$5 Billion in P.P.P. Loans Were Approved Last Week
The revived Paycheck Protection Program is off to a smoother — and slower — start than it had last spring, when desperate borrowers deluged banks with loan applications and overwhelmed the government’s computer systems.
The program opened broadly on Tuesday as the Small Business Administration, which manages the relief program, began accepting applications from all lenders. The agency allowed a small subset of community lenders and tiny banks to start submitting their applications last week.
In the program’s first week, the agency approved around 60,000 applications from nearly 3,000 lenders, the it said on Tuesday. Those applications totaled $5 billion, consuming around 2 percent of the $284 billion the program has available to lend.
Those figures do not include loan applications sent to the agency on Tuesday, the first day most lenders were allowed to send in loan requests. New fraud checks and other safeguards mean that most applications will now take at least a day to gain approval.
The program is open to both first-time borrowers and to some returning ones: The hardest-hit small businesses, those with a drop in sales of at least 25 percent since the pandemic took hold, are eligible for a second loan.
Lenders said they were preparing for significant demand, especially for second-round loans. John Asbury, the chief executive of Atlantic Union Bank, in Richmond, Va., said he expected that at least 60 percent of his bank’s 11,000 borrowers would return for another loan.
Officials from the Treasury Department have said they anticipate that the program’s funding will be sufficient to fulfill all requests. Mr. Asbury hopes that’s true.
“We simply don’t know how much of a rush we’re going to get,” he said. “We’re getting a lot of calls.”
Bed Bath & Beyond and Kohl’s said they were dropping products from MyPillow amid a backlash to comments made by Mike Lindell, the bedding company’s chief executive, who has been promoting debunked conspiracy theories involving the election on social media.
Mr. Lindell said that Kohl’s and Bed Bath & Beyond acted after people on social media started pressuring them, according to an interview posted Monday on a pro-Trump site called Right Side Broadcasting Network. Mr. Lindell, who said that he had spoken with Bed Bath & Beyond minutes before the interview, claimed without citing evidence that the criticism was coming from fake accounts.
Bed Bath & Beyond said on Tuesday that its decision was rooted in MyPillow’s performance. “We have been rationalizing our assortment to discontinue a number of underperforming items and brands,” a representative said in a statement. A spokeswoman for Kohl’s said that “there has been decreased customer demand for MyPillow,” and that the chain did not plan to buy future inventory after clearing out its supply.
Mr. Lindell, whose company is a major advertiser on Fox News, has become a prominent supporter of President Trump. He drew a wave of attention last week after a photograph of partially visible notes he was carrying into the White House showed a mention of the Insurrection Act. MyPillow also offered a “FightforTrump” discount code on the day of the Capitol riots. On social media, groups like Sleeping Giants, which was created to choke off advertising dollars to Breitbart News, have been asking vendors about their support for MyPillow products.
Mr. Lindell railed against Sleeping Giants in the interview.
“These guys don’t understand, they’re scared,” Mr. Lindell said of Bed Bath & Beyond and Kohl’s. “They were good partners. In fact, I told them, you guys come back any time you want.”
Republicans foreshadowed their opposition to President-elect Joseph R. Biden Jr.’s economic plans on Tuesday, pressing Janet L. Yellen, his nominee for Treasury secretary, to defend a $1.9 trillion stimulus proposal that would provide more direct payments to individuals, expanded jobless benefits and money for states and cities.
The opposition from Republicans on the Senate Finance Committee during Ms. Yellen’s confirmation hearing underscored the challenge that the incoming Biden administration will face in trying to push its proposal through Congress given the narrow control it has in the Senate and House.
“We’re looking at another spending blowout,” said Senator Patrick J. Toomey, Republican of Pennsylvania. “The only organizing principle I can understand, it seems, is to spend as much money as possible, seemingly for the sake of spending it.”
Mr. Toomey took issue with Mr. Biden’s plans to send more money to states and cities, a measure that Republicans have opposed for the last year and that was dropped from the last round of stimulus talks in order to win passage of the $900 billion aid package. He also expressed concern about Mr. Biden’s proposed tax increases and his call for raising the minimum wage to $15.
Senator Tim Scott, Republican of South Carolina, seized on Mr. Biden’s call to raise the minimum wage from $7.25, arguing to Ms. Yellen that doing so would hurt small businesses while they are vulnerable and would lead to more job losses.
