In the anatomy of an economic crisis, a bank run is the point of no return.

Bank runs occur when people scramble to withdraw cash from banks in fear of collapse. In the worst cases, banks’ liquid cash reserves are exhausted, not everyone gets their money and the bank defaults.

It’s a grim scenario which, fortunately, has occurred rarely in history.

The most significant bank runs in the United States took place during the 1930’s Great Depression. More recently, there were runs on numerous U.S. banks during the Financial Crisis in 2008.

In Asia, bank runs have also been rare. A run on Japanese banks in 1927 led to the collapse of dozens of institutions across the country. There was a banking crisis in Myanmar in 2003 which the country has never really fully recovered from.

But perhaps since the Great Depression, none has been as significant compared to what is seemingly unfolding in China right now.

The Chinese bank run of 2022

In recent years it has become clear the Chinese people are losing faith in their financial institutions. There’s been anger over harsh COVID lockdowns in Shanghai recently, while the collapse of China Evergrande saw rare public demonstrations as residents faced the prospect of losing their life savings used as deposits for housing.

https://www.youtube.com/watch?v=mwyuHzKDMyI

“Return our money” the Evergrande protestors chanted at Evergrande headquarters in Shenzhen in 2021.

The song book is eerily similar at bank branches in a number of China’s rural provinces right now.

Multiple sources contacted by Asia Markets, have confirmed deposits at the following six banks have been frozen since mid-April.

• Yuzhou Xinminsheng Village Bank (located in Xuchang City, Henan Province)
• Zhecheng Huanghuai Bank (City of Shangqui, Henan Province)
• Shangcai Huimin Rural Bank (Zhumadian City, Henan Province)
• New Oriental Village Bank (City of Kaifeng, Henan Province)
• Huaihe River Village Bank (Bengbu City, Anhui Province)
• Yixian County Village Bank (Huangshan City, Anhui Province)

It’s understood the banks with branches across the Henan and Anhui Provinces successively issued announcements in April, stating they would suspend online banking and mobile banking services due to a system upgrade.

At the same time, clients reported their electronic deposits in online accounts, mobile apps and third-party platforms could not be withdrawn.

This led to depositors rushing to local bank branches, only to be told they were unable to withdraw funds.

By late May, images emerged on Chinese social media of demonstrations at the front of numerous bank branches. Asia Markets has verified these images with local contacts.

According to one user on the Chinese social media platform WeChat, the protests are ongoing but are rarely mentioned in Chinese press.

“It has caused widespread concern on the internet but the media attention is not high, the highest degree of concern is the four banks in Henan.”

The People’s Bank of China (PBOC) has responded to the rural bank run. It issued a statement on April 25.


Fraud scheme blamed

Following the public protests and the PBOC statement, the China Banking and Insurance Regulatory Commission revealed it is investigating fraudulent activity carried about by the Henan New Fortune Group – the largest shareholder of the four banks listed above in the Henan Province. It’s understood the commission is working with police to investigate allegations that the Group colluded with bank insiders to misappropriate bank funds.

Anti-CCP group, bannedbook.org, reported the following:


Bank run contagion to “sweep across China”

Regardless of the cause, the developments raise serious questions about the health of China’s and its regulatory oversight. The more immediate concern, however, is the prospect of contagion, which could see the (so-far) rural-only bank run spread to bigger cities.

There’s evidence this is already happening.

In one of the only mainstream international media articles to report on the unfolding situation, local residents highlighted the seriousness of the situation and the likelihood of contagion.

From the Financial Times on June 9:


On Twitter, a video of a large line at an ICBC Bank in China (one of China’s largest state-owned banks) posted on Tuesday, June 9, suggest contagion is in progress.

Translated to English, the tweet reads “The bank card system is locked, and these people are here to unlock it. Massive runs are coming.”

Blogger, Jennifer Zeng, has reported major issues with withdrawing cash from banks in Shanghai in recent days. The uncertainty no doubt exacerbated by the prospect of more lockdowns as COVID cases again spike.

“All banks in Shanghai have restricted depositors from withdrawing money… A bank run is about to sweep China,” she said.

Should the world be worried about Chinese banks?

