SAN FRANCISCO — Bitcoin was conceived more than a decade ago as “digital gold,” a long-term store of value that would resist broader economic trends and provide a hedge against inflation.
But Bitcoin’s crashing price over the last month shows that vision is a long way from reality. Instead, traders are increasingly treating the cryptocurrency like just another speculative tech investment.
Since the start of this year, Bitcoin’s price movement has closely mirrored that of the Nasdaq, a benchmark that’s heavily weighted toward technology stocks, according to an analysis by the data firm Arcane Research. That means that as Bitcoin’s price dropped more than 25 percent over the last month, to under $30,000 on Wednesday — less than half its November peak — the plunge came in near lock step with a broader collapse of tech stocks as investors grappled with higher interest rates and the war in Ukraine.
The growing correlation helps explain why those who bought the cryptocurrency last year, hoping it would grow more valuable, have seen their investment crater. And while Bitcoin has always been volatile, its increasing resemblance to risky tech stocks starkly shows that its promise as a transformative asset remains unfulfilled.
institutional investors like hedge funds, endowments and family offices that have poured money into the cryptocurrency market.
declining revenue and a loss of $430 million in the first quarter. The company’s stock has fallen more than 75 percent overall this year.
The Nasdaq is already in bear-market territory, having ended Wednesday down 29 percent from its mid-November record. November was also when Bitcoin’s price hit a peak of nearly $70,000. The crash has been a reality check for Bitcoin evangelists.
Ukrainian counteroffensive near Kharkiv appears to have contributed to sharply reduced Russian shelling in the eastern city. But Moscow’s forces are making advances along other parts of the front line.
American aid. The House voted 368 to 57 in favor of a $39.8 billion aid package for Ukraine, which would bring the total U.S. financial commitment to roughly $53 billion over two months. The Senate still needs to vote on the proposal.
Russian oil embargo. European Union ambassadors again failed to reach an agreement to ban Russian oil, because Hungary has resisted the adoption of the embargo. The country is preventing the bloc from presenting a united front against Moscow.
Bitcoin has rebounded from major losses before, and its long-term growth remains impressive. Before the pandemic boom in crypto prices, its value hovered well below $10,000. True believers, who call themselves Bitcoin maximalists, remain adamant that the cryptocurrency will eventually break from its correlation with risk assets.
Michael Saylor, the chief executive of the business-intelligence company MicroStrategy, has spent billions of his firm’s money on Bitcoin, building up a stockpile of more than 125,000 coins. As the price of Bitcoin has cratered, the company’s stock has dropped roughly 75 percent since November.
In an email, Mr. Saylor blamed the crash on “traders and technocrats” who don’t appreciate Bitcoin’s long-term potential to transform the global financial system.
“In the near term, the market will be dominated by those with less appreciation of the virtues of Bitcoin,” he said. “Over the long term, the maximalists will be proven correct, because billions of people need this solution, and awareness is spreading to millions more each month.”
In destructive power, the behemoths of the Cold War dwarfed the American atomic bomb that destroyed Hiroshima. Washington’s biggest test blast was 1,000 times as large. Moscow’s was 3,000 times. On both sides, the idea was to deter strikes with threats of vast retaliation — with mutual assured destruction, or MAD. The psychological bar was so high that nuclear strikes came to be seen as unthinkable.
Today, both Russia and the United States have nuclear arms that are much less destructive — their power just fractions of the Hiroshima bomb’s force, their use perhaps less frightening and more thinkable.
Concern about these smaller arms has soared as Vladimir V. Putin, in the Ukraine war, has warned of his nuclear might, has put his atomic forces on alert and has had his military carry out risky attacks on nuclear power plants. The fear is that if Mr. Putin feels cornered in the conflict, he might choose to detonate one of his lesser nuclear arms — breaking the taboo set 76 years ago after Hiroshima and Nagasaki.
Analysts note that Russian troops have long practiced the transition from conventional to nuclear war, especially as a way to gain the upper hand after battlefield losses. And the military, they add, wielding the world’s largest nuclear arsenal, has explored a variety of escalatory options that Mr. Putin might choose from.
“The chances are low but rising,” said Ulrich Kühn, a nuclear expert at the University of Hamburg and the Carnegie Endowment for International Peace. “The war is not going well for the Russians,” he observed, “and the pressure from the West is increasing.”
Mr. Putin might fire a weapon at an uninhabited area instead of at troops, Dr. Kühn said. In a 2018 study, he laid out a crisis scenario in which Moscow detonated a bomb over a remote part of the North Sea as a way to signal deadlier strikes to come.