Other Republicans complained that the Biden economic plan is fiscally irresponsible given the nation’s growing debt load and the federal budget deficit, which topped $3 trillion last year. Senator Bill Cassidy, Republican of Louisiana, said that Mr. Biden’s plan is not sufficiently targeted and that giving an additional $1,400 in direct payments to some people who have not lost jobs is not an efficient use of federal resources.
Ms. Yellen rebutted their arguments point by point, making the case that doing too little to stimulate the economy would be more costly in the long run. She said that economic research have shown minimal job losses from raising the minimum wage, pointing to studies of neighboring states when one imposes an increase and the other does not.
She also argued that jobless benefits, which under Mr. Biden’s plan would be supplemented with an extra $400 per week, are not sufficient to address the financial struggles facing families and that the $1,400 stimulus checks are important in situations where one person, generally a woman, has left a job to care for children who are out of school.
“There are many families that are bearing exceptional financial burdens that are not addressed by unemployment compensation,” she said.
Ms. Yellen did offer some assurances to Republicans who are fearful that Democrats will repeal the entire 2017 tax law, which slashed taxes for individuals and corporations. She said that while Mr. Biden does want to make changes to the law, including raising the corporate tax rate, such actions are not an immediate priority.
“The focus right now is on providing relief and on helping families keep a roof over their heads and food on the table, and not on raising taxes,” she said.
Janet L. Yellen won the endorsement on Tuesday of eight former Treasury secretaries, who called for her speedy Senate confirmation so that she can assume the job under President-elect Joseph R. Biden Jr.
The letter of support was released shortly ahead of Ms. Yellen’s testimony at her confirmation hearing before the Senate Finance Committee. The group said that any delay would pose an unnecessary risk to the economy at a critical time.
“With millions of Americans out of work, long-term unemployment rising, and activity stalled in large sectors of the economy, daunting challenges will face the incoming administration. Addressing these pressing issues will require thoughtful engagement by the Department of the Treasury,” they wrote. “Any gap in its leadership would risk setting back recovery efforts.”
They added that a delay in confirming Ms. Yellen would also sow confusion among American allies, who traditionally rely on the United States for global economic leadership in times of crisis.
The letter was signed by George P. Shultz, James A. Baker III, Robert E. Rubin, Lawrence H. Summers, John W. Snow, Henry M. Paulson, Jr., Timothy F. Geithner and Jacob J. Lew. That all-male crew reflects the significance of Ms. Yellen’s nomination — if confirmed, she would be the first woman to lead the Treasury in its 231-year history.
The former secretaries said that Ms. Yellen, a former Federal Reserve chair, was uniquely qualified for the job because of her experience and knowledge.
Ms. Yellen is expected to have a smooth path to confirmation. An acting Treasury secretary is expected to fill the void at the Department between when Treasury Secretary Steven Mnuchin departs on Wednesday at noon and when Ms. Yellen is confirmed.
Representative Cheri Bustos of Illinois on Tuesday introduced a resolution that would acknowledge the journalists who covered the Capitol rampage on Jan. 6 even as Trump supporters, provoked by verbal attacks on the press lodged by the president himself, threatened and assaulted them.
Ms. Bustos, a Democrat, was a journalist for nearly two decades and worked as a reporter at The Quad-City Times of Illinois and Iowa.
A spokeswoman for Ms. Bustos said Tuesday afternoon that the resolution had 42 co-sponsors. It says that supporters of President Trump “surrounded, threatened and struck journalists, destroying equipment and forcing personnel to flee for fear of their safety,” and that “despite the overwhelming threats to their lives, journalists bravely continued to report.”
The resolution notes that Mr. Trump, in his speech on the morning of the riot, echoed his many past accusations that the media was the “enemy of the people” and “the biggest problem we have in this country.” Last week, the House impeached the president a second time, charging him with “incitement of insurrection.”
Print, photo and video journalists had started the day anticipating merely a presidential rally near the White House and the pro forma tallying of Electoral College votes. They continued to document the protest as it turned violent and as a crowd stomped on cameras while chanting, “CNN sucks!” The words “murder the media” were scratched into a door of the Capitol.
In a statement, Ms. Bustos said she and many colleagues had learned from
news broadcasts, while on the House floor, that a violent mob had breached the Capitol.
“We were getting news alerts in almost step-by-step fashion,” she said. “And I could see, firsthand, journalists in the gallery covering what was going on. Just like we were at risk, so were they.”
The average price for a one-way domestic flight dropped to $135 last summer, its lowest level in at least two decades, according to an analysis of new federal data by Cirium, an aviation data firm.
Normally, personal travel picks up during the summer and drops in the fall. That decline is usually offset by corporate travel, but with few people boarding planes and businesses having paused most employee travel during the pandemic, airlines cut fares to fill the reduced number of seats they were still selling.
