The Week in Business: Escalating U.S. Sanctions on Russia

 The Week in Business: Escalating U.S. Sanctions on Russia


On Wednesday at midnight, the Biden administration allowed an exception to several sanctions against Russia that allowed the country to continue paying off foreign debts during its war in Ukraine. The Treasury Department issued the notice a few hours before the deadline. Russia is now running towards a standard intended to be avoided: a default on foreign debt for the first time in more than a century. Treasury Secretary Janet L. Yellen said Tuesday that the exemption is always intended to be temporary. However, the decision represents an increase in U.S. sanctions on Russia as Western countries try to increase its economic pressure.

The mass shooting at a school in Uvalde, Texas, last week that killed 19 children and two teachers provided a spotlight on how companies interact with gun manufacturers. But while many members of the public want to see corporations distance themselves from gun makers – and while many corporations want to do so – a Texas law that took effect last year makes that stance more complicated. The law prohibits state government entities from working with companies that “discriminate” against companies or individuals in the gun industry. That means a corporation like JPMorgan Chase could be shut down from the lucrative state municipal bond market if it refuses to work with gun or ammunition manufacturers. Just this month, before the Uvalde massacre, Chase’s lawyers suggested in a letter to the Texas attorney general that the bank be willing to do more business with gun companies, saying the bank does not “discriminate against a firearms entity.”

Broadcom, the semiconductor maker, said Thursday it would buy software company VMware for $ 61 billion. Broadcom offered VMware the equivalent of $ 138.23 per share, more than 40 percent higher than the company’s stock price before news began of a possible acquisition. The deal is the latest in Broadcom’s expansion efforts, as its chief executive for many years bought several companies responsible for the corporate computer infrastructure. VMware, a major player in cloud computing, has more than 500,000 customers worldwide and partners with all the other major cloud providers, Amazon and Google among them. With the company’s acquisition, Broadcom is the owner of a range of popular computing tools, making it more competitive in data-center and cloud computing technology.

Gas prices jumped about 50 cents per gallon last month, meaning drivers over the Memorial Day weekend will have a hard time finding gas under $ 4 per gallon. Russia’s war in Ukraine was the fastest growing cause, as Russia’s energy sanctions reduced world supplies. But drivers ’habits can add to the pressure. Analysts say an increase in travel, in part as a result of Americans eager to move away after delays in plans due to Covid, has helped keep prices high. It appears that travelers will also not be bothered by high fares: To offset the increase in fuel costs, many airlines have raised ticket prices and found that customers are still willing to pay. Southwest Airlines and JetBlue Airways said last week that their second -quarter revenues were way higher than previously planned.

The Biden administration has already taken steps to address the severe shortage of infant formula, working with Abbott Laboratories to restart production of its closed formula plant and flying in emergency supplies from Europe. But now the Federal Trade Commission wants to examine the conditions that led to the shortage in the first place: The agency last week announced that it had begun an inquiry into the consolidation of the industry, which is ruled by only four companies, and whether federal. Regulations and trade agreements prevent foreign companies from entering the market. The FTC will also check online formula resellers and seek information from families who believe they may have been scammed when trying to buy formula or paying an excessive price.

For months, economists have been expecting to reach the point where the number of U.S. jobs, which has continued to grow this year, has hit its peak. This week’s job report could be that point – or not. While Americans continue to mourn inflation, many are still paying higher prices for the goods and services they want and need. Consumer habits can shift, but spending remains high, and that often means more job openings. It is therefore possible that job growth will continue to improve, even if the Federal Reserve raises interest rates.

Twitter was fined $ 150 million by the FTC for misleading users about how it treated their personal data. New data shows that inflation slowed in April but remained near a four-decade high. And strong financial reports from retailers last week pulled markets higher.



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