The lack of reporting about the clear signs of a bank run in China is somewhat surprising.

As HSBC China’s Xuefang Liu puts it, “The rise of China as a global economic power has caused concern that a crisis in Chinese banking could lead to a worldwide downturn similar to the Global Financial Crisis.”

While many analysts believed China’s banking system was widely immune to the Evergrande Crisis, cracks are beginning to emerge and should this bank run intensify, already volatile global markets could be faced with a black swan event even more significant than Evergrande.


https://www.asiamarkets.com/chinese-banks-run/

Apple’s iOS 16 and macOS Ventura will introduce passwordless login for apps and websites. It’s only the beginning.

YOUR PASSWORDS ARE terrible. Year after year, the most popular passwords leaked in data breaches are 123456, 123456789, and 12345—‘qwerty’ and ‘password’ come close behind—and using these weak passwords leaves you vulnerable to all sorts of hacking. Weak and repeated passwords are one of the most significant risks to your online life.

For years, we’ve been promised a more secure, password-free future, but it seems like 2022 will actually be the year that millions of people start to move away from passwords. At Apple’s Worldwide Developer Conference yesterday, the company announced it will launch passwordless logins across Macs, iPhones, iPads, and Apple TVs around September of this year. Instead of using passwords, you will be able to log in to websites and apps using “Passkeys” with iOS 16 and macOS Ventura. It’s the first major real-world shift to password elimination.

So how does it work? Passkeys replace your tired old passwords by creating new digital keys using Touch ID or Face ID, Apple’s vice president of internet technologies, Darin Adler, explained at WWDC. When you are creating an online account with a website, you can use a Passkey instead of a password. “To create a Passkey, just use Touch ID or Face ID to authenticate, and you’re done,” Adler said.

When you go to log in to that website again, Passkeys allow you to prove who you are by using your biometrics rather than typing in a passphrase (or having your password manager enter it for you). When signing in to a website on a Mac, a prompt will appear on your iPhone or iPad to verify your identity. Apple says its Passkeys will sync across your devices using iCloud’s Keychain, and the Passkeys are stored on your devices rather than on servers. (The use of iCloud Keychain should also solve the problem of losing or breaking your linked devices.) Under the hood, Apple’s Passkeys are based on the Web Authentication API (WebAuthn) and are end-to-end encrypted so nobody can read them, including Apple. The system for creating Passkeys uses public-private key authentication to prove you are who you say you are.

A passwordless system would be a significant step forward for most people’s online security. As well as eliminating guessable passwords, removing passwords reduces the likelihood of successful phishing attacks. And passwords can’t be stolen in data breaches if they don't exist in the first place. (Some apps and websites already allow people to log in using their fingerprints or using face recognition, but these usually require you to first create an account with a password.)

Apple’s Passkeys aren’t entirely new—the company first detailed them at 2021’s WWDC and started testing them shortly after—and Apple isn’t the only one that wants to eliminate passwords. The FIDO Alliance, a tech industry group, has been working on the underlying standards needed to ditch passwords for almost a decade, and Apple’s Passkeys are the company’s implementation of these standards.

In recent months, FIDO has taken a series of important steps to bring the password’s demise closer to reality. In March, FIDO announced it has figured out a way to store the cryptographic keys that sync between people’s devices, calling them “multi-device FIDO credentials” or “passkeys.”

This was followed in May by Apple, Microsoft, and Google declaring their support for the FIDO standards. Jen Easterly, the director of the US Cybersecurity and Infrastructure Security Agency, said adoption of the standards would keep more people safe online. At the time, the three tech giants said they would start rolling out the technology “over the course of the coming year.” Microsoft account owners have been able to ditch their passwords since September of last year, and Google has been working on its passwordless technology since 2008.

When all the tech companies have rolled out their version of passkeys, it should be possible for the system to work across different devices—in theory, you could use your iPhone to log in to a Windows laptop, or an Android tablet to log in to a website in Microsoft’s Edge Browser. “All of FIDO’s specs have been developed collaboratively, with inputs from hundreds of companies,” says Andrew Shikiar, the executive director of the FIDO Alliance. Shikiar confirms that Apple is the first company to start rolling out passkey-style technology and says this shows “how tangible this approach will soon be for consumers worldwide.”

