Bloomberg - Evening Briefing - Striking complications

With the US still on a bumpy road to fully taming inflation, the economy is encountering two new challenges: A potential government shutdown that could dent confidence and growth, and an unprecedented strike against all three of the legacy Detroit automakers. Workers at Ford, General Motors and Stellantis are demanding job security and better wages. The walkout comes amid a resurgence of labor activism in the US after decades of decline, with unionized workers emboldened by a tight labor market, inflation and risks shouldered during the pandemic. GM Chief Executive Officer Mary Barra said the strike could be resolved “very quickly.” A prolonged action could ripple across the economy, but President Joe Biden, reportedly siding with the workers, said corporate profits have not been shared fairly with employees. The administration has sent officials to assist in negotiating a settlement.

GM Chief Executive Officer Mary Barra said the strike could be resolved “very quickly.” Photographer: Jordan Vonderhaar/Bloomberg

The strike could complicate Fed Chair Jerome Powell’s bid for a soft landing. And while the Federal Reserve appears likely to pause its interest-rate hiking campaign this month as it gains more ground on inflation, many Americans say they are more optimistic but still feeling the pinch of higher prices. US consumer prices rose by the most on a monthly basis in over a year, with over half of the advance due to gasoline. And though labor is having a moment and workers want pay that keeps up spending power, the UAW strike comes with a catch, Liam Denning writes in Bloomberg Opinion. “A rapid uptake of electrified vehicles demands cheap cars and, eventually, a less labor-intensive industry.”

High-stakes infighting among US Republicans is playing out on several fronts, including an increasingly likely government shutdown and House Speaker Kevin McCarthy’s first steps toward seeking the impeachment of Biden. Both measures are being demanded by far right members of the House, who secured the right to easily oust McCarthy from his job. On impeachment, Republicans have joined Democrats in assailing the lack of any evidence of wrongdoing. Noah Feldman, writing in Bloomberg Opinion, says the planned proceedings mark “a low point in the mis-deployment of the Constitution’s mechanism for removing a sitting president.’’ The effort by the GOP comes as Biden’s son Hunter was indicted on federal charges that he purchased a firearm without disclosing that he was unlawfully using drugs. A plea deal regarding the allegations recently fell apart.

North Korean leader Kim Jong Un made a rare trip out of the country to meet with Russian leader Vladimir Putin–a visit US leaders say is aimed at the Kremlin securing North Korean arms for its faltering invasion of Ukraine. After talks with Putin that Kim called “epoch-making,” Putin accepted an invitation to visit North Korea for the first time since 2000. The new ties ought to concern the two nations’ principal backer—China—as much as it does their foes in the West, Bloomberg Opinion editors write.

Vladimir Putin and Kim Jong Un at the Vostochny Cosmodrome in Uglegorsk, Russia Photographer: Mikhail Metzel/Getty Images

Google’s search engine controls almost 90% of online queries. The US government contends the tech giant has paid billions of dollars to maintain a monopoly over the search market. In its biggest antitrust challenge yet, Google is being sued by the Justice Department and state attorneys general over antitrust allegations—a case that could result in the breakup of the 25-year-old company. Apple, fresh off its hotly anticipated product event, is facing wilting US consumption and Chinese regulatory curbs.

Volkswagen is under pressure to step up its electric-vehicle strategy, and fast. Europe’s largest carmaker is feeling the squeeze from top to bottom—and from the US and China. The European Union, for its part, is launching a probe into Chinese subsidies for EVs in a bid to ward off a flood of cheap imports. China said the move will harm relations, while chiding foreign automakers for failing to keep up with technological innovations. Americans are at least picking up the pace on EV adoption, with sales surging past 3 million vehicles. 

Want to stay in shape while traveling? Try a hula hoop. And maybe try it out in Kona Village, Hawaii’s most ambitious resort in decades. It’s testing the state’s strategy for fewer, higher paying and eco-conscious guests. The price is $2,500 a night. Queen’s Bohemian Rhapsody might be considered a priceless rock composition, but the piano Freddie Mercury composed it on was sold at auction for $2.16 million. The instrument, along with his Tiffany mustache comb and other goods, netted a total of $50.4 million, the highest ever for any celebrity sale, Sotheby’s said. 

An exhibition of Freddie Mercury’s belongings was open to the public at Sotheby’s London ahead of the auction. Photographer: Tristan Fewings/Getty Images Europe

• Central bank rate decisions across the Americas, Asia, EU and Mideast.
• UN General Assembly opens with Russia’s war on Ukraine the big issue. 
• Junior doctors and hospital consultants plan to strike in England.
• Instacart and its backers set the stage for an initial public offering.
• Earthshot Prize for contributions to environmentalism.

Joe Bankman and Barbara Fried were renowned Stanford Law professors. Now their eldest son, Sam Bankman-Fried, is about to face trial over charges he led one of the world's largest frauds. His parents weren’t accused of wrongdoing and have been largely overlooked in the FTX saga. But interviews with friends and colleagues show how they helped shape their son’s worldview and played previously unreported roles in his crypto empire. 

Photographer: Arsh Raziuddin. Photos: Getty Images (2); Josh Edelson (1)

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