Category: Economy News

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Why the U.S. economy will avoid a recession, but freight will slow in 2023

Why the U.S. economy will avoid a recession, but freight will slow in 2023

The total U.S. financial system may well not be as certain for a recession in 2023 as the mainstream media has warned a lot of this 12 months. But the freight overall economy could have to start out the new year functioning its way out of a hole.

If you watch cable news, you are going to see and listen to a great deal economic negativity likely into 2023. But FTR Transportation Intelligence analysts are not as bitter on the future as the talking heads filling up space on your Tv.

“We get questioned a large amount about why aren’t we more detrimental than we are,” Todd Tranausky, FTR’s VP of rail and intermodal, reported for the duration of his firm’s December Condition of Freight webcast. “Yes, there’s gradual progress, but we really don’t have a economic downturn in our forecast. It never ever turns damaging again.”

Citing actual GDP quarterly changes on history, FTR tracked damaging development in the 1st two quarters of 2022, adopted by 2.6{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} advancement in Q3. Its forecast sees growth amongst .8{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} and 1.6{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} in excess of the next five quarters—including the ultimate quarter of 2022.

But Tranausky observed that while GDP is a good metric to see how the basic financial system is faring, “it doesn’t drill down into what that usually means for transportation. There are things of GDP that—even if they are positive—do not always help transportation. And vice versa.”

Truckload volumes began the year at a better degree after good growth in 2021.

“Coming into 2022, we ended up managing at a rather good clip, forward of the pandemic ranges,” according to Avery Vise, FTR’s VP of trucking. “However, at any time due to the fact the end of Q1, it is been all downhill—at a very gradual slope.”

The FTR truckload forecast for 2023 is flat, Vise said. “But it’s flat from a rather potent stage,” he mentioned. “So it truly comes down to irrespective of whether you’re a glass-half-total or glass-50 percent-vacant person.”

3 good U.S. economic system signals for 2023

In this article is a look at three beneficial financial signals heading into the new yr and two indicators that need to give freight movers pause as they seem forward to 2023:

Payroll work growth continues

A single of the reasons FTR is fewer pessimistic than other prognosticators is the sound payroll development the U.S. overall economy has found all calendar year. “If you have examine the headlines or you noticed the careers report just very last week, you have listened to a great deal of dialogue around how that is going to make it more difficult for the Fed to gradual fascination fee hikes,” Tranausky defined. “And absolutely, payroll positions go on to operate at a healthy level—not as powerful as they have been—but they’re nevertheless chugging together at healthful levels.”

This implies People nonetheless are making cash to devote, he explained. “That’s a superior signal for the underlying economic climate and one thing that definitely provides us hope that we’re not likely to turn detrimental. We really don’t see a recession on the horizon.”

Industrial demand from customers has not been achieved

Continuous career advancement isn’t the only reason FTR is much more optimistic for 2023. Pent-up industrial desire is also driving the transportation sector forecast. Just after leveling off before this year, new orders for created goods are back on the rise, Tranausky mentioned.

“It’s surely much better than anything at all we saw prior to the pandemic,” he explained of industrial demand from customers. “The output actually hasn’t adjusted to that. It’s rising—but it’s undoubtedly rising a good deal slower.”

He stated the delta concerning orders and output would ultimately have to be achieved. “It’s likely to sustain ongoing financial activity—even if we see the economy downshift, you’re going to have some of that demand from customers that’s heading to have to do the job its way through the system,” Tranausky spelled out.

He said it could get at the very least 50 percent of next 12 months for the output to catch up with desire. “Even if we do get a even more downturned economic climate, there is continue to heading to be some time right before it truly flows via the numbers and flows by way of transportation.”

Buyers continue on to eat

A third cause FTR is a lot more bullish on the 2023 financial system is the American client. “We however really do not have any indication that use has fallen,” Tranausky explained. “Even with substantial inflation. Even with mortgage loan premiums likely up. Even with all the explanations to be detrimental out there, the facts does not however present that consumption is going down. We haven’t observed paying definitely take part in those declines.”

Using inflation into account, consumer paying out on goods and solutions is out-doing pre-pandemic trendlines, Tranausky famous. “So expending proceeds to hold in. At some stage out there in the potential, this just cannot keep on. But for the minute, it is keeping up extremely well and reveals no signals of holding again. It demonstrates no indications of likely again. It shows no signals of declining. 

“So that provides us hope as we assume about client investing, we imagine about usage, we think about demand in the overall economy,” he ongoing.