“Summer was their last best chance to generate revenue,” said Jon Jager, a Cirium analyst.
The firm came up with its estimates by analyzing Transportation Department data on airfares from July to September, which was released on Tuesday. The $135 average price for a one-way ticket last summer included taxes and fees and is the lowest quarterly average airfare, before adjusting for inflation, since at least 2000, according to Cirium. The price also represents a 32 percent decline from the $198 average in summer 2019.
Airline travel has recovered somewhat since falling more than 95 percent in April, but it remains subdued. On Monday, just over 875,000 people were screened by the Transportation Security Administration, compared with nearly 2.3 million on the same day last year. Over the past week, the agency has screened only about 37 percent as many passengers as it did a year ago.
The fare data also varies substantially by airline. At Delta Air Lines, the gross fare for a one-way ticket from New York to Los Angeles declined 21 percent, to $298, from the summer of 2019 to the summer of 2020, for example. Fares on the same route over the same period fell 32 percent at United Airlines and 46 percent at American Airlines.
Over all, Delta’s airfares dropped 20 percent from the first quarter of 2020 to the third quarter, while prices dropped 26 percent for Southwest Airlines, 27 percent for United and 31 percent for American.
By: Ella Koeze·Data delayed at least 15 minutes·Source: FactSet
Stocks climbed on Tuesday, with Wall Street rebounding from a small decline last week, as Janet Yellen, the incoming Biden administration’s pick for Treasury secretary, promoted a vigorous fiscal response to the pandemic at a Senate hearing.
The S&P 500 rose 0.8 percent, following mixed trading in Europe and a rally in Asia.
Ms. Yellen, the former chair of the Federal Reserve, told senators at her confirmation hearing on Tuesday morning that the United States needed a robust fiscal stimulus package.
Oil prices rose. Futures of Brent, Europe’s benchmark, rose 2 percent to $55.86 a barrel. Futures of West Texas Intermediate rose to $53 a barrel. The International Energy Agency cut its estimates for oil demand for 2021 because of lockdowns to curb the spread of the coronavirus. But oil prices have recovered in recent months after Saudi Arabia and some other nations cut production.
The chairman of the Federal Trade Commission, Joseph Simons, said on Tuesday that he would leave the post on Jan. 29 after a tenure during which the agency brought multiple major enforcement actions against Facebook.
Mr. Simons, a Republican whom President Trump picked to lead the agency, became the agency’s leader in the middle of a data privacy investigation into Facebook. The case resulted in a record $5 billion fine for the social media giant. Late last year, he sided with the two Democrats in the five-member agency in to sue Facebook for antitrust violations.
Mr. Simons leaves as the agency continues investigations of Big Tech, including an antitrust investigation of Amazon.
“As technology and our economy continue to evolve through the digital age, the F.T.C.’s staff work tirelessly so that consumers continue to benefit from a fair and competitive marketplace,” Mr. Simons said in a statement. “It’s been a privilege to be part of that effort.”
In addition to replacing Mr. Simons at the agency, President-elect Joseph R. Biden Jr. will also need to fill the spot held by Rohit Chopra, a Democratic commissioner. Mr. Biden’s transition team has announced plans to nominate Mr. Chopra as director of the Consumer Financial Protection Bureau.
The merger of Fiat Chrysler and Peugeot that created Stellantis, the world’s fourth largest automaker, will protect jobs rather than threaten them, Carlos Tavares, the new company’s chief executive, said as shares of the new company rose sharply on their first day of trading in New York.
Mr. Tavares insisted that the merger is a “shield” for Stellantis’s 400,000 employees rather than a risk, allowing Fiat Chrysler and Peugeot to share the enormous cost of developing new technologies for electric vehicles and autonomous driving.
He repeated a promise not to close any factories as a result of the merger, which shareholders approved earlier this month. But Mr. Tavares did not rule out shutdowns in places like Brazil or Britain if regulations — for example the British government’s plan to ban the sale of new gasoline or diesel cars by 2030 — “lead to a situation where there is no business model.”
“Then the consequences are clear for everybody,” Mr. Tavares told reporters during a conference call. Union officials in Britain have expressed concern about the fate of a factory in Ellesmere Port that produces midsize cars for the Vauxhall and Opel, two of the company’s brands.
Over all, Stellantis has 14 brands including Fiat, Chrysler, Jeep, Peugeot, Citroën, Alfa-Romeo, Maserati and Ram Trucks. Some analysts have questioned whether so many brands are manageable, but Mr. Tavares said there were no plans to cull them.