“It feels horrible to talk about these things,” Dr. Kühn said in an interview. “But we have to consider that this is becoming a possibility.”
Washington expects more atomic moves from Mr. Putin in the days ahead. Moscow is likely to “increasingly rely on its nuclear deterrent to signal the West and project strength” as the war and its consequences weaken Russia, Lt. Gen. Scott D. Berrier, director of the Defense Intelligence Agency, told the House Armed Services Committee on Thursday.
President Biden is traveling to a NATO summit in Brussels this week to discuss the Russian invasion of Ukraine. The agenda is expected to include how the alliance will respond if Russia employs chemical, biological, cyber or nuclear weapons.
James R. Clapper Jr., a retired Air Force general who served as President Barack Obama’s director of national intelligence, said Moscow had lowered its bar for atomic use after the Cold War when the Russian army fell into disarray. Today, he added, Russia regards nuclear arms as utilitarian rather than unthinkable.
“They didn’t care,” Mr. Clapper said of Russian troops’ risking a radiation release earlier this month when they attacked the Zaporizhzhia nuclear reactor site — the largest not only in Ukraine but in Europe. “They went ahead and fired on it. That’s indicative of the Russian laissez-faire attitude. They don’t make the distinctions that we do on nuclear weapons.”
Mr. Putin announced last month that he was putting Russian nuclear forces into “special combat readiness.” Pavel Podvig, a longtime researcher of Russia’s nuclear forces, said the alert had most likely primed the Russian command and control system for the possibility of receiving a nuclear order.
It’s unclear how Russia exerts control over its arsenal of less destructive arms. But some U.S. politicians and experts have denounced the smaller weapons on both sides as threatening to upend the global balance of nuclear terror.
For Russia, military analysts note, edgy displays of the less destructive arms have let Mr. Putin polish his reputation for deadly brinkmanship and expand the zone of intimidation he needs to fight a bloody conventional war.
“Putin is using nuclear deterrence to have his way in Ukraine,” said Nina Tannenwald, a political scientist at Brown University who recently profiled the less powerful armaments. “His nuclear weapons keep the West from intervening.”
A global race for the smaller arms is intensifying. Though such weapons are less destructive by Cold War standards, modern estimates show that the equivalent of half a Hiroshima bomb, if detonated in Midtown Manhattan, would kill or injure half a million people.
The case against these arms is that they undermine the nuclear taboo and make crisis situations even more dangerous. Their less destructive nature, critics say, can feed the illusion of atomic control when in fact their use can suddenly flare into a full-blown nuclear war. A simulation devised by experts at Princeton University starts with Moscow firing a nuclear warning shot; NATO responds with a small strike, and the ensuing war yields more than 90 million casualties in its first few hours.
No arms control treaties regulate the lesser warheads, known sometimes as tactical or nonstrategic nuclear weapons, so the nuclear superpowers make and deploy as many as they want. Russia has perhaps 2,000, according to Hans M. Kristensen, director of the Nuclear Information Project at the Federation of American Scientists, a private group in Washington. And the United States has roughly 100 in Europe, a number limited by domestic policy disputes and the political complexities of basing them among NATO allies, whose populations often resist and protest the weapons’ presence.
Russia’s atomic war doctrine came to be known as “escalate to de-escalate” — meaning routed troops would fire a nuclear weapon to stun an aggressor into retreat or submission. Moscow repeatedly practiced the tactic in field exercises. In 1999, for instance, a large drill simulated a NATO attack on Kaliningrad, the Russian enclave on the Baltic Sea. The exercise had Russian forces in disarray until Moscow fired nuclear arms at Poland and the United States.
Dr. Kühn of the University of Hamburg said the defensive training drills of the 1990s had turned toward offense in the 2000s as the Russian army regained some of its former strength.
Concurrent with its new offensive strategy, Russia embarked on a modernization of its nuclear forces, including its less destructive arms. As in the West, some of the warheads were given variable explosive yields that could be dialed up or down depending on the military situation.
A centerpiece of the new arsenal was the Iskander-M, first deployed in 2005. The mobile launcher can fire two missiles that travel roughly 300 miles. The missiles can carry conventional as well as nuclear warheads. Russian figures put the smallest nuclear blast from those missiles at roughly a third that of the Hiroshima bomb.
Before the Russian army invaded Ukraine, satellite images showed that Moscow had deployed Iskander missile batteries in Belarus and to its east in Russian territory. There’s no public data on whether Russia has armed any of the Iskanders with nuclear warheads.
Nikolai Sokov, a former Russian diplomat who negotiated arms control treaties in Soviet times, said that nuclear warheads could also be placed on cruise missiles. The low-flying weapons, launched from planes, ships or the ground, hug the local terrain to avoid detection by enemy radar.
