Bloomberg - Evening Briefing - Cooling by design

The labor market has been the stalwart of the US economy this year, supporting momentum that’s set it on a glide path for that Goldilocks scenario known as a soft landing. New data this week showed more people entering the workforce (which did cause the unemployment rate to rise), increased hiring and slowing wage growth—three key ingredients of Fed Chair Jerome Powell’s design for a victorious conclusion to his war on pandemic-era inflation. More good news for the American economy came in the form of  corporate profits, which are on the rise again after a year of declines. But as always, that slow descent could turn into something else.

Bloomberg Originals explains in China’s Great Slowdown how the second-largest economy in the world got that way, and why some think it may be peaking prematurely.

Over in Europe, however, things are decidedly less rosy. Energy costs are keeping inflation sticky, which in tandem with weak economic growth has revived talk of stagflation. Then there’s China: The picture there is increasingly grim as a property crisis continues to spiral. The nation’s economy was meant to drive one third of global economic growth this year, but that ship seems to have sailed away. China’s dramatic slowdown is now stoking fear of contagion—though it’s also creating openings for advantage. As Beijing scrambles to cobble together new efforts to stimulate the economy and support its currency, policymakers across Europe and especially in Washington are rethinking assumptions about just who will hold economic sway in the decades to come.

The so-called “Summer of Strikes” isn’t over just yet. Shawn Fain, the new president of the United Auto Workers, has declared “war” on the Detroit big three automakers, with contract demands including proposals for a 46% raise and a 32-hour work week. Technology allowed white- collar workers to work from home during the pandemic, and now service and factory workers want to improve their work-life balance, too. Though if you’re an intern at Ken Griffin’s Citadel, your salary of $19,200 a month may make up for a lot of WFH days. And finally, online job search site Indeed said it will pay $10,000 to help transgender workers move to states where they feel safer. America is now the subject of a travel alert by Canada, given discriminatory policies of some Republican-controlled states toward LGBTQ individuals. One of those states—Florida—earned a similar warning from domestic civil rights groups over how its policies will impact people of color.

Shawn Fain, the new president of the United Auto Workers, speaks to union members before a practice picket in Detroit. Photographer: Jeff Kowalsky/Bloomberg

Kyiv’s forces appear to have pierced the first line of Russian fortifications in Ukraine’s southeast and are fighting to widen the breach, a potential breakthrough in its counteroffensive against the Russian invasion. Kremlin leader Vladimir Putin, meanwhile, has agreed to make his first foreign trip—to China’s Belt and Road Forum—since the International Criminal Court issued a warrant for his arrest on war crimes charges. 

Senate Minority Leader Mitch McConnell was cleared by a US Capitol health official to work one day after he froze for a second time. Twice-impeached and four-time indictee Donald Trump pleaded not guilty to Georgia charges he led a racketeering conspiracy to overturn the 2020 election. While the ex-president has been seeking to cash in on his felony prosecutions, polls after the first GOP debate show increasing support for his rivals. Still, with much of the party’s base in his corner, the 2024 nomination looks like it’s his to lose—for now. “To be sure, Trump is absolutely the most likely to win the nomination,” Jonathan Bernstein writes in Bloomberg Opinion. “But it’s simply too early to be sure and one can’t repeat too many times that everything about this is unprecedented.”

Mitch McConnell Photographer: Liz Dufour/The Enquirer/USA Today Network

While many now forgo face masks and have returned (for the most part) to pre-Covid life, that doesn’t mean the virus that killed millions of people is history. New variants, dubbed Eris and Pirola, have emerged, with the latter prompting England is to push forward its vaccination booster program. In other health news, doctors at some of the largest US teaching hospitals are blowing the whistle on colleagues who schedule two or even three operations at virtually the same time, leaving during critical portions, then billing Medicare for work they didn’t do.

Tesla slashed prices for its Model S and X in the US and China after the unveiling of a revamped Model 3 sedan in China. The US EV-maker has been trying to compete with rivals at home and abroad, like BYD and Nio. Maserati, also in the EV game, has resurrected its grand touring coupe, the GranTurismo with an option to go full electric. The cars will cost you though. They have a $205,000 starting price.

The GranTurismo comes with a 3.0-liter, twin-turbo V-6 engine and eight-speed automatic transmission. Source: Lorenzo Marcinno

• US and Canadian markets are closed for Labor Day holiday.
• Turkey’s Erdogan to meet Putin to discuss grain deal.
• Country Garden yuan bond crisis reaches climax as default looms.
• Carmakers from everywhere gather for the Munich Motor Show.
• Group of 20 leaders meet in New Delhi amid India-China tension.

Big Oil member Shell shelved a public commitment to spend up to $100 million a year building a pipeline of carbon credits, part of its promise to zero out emissions by 2050. Instead, the company and its new CEO decided to double down on extracting and selling the fossil fuels driving the climate crisis.

Shell discarded plans it said would develop millions of carbon offsets projects around the world. Instead, it’s embracing oil and gas even more. Photographer: Krisztian Bocsi/Bloomberg

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