Morning Consult Finance: What's Ahead & Week in Review

Morning Consult Finance: What’s Ahead & Week in Review

Finance

Essential financial news & intel to start your day.

April 9, 2023

By Amanda Jacobson Snyder

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Good morning, finance readers.

Morning Consult’s State of Workers 2023 report found that over the past year, the share of employed adults who said they do most of their work remotely fell by 4 percentage points. I remember during the COVID-19 lockdown being absolutely sure that remote work was the future of all white-collar employment, but now I’m less certain the trend will stick.

Sure, there are a few reported benefits to remote work — saving on commuting costs, time and parking, less futzing with business attire, flexibility with child care, less eating out, lower stress, higher productivity, access to cheaper or more appealing housing, not to mention benefits for employers, like workers taking fewer sick days, and savings on the costs required to house in-person employees, including real estate, heating and cooling, water, that fridge and coffee maker, office chairs, desks, internet service, landline phones and janitorial to clean it all — but can those benefits outweigh the business-driving synergy that is achieved in an in-person meeting? Can online chat replace the employee camaraderie building of workroom kitchen banter? Regarding the latter, recent personal evidence* certainly suggests it can, even among ancient millennials like myself (who, by the way, came of age using AOL instant messaging and ICQ chats.)

But let’s get back to the State of Workers report: Do you know which generation has primarily driven the dip in remote work since last year? Find out in the weekly MCIQ quiz.

*Submitted as evidence: a Slack chat conducted April 7, 2023, among three full-time employed U.S. “adults” on the casting choices and possible plot strengths and weaknesses of the upcoming Barbie feature film.

What’s Ahead

Highlights this week:

The World Bank and the International Monetary Fund hold their spring meetings in Washington D.C. this week. World Bank President David Malpass, Goldman Sachs Group Inc. CEO David Solomon and Melinda French Gates of the Gates Foundation will discuss gender inclusion and equality in a session on women entrepreneurs Thursday.

National Economic Council Director Lael Brainard, former Council of Economic Advisers Chair Jason Furman, U.S. Trade Representative Katherine Tai, U.S. trade representative, and Mastercard Inc. Vice Chairman and President Michael Froman are a few of the high-profile speakers joining Semafor for the World Economy Summit on Wednesday.

Mastercard CEO Michael Miebach will speak at the 2023 Global Inclusive Growth Summit, which takes place virtually Thursday.

Bank and financial firm earnings also kick off Friday, with BlackRock Inc., JPMorgan Chase & Co., Wells Fargo & Co., Citigroup Inc. and PNC Financial Services Group Inc. releasing results.

Regulators on the road:

Treasury Undersecretary Jay Shambaugh joins the Brookings Institution for a fireside chat Monday to discuss the global economic outlook, financial stability and geopolitical dynamics.

Consumer Financial Protection Bureau Director Rohit Chopra joins Washington Post Live on Tuesday to discuss recent banking failures.

Commodity Futures Trading Commission Chairman Rostin Behnam will give a keynote address at the National Credit Union Administration’s Capital Markets Symposium on Tuesday.

Social Security Administration acting Commissioner Kilolo Kijakazi joins the Urban Institute Tuesday for an event titled, “Strengthening Social Security for Older Adults, People with Disabilities, and Their Families.”

Federal Deposit Insurance Corp. Vice Chairman Travis Hill will join the Bipartisan Policy Center to discuss the FDIC’s role and response to the recent bank failures and instability in the financial markets on Wednesday.

Former Treasury Secretary Lawrence H. Summers and former Council of Economic Advisers Chair R. Glenn Hubbard will join the Economic Club of New York for a webinar on Wednesday. Summers will also join Foreign Policy magazine on Friday to discuss the economy.

Fedspeak roundup:

The Federal Open Market Committee releases minutes from its March 21-22 meeting on Wednesday.

New York Fed President John Williams will participate in a moderated discussion organized by the Economics Review at New York University on Monday.

Chicago Fed President Austan Goolsbee will speak at the Economic Club of Chicago on Tuesday.

Minneapolis Fed President Neel Kashkari will participate in a town hall at Montana State University on Tuesday.