From inside Russian territory, he said, “they can reach all of Europe,” including Britain.
Over the years, the United States and its NATO allies have sought to rival Russia’s arsenal of lesser nuclear arms. It started decades ago as the United States began sending bombs for fighter jets to military bases in Belgium, Germany, Italy, Turkey and the Netherlands. Dr. Kühn noted that the alliance, in contrast to Russia, does not conduct field drills practicing a transition from conventional to nuclear war.
In 2010, Mr. Obama, who had long advocated for a “nuclear-free world,” decided to refurbish and improve the NATO weapons, turning them into smart bombs with maneuverable fins that made their targeting highly precise. That, in turn, gave war planners the freedom to lower the weapons’ variable explosive force to as little as 2 percent of that of the Hiroshima bomb.
The reduced blast capability made breaking the nuclear taboo “more thinkable,” Gen. James E. Cartwright, a vice chairman of the Joint Chiefs of Staff under Mr. Obama, warned at the time. He nonetheless backed the program because the high degree of precision lowered the risk of collateral damage and civilian casualties. But after years of funding and manufacturing delays, the refurbished bomb, known as the B61 Model 12, is not expected to be deployed in Europe until next year, Mr. Kristensen said.
The steady Russian buildups and the slow American responses prompted the Trump administration to propose a new missile warhead in 2018. Its destructive force was seen as roughly half that of the Hiroshima bomb, according to Mr. Kristensen. It was to be deployed on the nation’s fleet of 14 ballistic missile submarines.
While some experts warned that the bomb, known as the W76 Model 2, could make it more tempting for a president to order a nuclear strike, the Trump administration argued that the weapon would lower the risk of war by ensuring that Russia would face the threat of proportional counterstrikes. It was deployed in late 2019.
“It’s all about psychology — deadly psychology,” said Franklin C. Miller, a nuclear expert who backed the new warhead and, before leaving public office in 2005, held Pentagon and White House posts for three decades. “If your opponent thinks he has a battlefield edge, you try to convince him that he’s wrong.”
When he was a candidate for the presidency, Joseph R. Biden Jr. called the less powerful warhead a “bad idea” that would make presidents “more inclined” to use it. But Mr. Kristensen said the Biden administration seemed unlikely to remove the new warhead from the nation’s submarines.
It’s unclear how Mr. Biden would respond to the use of a nuclear weapon by Mr. Putin. Nuclear war plans are one of Washington’s most deeply held secrets. Experts say that the war-fighting plans in general go from warning shots to single strikes to multiple retaliations and that the hardest question is whether there are reliable ways to prevent a conflict from escalating.
Even Mr. Clapper, the former director of national intelligence, said he was unsure how he would advise Mr. Biden if Mr. Putin unleashed his nuclear arms.
“When do you stop?” he asked of nuclear retaliation. “You can’t just keep turning the other cheek. At some point we’d have to do something.”
A U.S. response to a small Russian blast, experts say, might be to fire one of the new submarine-launchedwarheads into the wilds of Siberia or at a military base inside Russia. Mr. Miller, the former government nuclear official and a former chairman of NATO’s nuclear policy committee, said such a blast would be a way of signaling to Moscow that “this is serious, that things are getting out of hand.”
Military strategists say a tit-for-tat rejoinder would throw the responsibility for further escalation back at Russia, making Moscow feel its ominous weight and ideally keeping the situation from spinning out of control despite the dangers in war of miscalculation and accident.
In a darker scenario, Mr. Putin might resort to using atomic arms if the war in Ukraine spilled into neighboring NATO states. All NATO members, including the United States, are obliged to defend one another — potentially with salvos of nuclear warheads.
Dr. Tannenwald, the political scientist at Brown University, wondered if the old protections of nuclear deterrence, now rooted in opposing lines of less destructive arms, would succeed in keeping the peace.
“It sure doesn’t feel that way in a crisis,” she said.
David E. Sanger contributed reporting from Washington.
For the past nine months, I have been pregnant. But I have not — for the most part — been pregnant at work.
In the beginning, when I felt nauseous, I threw up in my own bathroom. Saltine crackers became a constant companion but remained out of view of my Zoom camera. A couple of months later, I switched from jeans to leggings without any comment from my co-workers.
And as my baby grew from the size of a lemon to a grapefruit to a cantaloupe, the box through which my colleagues see me on video calls cropped out my basketball-sized gut.
Outside the virtual office, an airport security screener scolded me for trying to pick up a suitcase, cashiers became extra nice and strangers informed me of how big or small or wide or high my belly was.
