SAN FRANCISCO (AP) — Elon Musk was alternately depicted in a San Francisco courtroom as a liar who callously jeopardized the savings of “regular people” or a well-intentioned visionary. Those descriptions emerged Wednesday in opening statements at a trial focused on a Tesla buyout that never happened. Lawyers on opposing sides drew the starkly different portraits of Musk for the nine-person jury that will hear the three-week trial. The case is focused on two August 2018 tweets that the billionaire posted on the Twitter service that he now owns. The tweets indicated that Musk had lined up the financing to take Tesla private at a time when the automaker’s stock was slumping amid production problems.
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Job cuts in tech sector spread, Microsoft lays off 10,000
Microsoft is cutting 10,000 workers, almost 5% of its workforce, as it joins other tech companies in a scaling back of their pandemic-era expansions. The company said in a regulatory filing Wednesday that the layoffs were a response to “macroeconomic conditions and changing customer priorities.” The company said it will also be making changes to its hardware portfolio and consolidating its leased office locations. The loss of employees is far less than how many Microsoft hired during the COVID-19 pandemic as it responded to a boom in demand for its workplace software and cloud computing services as people worked and studied from home.
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Justice Dept. charges Russian founder of cryptocurrency firm
WASHINGTON (AP) — A Russian national who founded a cryptocurrency exchange the Justice Department says evaded U.S. regulations and became a haven for proceeds of criminal activity has been arrested. Federal officials say Anatoly Legkodymov was arrested Tuesday in Miami and was due in court Wednesday on a charge of conducting an unlicensed money transmitting business. Prosecutors allege his China-based cryptocurrency exchange, Bitzlato, did not implement required anti-money-laundering safeguards and required only minimal identification from its users. The charge Legkodymov faces carries a maximum penalty of five years in prison upon conviction. Legkodymov is in custody, and it’s unclear if he has a lawyer who could comment on his behalf.
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Fed’s Mester: Rate hikes have begun to quell US inflation
WASHINGTON (AP) — Growing evidence that high inflation is finally easing shows that the Federal Reserve’s sharp interest rate hikes are working as intended, says Loretta Mester, a key Fed policymaker. But further rate hikes are still needed, she says, to decisively crush the worst inflation bout in four decades. “We’re beginning to see the kind of actions that we need to see,” Mester, president of the Federal Reserve Bank of Cleveland, said in an interview with The Associated Press. Other Fed officials, too, have said they were encouraged by recent milder readings on inflation and wage growth. But Mester’s comments are notable because she is among the more consistently hawkish members of the Fed’s 19-person interest-rate-setting committee.
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December retail sales fall 1.1% as inflation takes a toll
NEW YORK (AP) — Americans cut back on spending in December, the second consecutive month they’ve done so, underscoring how inflation and the rising cost of using credit cards slowed consumer activity over the crucial holiday shopping season. Retail sales fell 1.1% in December, following a revised 1% drop in November, the Commerce Department reported Wednesday. In October, retail sales ticked up 1.3%, helped by early holiday shopping. Spending had remained resilient despite a spike in inflation that began almost 19 months ago, but the capacity of Americans to continue that spending has ebbed. And cracks are forming.
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Wholesale inflation in US slowed further in December to 6.2%
WASHINGTON (AP) — Wholesale prices in the United States rose 6.2% in December from a year earlier, a sixth straight monthly slowdown and a hopeful sign that inflation pressures will continue to cool. The latest year-over-year figure was down from 7.3% in November and from a recent peak of 11.7% in March. On a monthly basis, the producer price index, which measures costs before they reach consumers, dropped 0.5% from November to December. The producer price data can provide an early sign of where consumer inflation might be headed. The data reflects the prices that are charged by manufacturers, farmers and wholesalers, and it flows into an inflation gauge that the Federal Reserve closely tracks.
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Wall Street suffers biggest pullback of the year, led by tech
Wall Street suffered its biggest pullback of the year as a January market rally sputtered. Technology stocks led the way lower, including a 1.9% drop in Microsoft after the tech titan joined others in its industry in announcing layoffs. Weak readings on retail sales and industrial production also helped keep investors in a selling mood. The S&P 500 fell 1.6% Wednesday. The Nasdaq fell 1.2% and the Dow lost 1.8%. Treasury yields fell broadly. Japanese stocks ended higher after the Bank of Japan kept its loose monetary policy unchanged, dispelling speculation that it would raise rates to fight inflation.
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US, Chinese officials discuss climate, economy, relationship
ZURICH (AP) — U.S. Treasury Secretary Janet Yellen has met with her Chinese counterpart and pledged an effort to manage differences and “prevent competition from becoming anything ever near conflict.” The sit-down Wednesday in Zurich is the highest-ranking contact between the two countries since their presidents in November agreed to look for ways to ease strained relations. Yellen’s first face-to-face meeting with Vice Premier Liu He comes as the U.S. and Chinese economies grapple with differing but intertwined challenges on trade, technology and more. A U.S. Treasury readout of their meeting says the two agreed the U.S. and China would cooperate more on issues around financing for battling climate change.
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The S&P 500 fell 62.11 points, or 1.6%, to 3,928.86. The Dow Jones Industrial Average fell 613.89 points, or 1.8%, to 33,296.96. The Nasdaq fell 138.10 points, or 1.2%, to 10,957.01. The Russell 2000 index of smaller companies fell 29.92 points, or 1.6%, to 1,854.36.