Two months after the Centers for Disease Control and Prevention said it was OK for vaccinated people to forgo masks indoors, the agency reversed course on Tuesday, saying that Americans should put masks on again — at least in areas where the coronavirus infection rate is high.
The official guidance — swayed by research on the Delta variant, which is causing rising case counts and “breakthrough” infections of vaccinated people — is aimed at places where the virus is surging. At the moment, that covers nearly two-thirds of U.S. counties. Per the guidance, all residents of Florida, vaccinated or not, should wear masks indoors.
The announcement complicates return-to-office plans for many companies at a time the Delta variant is already forcing some of them to push back their start dates. Asana, a software company, told employees last week that it was pushing its return-to-office date for all employees in San Francisco and New York to no earlier than Feb. 1, a person familiar with the situation said. The company is also mandating vaccines for all employees coming into the office.
Companies that have already opened their doors must decide whether to retrench on masking policies. When the C.D.C. lifted its masking guidance in May, many companies issued new guidelines allowing fully vaccinated employees and customers to return without masks. The move served as an important incentive for workers, as well as a signal that the pandemic was winding down. For employees, it provided a sense of safety and normality in returning to offices.
Walmart, which began to allow fully vaccinated employees to go mask-free in May, did not respond to a request for comment. Neither did a spokeswoman for Kroger, which has likewise reduced its masking restrictions.
In New York City, finance firms have already begun to call back workers. Goldman Sachs and JPMorgan Chase, which allow fully vaccinated employees to go mask-free, had no comment about the C.D.C.’s announcement. A spokeswoman for American Express said the company had “no updates to share,” as the company is not back in the office yet.
“People are enjoying their freedom, so I don’t know if we’re going to go back or not,” said Alana Ackels, a labor lawyer at Bell Nunnally. She added that after the C.D.C.’s guidance in May, her phone “was ringing off the hook because everyone wanted to get rid of the mask.” On Tuesday evening, after the agency’s reversal, “I haven’t gotten a single call about it,” she said.
MGM Resorts International, the casino and hotel giant, said Tuesday it would require all guests and visitors to wear masks indoors in public areas, “based on the latest information and guidance from health experts and public officials.”
The National Retail Federation, which represents businesses on the front lines of managing and enforcing public masking policies, said in a statement that “retailers will continue to follow the guidance of the C.D.C.” It added, “It is truly unfortunate that mask recommendations have returned when the surest known way to reduce the threat of the virus is widespread vaccination.”
The C.D.C.’s move may spur more corporate vaccine mandates, said David Schwartz, who runs the labor group at the law firm Skadden, Arps, Slate, Meagher & Flom. This might be a preferable alternative to “requiring employees and customers to wear masks and not being able to maintain a consistent policy,” he said. The Washington Post on Tuesday joined a short but growing list of private companies requiring vaccination as a condition of employment.
If businesses think vaccine mandates are beneficial, “we encourage them to do so,” said Dr. Rochelle Walensky, the C.D.C.’s director.
Government officials have been imposing vaccine mandates at the state, local and federal levels recently, and encouraging private companies to follow suit. President Biden is weighing a vaccine mandate for all two million federal employees, and is expected to deliver a speech on Thursday about it.
Kellen Browning and Sarah Kessler contributed reporting.
The Federal Reserve is debating when and how to slow its huge bond purchases, the first step in moving away from its emergency stance as the economy rebounds from the pandemic. As it does, the hole that the coronavirus blew through the labor market looms large.
The reasons to withdraw support soon are obvious. Growth is coming in strong, bolstered by vast government spending. Inflation has heated up, and while that is expected to be a temporary situation, the increase in prices is surprisingly strong.
But the jobs situation is another story. About 6.8 million jobs are missing from employer payrolls compared with February 2020.
The central bank has every reason to expect the economy to continue healing once it slows (or even stops) the bond buying. Asset prices may fall a little bit, and longer-term interest rates might rise slightly, but the Fed’s policy rate is still set at rock bottom, which should keep borrowing costs relatively low. Government spending continues to trickle out into the economy. Many consumers are flush with savings, and eagerly spending them.
The key for Jerome H. Powell, the Fed chair, and his colleagues is to avoid tanking the economy by surprising investors and causing markets to gyrate, credit to dry up and growth to pull back more abruptly than planned.