Why the freight financial state isn’t solid heading into 2023 

There is a “but,” Tranausky explained. “The over-all overall economy is performing pretty very well. But the economic climate is not so good for freight. We’re not seeing the exact form of fundamentals supporting the freight sector.”

Two good reasons freight could be much more sluggish in 2023 are that buyer consumption of providers is outpacing merchandise, and the sharp drop in imports assists out total GDP advancement but not the countrywide freight market place, according to FTR.

That sluggish freight, as Vise famous, is in contrast to just one of the busiest freight economies on record, which started off through the pandemic. 

Individuals expend a lot more on expert services than goods

The consumer paying that retains the total overall economy afloat has shifted from COVID-period merchandise investing to write-up-pandemic service shelling out, which added benefits items transportation significantly less than the e-commerce explosion did.

“If you search at the trucking side, if you glance at the rail facet, if you drill down into the distributors, that should not shock any one,” Tranausky said. 

Vise explained that while retail stock-to-sales ratios surged in 2022, the quantity has fallen in latest months. “I see this as a favourable because that suggests that vendors are presently reducing back—they’re not waiting for usage, which hasn’t fallen off however, to slide off,” he stated. “They know that it is going to, and they absolutely know it won’t increase. So they’re commencing to reduce back again on inventory.”

He mentioned this would slash into freight quantity in the around term but also reduces the likelihood of extra drastic “inventory correction, which I assume would certainly be a even larger trouble.”

Imports are down 

Right after the 12 months began with enormous West Coast port bottlenecks, imports have fallen sharply, “which individuals in the intermodal place undoubtedly have seen—particularly on the West Coast,” Tranausky reported. “That’s not essentially a positive indication for transportation ability as we go forward.”

The over-all U.S. Serious GDP followed up adverse quarters in the center of 2022 with growth in Q3, and FTR forecasts continued development in excess of the next five quarters through the stop of 2023. 

The picture is not as “rosy” for FTR’s GDP “goods transport sector,” which contracted in Q2 and Q3 this 12 months and forecasts far more contraction as a result of Q1 of 2023. 

“That’s four consecutive quarters of declines in phrases of GDP items transport,” Tranausky mentioned. “You see factors certainly holding in adverse territory but finding improved as we get to the end of this yr and into 2023. It’s undoubtedly a slower modify in outlook than we noticed in authentic GDP.”

But by the center of following yr, FTR is forecasting development in the merchandise transport sector in Q2 by way of Q4 of 2023.

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Inflation, Interest Rates in the Spotlight This Week for Economy, Markets | Economy

Inflation, Interest Rates in the Spotlight This Week for Economy, Markets | Economy

How substantial will the November client value index flip out to be on Tuesday?

How significantly will the Federal Reserve determine to increase interest prices on Wednesday?

And what will November retail profits convey to about the Christmas buying year on Thursday?

Questions aplenty this 7 days for the economy and the markets with solutions to appear in a details-loaded week that puts the last stamp on two of 2022’s most important economic trends: the tempo of inflation and the stage of interest premiums.

“Inflation has dominated the overall economy this year, and the financial outlook depends in significant element on the route of inflation and the amount of soreness needed to get inflation back again on monitor,” Joey Politano, a labor industry pro and unbiased economics blogger, wrote Saturday on his Apricitas Economics website.

The week’s spotlight claims to be the Wednesday conclusion by the Fed on how much to increase desire prices with specialists predicting a 50-foundation-point hike just after Chairman Jerome Powell signaled as much before this month in a speech at the Brookings Establishment.

“The time for moderating the rate of amount boosts might come as soon as the December conference,” Powell reported. “We have a wide established of ideas about where by that vacation spot could be, but we could be completely wrong. We are going to have to see.”

Political Cartoons on the Economic climate

Analysts will pore above the decision but also scrutinize Powell’s opinions at the push meeting that follows the announcement and the up-to-date financial projections that will be unveiled.

By then, the Fed will have the news on Tuesday of November’s purchaser rate index. Estimates are for a ongoing downward trend in price tag improves, with a every month improve of .3{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} when compared to October’s .4{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}, and a annually rate of 7.3{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} right after the prior month’s 7.7{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}. When that is significantly over the Fed’s prolonged-term aim of a 2{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} once-a-year regular, it will be the path and trend that matters most.

