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Biden’s plan to overhaul 401(k) tax breaks could force some companies to cut retirement benefits

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Biden's plan to overhaul 401(k) tax breaks could force some companies to cut retirement benefitsA frequently overlooked part of Democratic presidential nominee Joe Biden’s platform would upend the traditional tax preferences of retirement accounts like 401(k) plans — a change that industry experts warned could force some small companies to cut those benefits.


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The Sponsorships That Win You Diehard Customers Now

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Sponsorships and partnerships are evolving to inspire brand loyalty and advocacy.

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The Dow has fallen 7% in the past 9 days. Is that a bad sign for Trump?

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On the face of it, markets tumbling less than a week before the election doesn’t look like a good thing.

The Dow has fallen over 7% in the past nine trading days, with Nov. 3 just around the corner (the S&P 500 has followed suit, dropping roughly 6%). While spiking coronavirus cases and a lack of a stimulus deal are certainly driving some investor angst, does a pre-Election Day sell-off bode ill for Trump’s re-election?

“All else equal, a weaker stock market could certainly help Biden,” LPL’s Jeff Buchbinder tells Fortune. “On the margin [it’s] a little bit worse for President Trump based on history.”

Though pre-election drops of this magnitude aren’t unheard of, they are rare. The S&P 500 and Dow both fell over 3% on Wednesday, and according to LPL’s Ryan Detrick, “Only twice did the S&P 500 fall 3% or more within 6 trading sessions of the presidential election. 1932 and 2008. The incumbent party lost both times,” he wrote in a tweet Wednesday.

Detrick adds, “before [the] 2016 [election], the Dow fell 9 days in a row and the incumbent party obviously lost, so that time played out poorly for the party in power,” he told Fortune via email.

What perhaps has stronger historical precedent is a slightly longer time horizon: Buchbinder notes that in 20 out of the past 23 elections, it boded well for the incumbent when the S&P 500 was up three months before the election, while stocks trading down tended to favor the challenger. Stocks have traded roughly flat since three months ago, but turned lower on Wednesday: The Dow is down around 0.5% since August 3, while the S&P 500 is trading about 0.7% lower.

“Maybe from that perspective you could call it a mixed bag” for Trump, Buchbinder says, though the now-negative three-month trend would suggest a Biden victory.

Buchbinder points out that “stocks that tend to be favored more by Democrats than Republicans continue to do pretty well on a relative basis, potentially signaling Biden.”

Indeed, according to a recent J.P. Morgan report, stocks in a so-called “Biden basket” (names that would do well under his administration) are outperforming those in a “Trump basket” by around 66% since December 2019. “Recently markets have been saying, ‘Biden’s the favorite,’ but we’ll see where it goes from here,” LPL’s Buchbinder adds.  

Still, some argue that the contest between the two candidates is closer than pollsters and perhaps even markets had anticipated in recent weeks: According to some A.I. analysis, the race is tight, and Buchbinder notes “we could get more volatility if the polls tighten and more people start to worry about a contested outcome—that’s something to watch.”

To be sure, there’s hardly anything typical about this year, and some historical patterns have been broken (as a small example, Oct. 28 is historically the best day of the year for stocks—a trend that certainly hasn’t held up in 2020).

Despite the recent selloff, continued virus worries, and overall investor angst, Buchbinder remains optimistic: “The combination of [future] stimulus, getting the pandemic under control and moving past it, and clarity on the election, we think, can push stocks higher between now and year-end and into 2021.”

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4 key moments from the Senate’s showdown with Big Tech CEOs

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For more than three hours on Wednesday, Democrat and Republican senators took jabs at Facebook, Twitter, and Google, saying that they disseminate misinformation, spark violence, and suppress conservative voices.

The Senate Committee on Commerce, Science, and Transportation explored whether Section 230, a law that protects Internet companies from being held liable for what users post, gives Big Tech companies too much immunity. Lawmakers from both parties agree that the law should be changed or even revoked, though they differ about why.

Democrats repeatedly criticized the companies for failing to remove harmful information on their services. Meanwhile, Republicans hammered the companies for allegedly suppressing conservative views and influencing elections.