The new company is also looking for ways re-enter the Chinese market after Peugeot failed to make a dent there, Mr. Tavares said. China has become the world’s largest car market by far and no major carmaker can afford to ignore it.
Based on vehicle sales during the first nine months of 2020, Stellantis trails Toyota, Volkswagen and the Renault-Nissan-Mitsubishi alliance. It has headquarters in the Netherlands with large production facilities in France, Italy and the United States.
In Mr. Tavares’s telling, the financial might of the new company will allow it to introduce new models and pursue opportunities that would not have been possible before the merger, providing work for underused factories in places like Italy. Labor costs are a relatively small factor, he said.
“There are many more things to do than just cutting jobs,” he said.
Stellantis shares were up 11 percent on their first day of trading on the New York Stock Exchange.
As Washington girds itself for President-elect Joseph R. Biden Jr.’s inauguration on Wednesday, lawmakers have asked transportation and hospitality companies for help “identifying and preventing the ongoing and extreme threat of further violent attacks.” Here’s how companies are responding:
Airlines: American, Delta, Southwest and United have imposed bans on firearms in checked luggage on flights to the Washington area. American has also suspended alcohol service, and Alaska Air has limited the number of tickets available for flights to and from Washington.
nd hospitality: Airbnb has canceled reservations in Washington for this week. Expedia’s Vrbo is blocking bookings through Friday, and it rolled out new procedures on Monday that include screening guests against federal threat lists. A spokesman for Hyatt said the chain had increased security personnel and was limiting hotel access to registered guests. The InterContinental Hotels Group is hiring extra security for its company-owned hotels and recommending that its franchised hotels do the same, a spokesman said. A representative for Hilton declined to discuss security measures but said it was “well-informed and mindful of current events.”
Other travel companies: To “avoid any disruptions” in Washington, the bus operator Vamoose canceled service Tuesday through Thursday. Megabus said last week that it would suspend service until Thursday. And the electric scooter companies Lime, Lyft, Spin and Helbiz are disabling service downtown.
The U.S. Federal Housing Finance Agency on Tuesday extended its moratorium on foreclosures and and evictions related to a foreclosure to the end of February, from the end of January. The extension should buy more time for the incoming Biden administration, which has indicated it wants to extend both the moratorium on foreclosures and rental evictions by several months — or at least until the pandemic begins to subside.
Federal regulators on Tuesday ordered Ford Motor to recall about three million cars to replace defective airbags made by the Japanese supplier Takata.
Ford had sought to have the vehicles excluded from recalls, but the National Highway Traffic Safety Administration found the airbags were similar to those subject to earlier recalls.
Takata airbags have been found to explode under certain conditions, shooting out inflater shrapnel that can injure or even kill drivers and passengers. The defect has been linked to more than a dozen deaths in the United States. Ford had argued its testing found the type of airbag inflaters used in its vehicles did not show a tendency to degrade over time.
The recall order covers vehicles including the Ford Ranger, Edge and Fusion made from 2007 to 2012.
Mazda had also sought to exclude some of its models from recalls. NHTSA ordered Mazda to recall an additional 5,800 vehicles.
More than 70 million vehicles equipped with Takata airbag inflaters have been recalled in more than 40 countries.
If you’re in the market for sports memorabilia, you might want to head to Costco. Yes, Costco.
The membership-only wholesale retailer, known for its bargains on bulk food and cleaning supplies, is selling a baseball autographed by Babe Ruth on its website for $64,000.
Costco describes it as “one of the nicest signed Babe Ruth Home Run Special Balls ever made available to the public, and is over all one of the nicest signed Babe Ruth balls known to be in existence.” Costco listed another ball signed by the Sultan of Swat in May for $30,000.
The concept might seem like a departure from Costco’s brand, offering customers staples on the cheap. Not so, said Andrew Lipsman, an analyst at the research firm eMarketer.
“It’s not totally out of character for Costco to sell high-ticket items,” he said, noting that the company has sold furniture and engagement rings, sometimes for hundreds of thousands of dollars. “My sense is that this is some sort of experiment in high-ticket items and seeing what will sell.”
Mr. Lipsman added that it might be a sign that the company was aligning around a growing market. “Sports memorabilia has been skyrocketing over the past year,” he said.
Indeed, the PWCC 500, an index of the top 500 trading cards, reached a record high in June, and has continued climbing. Experts attribute this to the spending power of baby boomers, millennials entering the market and increasing interest from foreigners, The Wall Street Journal reported.
