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AMC Entertainment announced that it would reopen roughly 140 additional theaters by Sept. 4, bringing a total of 70 percent of its movie theaters in the United States back into operation. Shares of the company jumped nearly 10 percent after-hours following the announcement Tuesday afternoon.
The majority of the theaters will reopen on Sept. 3, the same day that Christopher Nolan’s “Tenet” comes out. Theater executives are hoping the $200 million thriller will draw crowds of viewers out of their homes to experience the film on the big screen. But it remains to be seen whether people will want to sit in an enclosed space next to other moviegoers at a time when the virus continues to spread across the country.
AMC says it is consulting with “top scientists and experts in public health” to make the reopening process safe for patrons.
“Our comprehensive commitment to operating our theaters safely now includes social distancing through limiting ticket sales and automatic seat blocking, seamless contactless ticketing, greatly enhanced cleaning procedures, the availability of hand sanitizer and disinfecting wipes throughout our theaters, as well as a mandatory mask policy for all guests and crew members,” the company said in a statement.
On Sept. 4, AMC plans to start reopening its first California theaters, including seven theaters in the San Diego area.
The Trump administration issued an order on Tuesday barring evictions of most renters in the country for the rest of the year as the nation grapples with the coronavirus pandemic.
The order, put forward by the Centers for Disease Control and Prevention, said the action was needed to stop the spread of the virus and to avoid having renters lose their homes and wind up in shelters or other crowded living conditions, compounding the crisis.
The moratorium would go further than the eviction ban under the CARES Act, which covered as many as 12.3 million renters living in apartment complexes or single-family homes financed with federally backed mortgages. That provision expired in July.
To apply for the new moratorium, tenants would have to attest to a substantial loss of household income, the inability to pay full rent and best efforts to pay partial rent. Tenants would also need to stipulate that eviction would be likely to leave them homeless or force them to live with others at close quarters.
The order does not relieve tenants of their ultimate obligation to pay rent. It applies to those who expect to earn no more than $99,000 this year or who meet other income limits.
Treasury Secretary Steven Mnuchin told a congressional committee on Tuesday that the economy is recovering from the pandemic-induced recession but said “there is more work to be done” and that he would continue pushing for a “bipartisan agreement” on another round of economic stimulus from Congress.
“While we continue to see signs of a strong economic recovery, we are sensitive to the fact that there is more work to be done, and certain areas of the economy require additional relief,” Mr. Mnuchin told the Select Subcommittee on the Coronavirus Crisis.
Mr. Mnuchin suggested that lawmakers focus on a smaller, more targeted package of relief, saying “we need support quickly and if we need to do more we can come back.”
But while the Treasury secretary called on Congress to act, the chairman of the select subcommittee, Representative James E. Clyburn, Democrat of South Carolina, scolded Mr. Mnuchin for the administration’s handling of the pandemic and the recession and said the White House needs to take additional steps to help workers and businesses.
Mr. Clyburn challenged Mr. Mnuchin on President Trump’s claims that the economy is “roaring back,” saying unemployment remains high and millions are still out of work.
Deep divisions remain between the White House and congressional Democrats and it is unclear whether another stimulus package might pass. In a sign of those ongoing differences, Mr. Mnuchin said the next round of stimulus should include “liability protection for universities, schools, and businesses.”
That proved to be a stumbling point the last time, with Mitch McConnell, the Senate majority leader, insisting that any additional relief include protection against virus-related lawsuits for companies and other institutions. Democrats, along with unions and workers’ rights advocates, objected to the proposal, saying it would result in negligent behavior on the part of businesses and schools and lead to more coronavirus cases and more deaths.
Lael Brainard, a Federal Reserve governor, said the U.S. economy remained at risk as the coronavirus pandemic wears on — and support from Congress and the White House was crucial to cushioning the blow.
“The economy continues to face considerable uncertainty associated with the vagaries of the Covid-19 pandemic, and risks are tilted to the downside,” Ms. Brainard said in remarks prepared for delivery at a Brookings Institution event on Tuesday. “As was true in the first phase of the crisis, fiscal support will remain essential to sustaining many families and businesses.”
Her comments came as the future of another government support package looked uncertain. Ms. Brainard, the last person on the Fed’s board in Washington to have been picked for her job by the Obama administration, said that monetary policy would also play a role as pandemic uncertainty persisted, and that central bankers would need to pivot from stabilizing markets to supporting economic growth in the coming months.