Any success for a passwordless future depends on how it works in reality. At the moment, there are unanswered questions about what happens to your Passkeys if you want to ditch Apple’s ecosystem for Android or another platform. (Apple hasn’t yet responded to our request for comment.) And developers still need to implement changes to their apps and websites to work with Passkey. Plus, to gain trust in any system, people need to be educated about how it works. “Any viable solution must be safer, easier, and faster than the passwords and legacy multi-factor authentication methods used today,” ​​Alex Simons, the head of Microsoft’s identity management efforts, said in May. In short: If cross-device systems are clunky or a pain to use, people may shun them in favor of weak but convenient passwords.

While Apple’s Passkey and Google and Microsoft’s equivalents are still some months away (at the very least), that doesn’t mean you should idly keep using your weak or repeated passwords. Every password you use—whether it’s for a one-time account used to buy DIY supplies or your Facebook account—should be strong and unique. Don’t use common phrases, names of friends or pets, or personal information linked to you in your passwords.

Instead, your passwords should be long and strong. The best way to achieve this is by using a password manager, which can help you create and store better passwords. You can find our pick of the best password managers here. And while you’re thinking about your security, turn on multi-factor authentication for as many accounts as possible.


https://www.wired.com/story/apple-passkeys-password-ios16-ventura/

As recent payment outages in Germany (and elsewhere) have shown, even proponents of a cashless economy have an interest in safeguarding the future of cash, if only for the sake of financial stability.

A few days ago, many shops in Germany had “CASH ONLY” signs displayed on their windows or at the entrance to their premises. Some establishments allowed people without cash to pay by card, but only if they provided a signature. It was as if parts of Germany’s payment system had just travelled through a wormhole back to the 1990’s, albeit with euros rather than the Deutsche Mark as the legal currency.

According to initial reports, the cause of the problems was a software glitch affecting all H5000 payment card terminals, which are widely used by German retailers including some of the largest supermarket chains. Starting on May 24 normal card payments became all but impossible for those retailers. The problems lasted for a week or so, prompting some larger retailers to replace all of their card terminals. It’s an investment that many smaller, struggling retailers can ill afford to make right now.

There are (or at least were) around 100,000 H5000 units in Germany, according to some estimates. The devices were manufactured by the US financial services provider Verifone specifically for the German market, but they are operated by eleven network operators, including Payone GmbH and Concardis GmbH.

On May 27, one of those companies, Payone, reported it was facing issues with the H5000 card terminal and that the issues were occurring throughout the country: “Like other network operators, we are currently experiencing considerable restrictions in the processing of transactions with card payment terminals of the type H5000 from the manufacturer Verifone throughout Germany.”

According to Handelsblatt, financial supervisors from Bafin and Bundesbank are already on the case. The German banking industry, which represents the interests of banks and savings banks, also announced that it would “analyze and process the disruption in depth in collaboration with the various parties involved and the supervisory authorities”. However, it also conceded that it will still take “a while” before the last H5000 terminal is replaced or updated.

The problem first came to light on May 24 when the Konsum retail chain in Dresden published the following message on its Facebook page: “Attention, an important notice for you! Due to a Germany-wide malfunction, card payments are currently not possible in our stores.”

Similar problems began to be reported by other retail chains such as Netto, Edeka, Aldi Nord, Rossman and DM as well as smaller, independent retailers and petrol stations. Initial reports suggested that H5000 card machines across Germany were experiencing a software malfunction that stopped them processing payments.

“As things stand, it will be necessary to install new software updates on all H5000 terminals, which the manufacturer will provide as soon as possible,” Payone said.

But some IT experts have pointed to a different possible cause: an expiring security certificate. The problem, it seems, is that the Verifone H5000 is a rather old albeit robust model whose so-called “End of Life” was officially announced by Verifone in 2019. The company ended its production of the terminal a year later. Although it offered limited product support until 2023, one of the embedded certificates seem to have expired unnoticed on Tuesday May 24 causing the terminals to stop working. That is the hypothesis of Jan Wildeboer, a self-described “EMEA Evengelist” at IBM-owned Red Hat who began informing the English-speaking public about the issue in a rapidly expanding Twitter thread.