Bureau of Labor Statistics.
And research suggests that pregnant women tend to be seen as less competent, more needing of accommodation, and less committed to work as compared with women who don’t have children, said Eden King, a professor of psychology at Rice University who studies how pregnancy affects women in the workplace.
Similar stereotypes affect mothers — 63 percent of whom are working while their youngest child is under three, according to the Labor Department — but pregnancy is a more visible identity, said Ms. King. “It can be a very physical characteristic in a way that motherhood isn’t,” she said. “So some of those experiences and expectations may be exacerbated.”
In interviews with 10 pregnant or recently pregnant remote workers for this article, several women said that being visibly pregnant in real life but not on a work Zoom screen helped them feel more confident and less apprehensive about what parenthood might mean for their career. Christine Glandorf, who works in education technology and is due with her first child this month, said that like many professionals on the brink of parenthood, she worried that people’s expectations of her in the workplace could change. Remote work solves part of that equation.
“It’s nice that it’s literally not in people’s face in any way, shape or form unless I choose for it to be a part of the conversation,” she said.
a study published in the journal Personnel Psychology in 2020, Ms. King and her colleagues asked more than 100 pregnant women in a variety of industries to track how much their supervisors, without having been asked for help, did things like assign them less work so they wouldn’t be overwhelmed or protect them from unpleasant news.
Women who received more unwanted help reported feeling less capable at work, and they were more likely to want to quit nine months postpartum.
“The more you experienced those seemingly positive but actually benevolently sexist behaviors, the less you believed in yourself,” Ms. King said.
Journal of Applied Psychology in 2019, examined this apparent shift in treatment.
believe women and men should be treated equally at work and at home, mothers in opposite-sex relationships still handle a majority of the housework and child care. The same pattern holds for parental leave. While almost half of men support the idea of paid paternity leave, fewer than five percent take more than two weeks.
In 2004, California began a paid family leave program that provides a portion of a new parent’s salary for up to eight weeks. Though the program offers the same benefit to both new fathers and new mothers, a 2016 study found that it increased the leave women took by almost five weeks and the leave that men took by two to three days.
That was the disparity when new fathers actually had an option to take paid paternity leave. Most don’t. Paid leave is still uncommon for both men and women. According to the Bureau of Labor Statistics, in 2021, 23 percent of all private industry workers had access to parental leave, up from 11 percent 10 years earlier. Although the Department of Labor stopped differentiating between maternity and paternity leave in its data more than 25 years ago, other surveys suggest that paid leave is far more uncommon for fathers.
These inequalities are one reason the gender pay gap, even between spouses, widens after women have children.
The virtual office may be relatively new, but women have long thought about how to shape their colleagues’ perception of their pregnancies. In a 2015 study conducted by Ms. Little, researchers interviewed 35 women about their experience being pregnant at work.
companies summon people back to the office, fewer people will have that choice. But there is part of the remote work pregnancy experience that can be replicated offline, Ms. King said.
“Some women do need help, and some women do want accommodations,” she said. But “you have to ask women what they want and what they need and not assume that we know.”
MOSCOW — At this moment of crescendo for the Ukraine crisis, it all comes down to what kind of leader President Vladimir V. Putin is.
In Moscow, many analysts remain convinced that the Russian president is essentially rational, and that the risks of invading Ukraine would be so great that his huge troop buildup makes sense only as a very convincing bluff. But some also leave the door open to the idea that he has fundamentally changed amid the pandemic, a shift that may have left him more paranoid, more aggrieved and more reckless.
The 20-foot-long table that Mr. Putin has used to socially distance himself this month from European leaders flying in for crisis talks symbolizes, to some longtime observers, his detachment from the rest of the world. For almost two years, Mr. Putin has ensconced himself in a virus-free cocoon unlike that of any Western leader, with state television showing him holding most key meetings by teleconference alone in a room and keeping even his own ministers at a distance on the rare occasions that he summons them in person.
Speculation over a leader’s mental state is always fraught, but as Mr. Putin’s momentous decision approaches, Moscow commentators puzzling over what he might do next in Ukraine are finding some degree of armchair psychology hard to avoid.
capture Crimea without firing a single shot. The proxy war that Mr. Putin fomented in Ukraine’s east allowed him to deny being a party to the conflict.
“Starting a full-scale war is completely not in Putin’s interest,” said Anastasia Likhacheva, the dean of world economy and international affairs at the Higher School of Economics in Moscow. “It is very difficult for me to find any rational explanation for a desire to carry out such a campaign.”