There has been noteworthy enhancement of late in several crucial regions that have contributed to the quickest advancement in charges considering the fact that the 1980s. The cost of oil, now trading internationally at $75 a barrel, is way under its spring amount of all over $125. Condominium rents fell far more than 2{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} in November, when applied automobiles, digital products and other objects have also receded from calendar year-before costs. Wage progress, an critical element in the over-all inflation picture, is slowing.

Continue to, ING Main Worldwide Economist James Knightley sees the Fed continuing to increase costs effectively into 2023 just before switching gears and the economy slows much more.

“We seem for a ultimate 50bp hike in February, getting the Fed funds ceiling to 5{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502},” he stated on Friday. “But like the sector, we feel a economic downturn will dampen cost pressures and the composition of the US inflation basket, which is intensely weighted to shelter and cars, will aid a much quicker drop in yearly inflation readings than somewhere else.”

“Remember also that the Fed has a twin mandate which contains an employment dynamic,” Knightley extra. “This delivers the Fed greater adaptability versus other central banking companies to answer with stimulus and we imagine it will from the 3rd quarter of 2023 onwards.”

In the meantime, shoppers proceed to shell out, drawing down discounts amassed through the pandemic and reaching for their credit rating playing cards. The Census Bureau troubles its retail profits report for November on Thursday. Economists are forecasting a fall when compared to the 1.3{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} boost in Oct, while some forecast a flat to slightly constructive variety.

“We’ll be looking to see if any cracks are forming in the foundation of buyer endurance,” Sam Bullard, taking care of director and senior economist at Wells Fargo Company & Expense Banking, wrote on Sunday.

“Debt burdens are continuing to rise, and though family stability sheets are nonetheless in greater condition than they ended up pre-Fantastic Recession, the minimal rate of personal personal savings usually means individuals will finally strike a wall in their aggregate paying out habits,” he included. “We do hope resilience to proceed into the holiday period nonetheless, we be expecting retail revenue rose just .1{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} around the month in November.”

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Elon Musk Sounds a Dire Warning About the Economy

Elon Musk Sounds a Dire Warning About the Economy

Elon Musk is fearful about the financial system. 

For a number of months now, the richest gentleman in the world has ongoing to sound the alarm, warning that the overall economy pitfalls a deep economic downturn if the central bank’s monetary plan stays on study course. 

Whilst the Federal Reserve is holding its last financial assembly of the year in the coming days, the serial entrepreneur has just manufactured a new prediction. And like his previous predictions, this a single is extremely alarming.

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Jobless Claims Edge Up to 230K as Economy Slows | Economy

Jobless Claims Edge Up to 230K as Economy Slows | Economy

The amount of People in america submitting first-time statements for unemployment added benefits rose by 4,000 to 230,000 previous 7 days, the Labor Division described on Thursday.

The 4-7 days shifting ordinary, meanwhile, was 230,000 – up 1,000 from the prior interval.

The weekly amount was in line with estimates of 230,000 and compares to a revised 226,000 previous 7 days.

Claims have been moving up as the economic system slows and layoffs improve. Nevertheless, the labor market place overall is nonetheless relatively sturdy, while it has cooled from its breakneck rate of before this calendar year.

The Federal Reserve is hunting for the occupation current market to slow, bringing it closer to a balance of source and need. There are still roughly 1.7 careers for just about every available employee, a number that is historically large.

On the flip aspect, the potent labor industry is one reason why some economists say that even if the Federal Reserve manages to idea the economic climate into economic downturn upcoming yr, it could be a delicate downturn.

Political Cartoons on the Economy

“We’re heading to see occupation losses starting up in the initially quarter of following year,” states Dan North, main economist for North America at credit rating insurer Allianz Trade. “An economy can not tolerate an assault by the central lender.”

A more sanguine outlook arrives from Victor Li, an economics professor at Villanova University, who states “the great news is that it is continue to attainable for the Federal Reserve to engineer a soft landing.”

“There’s this fundamental assistance the economic system has,” Li says, pointing to people keen to devote, use credit playing cards and attract down price savings constructed up in the course of the pandemic. “There’s a ton of combined signals suitable now in the financial system.”

In truth, Curtis Lengthy, chief economist and vice president of study at the Countrywide Affiliation of Federal Credit Unions, suggests his users see mortgage exercise holding up though acknowledging his member establishments have found credit score card balances rising.

But, Extended provides, “I just never see the proof for a extreme financial downturn proper now.”

The November study of credit score union users, for illustration, discovered that total delinquency charges had been flattening but remaining “well below” pre-coronavirus stages. Credit score card delinquencies, when growing, are nonetheless down below pre-coronavirus concentrations.