Wuildeboer is a Linux expert and the H5000 was the first card terminal in Germany to run on open source software. On May 30, the Bavarian newspaper Süddeutsche Zeitung reported that a “curious detail” within the network operators’ support instructions seemed to support Wildeboer’s hypothesis (machine translated):

Usually, any tech support will immediately ask the caller, “Have you tried rebooting?” In this case, the network operators advise retailers against rebooting the terminals themselves. That fits with Wildeboer’s certification thesis. Because when you reboot, the devices check their integrity, i.e. whether they may have been manipulated by hackers. If they then lack a necessary certificate, they switch to a kind of safe mode from which only an on-the-spot technician can release them.

Who’s to Blame?

Trying to apportion blame for the payment terminal outages is not going to be easy. As the article in Süddeutsche Zeitung notes, Verifone released a software update in Verifone despite having previously stated there would be no more updates after April 2021. This suggests the developers may have realized there was a potential problem with the expiring certificate. But the update seems to have reached only a few retailers, who apparently experienced no problems with their terminals. For everyone else, the devices suddenly became unusable on May 24.

This, as the article notes, is where the question of guilt gets interesting. After all, retailers in Germany have clearly lost a certain amount of business as a result of the outage. If Verifone made a software update to avert the problem, then who is responsible for the broken devices? The retailer? Or the network operator? Or did Verifone fail to give the network operators and retailers sufficient warning about how critical the unscheduled update was?

Inherent Fragility

In recent days the crisis appears to have more or less petered out, at least for the companies that have been able to replace or fix their terminals. On June 3, the newspaper Focus reported that more and more of the affected retailers can now accept credit cards and giro cards again. But the crisis still serves as a timely reminder of one of the main dangers of going completely cashless: the inherent fragility of a purely cashless economy.

At a personal level the impact of the payment outage in Germany was fairly limited, as long as you had access to cash. And just about everybody did, given that ATMs continued to work throughout the outage. In other words, there was an alternative to digital money that was widely available to all users — i.e. physical cash.

There is also something rather peculiar about Germans (as well as Austrians): they love physical money (a topic I have written on before for WOLF STREET). Even the intense demonization of cash in the early days of the COVID-19 pandemic failed to shake the  German people’s faith in physical lucre, although the use of cashless payment transactions, whether by card or mobile, has grown significantly in the last two and a half years.

A recent 11-country survey by the payment companies PYMNTS and Stripe found cash and cheques are still the most common way to make in-store payments in Germany, accounting for 37% of all in-store transactions compared to 29% for card-based methods and 20% for mobile payment platforms. The study — Benchmarking the World’s Digital Transformation — found that cash is also still popular in Italy, Spain and Japan.

In many other parts of Europe, particularly in the north, cash is, to all intents and purposes, dying a natural, albeit artificially accelerated, death. For example, in France cash and cheques account for just 12.6% of in-store transactions. In the Netherlands it’s 18% and in the UK, 19%.

A Brief Foretaste

Just imagine what would happen if a similar payment card outage that just happened in Germany were to occur in Sweden, Norway, the UK or France, where far fewer people use cash. The disruptive impact would have been far greater. We already had a brief foretaste of what that might look like a few weeks ago. On Monday May 16, Norway, the world’s most cashless economy (according to its central banks), with reportedly just 4% of the population still using cash, suffered a nationwide outage of its card payment system. Card terminals went down throughout the country, leading to long queues at the ATMs.

“In a large number of shops, including grocery stores…, payment cards were useless on Monday afternoon,” reported the online newspaper Nettavisen. “Many feared that the ATMs would run out of cash as a result of the unexpected development.”

Imagine if the outage had lasted for days or weeks rather than hours, as occurred in Puerto Rico in 2017 as a result of devastation caused by Hurricane Maria. Electronic payment systems went down for weeks, turning the island into a de facto cash-only economy. So serious was the fallout that corporate clients began begging the New York Federal Reserve for large amounts of dollars in cash to meet payrolls. In the end, the Fed dispatched a jet loaded with an undisclosed amount of dollar bills to the stricken island.