Even if Mr. Putin were able to take control of Ukraine, she noted, such a war would accomplish the opposite of what the president says he wants: rolling back the NATO presence in Eastern Europe. In the case of a war, the NATO allies would be “more unified than ever,” Ms. Likhacheva said, and they would be likely to deploy powerful new weaponry along Russia’s western frontiers.
as an existential threat to his country, said that Moscow’s growing military presence on the Ukrainian border was a response to Ukraine’s deepening partnership with the alliance.
Given that such a war still seems unthinkable and irrational to so many in Moscow, Russian foreign policy experts generally see the standoff over Ukraine as the latest stage in Mr. Putin’s yearslong effort to compel the West to accept what he sees as fundamental Russian security concerns. In the 1990s, that thinking goes, the West forced a new European order upon a weak Russia that disregarded its historical need for a geopolitical buffer zone to its west. And now that Russia is stronger, these experts say, it would be reasonable for any Kremlin leader to try to redraw that map.
few Moscow analysts were predicting a military intervention. And skeptics of the view that Mr. Putin is bluffing point out that during the pandemic, he has already taken actions that earlier seemed unlikely. His harsh crackdown against the network of Aleksei A. Navalny, for example, has contradicted what had been a widely held view that Mr. Putin was happy to allow some domestic dissent as an escape valve to manage discontent.
“Putin, in the last year, has crossed a lot of Rubicons,” Michael Kofman, the director of Russia studies at CNA, a research institute based in Arlington, Va., said last week. “Folks who believe that something this dramatic is unlikely or improbable may not have observed that qualitative shift in the last two years.”
Americans are, by many measures, in a better financial position than they have been in many years. They also believe the economy is in terrible shape.
This is the great contradiction that underlies President Biden’s poor approval ratings, recent Republican victories in state elections and the touch-and-go negotiations over the Biden legislative agenda. It presents a fundamental challenge for economic policy, which has succeeded at lifting the wealth, incomes and job prospects of millions of people — but has not made Americans, in their own self-perception, any better off.
Workers have seized the upper hand in the labor market, attaining the largest raises in decades and quitting their jobs at record rates. The unemployment rate is 4.6 percent and has been falling rapidly. Cumulatively, Americans are sitting on piles of cash; they have accumulated $2.3 trillion more in savings in the last 19 months than would have been expected in the prepandemic path. The median household’s checking account balance was 50 percent higher in July of this year than in 2019, according to the JPMorgan Chase Institute.
Yet workers’ assessment of the economy is scathing.
In a Gallup poll in October, 68 percent of respondents said they thought economic conditions were getting worse. The share who thought things were getting better was lower than in April 2009, when the global financial crisis was still underway. And it is not merely a partisan response to the Biden presidency. In the University of Michigan’s consumer sentiment survey, Republicans rate current economic conditions worse than Democrats do — but both groups give ratings about as low as they did in the early 2010s, when unemployment was much higher and Americans’ finances were a wreck.
shortages and other inconveniences that do not show up in inflation data but reflect the same underlying phenomenon.
data from the Atlanta Fed. Many retirees receive pensions that are not adjusted for inflation.
And it is middle- and high-income earners whose pay gains were least likely to have kept up with inflation. Over the 12 months that ended in September, those in the top quarter of earners experienced 2.7 percent gains in hourly earnings, compared with 4.8 percent for the lowest quarter of earners. For lower earners, that follows years leading up to the pandemic in which pay gains exceeded inflation rates.
Understand the Supply Chain Crisis
Card 1 of 5
Almost anything manufactured is in short supply. That includes everything from toilet paper to new cars. The disruptions go back to the beginning of the pandemic, when factories in Asia and Europe were forced to shut down and shipping companies cut their schedules.
Now, ports are struggling to keep up. In North America and Europe, where containers are arriving, the heavy influx of ships is overwhelming ports. With warehouses full, containers are piling up. The chaos in global shipping is likely to persist as a result of the massive traffic jam.
The details of what a person buys can have an outsize effect on how acutely he or she feels the pain of inflation. For someone who has had no need to buy an automobile this year, steep inflation in cars and trucks has been a nonissue.
wrote in 1997. The idea of inflation, he continued, evokes “arbitrary injustice, arbitrary redistributions and social bitterness,” and “memories of social situations in which morale and a sense of cooperation were lost.”
That may be what makes the inflation surge such a tricky policy problem: It can be about something more profound than dollars in people’s pockets and the price of a gallon of gas.
Above all, issues around managing child care and work that had long been considered private family matters were suddenly out in the open, turning the needs of working parents into a subject that resonated in conference rooms and state capitals across the country.