But though economists split hairs around the likelihood of a economic downturn, workers have a clear opinion, according to a the latest American Staffing Association Workforce Keep an eye on study performed by The Harris Poll produced Wednesday.

The survey located that “nearly 8 in 10 grown ups (77{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}) say the U.S. financial system is both on the street to a recession in the next 12 months (35{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}) or currently there (42{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}).”

“The effects of a recession are hitting personnel throughout business enterprise sectors – including tech and social media businesses, e-commerce, and genuine estate,” explained Richard Wahlquist, president and main government officer at the ASA. “As companies aim on minimizing charges and belt tightening, employees are thinking about turning to 2nd work opportunities or further shifts to make ends meet.”

The Fed will meet up with up coming 7 days and by then will have experienced two important readings on inflation to digest as it considers an additional hike in curiosity premiums. On Friday, the government will report producer rates for November, adopted subsequent Tuesday by the shopper price index report.

Lengthy-time Fed watcher Hugh Johnson is wanting for the PPI to arrive in .2{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} larger than October, but for the yearly comparison to be 7.2{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}, down from 8{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} a thirty day period earlier. As for the CPI, he forecasts a yearly variety for November of 7.3{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}, down from 7.7{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} in October and June’s peak of 9.1{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}

“At the conclusion of this week and beginning of future 7 days will be, as soon as once more, an inflation week, “Johnson claims. “The yr-calendar year figures are anticipated to proceed ‘to boost.’”

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Dollar falls against major currencies amid economy concerns; yuan strengthens

Dollar falls against major currencies amid economy concerns; yuan strengthens

Greenback banknotes.

Simpleimages | Minute | Getty Images

The U.S. greenback weakened towards significant currencies on Wednesday amid problems that climbing interest charges could force the U.S. financial system into economic downturn, when a loosening of China’s COVID restrictions boosted the yuan.

The Peruvian sol fell as the country’s Congress voted to oust President Pedro Castillo in an impeachment demo on Wednesday. At its session reduced, the sol fell extra than 2{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} from the greenback.

Some traders have been anticipating the Fed will shortly slow its price tightening pace, but current upbeat U.S. employment, expert services and manufacturing unit info has included to trader uncertainty in excess of the Fed’s coverage outlook.

The Fed is anticipated to elevate rates again when it meets upcoming week.

A U.S. greenback index, which steps the buck versus a basket of currencies, was past down .4{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}.

Numerous U.S. bank executives are bracing for a worsening U.S. economic system up coming year. Between them, Bank of The us CEO Brian Moynihan told investors at a Goldman Sachs fiscal meeting that the bank’s exploration shows “damaging advancement” in the initially section of 2023, but the contraction will be “mild.”

One particular perspective is that “recessionary worries are heading to push the Fed to pause. This is why the dollar is weakening here,” explained Edward Moya at OANDA in New York. “Surging desire prices have been the key driver for greenback energy over the past 12 months.”

Against the dollar, the euro was up .3{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} at $1.0507. The euro has risen lately on signals that Europe’s financial downturn may possibly be less terrible than formerly feared.

The dollar was down .5{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} from the Japanese yen.

The U.S. dollar was unchanged in opposition to the Canadian dollar. The Lender of Canada hiked its benchmark overnight desire fee by 50 basis details to 4.25{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}, the greatest degree in pretty much 15 a long time, and signaled the tightening campaign was near an finish.

In Asia, China’s yuan was firmer as the governing administration before declared measures that marked a sharp improve to its tough zero-COVID coverage that has battered its financial system and activated historic protests.

China’s nationwide wellness authority claimed asymptomatic COVID-19 situations and these with moderate indications can self-handle even though in quarantine at dwelling.

The announcement was the strongest indicator so much that China is planning its folks to reside with the disease, although analysts say the path to entirely reopening the economic climate will be extended and bumpy.

The dollar was very last down .3{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} in opposition to the offshore Chinese yuan.

In cryptocurrencies, bitcoin very last was down 1.5{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}.

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The economy is solid and no one is happy

The economy is solid and no one is happy

Editor’s note: Morning Money is a free version of POLITICO Pro Financial Services morning newsletter, which is delivered to our subscribers each morning at 5:15 a.m. The POLITICO Pro platform combines the news you need with tools you can use to take action on the day’s biggest stories. Act on the news with POLITICO Pro.

