My Investing Muse (03Feb2025)
Layoffs & Closure news
-
Microsoft has initiated a wave of performance-based job cuts, with impacted employees losing their jobs effective immediately and receiving no severance packages, according to termination letters sent to staff.
-
Berkshire Hathaway said on Friday it has shed more than 4,000 jobs over the last year, on pace to post a record annual operating profit. In a regulatory filing, Berkshire said its dozens of operating businesses employ about 392,000 people, down from 396,440 shown in its most recent annual report last February. - Reuters
-
The JG Summit conglomerate will shut down its petrochemical business — which makes raw materials for the production of plastic products and industrial chemicals — due to a China-induced global oversupply of resins. - InsiderPH
-
Deutsche Bank has suffered a 92pc slump in its profits amid a major downturn in the German economy. Germany’s largest lender on Thursday vowed to slash jobs after its profits attributable to shareholders dropped to €106m (£89m) in the final three months of 2024, down from €1.26bn in the fourth quarter of 2023. - Telegraph UK
-
Last year, the teams responsible for Pixel hardware and Android software were merged into one division, and Google today announced a “voluntary exit program” for employees working in the Platforms & Devices group. - 9to5google
-
(Bloomberg) -- Amazon Inc. is laying off dozens of people in its communications department, the latest culling of the corporate workforce amid executives’ efforts to cut costs and reduce bureaucracy.
-
Nissan plans to cut up to 2,000 U.S. jobs, and slash factory output by 25%, per Automotive News Meanwhile VW Volkswagen is prepared to hand its factories to Chinese electric carmakers, per Telegraph
-
Volkswagen has confirmed that it is considering selling some of its German car factories to Chinese manufacturers as part of a cost-cutting plan to save billions. - MSN
The above are some snippets of news about layoffs, and closures in the past week.
Forecast of the market through oil
(Bloomberg) - Profits for Exxon Mobil Corp. and Chevron Corp were slammed by slumping fuel margins as the prospect of US tariffs on two major oil suppliers threatens to make the refining business even worse.
Tariffs can make it worse for oil producers. Source: https://www.ttnews.com/articles/exxon-chevron-refining-slump
Oil is the starting point of many products. It is not just gasoline, or diesel. We are surrounded by plastics. Oil products make their way into our makeup, roads, lubricants and more. It takes months to convert crude oil into these products. Thus, the oil industry production can be an outlook.
With a stagnating demand, let us be cautious.
USA credit card
Here are extracts from last week’s news about the credit card challenges.
Image
The share of US credit card accounts making ONLY the minimum payment hit 10.8% in 3Q 2024. This is the highest since 2012, the aftermath of the GREAT Financial Crisis. Consumers cannot afford to pay out their credit card debt.
Average credit card rates have climbed to 21.5%, or about 50% higher than three years ago, according to Fed data - X user Unusual WhalesA record number of consumers are making minimum credit card payments, per CNBC. The share of active credit card holders just making minimum payments rose to 10.75% in the third quarter of 2024, the highest ever in data going back to 2012 - X user unusual whales
We are seeing more credit challenges for the citizens. At a 21.5% average credit card rate, debt can be a spiralling pit.
My final thoughts
DeepSeek has brought much attention to the costs of AI, applications and infrastructure. While there is much debate about its affordability, its performance has shocked some industry players.
Much investment has been poured into AI and its ecosystem. With investments, there are expectations of returns, within a timeframe. DeepSeek has added some pressure to the expectations. With leading players like OpenAI yet to be profitable, we can expect more duress and scrutiny in this sector.
We can expect more challenges to arise after the LA Fire with issues in housing, retail, insurance, banking, construction and more. From an estimated $250 billion worth of losses, about $40 billion can be covered by insurance. California’s state-run insurance “FAIR PLAN” may not have enough to pay out.
President Trump has his work cut out for him - not to forget the recent plane-related accidents. Let us be cautious and consider some hedging.
Comments