The potential implications were profound: Not only could the pandemic help recalibrate the answer to a question like, “Who picks up a sick child from school?” but it could also radically alter whether workplaces look askance at the parent who takes time away from work to do to so. More fundamentally, any number of policy ideas that the pandemic inspired, if realized, could make it easier for working parents, especially women, to balance work and child care, as well as increase gender equality at work and at home and upend entrenched gender norms about caregiving.
“It just feels like an Overton window, where you have increased public dialogue but also you have public will to really change and reflect on women’s experiences in the work force,” C. Nicole Mason, the president and chief executive of the Institute for Women’s Policy Research, said in an interview this summer.
Roughly half of mothers with children under 18 were employed full-time last year. For white-collar women and women with office jobs, who were more likely to benefit from increased work flexibility, the possible reforms were uniquely promising.
But the optimism is fading, partially because of Washington. The Biden administration and Democrats in Congress indicated early in the year that federal paid family and medical leave was a priority in the president’s domestic spending package — but the plan was pared down from 12 weeks to four weeks, then dropped entirely from the framework President Biden announced on Thursday.
“As you can see, the window is closing,” Dr. Mason said this past week.
Now, as the pandemic recedes and everyday life begins to return to normal, some working mothers are worried that nothing much will change.
“People are finally seeing how important child care is in our society,” said Kristen Shockley, an associate professor of psychology at the University of Georgia who studies the intersection of work and family life. “But is that going to translate into a way that our society values caregiving? I’m less optimistic about that.”
“It gave me a feeling of déjà vu, because that’s what we were doing in the ’70s — we were trying to get supply-side effects,” said Barry P. Bosworth, a senior fellow at the Brookings Institution who led the Council on Wage and Price Stability under President Jimmy Carter. The efforts failed to control overall inflation, he said.
“It doesn’t work,” he said. “As a macro policy, you can’t go around trying to put your finger in the dike everywhere it pops up.”
Wages: The trouble with spirals.
The big price spikes in the 1960s and 1970s reversed once the underlying conditions that created them eased. But not all the way — in each case, the rate of inflation bottomed out a bit higher than the time before. Many economists believe that pattern had to do with human psychology: Workers and businesses had come to expect a higher rate of inflation, and had adapted their behavior accordingly, creating a self-sustaining cycle.
Economists particularly highlight the role of wages. Businesses can cut prices just as easily as they can raise them, but cutting wages is harder. No worker wants to be told that a job that was worth $10 an hour yesterday is worth just $9.50 an hour today. And if workers expect prices to rise at 5 percent per year, they will want raises to keep up with inflation.
Most economists believe that the forces driving the current surge in inflationwill ease in the months ahead. The question is whether that will happen before expectations shift. Some surveys have found that consumers are already beginning to anticipate faster inflation to stick around, although that evidence is mixed. Wages, too, have continued rising as employers struggle to rehire workers, although it’s not yet clear that they are taking off.
One reason that temporary price increases turned into permanent wage increases in the middle of the 20th century is that many union contracts had escalator clauses that tied wage gains directly to inflation. Those provisions effectively helped lock in price increases, feeding into the price spiral, said David Card, an economist at the University of California, Berkeley, who has studied the role of union contracts in inflation. Far fewer workers are members of unions today, and few contracts have inflation clauses, in part because they haven’t been necessary in a period of low inflation.
Perhaps the largest difference of all? Time. In the 1960s, it took years of price spikes and policy failures for Americans to lose confidence that their leaders could keep inflation under control.
“What happened by the ’70s took almost 10 years to develop,” Mr. Card said. “I don’t think it’s that feasible that it could happen that quickly.”
With vaccination spreading across the United States, social life has begun to bend toward a semblance of normalcy: dinner parties, restaurants, spontaneous encounters with strangers, friends and colleagues on the street or in the office. It’s exciting but also slightly nerve-racking.
“I think there will be a period of heightened anxiety as we meet people face-to-face again,” Adam Mastroianni, a fifth-year Ph.D. student in psychology at Harvard, told me (over the phone). “I’ve heard this from a lot of my friends, that we’re worried: Have we forgotten how to be with other people?”
I’d called Mr. Mastroianni for some help in rediscovering this ancient calculus. In March, he and his colleagues Daniel Gilbert, Gus Cooney and Timothy Wilson published a paper in the Proceedings of the National Academy of Sciences — “Do conversations end when people want them to?” — on one of the stickier aspects of human interaction. Our conversation has been edited for brevity and clarity.
Prisoner’s Dilemma, and the prison is politeness.
When Your Company is Named Covid, You’ve Heard All the Jokes.”
How and when to go about viewing the Super Flower Blood Moon of 2021. (Hint: It helps if you live in Oceania, Hawaii, eastern Asia or Antarctica.)