Of course, there are myriad other reasons why a fully cashless society is far from desirable, including the inevitability of more granular surveillance, the loss of one of our last vestiges of personal privacy and anonymity, the exclusionary effects it will have on those who are unable to access or use digital technologies and the much greater power and control it would grant to both governments and corporations over our spending habits — and indeed potentially over our ability to spend money at all.

As Silkie Carlo, the director of the British civil liberties organization Big Brother Watch wrote in a recent op-ed for the Daily Telegraph, financial services companies have already shown a predilection for taking an interventionist approach to people’s spending:


Even people who have absolutely no qualms whatsoever about the prospect of governments, central banks and corporations instituting a cashless economy as a means of grabbing a lot more power, or arguably total power, over our lives should have serious concerns about its potential implications for the stability of the financial system. As Stefan Ingves, the governor of Sweden’s central bank, the Riksbank, warned back in 2018, replacing physical cash altogether could cause serious problems in times of crisis:


Of course, central banks themselves are exploring the possibility of introducing their own central bank digital currencies, or CBDCs, in the near future. A small number have already done so, including the People’s Bank of China, whose digital yuan is already being used in pilot schemes to stimulate consumption in its pandemic-hit economy. While it’s true that many central banks have insisted that physical cash will continue to exist alongside the CBDCs, central banks are not exactly known for keeping their word.



https://www.nakedcapitalism.com/2022/06/germany-just-gave-a-timely-lesson-onthe-dangers-of-going-completely-cashless.html

Report on 300 top US companies found CEOs making an average of $10.6m, with the median worker getting $23,968

The wage gap between chief executives and workers at some of the US companies with the lowest-paid staff grew even wider last year, with CEOs making an average of $10.6m, while the median worker received $23,968.

A study of 300 top US companies released by the Institute for Policy Studies (IPS) on Tuesday found the average gap between CEO and median worker pay jumped to 670-to-1 (meaning the average CEO received $670 in compensation for every $1 the worker received). The ratio was up from 604-to-1 in 2020. Forty-nine firms had ratios above 1,000-to-1.

At more than a third of the companies surveyed, IPS found that median worker pay did not keep pace with inflation.

The report, titled Executive Excess, comes amid a wave of unionization efforts among low wage workers and growing scrutiny of the huge share buyback programs many corporations have been using to inflate their share prices. US companies announced plans to buy back more than $300bn of their own shares in the first quarter of the year and Goldman Sachs has estimated that buybacks could top $1tn in 2022.

Share-related remuneration makes up the largest portion of senior executive compensation and as buybacks generally boost a company’s share price, they also boost executive pay. Senator Elizabeth Warren has called buybacks “nothing but paper manipulation” designed to increase executive pay.

The report found that two-thirds of low-wage corporations that cut worker pay in 2021 also spent billions inflating CEO pay through stock buybacks.

The biggest buyback firm was home improvement chain Lowe’s, which spent $13bn on share repurchases. That money could have given each of its 325,000 employees a $40,000 raise, according to IPS. Instead, median pay at the company fell 7.6% to $22,697.

“CEOs’ pandemic greed grab has sparked outrage among Americans across the political spectrum,” said report lead author Sarah Anderson, director of the IPS Global Economy Project. She cited one recent poll that showed that 87% of Americans see the growing gap between CEO and worker pay as a problem for the country.

IPS noted that many of the companies in its sample were also the recipients of large federal government contracts. Forty companies in the sample were awarded $37.2bn in government contracts between 1 October 2019 and 1 May 2022.

The biggest recipient was Maximus, a company that manages federal student debts and Medicare call centers, which received $12.3bn in federal contracts. In 2021, Maximus CEO Bruce Caswell collected $7.9m in compensation, 208 times the firm’s median paycheck. Maximus workers have recently staged walkouts over pay and benefits.

Amazon, the second-largest federal contractor in the sample, amassed $10.3bn in federal contracts. Last month shareholders approved a $212m pay deal for Amazon’s CEO, Andy Jassy, 6,474 times the company’s median pay.