The state of the job market is a particularly good reason to proceed carefully. If the Fed accidentally sends an overly aggressive signal to markets, causing financial conditions to become too restrictive when millions are still in need of new positions, it could make for a long road back to full employment.
The risk looms especially large as a coronavirus variant causes cases to surge in many countries, including the United States. While it is still unclear how much of a hurdle the Delta variant poses to growth, it has underlined that the pandemic is a persistent threat.
For now, the Fed is being careful to broadcast every incremental step as it debates when and how to begin tiptoeing away from its policy support, something it wants to do only after the economy has made “substantial” further progress. The idea is that a constant drip of communication will prevent any market-rocking surprises.
And the central bank has set out an even more ambitious, and more patient, goal when it comes to interest rates. Barring some big surprise in which financial risks or inflation bubble up dangerously, officials want to see the job market return to maximum employment before lifting borrowing costs.
“They’d like to wait,” said Kathy Bostjancic, chief U.S. financial economist at Oxford Economics. She explained that officials were weighing the need to keep longer-run inflation under wraps against the many jobs still missing — and hoping that price pressures proved short-lived.
“They’re banking on the T-word,” Ms. Bostjancic said. “Transient.”
Yet when that “full employment” goal will be met is a major unknown. Many workers have retired since the start of the pandemic, and it is not clear whether they will return to work even if opportunities are plentiful.
But the participation rate for prime-age workers — the share of people between the ages of 25 and 54 who are working or actively looking for jobs — has fallen precipitously since last year, and Fed officials are hoping to see that figure recover. Lingering child care issues and pandemic nervousness may be keeping would-be workers at home.
The Fed is trying to wait and see what the job market can do.
“It would be a mistake to act prematurely,” Mr. Powell told lawmakers recently. “At a certain point the risks may flip, but right now the risks to me are clear.”
Boeing on Wednesday said that it made a $587 million quarterly profit, a result that surprised Wall Street, which had been expecting a loss, and a strong sign that the aerospace giant is overcoming the 737 Max crisis, problems with its 787 Dreamliner jet and the economic shock caused by the pandemic.
The profit for the second quarter, which ended in June, is a big turnaround from the $2.4 billion loss Boeing reported in the same period last year. Wall Street analysts had expected Boeing to lose more than $100 million in the quarter this year, according to S&P CapitalIQ.
Revenue totaled nearly $17 billion in the quarter, a big jump from $11.8 billion in the same period last year. Revenue surged this year in its troubled commercial jet operations, but the division still had an operating loss of $472 million in the three months ended June 30.
Boeing’s 737 Max was grounded for months after two fatal crashes. The company and regulators have had quality concerns about its 787 Dreamliner that have at times stopped delivery of the wide-body jet.
In the second quarter of this year, Boeing delivered 79 commercial airplanes, up from 77 in the first.
Boeing said it had delivered more than 130 737 Max aircraft since the Federal Aviation Administration in November cleared the plane to fly. The company said it expected to nearly double monthly production of the jet to 31 planes early next year, from 16 per month.
But production problems are still affecting the 787. The F.A.A. had questioned the quality of Boeing’s inspections, and the company temporarily stopped delivery of the airplane. Boeing said it would produce fewer than five 787s a month as it does more work on undelivered planes. It added that it expected to deliver fewer than half of the 787s in its inventory this year.
Boeing had said that it wanted to cut its work force to 130,000 employees by the end of this year, from 141,000. But on Wednesday, Dave Calhoun, the company’s chief executive, said it would keep its work force at its current size, citing “encouraging recovery trends” for the decision.
Evil Geniuses, one of the first professional e-sports teams, will announce on Wednesday that China’s Fosun Sports Group is taking a minority stake in the business, the DealBook newsletter was first to report. The transaction values the squad of elite video gamers at more than $250 million, which would make it one of the most valuable in the sector.
The team, which was founded in 1999, well before e-sports became a billion-dollar industry, is also teaming up with the English Premier League soccer club Wolverhampton Wanderers. That venture is aimed at tapping Asian markets, where the “Wolves” have training facilities, as well as at cross-promoting the teams to each other’s fan bases.
DealBook spoke with Nicole LaPointe Jameson, who took over as the chief executive of Evil Geniuses two years ago after its sale to the private equity firm Peak6. That deal came three years after Evil Genius’s players bought back the company from Amazon’s Twitch, leaving it rudderless and struggling in competitions. Ms. LaPointe Jameson, 27, has also had to navigate the sometimes toxic culture of video gaming, including claims of harassment and racism by players on the team she runs.