“It will be important to provide the requisite accommodation to achieve maximum employment and average inflation of 2 percent over time,” she said.
The Fed last week unveiled a new long-run policy statement, making critical updates to its strategy for achieving its goals of full employment and stable inflation. Ms. Brainard said the tweaks, which together lay the groundwork for long periods of very low interest rates, will help to guide the central bank’s policies coming out of the pandemic.
One key change — the Fed will now aim for 2 percent inflation on average over time, instead of as a more or less absolute goal — will allow the Fed to keep rates low even as prices climb slightly, she said.
“I would expect the Committee to accommodate rather than offset inflationary pressures moderately above 2 percent, in a process of opportunistic reflation,” she said.
U.S. stocks fluctuated in early trading Tuesday before turning positive. The S&P 500 rose 0.75 percent, closing at another record high. The index ended August up about 7 percent for its second-best month of the year.
Zoom’s stock shot up 40 percent after the video conferencing company reported that its revenue had quadrupled in the most recent quarter.
European stocks were lower on Tuesday, after Germany, Europe’s largest economy, lowered its economic growth forecast for 2021, though it revised upward its 2020 estimate.
Most Asian markets ended the day slightly higher, but Japan’s Nikkei was flat. Markets in China were lifted by data showing that the country’s factory activity last month expanded at the fastest rate since 2011, signaling a continued recovery from the economic damage wrought by the pandemic.
The U.S. dollar continued its decline, dropping to a two-year low, while the euro rose to just below $1.20 and China’s yuan also strengthened.
The Dow Jones industrial average introduced on Monday its revamped lineup of stocks, with Amgen, Salesforce.com and Honeywell replacing Exxon Mobil, Raytheon and Pfizer in the 30-stock menu. The rejiggering came after Apple’s 4-for-1 stock split.
Watch out: Weekly data on unemployment filings are about to get even more confusing.
The Labor Department has announced that it is changing the way it adjusts jobless claims figures for seasonal patterns. Economists say the change will make the data more accurate, but it will also complicate comparisons over time.
The seasonal adjustment process is meant to account for regular, predictable patterns in layoffs. Hundreds of thousands of seasonal retail workers are let go after the holidays each year, for example.
The surge of layoffs during the pandemic, however, threw off seasonal patterns and led the seasonal adjustment process to exaggerate week-to-week changes.
Until now, seasonal adjustments have taken past patterns into account by offsetting the total by the percentage by which claims ordinarily rose or fell that week. The new methodology will base the adjustments on the number of people who filed claims in a given week in prior years.
Heidi Shierholz, a former chief economist for the Labor Department under President Barack Obama and now a senior economist at the left-leaning Economic Policy Institute, said the change in methodology should make the seasonally adjusted numbers more accurate.
The Labor Department does not plan to revise its estimates for previous weeks, however. That means that the next set of numbers, which will be released on Thursday, will not be directly comparable to earlier data. The report will almost certainly show a big drop in seasonally adjusted claims, but that will reflect the change in methodology, not a real-world decline in layoffs.
As a result, in our coverage, The Times plans to emphasize unadjusted figures, which will not be affected by the change in methodology and are comparable over time. We will continue to use the unadjusted figures at least until weekly claims fall to a level where normal seasonal patterns become relevant again.
None of this will change the big picture. Both adjusted and unadjusted data showed a huge spike in unemployment filings beginning in March, and a much more gradual decline since then. Both show progress stalling in recent weeks.
“The broad brush strokes are the same no matter what numbers you use here,” Ms. Shierholz said.
The Trump administration plans to delay the collection of payroll taxes for more than one million federal workers through the end of the year, a move that could result in a sharp reduction in pay in the early months of 2021.
The plan, which stems from an executive order issued by President Trump in August, would force some federal employees into a complicated deferral of tax liability that few private-sector workers are likely to face. Many companies and business groups have said they don’t plan to suspend the collection of payroll taxes, which is voluntary, calling it unnecessary and overly complex.
Mr. Trump’s executive order aims to boost the economy by delaying the collection of the tax workers pay to help fund Social Security. But because Mr. Trump does not have the authority to eliminate the tax without the consent of Congress, workers will still owe that money next year. Mr. Trump has promised to sign a bill that would eliminate the taxes owed but Congress has shown little appetite for such legislation, in part because the money is used to fund entitlement programs that are already facing future insolvency.
