This article discusses the U.S. Department of Justice's decision to file a lawsuit to block JetBlue's proposed $3.8 billion acquisition of Spirit Airlines, a move that would create the fifth-largest carrier in the U.S. The lawsuit is seen as a test of President Joe Biden's aggressive antitrust strategy, and the Transportation Department is also expected to deny a transfer of Spirit's airline certificate. JetBlue CEO Robin Hayes expressed disappointment but not surprise at the government's determination.
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Jerome Powell, Federal Reserve Chair, is set to testify before Congress on Tuesday and investors are watching closely for signs of future rate hikes. The Fed has raised its benchmark interest rate to 4.6%, its highest level in 15 years, making mortgages, auto loans, credit card rates and business lending more expensive. Powell will have to convince lawmakers that the central bank is capable of bringing down inflation without crashing the US economy in its wake.
Danielle Miller, a 32-year-old Miami social media influencer, has pleaded guilty to five federal charges related to a $1.5 million COVID relief fraud scheme. She used stolen identities and fake business names to access pandemic-related financial assistance, which she then used to fund her own personal expenses. Miller faces up to 20 years in prison and a fine of up to $250,000, as well as restitution to the victims.
The Biden Administration and the USDOT are working to crack down on "junk fees" by pushing airlines to improve customer service. American, Alaska, and Frontier Airlines have committed to guaranteeing that parents can sit with their children without paying extra fees. The USDOT has created a dashboard to help families determine which airlines offer this guarantee and which ones could charge extra.
Mortgage applications have dropped to a 28-year low as mortgage rates continue to rise, according to the Mortgage Bankers Association. Refinances are more than 70% down from last year, and the housing market is still trying to adjust to the pandemic's impact on the economy. Joel Kan, MBA’s associate vice president of economic and industry forecasting, noted that the increase in mortgage rates has caused some buyers to pull back.
US economic strength was demonstrated in January, as the Federal Reserve's preferred inflation gauge, the Personal Consumption Expenditures (PCE) price index, rose 5.4% from a year earlier and 0.6% from December to January. Consumer spending also increased 1.8% from December, though goods prices declined 0.7%. The Core PCE index rose 0.2% from December to January, indicating that inflation remains entrenched in the US economy and the Fed is likely to keep raising interest rates.
Sam Bankman-Fried, the founder of crypto trading platform FTX, is facing 16 criminal charges, including conspiracy to operate an unlicensed money transmitting business, conspiracy to commit bank fraud, securities fraud, and money laundering. Prosecutors allege that Bankman-Fried directed tens of millions of dollars of illegal campaign contributions to elected officials as part of a “multibillion-dollar fraud.” If convicted, Bankman-Fried could face up to 20 years in prison.
A recent study from Cornell University has revealed that the number of work stoppages in the US has increased significantly in the past year, with 424 work stoppages of all sizes in 2022, up from 279 the previous year. This increase is indicative of a tight labor market, as workers take advantage of the situation to press employers for better pay and working conditions. Miller, a Teamsters Local 230 member, led one of these strikes, with 230 of his coworkers, in order to press their employer, Sysco, for better pay and working conditions.