Bloomberg - Evening Briefing - No clear path

It’s anyone’s guess where the global economy is headed. This has been the case for some time, and is especially true these days, given the strange state of affairs in the US and new faces at the top in China. The Federal Reserve’s mission to tamp down inflation is ever more likely to mean a higher peak interest rate than investors had been expecting just weeks ago, thanks in part to a labor market that continues to defy expectations. On the continent, the European Central Bank has signaled a similar situation when it comes to rising rates. Central bankers appear worried about a cycle in which workers seek higher pay to offset inflation’s bite, and in turn trigger more price increases. In Washington, the Fed’s monetary policy has detractors, too, including Democratic Senator Elizabeth Warren, who warned rate hikes could “tip this whole economy off an economic cliff” and push millions out of work. 

In China, government officials say the economy there is showing signs of a stronger than expected rebound following an abrupt end to “Covid zero,” and that manufacturing posted its biggest improvement in more than a decade. With Beijing’s leaders gathering at their annual legislative session amid a reshuffle of economic policymakers, observers on Wall Street and in Washington are wondering whether Xi Jinping’s new guard will accelerate intervention in the economy—and confrontation with the West.

Do you have to be smart to get rich? Not necessarily, Tyler Cowen writes in Bloomberg Opinion. While it’s long been accepted wisdom from businesspeople to academics and economists, Cowen posits that the link between earned income and IQ simply isn’t that strong.

Elon Musk is far from being a fixed point in time or space. His private jet makes trips as short as 13 minutes. He became the world’s richest person again this week thanks to a 70% surge in Tesla stock this year, then lost the title after disappointing at investor day. And Twitter, with all its problems? Whatever attention Musk has to spare may go toward a midlife career shift: building an alternative to ChatGPT. Oh, and heat pumps too. 

Elon Musk isn’t just a regular at the top of rich-people rankings—he also leads his fellow Silicon Valley plutocrats in other ways. Sources: Aircraft tail number data compiled by Bloomberg News from ADS-B Exchange.

The median age for first-time homebuyers in the US is now the highest on record, and housing prices are at their least affordable in four decades. This dynamic may push would-be buyers into new construction, since existing homeowners have few incentives to give up their low-rate mortgages. On the commercial front, the work-from-home revolution has helped land major office landlords in default, raising fears of more to come as the pandemic reshapes offices, city centers and your commute. 

Israel’s new far-right government is besieged by multiple crises, mostly of its own creation, and with no clear way out: Israeli troops have killed more than 60 Palestinians in 2023, the most in two decades, as the US, and neighbors Egypt and Jordan, grasp for a solution. Odds of an Israeli strike against a quickening Iranian nuclear program may be rising as well. And domestic strife may be reaching a breaking point as hundreds of thousands of Israelis take to the streets to decry plans by Prime Minister Benjamin Netanyahu (who faces charges of bribery) and his government to gut the judiciary. How serious is the schism? Yuval Diskin, former head of Israel’s domestic security agency, says “we are liable to be on the brink of civil war.” 

Demonstrators gathered in Tel Aviv on March 1 to protest Benjamin Netanyahu’s bid to restrict the authority of Israel’s judiciary. Photographer: Jack Guez/Getty Images

Believe it or not, car prices might go down this year by around 5%. That includes Tesla, BMW and Volkswagen (but probably not Mercedes). The cost for a bottle of 60-year-old Balvenie—a special single malt that marks head-blender David Stewart’s six decades at the company—will run $145,000. What’s free in this world—or at least in Singapore? Well, 12,500 tickets to Hong Kong offered by Cathay Pacific. But they were claimed in one hour.

• China’s annual legislation session kicks off in Beijing.
• Fed Chair Jerome Powell testifies before Congress.
• UK Prime Minister Rishi Sunak meets with France’s Emmanuel Macron.
• Annual energy conference CERAweek takes place in Houston.
• International Women’s Day is marked on Wednesday.

Pras Michél, a rapper in the 90s powerhouse group the Fugees, put his fame and connections to use for political fundraising, in turn fueling a wild tale of celebrity and political intrigue. The saga included entanglement in one of the century’s great financial scandals and even mediating high-stakes negotiations between global superpowers. But now Michél has been accused by the US government of serious criminal conduct. Having rejected a plea deal that would have forced him to say he worked as an unregistered agent of a foreign government, Michél could face decades in prison if convicted at trial. 

Pras Michél Photographer: Marc Baptiste for Bloomberg Businessweek

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