Last week, the Treasury Department issued guidance to implement the delay, which affects workers earning less than $104,000 per year. That guidance effectively gives employers the ability to suspend payroll tax collections from Sept. 1 through Dec. 31. If no additional measures are passed by Congress, those deferred taxes would be due in the first quarter of 2021. As a result, employees would see larger-than-normal paychecks for the end of this year, and smaller paychecks at the start of next year.
Few companies have indicated they would participate in the deferral, but a spokeswoman for the Office of Management and Budget said on Tuesday in an email that the White House was moving to implement the guidance for its employees.
While the federal government is the nation’s largest employer, the move by itself will not provide much of a boost to economic growth. The Committee for a Responsible Federal Budget estimates that the overall tax deferral for eligible workers through year’s end would add up to about $5 billion over four months.
Most unemployed Americans would go back to work if given the opportunity, even if the government made jobless benefits more generous, according to a new survey.
The Gallup survey was conducted in early August, days after the expiration of the $600 a week in extra benefits that the federal government had been paying out to jobless workers during the pandemic. More than 400 respondents who were receiving unemployment benefits were asked whether they would return to their previous jobs if the payments were reinstated at a lower level. More than 80 percent said they were “very likely” or “somewhat likely” to go back to work.
The amount of money offered made little difference to people’s decisions. About a third of the respondents were asked about a prospective $150 weekly add-on to their unemployment benefits. Another third were asked about $300, and the remaining third were asked about $450. The responses looked almost identical across the three groups.
Sonal Desai, chief investment officer of Franklin Templeton Fixed Income, a partner with Gallup on the survey, said the results might look surprising at first. But jobless Americans have good reason to prefer going back to work. The expiration of the earlier $600 supplement was a potent reminder that benefits are temporary. And with the unemployment rate still above 10 percent, there is lots of competition for available jobs.
“You’ve got literally millions of people who have been sidelined, so especially if you’re in the restaurant or hospitality business, you would be worried that if you didn’t go back that someone else would take your job,” Ms. Desai said.
Other recent research has also found that the extra jobless benefits did not discourage people from returning to work in significant numbers. And recent economic data does not suggest that jobless Americans have rushed back to work since the $600 benefit expired.
Democrats and Republicans don’t agree on much these days. But they agree on this: They would like the government to send them money.
According to a survey of 5,000 adults conducted in early August by Gallup and Franklin Templeton, the investment firm, 70 percent of Americans believe the federal government should send a second round of direct cash payments.About 82 percent of Democrats and 64 percent of Republicans supported such a move.
The partisan divide over the size of a potential stimulus payment was even smaller. Among those who support another round of checks, about two-thirds across all partisan groups said the payments should be $900 or more, the largest option offered in the survey.
“At this point, with unemployment still quite high, it’s obvious that there’s not going to be an immediate recovery, so there’s still a lot of interest among both parties in continuing some form of relief,” said Jonathan Rothwell, principal economist for Gallup.
The earlier payments, which sent $1,200 per adult and $500 per child to most American households, were among the most popular components of the CARES Act, the emergency spending package passed in March.
But prospects for further payments are uncertain. House Democrats in May passed a bill that included another round of $1,200 checks, but Senate Republicans have refused to take up the measure and are divided over an alternative.
J.C. Penney’s advisers warned a bankruptcy judge in Texas on Monday that talks with buyers have hit a stalemate. The retailer now has until Sept. 10 to make a deal with a buyer, sell to its creditors or liquidate, today’s DealBook newsletter explains.
The department store operator’s survival hinges on a plan to carve out some of its best properties into a real estate investment trust, or REIT, and sell its retail business to a buyer that would keep stores open. Its lenders have steered the process since it filed for bankruptcy in May.
It thought it had found salvation in Brookfield Property Partners and Simon Property Group, after Hudson’s Bay Group and Sycamore Partners dropped out of the running. Brookfield and Simon both own malls with J.C. Penney stores as tenants, so a liquidation would hurt them. Still, the consortium of mall owners and J.C. Penney’s creditors have butted heads. Key sticking points include valuation and who has the right to redevelop mall space: Brookfield and Simon or the creditors. If creditors lose that right, any REIT would have less value.
Talks have been dragging for weeks. The bankruptcy judge overseeing the case told both sides that they were trying the court’s patience. The rebuke wasn’t enough: J.C. Penney’s lawyer, Kirkland & Ellis’s bankruptcy guru Josh Sussberg, told the court yesterday that the discussions with potential buyers had stalled, and the company would instead focus on a bid by lenders. It is unclear, though, whether the hedge funds that own J.C. Penney’s debt want to take over an ailing retail business during a pandemic.