“You think that people don’t trust you,” said Sen. Ron Johnson, a Republican from Wisconsin. “I agree with that. We don’t trust you.”

Facebook CEO Mark Zuckerberg, Alphabet CEO Sundar Pichai, and Twitter CEO Jack Dorsey spent the hearing trying to defend themselves from the attacks. Time and again, they said they’re at war against harmful content, that they are politically neutral, and that they’re working to safeguard the presidential election.

Here are the highlights from the hearing:

Heated exchanges

The hearing was marked by intense exchanges between lawmakers expressing their frustration and executives trying to be as inoffensive as possible.

Sen. Cory Gardner, a Colorado Republican, took Dorsey to task for allowing Iran’s Ayatollah Ali Khamenei tweets questioning the Holocaust to remain untouched on Twitter while the service routinely flags President Trump’s tweets. 

Republican Texas Sen. Ted Cruz criticized Twitter for blocking a New York Post article that suggested Biden had ties to corruption in the Ukraine while allowing a New York Times story about Trump’s taxes to remain. One day after the Post article about Biden was published, Twitter reversed its stance on blocking it. But Cruz also asked Dorsey point-blank whether Twitter has the ability to influence elections.

Dorsey responded by saying, “No, we are one part of a spectrum of communication channels people have.” Cruz snapped back, “Mr. Dorsey, I find your opening answers absurd on their face.”

Democratic Sen. Amy Klobuchar, from Minnesota, said she was concerned about Google’s “defiant” response to the Justice Department’s antitrust lawsuit against it. She also questioned Zuckerberg about Facebook’s alleged interest in pushing divisive content to users because it provokes them to spend more time on the platform. 

Zuckerberg disagreed with Klobuchar’s characterization, saying Facebook shows users content that it thinks will be meaningful to them like “when your cousin had her baby.” Klobuchar stopped Zuckerberg mid-sentence, saying she’s not talking about cousins and babies but rather the “corrosive” content like conspiracy theories. 

Beyond Section 230

Though the hearing was supposed to focus on Section 230, senators often veered off topic to discuss other issues including data privacy, antitrust, and political ads.

The CEOs of Twitter, Google, and Facebook all said they continue to see foreign and domestic actors trying to interfere with the U.S. election, contrary to President Trump’s minimizing or dismissing the problem. The CEOs added that they have coordinated with the rest of the tech industry and law enforcement to identify and remove such posts. 

“One of the threats the FBI has alerted our companies and the public to was the possibility of a hack-and-leak operation in the days or weeks leading up to this election,” Zuckerberg said. “That if a trove of documents appeared, that we should view that with suspicion that it might be part of a foreign manipulation attempt.” 

Tech troubles

The virtual hearing about the tech industry ended up being marred by tech hiccups. Even the tech CEO had troubles.

Zuckerberg went AWOL from the opening statements because of a technical snafu that ended up delaying the hearing for a few minutes while the CEO tried to fix the problem. After Zuckerberg appeared, and explained he had trouble connecting, Sen. Roger Wicker, the Republican chairman of the committee, joked, “I know the feeling, Mr. Zuckerberg.”

Later, Democratic Sen. Richard Blumenthal’s audio was muted halfway through a sentence. Wicker alerted Blumenthal to the issue, and the hearing briefly paused until he was unmuted.

Low moments

Some lawmakers used the hearing to go off in odd tangents.

For example, Republican Sen. Marsha Blackburn of Tennessee asked Pichai if Google still employed software engineer Blake Lemoine. In leaked internal emails, the Google employee likened Blackburn to a “terrorist” and a “violent thug” in her approach to certain political issues. “He has had very unkind things to say about me,” said Blackburn, implying that he should be fired and later suggesting that Internet companies unfairly censor conservative voices.

In another odd moment, Sen. Johnson became frustrated with Dorsey because Twitter did not remove a tweet that contained a lie about Johnson strangling his neighbor’s dog. The author admitted in the tweet that the dog strangling was false, likely to show how misinformation can be spread.

“That could definitely impact my ability to get reelected,” he complained in complete seriousness about the tweet.

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