Talk of peak inflation has become passé in some quarters. Wall Street quivered a bit at the prospect of an historic 100 basis-point rate hike by the Fed later this month after inflation reached a new four-decade high, driven by gas, shelter and food. While the US increase is likely to be only 75 basis points, the Bank of Canada went the full 100 as central banks everywhere try to put a lid on price surges without causing downturns. The European Central Bank is set to raise rates for the first time in a decade next week while the euro’s slide to parity with the dollar may raise new inflationary questions. Also, according to Justin Fox in Bloomberg Opinion, inflation is “even worse” if you measure it “the proper way.”

Protesters in Sri Lanka took to the streets to celebrate the departure of President Gotabaya Rajapaksa, who stepped down after days of anti-government demonstrations in the economically crippled country. The plane carrying Rajapaksa to Singapore was the most tracked in the world. 

A demonstrator waves the national flag outside the president’s office in Colombo, Sri Lanka. Photographer: Buddhika Weerasinghe/Bloomberg

Twitter’s lawyers claim they may need only four days in court to prove their case against Elon Musk, who wants to bail on his $44 billion takeover. Tesla bulls initially rejoiced at the deal’s near-collapse, and some banks could dodge steep losses from underwriting the debt. 
 
The season of “revenge travel” has turned into the summer of travel chaos. Emirates rejected London Heathrow Airport’s demand that airlines cut capacity for two months, while travelers in beleaguered US and European airports are turning to tracking devices for their luggage. Delta Air Lines even sent an empty plane to bring back 1,000 US bags trapped in the UK.

Heat waves are threatening ancient sequoias in Yosemite National Park, shrinking wheat yields in France and turning deadly in China. Amid the driest spell in Spain and Portugal in more than a millennium, Russia’s retaliation over sanctions for its war on Ukraine is forcing Europe to burn more coal. 

Firefighters put out hot spots from the Washburn Fire in Yosemite National Park, California. Photographer: Nic Coury/AFP

Across China, homebuyers are refusing to pay mortgages, escalating the real estate crisis, and the country is now censoring crowd-sourced documents tallying the boycotts. In the tight US home market, 15% of sales fell through last month as rising interest rates pushed buyers to walk away. In Manhattan, apartment rents reached another record high. 

• Big Tech reports earnings amid the worst rout in a decade.
• Debates continue in the crowded Tory contest for UK prime minister.
• Farnborough International Airshow arrives as  travel surges.
• Ex-Trump aide Steve Bannon  faces trial for contempt of Congress.
• Sri Lanka is set to elect a new president.

MBS’s $500 Billion Desert Dream Gets Weirder

It’s one of the largest and most difficult construction projects in history: turning a massive expanse of desert in Saudi Arabia into a high-tech city-region called Neom. Five years into development, bringing Saudi Crown Prince Mohammed bin Salman’s mega-project to life is proving a formidable challenge, even for a near-absolute ruler with access to a $620 billion sovereign wealth fund.

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