Also of note: Mr. Sussberg said in the hearing that the retailer would shut even more stores.
At risk are some 70,000 jobs. A liquidation would also likely bring bad publicity for the hedge funds that have funded J.C. Penney’s bankruptcy. (Mr. Sussberg made sure to list the funds’ names, which included H/2 Capital, at an earlier hearing.) It would also be costly for Brookfield and Simon, but they may simply decide to take the hit and adjust to a new world in which malls are reborn as distribution centers.
If you like charts that go up and to the right, there is a lot to like in recent market moves, notes today’s DealBook newsletter.
Zoom’s latest quarterly earnings beat already high expectations — and raised them further. The videoconferencing company reported yesterday that revenue more than quadrupled in its most recent quarter, while profit was 30 times higher than a year ago. At the close on Tuesday, Zoom’s shares were up more than 40 percent, adding billions to the net worth of its chief executive, Eric Yuan.
Tesla’s stock is also soaring. Monday’s five-for-one stock split had no effect on the company’s valuation, but the electric carmaker’s shares gained more than 12 percent on the day. Before the market opened on Tuesday, the company announced that it will raise up to $5 billion by selling new shares “from time to time.” Now seems like a good time to take advantage of the run-up in its stock price, which has made Tesla the seventh-largest listed company in the U.S. and Elon Musk, its chief executive, the world’s third-richest man (ahead of Mark Zuckerberg and closing in on Bill Gates).
Its shares were down nearly 5 percent on Tuesday, but have risen by more than 400 percent so far this year.
Dozens of former McDonald’s franchisees are suing the company for racial discrimination, saying that the fast food giant placed Black-owned franchises in subpar locations with higher operating and insurance costs and less opportunity for profit than locations owned by white franchisees.
“Revenue at McDonald’s is determined by one thing and one thing only, and that’s location,” said James Ferraro, attorney for the plaintiffs, in an interview. “When you want a Big Mac, you go to the nearest McDonald’s location.”
In the lawsuit, which was filed Tuesday in a federal court in Illinois, the 52 plaintiffs claimed that McDonald’s had impeded the efforts of Black franchisees to acquire additional stores and pushed Black franchisees out of the system by refusing to offer the same support, including rent relief, offered to white franchisees experiencing financial hardship.
The lawsuit said the plaintiffs’ average annual revenue, at $2 million, was at least $700,000 less than the company’s national franchisee average between 2011 and 2016. Last year, national average sales for its franchisees was $2.9 million, according to the suit.
McDonald’s denied the racial discrimination allegations, saying that while the company might recommend locations, the franchisees themselves ultimately chose the location they wished to purchase.
“We are confident that the facts will show how committed we are to the diversity and equal opportunity of the McDonald’s system, including across our franchisees, suppliers and employees,” the company said in a statement.
Old Navy, one of the largest U.S. apparel chains, said that it would give its employees a day of pay for serving as poll workers on Election Day this year, whether or not they are scheduled to work in stores on Nov. 3. The compensation will add to payment from their county’s election commissioner. The chain said in a release that it wanted to engage its field employees in the democratic process, especially given that about 64 percent are between the ages of 18 and 29. Retail is the second-biggest private employer in the U.S. after health care, and a series of chains have recently started announcing days off and other initiatives to encourage voter turnout this year in a tight presidential race.
General Motors said on Tuesday that it would stop making ventilators after delivering 30,000 of them to the federal government. The company’s partner, Ventec Life Systems, will take control of an assembly line at a G.M. electronics plant in Kokomo, Ind. The automaker started building the assembly line in March to meet surging demand for ventilators in the early days of the coronavirus pandemic. Ventec will continue making ventilators in Kokomo and at its own plant in Bothell, Wash.
Walmart is rolling out a membership service that will give customers free shipping on tens of thousands of items, including produce and groceries. The service, Walmart+, will cost $98 a year. That is lower than the $119 charged for Amazon Prime, which has set the bar for e-commerce membership services, but Walmart+ will require an order of at least $35 to qualify for the free shipping, while Prime does not have a minimum. Walmart said many of the 160,000 items that would qualify for the free shipping would be delivered directly from its stores to customers’ homes.
On Sunday, United Airlines said it was permanently dropping change fees for most customers flying domestically. American Airlines and Delta Air Lines followed suit a day later. The changes, effective immediately, apply to all standard economy and premium seats, but not to any of the airlines’ low-price basic economy seats, which come with additional restrictions.