This report offers a number of policy solutions, including actions president Joe Biden could take without waiting for Congress. “The president could wield the power of the public purse by introducing new standards making it hard for companies with huge CEO-worker pay gaps to land a lucrative federal contract,” Anderson said. The report also urges Biden to ban top executives at federal contractors from selling their personal stock for a multi-year period after a buyback.


https://www.theguardian.com/us-news/2022/jun/07/us-wage-gap-ceos-workers-institute-for-policy-studies-report

A growth of 2.6% is still a growth, it's better than not having one at all or having a shrink...

The World Bank on Tuesday slashed its global growth forecast and warned that many countries could fall into recession as the economy slips into a period of stagflation reminiscent of the 1970s.

Global economic expansion is expected to drop to 2.9% this year from 5.7% in 2021 — 1.2 percentage points lower than the 4.1% predicted in January, the Washington-based bank said in its latest Global Economic Prospects report.

Growth is expected to then hover around that level through 2023 to 2024 while inflation remains above target in most economies, the report said, pointing to stagflation risks.

Russia’s invasion of Ukraine and the resultant surge in commodity prices have compounded existing Covid pandemic-induced damage to the global economy, which the World Bank said is now entering what may be “a protracted period of feeble growth and elevated inflation.”

“The war in Ukraine, lockdowns in China, supply-chain disruptions, and the risk of stagflation are hammering growth. For many countries, recession will be hard to avoid,” World Bank President David Malpass said.

Growth in advanced economies is projected to decelerate sharply to 2.6% in 2022 from 5.1% in 2021 before further moderating to 2.2% in 2023, the report said.

Expansion in emerging market and developing economies, meanwhile, is projected to fall to 3.4% in 2022 from 6.6% in 2021, well below the annual average of 4.8% from 2011 to 2019.

That as inflation continues to climb in both advanced and developing economies, prompting central banks to tighten monetary policy and raise interest rates to curb soaring prices.

1970s-style stagflation

The present high-inflation, weak growth environment has drawn parallels with the 1970s, a period of intense stagflation which required steep increases in interest rates in advanced economies and triggered a string of financial crises in emerging market and developing economies.

The World Bank’s June report offers what it calls the “first systematic” comparison between the situation now and that of 50 years ago.

Clear parallels exist between then and now, it said. Those include supply side disturbances, prospects for weakening growth, and the vulnerabilities emerging economies face with respect to the monetary policy tightening that will be needed to rein in inflation.

However, there are now also a number of differences, such as the strength of the U.S. dollar, generally lower oil prices, and broadly strong balance sheets at major financial institutions, which present room for maneuver.

To reduce the risks of history repeating itself, the World Bank urged policymakers to coordinate aid for Ukraine, counter the spike in oil and food prices, and set up debt relief for developing economies.


https://www.cnbc.com/2022/06/07/world-bank-cuts-global-growth-outlook-and-warns-of-70s-stagflation.html

PHOENIX (AP) — Concern about the inflation rate is widespread following a jump to a four-decade high earlier this year. In Arizona, rising inflation has an added twist: the state’s minimum wage is now tied to changes in the Consumer Price Index.

If prices continue to rise robustly, lower-income workers here could get a significant wage boost — about one-third of all Arizonans earn the minimum or just a few dollars an hour more, according to a recent report. If the recent trend continues, Arizona’s minimum wage could increase by more than $1 and approach $14 an hour at the start of 2023.

Yet a wage hike at or near the current inflation rate could mean more belt-tightening for restaurants and other businesses, some of which could close.

“Even prior to the pandemic, restaurants have always operated on thin margins,” said Melissa Maggiore, owner of the Italian Daughter restaurant in Scottsdale, in an email The Arizona Republic. A big hike could lead to job losses, fewer hours and reduced service including more quick-serve formats, she said.

With the minimum wage tied to consumer price levels, higher inflation here could become self-perpetuating, at least compared with the many states where this isn’t the case. Inflation already is running hotter in metro Phoenix, 11% annualized through April, than in any other large urban area.

However, the state’s minimum wage increases are pegged to national inflation, not that at the local level. The U.S. rate is 8.3% currently.

Arizona has one of the nation’s highest minimum wages following passage of Proposition 206 by statewide voters in 2016. That ballot measure bumped up the minimum wage in four specified steps from $8.05 an hour in late 2016 to $12 an hour by Jan. 1, 2020.