Philadelphia Fed President Patrick Harker speaks Tuesday on the economic outlook at a Wharton Initiative on Financial Policy and Regulation event.

Richmond Fed President Thomas Barkin will deliver opening remarks at the Investing in Rural America 2023 conference on Wednesday.

Fed Governor Christopher J. Waller will discuss his outlook on the economy at the Graybar National Training Conference in San Antonio on Friday.

Week in Review

Job market turns down the heat

The Bureau of Labor Statistics said Friday that the U.S. economy added 236,000 jobs in March, lower figures than market analysts had expected, and the unemployment rate dropped to 3.5%. (CNN)
The country also posted 9.9 million new job openings in February on a seasonally adjusted basis, the first time in nearly two years that that number fell below 10 million. (The Wall Street Journal)

How to spend $80 billion

The Internal Revenue Service plans to hire 30,000 new employees over the next two years, including 8,782 staff positions dedicated to enforcement and 13,883 dedicated to customer service, according to a report released by the agency outlining how it will spend the $80 billion in new funding it is set to receive during the next 10 years. The IRS will allot about 60% of those new funds — $47.4 billion — to increasing tax collection and enforcement actions on wealthy individuals and corporations “with complex tax filings and high-dollar noncompliance.” (Reuters)
IRS Commissioner Danny Werfel said in comments at his swearing-in ceremony that the agency will use its $80 billion in new funding to make transformational “real-world improvements” for taxpayers, adding locations for IRS staff to provide in-person service and bolstering taxpayers’ ability to manage tax issues electronically rather than through the physical mail. (The Associated Press)

Cloudy with a chance of recession

International Monetary Fund Managing Director Kristalina Georgieva said rising interest rates and lingering effects on economic growth related to Russia’s war in Ukraine and COVID-19 could lead to the weakest period of global economic growth since 1990, adding that she expects global growth to remain at about 3% over the next five years. (The Guardian)
JPMorgan CEO Jamie Dimon said in a CNN interview that while the banking industry remains sound, recent turmoil is “another weight on the scale” toward recession, and while he couldn’t say if more banks could fail in the coming months, he noted that recent bank failures are nothing like the 2008 financial crisis and “the American public shouldn’t think that.” (CNN) Dimon also said in his annual letter to shareholders that recent bank failures “will clearly cause some tightening of financial conditions” and may have repercussions for years to come. (The Wall Street Journal)

OPEC+ surprise cuts

OPEC+ member countries announced plans to cut oil production by more than 1 million barrels per day, a move that came as a surprise after the organization had pledged to hold production steady. (Bloomberg)
Treasury Secretary Janet Yellen called the decision an “unconstructive act,” and told reporters she wasn’t sure yet what the price impacts would be, but the cuts may warrant a reassessment of the current price cap on Russian oil. (CNBC)
St. Louis Fed President James Bullard said the surprise move will likely make the Fed’s job of tackling inflation “a little bit more difficult.” (Bloomberg)

Democrats and Republicans dig in their heels on debt ceiling

House Speaker Kevin McCarthy (R-Calif.) said in an interview with Bloomberg TV that Wall Street should be “very concerned” about the political stalemate between Republicans and Democrats over the looming debt ceiling, saying that the GOP is “never going to move a bill that just raises the debt ceiling.” (Bloomberg)
A GOP aide said that Republican lawmakers in the House plan to focus on passing the 12 annual federal government spending bills and pushing for spending cuts as those bills move through the appropriations process, which the aide said is likely to begin in May. (Fox News)
A group of centrist Democrats in the Problem Solvers Caucus are moving ahead with an emergency plan to address the debt ceiling impasse, but White House officials and Democratic party leaders have made it clear they do not support the strategy, according to four lawmakers familiar with the discussions. (Politico)

Stat of the Week

21%

The decrease in the United Nations’ index of food-commodity prices since it reached a record high a year ago following Russia’s invasion of Ukraine, which disrupted grain exports. However, the index is still up 40% compared to two years ago, and meat and sugar prices saw increases in the UN’s latest data release.