“Two years ago, we were worth nothing close” to the company’s current valuation, said Ms. LaPointe Jameson, who is the first Black chief executive of a major e-sports team. When she arrived, the company “had to make decisions at the $5 level very carefully,” she said.
Since she took over, Evil Geniuses has expanded into more games, notably League of Legends, and has hired a more diverse set of influencers to attract attention to its players (and sell merchandise and sponsorships).
“When I came into the e-sports space, I was unexpected in many different ways,” she said, noting her private equity background, where she specialized in turning around distressed businesses. “I kind of came out of Mars for them.”
Ms. LaPointe Jameson said she “won’t shy away from the negative reputation” of gaming, and described tackling reports of harassment by players as well as financial troubles as “trial by fire.” The company’s “robust curriculum” about antibullying should help reduce the stigma that turns some off from the industry, she said. “We are happy to tackle that,” she added, “but it is a bit against the grain because that is not the easiest path to proceed as a company.”
Ms. LaPointe Jameson has focused on recruiting, more than half of her leadership team are women, and she has introduced benefits like parental leave. “It was important for me to make sure those types of ‘unsexy back-end components’ were brought in,” she said, so people “who had never heard of e-sports would consider coming here.”
Federal Reserve officials are gathering in Washington this week with monetary policy still set to emergency mode, even as the economy rebounds and inflation accelerates.
Economists expect the central bank’s postmeeting statement at 2 p.m. Wednesday to leave policy unchanged, but investors will keenly watch a subsequent news conference with the Fed chair, Jerome H. Powell, for any hints at when — and how — officials might begin to pull back their economic support.
That’s because Fed policymakers are debating their plans for future “tapering,” the widely used term for slowing down monthly purchases of government-backed debt. The bond purchases are meant to keep money chugging through the economy by encouraging lending and spending, and slowing them would be the first step in moving policy toward a more normal setting.
Big and often conflicting considerations loom over the taper debate. Inflation has picked up more sharply than many Fed officials expected. Those price pressures are expected to fade, but the risk that they will linger is a source of discomfort, ramping up the urgency to create some sort of exit plan. At the same time, the job market is far from healed, and the surging Delta coronavirus variant means that the pandemic remains a real risk. Policy missteps could prove costly.
Here are a few key things to know about the bond-buying, and key details that Wall Street will be watching:
The Fed is buying $120 billion in government backed bonds each month — $80 billion in Treasury debt and $40 billion in mortgage-backed securities.
Economists mostly expect the central bank to announce plans to slow those purchases this year, perhaps as soon as August, before actually dialing them back late this year or early next. That slowdown is what Wall Street refers to as a “taper.”
There’s a hot debate among policymakers about how that taper should play out. Some officials think the Fed should slow mortgage debt buying first because the housing market is booming. Others have said mortgage security buying has little special effect on the housing market. They have hinted or said they would favor tapering both types of purchases at the same speed.
The Fed is moving cautiously, and for a reason: Back in 2013, markets convulsed when investors realized that a similar bond-buying program after the financial crisis would slow soon. Mr. Powell and crew do not want to stage a rerun.
Bond-buying is just one of the Fed’s policy tools, and is used to lower longer-term interest rates and to get money chugging around the economy. The Fed also sets a policy interest rate, the federal funds rate, to keep borrowing costs low. It has been near zero since March 2020.
Central bankers have been clear that tapering off bond purchases is the first step toward moving policy away from an emergency setting. Increases in the funds rate remain off in the distant future.
Athleta, the women’s athleisure brand owned by Gap, will make an investment in Obé Fitness, a provider of on-demand workout classes, as it introduces a new platform for customers called AthletaWell, the retailer said Wednesday.
The brand said that its new AthletaWell site, which will be free through Athleta’s loyalty program, will include online discussion groups and exclusive workouts from Obé Fitness. The new site is part of a push to drive further sales at Athleta, which surpassed $1 billion in revenue last year and is one of Gap’s best-performing divisions. The company is hoping to attract more people to Athleta’s loyalty program, as those customers usually spend more than typical shoppers.