According to researchers at the University of California, Los Angeles, there are at least 65 creatures, including humans, that make a laugh-like sound: “There could be more that, we think, are out there. Part of the reason they probably aren’t documented is because they’re probably really quiet, or just in species that aren’t well studied for now.”
Some of us were wondering — and now we know — why the iPhone’s “snooze” button provides exactly nine minutes of snoozing.
Jill Lepore, in The New Yorker, provides a brief and compelling history of burnout: “May there one day come again more peaceful metaphors for anguish, bone-aching weariness, bitter regret, and haunting loss.”
What went wrong in the Suez Canal, from a fluid dynamics perspective, courtesy of the Practical Engineering channel on YouTube.
All about the “cartoonishly evil-looking” amblypygid, sometimes known as the whip spider or tail-less whip scorpion but which, as Eric Boodman writes in Undark, is “neither spider nor scorpion.”
If you prefer true spiders, there’s this BBC video segment on how some make use of electric fields to get around.
When Jeffrey Epstein gave The Times columnist James Stewart a tour of his apartment a few years ago, he boasted of his expansive Rolodex of billionaires — and the dirt he had on them. A year and a half after the financier’s death by suicide in a New York jail, the fallout for those in the registered sex offender’s orbit, and increasingly those a step or two removed from it, continues to spread.
For example, the latest management reshuffle at Apollo, as we reported yesterday, can be linked back to Epstein. Tracing all the resignations and reshuffles directly and indirectly tied to the scandal will take a while (we’re working on it), but here’s a tally of some so far:
The Apollo co-founder Leon Black said in January that he would resign as C.E.O. but stay on as chairman, after an internal inquiry found he had paid $158 million to Epstein for tax advice. He unexpectedly quit both posts in March, and later stepped down as chairman of the Museum of Modern Art. Josh Harris, a fellow co-founder who had unsuccessfully pushed Black to quit immediately, said yesterday that he was stepping back from Apollo after failing to become the next C.E.O.; Marc Rowan, Apollo’s third co-founder and Black’s pick as successor, now leads the firm.
When the details of meetings between Epstein and Bill Gates burst into public view in late 2019, the billionaire’s wife, Melinda French Gates, hired divorce lawyers. The couple’s split, announced this month, could upend their numerous investments and philanthropic ventures
Les Wexner announced last February that he would step down as C.E.O. of the Victoria’s Secret parent company L Brands, under pressure from multiple internal investigations about his close ties to Epstein. Earlier this year, he and his wife, Abigail Wexner, said they would not stand for re-election to the L Brands board this month. (The company is now in the process of spinning off Victoria’s Secret.) Mr. Wexner was Epstein’s biggest early client and, a Times investigation found, the original source of the financier’s wealth.
Prince Andrew of Britain gave up his public duties last November, days after a disastrous interview with the BBC centered on his relationship with Epstein. At least 47 charities and nonprofits of which he was a patron have since cut ties to the prince.
Joi Ito resigned as the director of the M.I.T. Media Lab, a prominent research group, in 2019 and as member of several corporate boards (including The New York Times Co.), after acknowledging that he had received $1.7 million in investments from Epstein.
Alexander Acosta resigned as Donald Trump’s labor secretary in 2019, amid criticism of his handling of a 2008 sex crimes case against Epstein when he was a federal prosecutor in Miami.
HERE’S WHAT’S HAPPENING
Morgan Stanley sets up its C.E.O. succession competition. The Wall Street firm gave new roles to four top executives, marking them as candidates to take over from James Gorman: Ted Pick and Andy Saperstein were named co-presidents; Jonathan Pruzan was named C.O.O.; and Dan Simkowitz was named co-head of strategy with Pick.
The U.S. endorses a global minimum tax of at least 15 percent. The proposal, which was lower than some had expected, is closely tied to the Biden administration’s plans to raise the corporate tax rate. Global coordination would discourage multinationals from shifting to tax havens overseas.
Treasury officials said they could capture at least $700 billion in additional revenue. That would involve hiring 5,000 new I.R.S. agents, imposing new rules on reporting crypto transactions and other measures.
U.S. customs officials block a Uniqlo shipment over Chinese forced labor concerns. Agents at the Port of Los Angeles acted under an order prohibiting imports of cotton items produced in the Xinjiang region.
U.S. steel prices are soaring. After years of job losses and mill closures, American steel producers have enjoyed a reversal of fortune: Nucor, for instance, is the year’s top-performing stock in the S&P 500. Credit goes to industry consolidation, a recovering economy and Trump-era tariffs. Unsurprisingly, steel consumers aren’t thrilled about it.
