Business Highlights: Inflation realities, GDP contraction

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Inflation’s harsh realities on display as Fed officials meet

JACKSON HOLE, Wyoming (AP) — A half-hour drive or so from the resort where the high priests of international finance have convened in Jackson Hole, Wyoming, to discuss the world’s economic challenges, a food bank distributes meals from a commercial garage. Across the street, a collection of townhomes that will sell for millions is nearing completion. “Unparalleled luxury,” its website says, in a “truly relaxing oasis.” As the Federal Reserve’s annual economic symposium gets under way at a lodge in Grand Teton National Park, some of the very problems Fed officials are grappling with — high inflation, soaring rental costs and home prices, and stark economic inequality — are plainly visible near the idyllic setting.

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Government revision shows economy shrank 0.6% last quarter

WASHINGTON (AP) — The U.S. economy shrank at a 0.6% annual rate from April through June, the government said in an upgrade from its initial estimate. It marked a second straight quarter of economic contraction, which meets one informal sign of a recession. Most economists, though, have said they doubt the economy is in or on the verge of a recession, given that America’s job market remains robust, with strong hiring, low unemployment and widespread openings. In its revised estimate, the Commerce Department calculated that the nation’s gross domestic product contracted last quarter, though less than the 1.6% annual decline in the January-March period.

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Wall Street rallies as countdown to Fed speech nears end

NEW YORK (AP) — Stocks rallied on Wall Street, clawing back more of their recent losses, as the countdown clicks closer to zero for a highly anticipated speech about interest rates. The S&P 500 rose 1.4% Thursday for its best day in nearly two weeks. It and other indexes trimmed their losses for the week, caused by Monday’s tumble that was the worst for stocks in months. Wall Street’s focus is on an economic summit at Jackson Hole, Wyoming, which has been the setting for market-defining announcements by the Federal Reserve in past years. The Fed’s chair is scheduled to speak Friday morning.

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Congress wants to hear what Twitter whistleblower has to say

WASHINGTON (AP) — U.S. lawmakers are anxious to hear from Twitter’s former security chief, who has alarmed Washington with allegations that the influential social network misled regulators about its cyber defenses and efforts to control fake accounts. Leaders of several congressional panels are poring over the disclosures by respected cybersecurity expert Peiter Zatko, and calls on Capitol Hill for investigations are mounting. Zatko is due to testify next month at a Senate hearing. He has accused Twitter of deceptions involving its handling of “spam,” or fake, accounts, an allegation that is at the core of billionaire tycoon Elon Musk’s attempt to back out of his $44 billion deal to buy Twitter.

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Labor board accuses Starbucks of pay disparity

NEW YORK (AP) — The National Labor Relations Board says Starbucks is violating U.S. labor law by withholding pay hikes and other benefits from stores that have voted to unionize. The labor board’s Seattle office filed the complaint late Wednesday. Starbucks offered $200 million in enhanced pay and benefits — including increased training — to non-union stores in May. The company says those benefits must be subject to bargaining at unionized stores. But the NLRB complaint says Starbucks is interfering with workers’ right to organize by making the offer. More than 220 U.S. Starbucks stores have voted to unionize since late last year.

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Judge orders more document production in Musk-Twitter suit

DOVER, Del. (AP) — The Delaware judge presiding over Twitter Inc.’s lawsuit to prevent billionaire Elon Musk from backing out of a $44 billion deal to buy the social media company has ordered both sides to turn over more information to opposing lawyers. After hearing oral arguments Wednesday, the judge ordered Twitter Thursday to provide Musk’s attorneys more data regarding the company’s estimates that less than 5% of the accounts on its platform are fake. Musk claims that up to 30% of the accounts could be spam or bots,.

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Six months into war, Russian goods still flowing to US

BALTIMORE (AP) — Six months into the war in Ukraine, American companies — including federal contractors — continue to buy everything from birch wood flooring to weapons-grade titanium from major Russian corporations. This despite President Joe Biden’s insistence that the U.S. would crack down on Russia in response to its February 2022 invasion of its neighbor. The Associated Press found more than 3,600 shipments of wood, metals, rubber and more have arrived at U.S. ports from Russia since it began launching missiles and airstrikes into its neighbor in February. That’s a significant drop from the same period in 2021 when about 6,000 shipments arrived, but it still adds up to more than $1 billion worth of commerce a month.

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Facebook parent culls large Proud Boys network from sites

MENLO PARK, Calif. (AP) — Facebook parent Meta says it has removed a network of accounts linked to the Proud Boys, a far-right extremist group it banned in 2018. Meta said on Thursday that it recently uncovered and removed about 480 Facebook and Instagram accounts, pages and groups linked to the Proud Boys. That brought the total number of Proud Boys assets it has removed to around 750. Although the group has been banned from Meta’s platforms, the company says it has seen repeated attempts by its members at evading the ban. People behind the efforts are not identifying themselves as Proud Boys openly, creating front groups and using Facebook or Instagram to steer people to other, less moderated platforms.

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The S&P 500 gained 58.35 points, or 1.4%, to 4,199.12. The Dow Jones Industrial Average rose 322.55 points, or 1%, to 33,291.78. The Nasdaq advanced 207.74 points, or 1.7%, to 12,639.27. The Russell 2000 index of smaller companies advanced 29.35 points, or 1.5%, to 1,964.64.