Top CEOs aren’t quite saying there are storm clouds forming over the economy. But it’s getting colder, the skies have gone gray and the ranks of those willing to venture outside are dwindling.

Federal Reserve Chair Jerome Powell’s attempt to beat back rising costs without obliterating the labor market has made for confusing times; good news is often bad, bad news is often good and financial institutions and big businesses are stuck in the middle trying to figure out how to plan for what’s next.

The Business Roundtable’s fourth quarter survey released Monday painted a clear picture of just how “bleh” corporate America’s feeling going into 2023.

Sure, most of the executives surveyed don’t think we’re headed for a recession. And yes, more companies than not plan to hire workers and invest next year. But the outlook — or, as our colleague Victoria Guida once artfully put it, “the vibe” — is getting more sour. And there’s a growing sense of anxiety over how Washington will handle the economic forces that might compel the Fed to send rates through the roof.

“The Fed has been pumping the brakes to rein in inflation, and the survey results are unsurprising in that context,” said Business Roundtable CEO Joshua Bolten in a statement. Congress and the White House, he said, need to do more to support “pro-growth” policies to strengthen the economy.

The tricky thing, of course, is that economic growth is part of the problem. A report from the Institute for Supply Management found that service businesses in sectors like health care and retail remain white hot. Factory orders are up. Wages are still climbing as businesses compete for a dwindling number of unemployed workers.

Even as Powell and other Fed officials signal that they plan to raise interest rates in smaller increments in the near term, a resilient labor market and steady demand for goods and services could require a more aggressive approach. That should slow down the economy. And that explains why CEOs are increasingly pessimistic, even if they check “yes” next to the box indicating they plan to increase their employee headcount next year.

Which brings us to Wall Street.

One place where rising rates are hitting hard and fast is in the world mergers and acquisitions. Corporate deal making is slowing. Banks are having a hard time selling off the debt they’ve packaged to finance the deals that have closed. And Wall Street’s rank and file are about to start feeling the pinch.

Goldman Sachs is warning traders that their bonuses might not have as much pop as last year. JPMorgan, Bank of America and Citi reportedly plan to slash their incentive compensation pools by around 30 percent. And over at Morgan Stanley, CEO James Gorman said last week that he plans to make cuts to the bank’s workforce “all over the globe.”

“Some people are going to be let go,” Gorman said. “In most businesses, that’s what you do after many years of growth.”

IT’S TUESDAY — While Zach rocked out to Def Leppard, Sam’s go-to music in 2022 was heavy-duty normcore. The Beatles, Springsteen, Sturgill Simpson; basically the “I like Hiking and IPAs” of playlists. MM hopes your tastes are a bit more interesting. Please send tips to [email protected] and [email protected].

Trade deficit data released at 8:30 a.m. … Acting FinCEN Director Him Das will give keynote remarks at the ABA/ABA conference at 8:30 a.m. … The House Financial Services diversity and inclusion subcommittee holds a hearing at 10 a.m. … House Veterans’ Affairs holds a hearing on transitional housing reform at 10 a.m. … House Financial Services capital markets subcommittee holds a hearing on corporate disclosure of workforce management and diversity at 2 p.m.

What are you expecting from travel this holiday season? Hit and miss; highs with and some expensive lows? POLITICO invites you to debate the Travel Experience Redefined, with Sen. Jacky Rosen (D-Nev.), and a host of consumer and industry voices, Dec. 7, 8.30 a.m. ET. You can join online or at the Madison Hotel in D.C. Register here.

CANNABIS AND BANKING — Our Natalie Fertig: “The package of cannabis legislation built around the SAFE Banking Act will reportedly include the HOPE Act and the GRAM Act, according to three people familiar with the discussions. The HOPE Act would create grant funding for states to expunge cannabis-related records, and the GRAM Act would protect gun rights for marijuana users in legal jurisdictions.”

— Also from Natalie: “A bipartisan group of senators led by Majority Leader Chuck Schumer and Steve Daines (R-Mont.) are working to include it in the National Defense Authorization Act, which is expected to come to the floor later this week.”

PROXY WAR — Our Declan Harty: “A federal judge backed the SEC’s decision to undo Trump-era restrictions intended to rein in the companies that advise shareholders on corporate governance issues.”

FIRST IN MM — Venture capital behemoth Andreessen Horowitz (a16z) has tapped former CFTC Commissioner Brian Quintenz to lead its crypto arm’s policy efforts in Washington. “With the new Congress taking office in just a couple of weeks, we couldn’t be more excited to have Brian starting today in his new full-time role to lead our efforts on Capitol Hill,” said Anthony Albanese, a16z crypto’s chief operating officer.

