June 13, 2021

Britain’s economic recovery continues apace as U.S. stocks edge higher.


Credit…Mary Turner for The New York Times

Britain is emerging strongly from the pandemic, which caused the deepest recession in three centuries last year. The economy grew 2.3 percent in April from the month before, the national statistics agency said on Friday, as lockdown restrictions were partially lifted. It was the third-consecutive month of growth.

The jump was fueled by the pickup in consumer services, including retail, outdoor dining and self-catering vacations, as well as students returning to classrooms. Activity in the personal services sector, such as hairdressing, grew by two-thirds in April.

At the end of April, the British economy was 3.7 percent smaller than it was before the pandemic. It is expected to recover lost output by the end of the year.

The pace of that recovery might change over the next few months, however, because the government is mulling a delay to lifting the last of the social-distancing restrictions. Prime Minister Boris Johnson is set to decide by Monday whether to delay the full reopening on June 21 by four weeks.

The economic impact of a delay “would be minor,” said analysts at Berenberg bank. “Any damage from a later easing after most restrictions have been lifted anyway could be offset afterwards by a confidence effect if vaccines prove to be the game-changer.”

The FTSE 100 in Britain climbed 0.6 percent.

U.S. stock futures drifted higher on Friday and the S&P 500 was set to extend beyond the record high it reached on Thursday.

The yield on 10-year Treasury notes edged higher to 1.44 percent, halting a downward trend. Over the past four weeks, the yield has dropped nearly 20 basis points from 1.63 percent. On Thursday, the yield fell six basis points, or 0.06 percentage points, even as data showed inflation in the United States jumped 5 percent in May from a year earlier. Inflation erodes the value of bonds, tending to make their prices fall and yields rise.

But investors seem untroubled for now. Federal Reserve officials have repeatedly said they expect the rise in inflation to be temporary and not a reason for them to imminently pull back monetary stimulus.

Most European stock indexes rose. The Stoxx Europe 600 was climbing 0.6 percent, led higher by consumer stocks such as the French carmaker Renault and the Danish jewelry maker Pandora, whose share price hit a record high.

Oil prices rose. Futures on West Texas Intermediate, the U.S. crude benchmark, rose 0.6 percent to $70.74 a barrel, the highest since October 2018.

Didi Chuxing, the Chinese ride-hailing company, made its initial public offering filing public on Thursday, as ride-hailing services begin reviving with the receding of the pandemic.

Founded in Beijing in 2012, Didi began as a taxi-hailing service before expanding into other forms of transportation. In 2015, it merged with another Chinese rival, Kuaidi Dache, to form what became Didi Chuxing.

Didi has since been dominant in China. In 2016, Uber, which had been spending heavily to grow in China, sold its Chinese operations to Didi. (Uber was granted a stake in the resulting company.) Didi now operates in 15 countries, including Brazil and Mexico.

The company’s I.P.O. is likely to be closely scrutinized amid a wave of other technology offerings and as Beijing has begun to rein in domestic tech giants. Didi was valued at $56 billion in 2017 and its investors include SoftBank of Japan and Mubadala, an Abu Dhabi state fund.

Didi’s filing, made under its formal name, Xiaoju Kuaizhi, showed that revenues declined 8 percent to $21.63 billion last year as passenger numbers slid during the pandemic. The company lost $1.6 billion last year, though it reported a profit of $30 million in the first quarter of this year. Like most ride-hailing companies, Didi has historically been unprofitable.

Didi said that an I.P.O. would fund an expansion.

“We aspire to become a truly global technology company,” Didi’s founders, Cheng Wei and Jean Liu, wrote in a letter included with the filing. “What we have learned and built is relevant across the globe — in Latin America, Russia, South Africa or anywhere where affordable, safe and convenient mobility is valuable.”

Other ride-hailing services have reported that business has been recovering. Last month, Uber said revenue for the first three months of the year — excluding the costs of a settlement — was up 8 percent from a year ago, to $3.5 billion. The company lost $108 million.

The closed Cinerama Dome movie theater in Los Angeles. The Small Business Administration has overhauled a program meant to help music clubs, movie theaters and other venues.
Credit…Chris Pizzello/Associated Press

The Small Business Administration has essentially ousted the leaders of a deeply troubled $16 billion relief effort for live-events businesses, bringing in a new team to take over and fix the program.

More than six weeks after the long-delayed program started taking applications, 14,000 businesses have applied for a Shuttered Venue Operators Grant. Only 90 have been awarded one. Thousands of applicants are tangled in technical glitches and bureaucratic messes, including an error that led to many people being inaccurately declared dead.

The program, which was enacted into law in December to help music clubs, movie theaters and other venues that were forced to shut down because of the pandemic, had been managed by a team from the S.B.A.’s Office of Disaster Assistance, which also oversees the agency’s $200 billion disaster loan effort.

But on Wednesday, the agency told industry groups that it was shifting the program’s leadership to a group of employees from its Office of Capital Access, which coordinated the $800 billion Paycheck Protection Program and the $29 billion Restaurant Revitalization Fund.

On a Thursday morning call with industry groups, Patrick Kelley, associate director of the S.B.A.’s Capital Access Office, said the agency would quickly resolve the mistaken death reports and speed up the review process, according to two participants on the call.