Athleta will also take advantage of the partnership with Obé in other ways. “We’ll be working together to co-create apparel,” said Kim Waldmann, Athleta’s chief digital officer. “We’ll be working on events together, both virtual and in-person, and new innovative shopping experiences.”
The investment comes roughly a year after Lululemon said it would buy Mirror, the fitness start-up, highlighting the potential in linking streaming workouts to athletic apparel.
The airline industry took the unusual step on Tuesday of asking federal regulators to help increase jet fuel supplies at the Reno-Tahoe International Airport, one of several smaller airports in the West that have been hit by shortages.
In a petition, Airlines for America, a trade association, and World Fuel Services, a company that supplies airlines with fuel, warned the Federal Energy Regulatory Commission that the shortage of jet fuel had become so dire that it could force airlines to cancel passenger and cargo flights. The trade group predicted low fuel inventories through Labor Day.
The airline industry wants the commission to mandate that pipeline operators deliver more jet fuel to the Reno airport by temporarily prioritizing those supplies over other fuels like gasoline and diesel.
The shortages at smaller airports, mainly in the West, have been caused by several factors, among them the post-pandemic travel boom, a shortage of truck drivers and heightened demand for jet fuel by firefighting crews that are trying to put out several large wildfires with aircraft.
At the same time, airlines have increased flights to destinations like Reno above 2019 levels because of the popularity of domestic vacation spots like Lake Tahoe, the northern shore of which is less than an hour from the Reno airport by car.
Tom Kloza, global head of energy analysis at the Oil Price Information Service, said another factor in the shortages is problems at refineries in Western states that process crude oil into jet fuel, gasoline and diesel. Many are not operating at full capacity because of unscheduled maintenance and because recent heat waves have made it difficult for those industrial plants to operate normally.
“It’s unusual but it’s really limited to the Western geography,” Mr. Kloza said.
Airlines operating out of several airports in Nevada, on the Pacific Coast and in and around the Rocky Mountains have been forced to delay and cancel flights in recent days. The Oil Price Information Service has reported that the situation is expected to worsen, particularly if the wildfires persist into August. The information service reported that other airports that have experienced “hand-to-mouth supplies of jet fuel” include those serving Sacramento; Boise, Idaho; and Spokane, Wash.
“Transporters stress that every regional airport that is not supplied via pipeline is struggling to get enough fuel to handle robust summer demand,” Mr. Kloza said.
Deutsche Bank, Germany’s largest bank, beat expectations with a quarterly net profit of 692 million euros, or $817 million, compared to a loss a year earlier, the company reported Wednesday. Revenue dipped 1 percent to €6.2 billion, Deutsche Bank said, but that was more than offset by cost cuts and a reduction in the amount of money that the bank set aside to cover problem loans.
Apple’s profits nearly doubled in the latest quarter, showing that the world’s richest and most valuable public company is exhibiting little sign of slowing down. Apple said on Tuesday that its profits increased 93 percent to $21.7 billion in its fiscal third quarter compared with a year earlier, while sales rose 36 percent to $81.4 billion, both outpacing analysts’ expectations. Apple said its iPhone sales grew 50 percent to $39.6 billion, a quarterly increase that was high by even its lofty standards. Apple sold more of all of its other products, including iPads, Macs and wearable devices such as the Apple Watch and AirPods. The company’s sales also increased in every geographic area, led by its Greater China region, with 58 percent growth.
Alphabet, Google’s parent company, made in three months what it took until recently an entire year to earn. The search and advertising company on Tuesday reported record profits and revenue for the second quarter, vindicating the enthusiasm of investors who doubled its value on the stock market since early last year. Alphabet said it made a profit of $18.5 billion, or $27.26 a share, for the quarter. As recently as 2015, it made less than that all year. Revenue rose 62 percent to $61.88 billion from a year ago, a level of increase unseen since the company’s rapid growth around 2005, when it was still a start-up.
Microsoft continued its string of strong financial results. Sales in the three months ending in June hit $46.2 billion, up 21 percent from a year earlier, and profits rose 47 percent to $16.5 billion, producing its most profitable quarter, Microsoft said on Tuesday. The results surpassed analyst expectations. With the pandemic moving people online to a greater extent and the economy rebounding, companies have accelerated their spending in key areas where Microsoft has invested, including security and cloud services. Sales of Azure, the company’s flagship cloud-computing product, were up 51 percent.
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