Costco declined to comment for this article.
Baseball collectors’ items often fetch the highest prices. A Ruth jersey sold for $5.67 million at an auction in 2019.
Along with 27 other items on the “sports memorabilia” section of its website, Costco is also selling a bat signed by Ty Cobb. The bat, which Costco describes as “ultra rare and highly valuable,” is inscribed with the phrase “With Best Wishes Sincerely” and dated “3/14/49.” It is priced at $160,000.
Both sales end on Jan. 31.
Microsoft has agreed to invest in the autonomous vehicle division of General Motors called Cruise in a bid to become a supplier of technology for self-driving cars.
The software giant is participating in an investment round that will inject $2 billion into Cruise. G.M. and Honda are also participating in this round, which values the business at $30 billion.
“Microsoft, as the gold standard in the trustworthy democratization of technology, will be a force multiplier for us as we commercialize o
ur fleet of self-driving, all-electric, shared vehicles,” Cruise’s chief executive, Dan Ammann, said in a statement.
As part of the partnership, G.M. has agreed to use Microsoft’s Azure cloud-computing service to manage and provide data services related to autonomous cars.
Cruise is developing vehicles that G.M. hopes to use in driverless taxi and delivery services, though it is not clear how soon the company will begin such services. The automaker, Tesla and other companies have fallen behind the schedules they once offered for having large commercial fleets of autonomous cars on the road picking up passengers and delivering goods.
The Senate confirmation hearing of Janet Yellen as Treasury secretary begins on Tuesday, with a focus on reviving the pandemic-stricken economy, recovering lost jobs and regulating Wall Street. On economic stimulus, “right now, with interest rates at historic lows, the smartest thing we can do is act big,” Ms. Yellen is set to say in her opening remarks.
Corporate earnings season is ramping up, with more of America’s big banks releasing fourth-quarter earnings. Bank of America and Goldman Sachs reported on Tuesday, while Morgan Stanley steps up on Wednesday.
Netflix also reports its latest earnings on Tuesday, followed by Procter & Gamble and United Airlines on Wednesday, and IBM and Intel on Thursday.
Joseph R. Biden Jr. is expected to issue dozens of executive orders on Thursday, his first full day in office as president. He will also present legislative proposals for a $1.9 trillion stimulus bill, changes to immigration laws and other priorities of his administration.
The global pandemic ravaging American businesses and low-wage employees has barely lapped at the revenues and profits of the country’s biggest banks. Now, banks are saying that the worst of the pandemic’s potential to do them harm has passed.
Bank of America revealed on Tuesday that it had adjusted its calculations for how much cash it needed to set aside for a disaster, joining other large American banks in releasing some rainy-day funds based on an improved economic forecast. Goldman Sachs also said on Tuesday that it had adjusted its reserves, lowering them for some of its businesses while raising them slightly for its new consumer credit card division.
The banks can now use their freed-up cash to do things they avoided last year, like making new loans. They are also preparing to start distributing money to shareholders again after the Federal Reserve lifted temporary restrictions on share buybacks and dividend payments late last year.
“We continued to see signs of a recovery, led by increased consumer spending, stabilizing loan demand by our commercial customers and strong markets and investing activity,” Bank of America’s chief executive, Brian Moynihan, said in a statement accompanying the bank’s earnings report.
The bank released $828 million, less than its counterparts Citigroup and JPMorgan Chase each shed. But the move reflected similar changes to expectations of how the economy would perform this year, now that a vaccine for the coronavirus has begun to be distributed and Congress has passed another economic stimulus package.
In the fourth quarter of 2020, Bank of America earned $5.5 billion after taking in revenue of just over $20 billion. The numbers were not record-setting — in the same period in 2019, earnings were $7 billion and revenue was $22.3 billion — but they signaled that the bank was handily weathering the economic conditions caused by the pandemic. Revenue and income in its giant consumer business was down compared with the previous year, but business in its Wall Street division was better.
In the last three months of 2020, the bank took in $3.9 billion in revenue from trading in the financial markets and other related activities, a 14 percent increase from the same period a year earlier. The division earned $834 million for the quarter, compared with $638 million during the same period in 2019.
Goldman Sachs earned just over $4.5 billion in the final quarter of 2020 on revenue of $11.7 billion, which was 18 percent higher than the same quarter of 2019 thanks to a jump in its Wall Street trading and investment banking businesses. It pared down the amount of money it was setting aside to deal with losses in wholesale loans, but added
more for its consumer credit card business, which it started in the spring of 2019.