The Small Business Administration is supposed to review and approve applications in tiers, with those who suffered the deepest financial losses helped first, but its deadline for addressing the first tier of applications was Wednesday — and thousands of those applicants are still waiting. Carol Wilkerson, an agency spokeswoman, said those applicants “remain at the front of the line.”

The changes followed repeated pleas for help from lawmakers and industry advocates. “The agency’s rollout and execution of the grant program has been a disaster,” Representative Greg Stanton, an Arizona Democrat, wrote in a letter sent Wednesday to Isabella Casillas Guzman, the S.B.A. administrator.

Seven trade groups also sent a letter on Wednesday asking the S.B.A. to “immediately fully fund” eligible applications. Entertainment venues are “experiencing a talent drain, cannot reopen and are hanging on by a thread because this funding is not arriving quickly enough,” they wrote.

The problem is becoming especially dire for businesses trying to salvage their summer season. Without money from the grant program, many are unable to hire staff, book performers, stock up on supplies and pay overdue bills.

Tracey Tee, the chief executive of Band of Mothers Media, which puts on a women’s comedy tour, got an email from the S.B.A. last week with the same news that has bedeviled thousands of venue owners and producers around the country. “Your name,” the email said, “appears on the Do Not Pay list with the Match Source DMF.”

Translated from bureaucratic jargon, it told Ms. Tee that she was considered dead.

“We are in debt up the wazoo,” Ms. Tee said. “We can’t afford to put shows back on the road because there’s no cash.”

Like virtually all producers, Band of Mothers — which puts on a “moms’ night out” music and comedy event called “The Pump and Dump Show” — was grounded by the pandemic last year, and has had little opportunity for revenue since. At the beginning of 2020, the company employed 13 people — most of them mothers of young children — but has since reduced its staff to two.

After receiving the email, Ms. Tee began a Kafkaesque effort to prove that the government’s information was incorrect. She called the Social Security Administration, which she said was unhelpful. An operator at her local office was friendly but said: “I think you’re being spammed or scammed,” Ms. Tee recalled.

The Small Business Administration has said little about the problem publicly. But in correspondence among applicants, the agency has acknowledged that the problem seemed to be a result of conflicts between employee identification numbers, which apply to businesses and nonprofit groups, and Social Security numbers, which apply to individuals. If a company has the same employee identification number as a dead person, the agency flagged that application as flawed.

Ms. Wilkerson, the S.B.A. spokeswoman, said the agency was working to clear up the problem and move applications forward. Mr. Kelley said on Thursday’s call that applicants should finally see the results of those efforts — and a wave of approvals — next week, according to participants on the call.

A “Yasuke” clothing line came about through a collaboration with the streetwear brand Hypland and its founder, Jordan Bentley.
Credit…Maggie Shannon for The New York Times

Netflix is trying a new way to bring in cash after a quarter in which its explosive growth showed signs of slowing down: Netflix.shop, a site that went live on Thursday.

The site is the next logical step for a company that has become serious about the retail business in the last year and as the field of streamed entertainment becomes increasingly crowded, John Koblin and Sapna Maheshwari report for The New York Times.

Two Netflix anime series, “Eden” and “Yasuke,” were featured in the store on its first day. “Lupin,” the buzzy French crime show about an expert thief, will be front and center at Netflix.shop later this month. In addition to baseball caps, T-shirts, hoodies and sweaters, the “Lupin”-related merchandise will include throw pillows ($60 apiece) and a side table ($150), all of it designed and produced in collaboration with the Louvre museum.

In the coming months, products tied to other Netflix shows, including “Stranger Things” and “Money Heist,” will appear on the online shelves.

The demand seems to be there: Thousands of fan-made products related to the Netflix documentary series “Tiger King,” including candles, face masks and greeting cards, are on sale at Etsy and similar sites, without the company’s blessing.

Unlike the Walt Disney Company, which is estimated to generate tens of billions of dollars in sales each year in merchandise, Netflix has no plans for brick-and-mortar stores in malls or Times Square.

Mark A. Cohen, the director of retail studies and an adjunct professor at Columbia University’s Business School, said he was skeptical about the longevity of the Netflix store after the excitement around its opening fades, in part because of the come-and-go cycle of Netflix hits.

“Most of them have a short shelf-life, unlike a Disney property, which is a generational long ride,” he said.

Executives received some of the biggest pay packages on record in 2020 as the gap between chief executives and everybody else widened during the pandemic, according to a comprehensive survey of the 200 highest-paid leaders at public companies conducted for The New York Times by Equilar, an executive compensation consulting firm.

Eight of the top-earning executives got compensation last year worth more than $100 million, Peter Eavis reports for The Times. In 2019, only one earned more than that; in 2018, five did.

The gap between the C-suite and the rest grew bigger, too. Chief executives in the survey received 274 times the pay of the median employee at their companies, compared with 245 times in the previous year. And their pay jumped 14.1 percent last year compared with 2019, while median workers got only a 1.9 percent raise.

“While Americans were cheering on the workers who were keeping our economy going, corporate boards were busy coming up with ways to justify pumping up C.E.O. pay,” said Sarah Anderson, global economy director at the Institute for Policy Studies, a progressive think tank.



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