Since then, increases are tied to changes in the national Consumer Price Index for urban workers, a widely followed U.S. inflation gauge. Arizona’s minimum-wage inflation calculation runs from September through August each year, with adjustments taking effect the following January.

For example, at the start of 2021, Arizona’s minimum wage increased moderately to $12.15 an hour from $12 in 2020, reflecting a slight 1.3% bump in U.S. inflation from September 2019 through August 2020.

Inflation then perked up to 5.3% over the 12 months through last August, pushing up Arizona’s minimum wage to $12.80 an hour starting this year.

Now inflation, as noted, is running at an 8.3% annual rate nationally, through April. If it continues at that pace through August, Arizona’s minimum wage would jump to about $13.85 an hour by Jan. 1, 2023. The Industrial Commission of Arizona officially will announce the new wage later this year.

Kelly Cooper, owner of BKD’s Backyard Joint in Chandler and two Valley locations of the Melting Pot, fears inflation could keep rising and that restaurants could face a minimum wage increase of 10% or higher by the August calculation date.

Plus, he’s concerned that there’s no provision under Proposition 206 for Arizona’s minimum wages to decline should inflation cool off sharply in the event of a recession. An elevated minimum wage could result in more job losses and business closures than otherwise would happen, making the next recession even worse, he predicts.

Economists are alarmed at the sudden uptick in inflation for goods and services beyond just labor expenses. Consumer costs have risen fairly steadily across the board, and shortages have appeared for products ranging from semiconductors and rental cars to baby formula.

The Federal Reserve is attempting to slow increases in price levels by raising interest rates. Some economists don’t think this strategy will work, though it’s too early to tell.

Arizona doesn’t have the nation’s highest minimum wage but it’s among the leaders. States that have or soon will have higher minimums include California ($15 an hour), Washington ($14.49), Massachusetts ($14.25), Connecticut ($14), New York ($13.20) and New Jersey ($13), according to a list compiled by the Labor Law Center.

Minimum wages have risen or will increase in about half of all states this year, the group said.

Yet the federal minimum has stayed at $7.25 an hour since 2009 (or $2.13 for employees who regularly receive tips). It remains in effect in 20 states, mainly in the South and Midwest.

In addition, some cities have their own minimums set above the levels in their states, including Flagstaff ($15.50) and Tucson ($13) in Arizona.

Despite a relatively high minimum wage here, 33.7% of Arizonans earn $15 an hour or less — slightly above the 31.9% share nationally, according to a recent report by Oxfam America. Workers in this group include tipped employees, farmworkers, domestic caregivers and students.

Also, people who are Black or Latino are disproportionately represented among $15-or-less workers, according to the report.

Arizona’s current minimum wage doesn’t apply to all workers. Exemptions include people employed by a parent or a sibling, those who work as a babysitter in an employer’s home on a casual basis and people employed by the Arizona state or federal governments. Another exemption applies to individuals working at small businesses that generate less than $500,000 in annual revenue.

Also, an employer may pay tipped employees — those who customarily and regularly receive tips or gratuities — up to $3 an hour less than the minimum wage, provided the employer keeps records showing that workers received at least the minimum for all hours worked.

In addition to higher minimum wages, Arizona’s Fair Wages and Healthy Families Act, which voters passed as Proposition 206 in November 2016, entitles employees to accrue paid sick time.


https://ktar.com/story/5091147/arizonas-minimum-wage-now-tied-to-changes-in-consumer-price-index/

What do you think is the effect of enhancing Multiplayer Gaming implementation in the Gambling industry?

Ministry of Defence acquires government's first quantum computer

June 9, 2022

The Ministry of Defence (MoD) has acquired the government's first quantum computer.

Quantum computers can make very complex calculations extremely quickly and their creators say they can solve the problems regular computers cannot.

https://finance.yahoo.com/news/ministry-defence-acquires-governments-first-025632383.html

He explained that sports betting requires knowledge of the sports and sophisticated strategies to win. 

