It was not a great day to be a billionaire oligarch savior of humanity.
FTX’s Sam Bankman-Fried’s humiliation continued. It was reported that he lent himself $1 billion through his hedge fund; he cashed out $300 million last year and told investors it was a partial reimbursement, and even apparently collected $370,000 in PPP loans when the company was already worth ten-figures.
Theranos founder and convicted fraudster Elizabeth Holmes was sentenced to 11 years in prison.
And Elon Musk admitted that he intends to enforce a new censorship regime at Twitter that includes shadow-banning content. This comes after the Tesla CEO has touted the importance of free-speech on his newly acquired platform. (Also this week, a Tesla burst into flames on a Pennsylvania highway.) Musk did throw conservatives a bone by finally reinstating the satirists at the Babylon Bee. (Why wasn’t this done on day one?) But other folk heroes like Donald Trump (who is literally running for president right now) and Alex Jones remain banned. Musk says he will deboost and demonetize “negative/hate tweets,” which could be defined as anything he wants to censor. We at the Breitbart Business Digest remain skeptical.
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Are you sitting down? The economy might be in a recession. What has seemed like a constant conversation topic over the last several quarters has reared its head, as leading economic indicators underperformed yet again compared to already weak expectations. The Conference Board Leading Economic Index (LEI) fell 0.8 percent in October against the expected 0.4 percent drop predicted by economists polled by the Wall Street Journal. These indexes are down for the eighth straight month and -3.2 percent over a six-month window; the LEI had risen 0.5 percent the six months prior, further suggesting that we are on a significant cold streak.
The 2-year and 10-year U.S. Treasury yield curves inverted Thursday and have remained that way. The inversion is the largest in 40 years.
Bank of America highlighted a massive drop in pending home sales as well as huge dives in lumber and global freight rates.
We almost got some real talk from President Joe Biden on Friday when he said that he anticipates setbacks ahead for the U.S. economy, but then he went on to say that grocery store prices are down slightly. They are actually up 12.4 percent from last year.
If all of this sounds very recession-y, that’s because it is.
So, what will the Fed do about it? Zero Hedge notes that of the 16 different Fed speakers this week, all of them indicated that the rate hikes will continue until things improve, and then maybe they’ll still get hiked some more. Boston Federal Reserve President Susan Collins said that she believes inflation can be tamed without a big rise in unemployment. But, of course, that remains to be seen.