firms such as Sequoia Capital and Andreessen Horowitz as well as Valor Equity Partners, Vy Capital, Fidelity Management & Research, and Saudi Prince al-Waleed bin Talal and Kingdom Holding, xAI said on its website late Sunday.

Read more at The WSJ

The Loneliness of the American Worker. How the Modern Workday is Fueling an Epidemic of Isolation.

More Americans are profoundly lonely, and the way they work—more digitally linked but less personally connected—is deepening that sense of isolation. Employers and researchers are just beginning to understand how workplace shifts over the past four years are contributing to what the U.S. surgeon general declared a loneliness health epidemic last year. The alienation affects remote and in-person workers alike. Among’s 5,000 hybrid and fully on-site employees, for instance, the most popular community chat group offered by a company mental-health provider is simply called “Loneliness.” 

Paradoxically, meetings can make people feel lonelier—and even more so if the meetings are virtual, behavioral researchers say. A 2023 survey by employee experience and analytics company Perceptyx found people who described themselves as “very lonely” tended to have heavier meeting loads than less-lonely staffers. More than 40% of those people spent more than half their work hours in meetings.

Read More at The WSJ