Global Stagflation Warning
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The World Bank yesterday raised the risk of a global recession, warning economies may face a 1970s-like period of stagflation, characterized by slow economic growth and rising prices. The organization lowered its global growth forecast for this year to 2.9%, down from 5.7% in 2021. Growth is expected to hover around that figure through 2024, the bank said, citing disrupted human activity, trade, and investments due to pandemic lockdowns and Russia's invasion of Ukraine. Read the report here.
Today's environment of high inflation, weak growth, and supply-chain disturbances draws parallels with the 1970s, when stagflation (see 101) required increases in interest rates in major economies, which then triggered financial crises in emerging markets and developing economies. Still, there are differences now, including a stronger US dollar and stronger balance sheets at major financial institutions.
The World Bank advised policymakers to avoid export bans and subsidies, instead focusing on accelerated debt relief and cushioning a spike in oil and food prices. |
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An independent expert panel recommended emergency use authorization yesterday for a COVID-19 vaccine manufactured by biotechnology firm Novavax. It would mark the fourth such vaccine available in the US, pending sign-off from the Centers for Disease Control and Prevention in the coming days.
Each COVID-19 vaccine works by priming the immune system to recognize and respond to the coronavirus spike protein. Shots from Pfizer and Moderna rely on relatively new mRNA technology (see 101), while Johnson & Johnson's vaccine is delivered via a modified flu-like virus. Novavax relies on a more traditional method using the spike protein itself—an approach the company says may appeal to those wary of existing shots.
Studies suggest the vaccine is 90% effective against pre-omicron variants, and its ability to protect against new strains has not been determined.
Around 67% of the US population has been fully vaccinated. See data on vaccine uptake here, and COVID-19 cases and deaths here. |
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A six-month trial of a four-day workweek kicked off in the UK this week, the biggest pilot to take place so far. More than 3,000 employees from 70 companies will work one less day for the same pay. Organized by the UK-based research group Autonomy and its partners, analysts will track productivity and employee well-being during the pilot.
A similar trial conducted in Iceland from 2015 to 2019 found an increase in overall well-being while productivity remained the same; 86% of workers in Iceland are now on or transitioning to a four-day schedule. Other countries plan to test the schedule this year, including Scotland, Australia, New Zealand, and Spain.
In the US and Canada, 38 companies will participate in a similar pilot. The potential shift faces challenges to widespread adoption—a survey of 459 companies found 91% were not considering a shortened workweek.
See the history of the concept here. |
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Sports, Entertainment, & Culture
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> Former world No. 1 golfer Dustin Johnson resigns from PGA Tour to play in Saudi-backed LIV Golf tournaments (More) | Tiger Woods to skip next week's US Open, will rest up to compete in July's British Open (More)
> "Inventing Anna" star Julia Garner tapped to play Madonna in upcoming biopic (More) | Carolina Panthers cheerleader Justine Lindsay becomes first openly transgender cheerleader in NFL history (More)
> Matthew McConaughey, whose hometown is Uvalde, Texas, advocates for responsible gun ownership and gun control policies at White House press briefing (More) |
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> European Union to mandate all new phones and other digital devices utilize USB-C plugs in an effort to standardize and reduce electronic waste; rules threaten Apple's use of proprietary Lightning ports (More)
> New artificial "leaves" made from common oxide and carbon-based materials provide a potential economically friendly way to produce hydrogen fuel from sunlight (More)
> Research shows complex sugar molecules found in mucus may be effective at fighting rare fungal infections (More) |
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> US stock markets up (S&P 500 +1.0%, Dow +0.8%, Nasdaq +0.9%) for second consecutive day (More)
> US Treasury Secretary Janet Yellen tells Senate Finance Committee she expects inflation to remain high (More)
> Target shares fall 2% after company warns its profits will drop as it works to reduce inventory levels (More) |
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> San Francisco voters recall Chesa Boudin as district attorney (More) | Billionaire developer Rick Caruso (D) and current Rep. Karen Bass (D) head to November runoff for Los Angeles mayoral race (More) | See results from primaries in seven states, including California, Iowa, and New Jersey (More)
> Department of Homeland Security warns of heightened extremist threats in the US over the next six months (More) | Florida Gov. Ron DeSantis (R) signs school safety bill, which includes crisis intervention training for officers (More) | American woman pleads guilty to leading an all-female Islamic State battalion (More)
> Russia increases shelling in the eastern Ukrainian city of Sievierodonetsk in attempt to gain full control of the Luhansk province (More) | The US seizes a Russian-owned yacht after receiving clearance from the Fiji Supreme Court (More) |
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