The Week in Business: We’ve Been Hacked
It’s going to be another bizarre holiday week. Here’s what you need to know to be sure for the days ahead in business and tech. – Charlotte Cowles
How are you? (December 13-19)
The hackers were here all along
In one of the largest and most sophisticated cyberattacks in years, hackers breached the networks of a wide variety of government agencies, including treasury and commerce, as well as a number of large private companies. What’s worse is that the hacks took place last spring but went undetected until the last few weeks. The perpetrator, who is widely believed to be a Russian intelligence agency, has been lurking in government networks for most of 2020. The Trump administration said little about the attack or what information was compromised?
The pitchforks are coming
It’s raining antitrust lawsuits in Silicon Valley, and now it’s up to Google to grab an umbrella. Ten states (and counts) on Wednesday accused the company of illegally monopolizing the digital advertising business and using its ubiquity to overwhelm certain publishers with their ads. “If the free market were a baseball game, Google would position itself as a pitcher, batsman and referee,” said Ken Paxton, the Texas attorney general who led the case. A day later, more than 30 states accused Google of illegally manipulating search results to drive users away from their competitors and towards companies it was comfortable with. Google denied the claims and says it will defend itself.
Everyone wins, everyone loses
Legislators ran to iron out the last few wrinkles in a much-needed pandemic relief bill and avoid a government shutdown. The latest bill of $ 900 billion (a third the size of what the Democrats originally proposed last May) includes $ 600 in payments for individuals, $ 300 a week in additional unemployment benefits, and help for small businesses. However, there is a lack of significant aid to state and local governments (a key item on the wish list for Democrats), as well as legal protections for businesses (which Republicans wanted) worried about liability for the virus spreading.
What’s next? (December 20th to 26th)
But first the tunnel
Federal Reserve Chairman Jerome H. Powell is not known to offer overly rosy economic forecasts. But he sounded almost optimistic last week when he said that a “light at the end of the tunnel” was visible – despite warning that the next few months would be difficult. He predicted the economy will recover in the second half of 2021, provided enough people are vaccinated and can safely resume normal activities. (Such an outcome became even more possible when a second Moderna vaccine received a thumbs up from the Food and Drug Administration.) To bolster growth and calm markets, Powell said the Fed would keep rates near zero and continue Purchase of government debt. He also reiterated his call for more federal incentives to create a financial “bridge” for those in desperate need this winter.
Call the sheriff
Robinhood, a finance app that allows users to easily trade stocks for free, may sound too good to be true and has raised a number of red flags with regulators. Last Thursday, the Securities and Exchange Commission said Robinhood had misled its users about how it was paid by Wall Street firms to pass business and that it had benefited at the expense of its customers. Robinhood agreed to pay a $ 65 million fine to pay the SEC’s fees without admitting or denying guilt. In another case the day before, a Massachusetts securities regulator accused Robinhood of having “unscrupulous” encouraged undemanding clients to make risky investments.
A smaller stretch
As the coronavirus picked up pace this fall, it accelerated employment growth, travel plans and vacation spending. (Except for Christmas trees, which are selling at a record high.) Retail sales fell in both October and November, marking a shift from months ago when Americans continued to spend money, especially online, despite economic turmoil. Of course, Americans were empowered earlier this year by the federal government’s pandemic aid, including stimulus checks and additional unemployment benefits. Now that these funds have been used up, people’s Christmas trees may not have much to themselves this season.