I wonder why Serrano just didn't take the Taylor rematch which it seems Taylor really wanted. Even Hearn seemed to be disappointed and very surprised it wasn't happening but maybe Jake thinks he can earn more for her with this fight. The first was a really close fight and I'm sure the rematch would have been even bigger.

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In a litany of woes Bank of Italy Governor Ignazio Visco listed this week, the sheer number of his fellow citizens who don’t bother seeking work was especially bleak.

The proportion of people active in the labor market is among the lowest in Europe, he complained to the country’s economic elite gathered in the gold-painted Shareholders’ Hall of Palazzo Koch, his institution’s home in Rome. Worst affected is the poorer south of Italy, where the governor hails from.

The labor market was only one of many weaknesses Visco highlighted in his annual speech on Tuesday. It may prove among the trickiest for the European Union to fix as it deploys skills-focused programs in its bid to reinvigorate Italy with 200 billion euros ($214 billion) of Recovery Fund cash.

Unlocking the jobs potential trapped in the inertia of the euro zone’s third-biggest economy is one of the few options available to fight the consequences of a demographic decline so stark that the world’s richest man, Elon Musk, has warned the country risks having no people left.

“Overcoming the factors that hinder productivity growth has become even more necessary” given the population outlook, Visco said. It “can only partly be countered by an improvement in the migration balance and by an increase in the labor-market participation.”

The numbers are stark: 2.62 million people are available for employment but not seeking it, more than the actual tally of jobseekers. On top of that are 872,000 part-time workers who would like more hours, and 90,000 people who want a job but aren’t immediately available, according to Bloomberg calculations based on Eurostat data.

“It makes me really sad to see these numbers,” said Andrea Prencipe, professor of innovation management and rector of Luiss University in Rome. “This points to a problem that goes beyond the usual issues of matching supply and demand, and skills. It’s a problem of mindset.”

As with many of Italy’s economic problems, the south suffers the most. Last year, when a measure of national unemployment averaged 9.5%, it was almost 24% in the area of Naples, where the 72-year-old Visco was born. The country’s third-biggest city, it is often seen as a proxy for the malaise and organized crime associated with that half of the peninsula.

Further east in Isernia, a landlocked province where the governor’s family comes from in the mountainous region of Molise, joblessness exceeded 12%.

Visco also highlighted how the country stands out for the low proportion of women in the workforce, exacerbated by the difficulty of regaining employment after having children.

But at the root of the problem is schooling. Low labor participation is “closely connected with educational attainment,” the governor said. It’s a commonly shared view. 

“We have a low-skilled labor force,” Italy Finance Ministry Deputy Secretary Maria Cecilia Guerra lamented on Rainews24 on Wednesday. “This has a big impact on our growth prospects.”

That isn’t easy to fix. Prencipe, the Luiss professor, says that simply throwing money at the problem won’t address it, even though the EU Recovery Fund does have initiatives devoted to skills and education. 

He says young people find it hard to enter the workforce after studying in Italy and need better-honed training that makes them nimbler at a time of faster-evolving employment requirements and lengthening lifespans.

Adapting to the shifting labor market is a challenge for Beatrice Tarantino. She has struggled to find a job since losing hers at an insurance company in Rome during redundancies in 2018. Currently helping a friend with childcare, she plans to return to the fray of seeking work later this year.

“After the pandemic struck, it got harder to look for a job,” the 49-year-old said. “Now I’m starting to feel too old to find one.”

Encouraging people to enter or return to the labor market is fundamental. The alternative, as Visco suggested, is that the country’s best and brightest emigrate, as almost 1 million already have done, while others do nothing. Such a challenge puts the onus on Italy to ensure that its vast injection of EU money isn’t only spent, but spent well. 

“It’s not a matter of how much funding -- which is considerable overall -- but of how we’re going to use it,” said Prencipe. “We need it to really tackle the problems related to labor and to learning.”



https://www.bnnbloomberg.ca/italy-is-held-back-by-2-6-million-people-who-have-given-up-on-work-1.1773994

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Moving from a 6.6% contraction in the year 2020-2021 to an 8.7 then on to 8.9% growth in 2021-2022, it looked like they had cause to celebrate. consumer inflation has hit a 6.95% and as a result, has slashed it's yearly growth forecast to 7.2%.