The daily business briefing: February 17, 2023
Wholesale prices rose more than expected in January, YouTube CEO Susan Wojcicki announces she's stepping down, and more
Producer prices rose faster than expected in January
U.S. wholesale prices rose 6 percent in January compared to a year earlier, the Labor Department reported Thursday. The rate was slower than the December pace of 6.5 percent, but faster than expected. The producer price index jumped 0.7 percent on a monthly basis, the most since June. The data marked the latest indication of stubborn inflationary pressures despite the Federal Reserve's push to raise interest rates to cool the economy and bring down inflation. The January change marked a step backward from December, when month-over-month producer prices dropped by a revised 0.2 percent. The average monthly increase was about 0.2 percent before the start of the coronavirus pandemic in 2020.
YouTube CEO Susan Wojcicki to step down
YouTube CEO Susan Wojcicki told employees Thursday she is stepping down after nine years as leader of the world's biggest video site to "start a new chapter focused on my family, health, and personal projects I'm passionate about." Longtime lieutenant Neal Mohan will replace her. Under Wojcicki, YouTube became an increasingly important part of Google, which bought YouTube in 2006. The $29.2 billion YouTube generated in ad sales in 2022 accounted for more than 10 percent of Google-parent Alphabet's total revenue. Wojcicki famously rented out her Silicon Valley garage to Google co-founders Larry Page and Sergey Brin in 1998, and became Google's 16th employee a year later. She later ran a Google video service competing with YouTube, then helped convince Google to buy it instead.
Tesla recalls 363,000 vehicles with 'Full Self Driving' feature
Tesla on Thursday issued a recall notice for all 363,000 U.S. vehicles equipped with its "Full Self Driving" driver-assist software after the National Highway Traffic Safety Administration identified the feature as a "crash risk." The news came as Tesla Workers United accused the electric car maker of firing more than 30 people Wednesday at a Buffalo plant where workers launched an effort to unionize this week. The union organizers said in a filing to the National Labor Relations Board that workers at the plant, where employees hone Tesla's Autopilot capabilities, were fired "in retaliation for union activity and to discourage union activity." Tesla did not immediately comment.
Stock futures fall after latest hot inflation data
U.S. stock futures slid early Friday after another hot inflation report worried investors. Futures tied to the Dow Jones Industrial Average and the S&P 500 were down 0.5 percent and 0.8 percent at 6:45 a.m. ET. Nasdaq futures were down 1 percent. The major indexes fell more than 1 percent Thursday after the Labor Department said the producer price index, a key inflation indicator, rose 0.7 percent last month, more than expected. The data and comments by St. Louis Federal Reserve President James Bullard fueled concerns that the Fed will raise interest rates higher and longer than anticipated to tame inflation. Bullard said he had supported a bigger rate hike at the central bank's last meeting, and another one might be necessary in March.
SEC sues fugitive developer behind 2 failed cryptocurrencies
The Securities and Exchange Commission on Thursday filed a civil fraud suit accusing Do Kwon, founder of failed cryptocurrencies TerraUSD and Luna, and his company of misleading U.S. investors. The SEC said Kwon and Singapore-based Terraform Labs Pte. Ltd. downplayed the risk of TerraUSD and misled investors about the way Luna was used in South Korea. Prosecutors in South Korea have obtained an arrest warrant and a "red notice" from global law-enforcement agency Interpol, effectively launching a global search for Kwon, who "appears to be in hiding," according to The Wall Street Journal. The SEC said in its complaint, which was filed in a Manhattan federal court, that the scheme resulted in the loss of $40 billion in market value.