LESS THAN ZERO COVID — WSJ’s Selina Cheng: “China’s scaling back of lockdowns and mass virus-testing is a response to nationwide protests against unpopular Covid-19 controls, a Communist Party mouthpiece acknowledged, in a rare sign that Beijing is responding to protesters’ demands and beginning to lay the groundwork for reopening the economy.”

WHEN THE OIL CAP HITS — FT’s Tom Wilson, David Sheppard, Ian Smith and Ayla Jean Yackley: “A traffic jam of oil tankers has built up in Turkish waters after western powers launched a ‘price cap’ targeting Russian oil and as authorities in Ankara demanded insurers promise that any vessels navigating its straits were fully covered.”

PROPS — Bloomberg’s Lu Wang: “Professional investors are loading up on bets that an economic recession can be avoided despite all the warnings to the contrary. It’s a dangerous bet — for a variety of reasons.”

CITI’S CEO WHISPERER — Bloomberg’s Jennifer Surane profiles Citigroup’s Sara Wechter, who has steered the bank’s policies on abortion, work-from-home and other political headaches: “Big banks used to avoid touchy political issues that could interfere in business. But Citigroup hasn’t shied away, making moves guided by an unlikely figure: Sara Wechter, a former investment banker who for more than a decade has been a behind-the-scenes counselor to a roster of Citigroup’s leaders.”

ANTI-ANTI-WOKE — Our Jordan Wolman on a new survey that found that ESG might be less of a political cudgel than some Republicans might hope: “Voters feel that companies should generally be able to conduct business and take ESG risks into account without government interference.”

NO EASY NARRATIVE — WSJ’s Nick Timiraos: “Federal Reserve officials have signaled plans to raise their benchmark interest rate by 0.5 percentage point at their meeting next week, but elevated wage pressures could lead them to continue lifting it to higher levels than investors currently expect.”

EVERY CRYPTO SUPER BOWL HEADLINE — Bloomberg’s Leah Nylen and Allyson Versprille: “The US Federal Trade Commission is probing several crypto firms over allegations their advertisements were deceptive or misleading, the agency said Monday.”

— NYT’s Matthew Goldstein: “As companies like FTX took on the marketing tactics and girth of mainstream financial firms, their customers came to believe they were safe places to deposit cash in exchange for cryptocurrency.”

OP-EDS — Former SEC Chair Jay Clayton and former CFTC Chair Tim Massad on how regulators can act now to rein in crypto abuses: “We believe the SEC and the CFTC should publish a core set of standards … [that] could easily be drawn from existing requirements for our securities and derivatives exchanges.”

— Meanwhile, American Bankers Association CEO Rob Nichols and Better Markets CEO Dennis Kelleher published a joint op-ed in CNBC calling for crypto companies to be held to the “same regulatory standards” as traditional banks and financial institutions.

CIRCLE SPAC SCRAPPED — From Sam: The stablecoin payments company Circle terminated plans to go public via a blank-check company on Monday after it failed to get approval from the SEC … “While disappointing that we did not complete SEC qualification in time, we remain focused on building a long-term public company,” Circle’s co-founder, Chairman and CEO Jeremy Allaire said in a series of tweets.”

UNTIL RECENTLY, A DROP IN THE BUCKET — From our Bjarke Smith-Meyer: “Crypto exchanges and companies will be fined at least €500,000 if they refuse to disclose details of who owns what digital assets on their platforms to the taxman, according to a draft bill obtained by POLITICO.”

SUPPOSED TO BE THE FUTURE OF THE GRID — Bloomberg’s David Pan and Naureen Malik on how Texas’s bid to attract Bitcoin miners isn’t panning out: “There are a lot of losers if the Bitcoin mining industry goes bust. For one, local authorities provided incentives such as tax abatements that reached into the tens of millions of dollars. The power generation planned that the region sorely needs to avoid another energy crisis may not materialize.”

Beth Zorc has been named CEO of the Institute of International Bankers effective Jan. 3. Zorc, whose resume includes stints as senior counsel on staff at both Senate Banking and House Financial Services, is coming to IIB from Robinhood, where she was associate general counsel.

Adrienne Lee Benson has started as a senior counsel to the deputy attorney general, Daniel Lippman has learned. She most recently was a senior adviser to the general counsel at Treasury.