Oprah Winfrey to Blackstone, made its stock market debut yesterday, ending its first trading session with a valuation of about $13 billion. DealBook spoke with Oatly’s C.E.O., Toni Petersson, about the I.P.O. and what’s next for the company.
resignation letter offering both praise of SoftBank’s chief, Masa Son — and unusually pointed criticism of the company’s corporate governance.
Going out vs. staying in, charted
It’s been a while since we checked in on an alternative indicator of pandemic economic activity: the share price ratio of Clorox to Dave & Buster’s.
Wait, what? Nick Mazing, the director of research at the data provider Sentieo, came up with that metric to gauge the openness of the economy. The higher Clorox’s share price rises relative to Dave & Buster’s, the more people appear to be staying home and disinfecting everything than going out to crowded bars. By this measure, conditions have nearly returned to prepandemic levels — indeed, Dave & Buster’s recently lifted its sales forecast, as nearly all of its beer-and-arcade bars have reopened.
packed concert schedule, selling tickets to people who may have already binge-watched all of “Below Deck.” The second, however, suggests that people aren’t as eager to get back to huffing and puffing at the gym as they are content to exercise at home. As restrictions lift and people feel safer in crowds, drinking and dancing appear to be higher priorities.
new book, “Noise: A Flaw in Human Judgment,” the Princeton psychology professor and Nobel laureate Daniel Kahneman, along with co-authors Olivier Sibony and Cass Sunstein, argue that these inconsistencies have enormous and avoidable consequences. Kahneman spoke to DealBook about how to hone judgment and reduce noise.
DealBook: What is “noise” in this context?
Kahneman: It’s unwanted and unpredictable variability in judgments about the same situations. Some decisions and solutions are better than others and there are situations where everyone should be aiming at the same target.
Can you give some examples?
A basic example is the criminal justice system, which is essentially a machine for producing sentences for people convicted of crimes. The punishments should not be too different for the same crime yet sentencing turns out to depend on the judge and their mood and characteristics. Similarly, doctors looking at the same X-ray should not be reaching completely different conclusions.
How do individuals or institutions detect this noise?
You detect noise in a set of measurements and can run an experiment. Present underwriters with the same policy to evaluate and see what they say. You don’t want a price so high that you don’t get the business or one so low that it represents a risk. Noise costs institutions. One underwriter’s decision about one policy will not tell you about variability. But many underwriters’ decisions about the same cases will reveal noise.
An arm of Goldman Sachs has raised $3 billion from clients to invest in later-stage start-ups. (WSJ)
SPACs have raised $100 billion this year through May 19, a record, but new fund listings dropped sharply last month. (Insider)
Politics and policy
President Biden issued an executive order directing government agencies to expand efforts to analyze and mitigate the economic risks tied to climate change. (Axios)
“As Paycheck Protection Program Runs Dry, Desperation Grows” (NYT)
CNN said the prime-time host Chris Cuomo inappropriately advised his brother, Gov. Andrew Cuomo of New York, on how to respond to sexual harassment allegations. (NYT)
Paul Romer was one of the tech industry’s favorite economists; now he is criticizing Silicon Valley giants for being too big. (NYT)
Amazon was recently pushed to ban prominent electronics accessory makers by the F.T.C. over fake-review schemes. (Recode)
Best of the rest
Bill Gates and Warren Buffett got more than 200 billionaires to pledge half their wealth to charity. Some are falling short, but still getting massive tax breaks. (Insider)
FIFA, the global soccer governing body, secretly considered supporting the European Super League, before reconsidering amid public outcry about the now-failed competition. (NYT)
Five questions to ask before you panic about inflation. (NYT)
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The central fact of the American economy in mid-2021 is that demand for all sorts of goods and services has surged. But supplies are coming back slowly, with the economy acting like a creaky machine that was turned off for a year and has some rusty parts.
The result, as underlined in new government data this week, is shortages and price inflation across many parts of the economy. That is putting the Biden administration and the Federal Reserve in a jam that is only partly of their own making.
Higher prices and the other problems that result from an economy that reboots itself are frustrating, but should be temporary. Still, the longer that the surges in prices continue and the more parts of the economy that they encompass, the greater the chances that Americans’ psychology about prices and inflation could shift in ways that become self-sustaining.
For the last few decades, companies have resisted raising prices or paying higher wages because they felt that doing so would cost them too much business. That put a damper on inflation across the economy. The question is whether current circumstances are evolving in a way that could change that.
shortage of limes, their prices spike and people use more lemons.
after a cyberattack shut down a major pipeline, are truly random events that tell us virtually nothing about underlying supply and demand or future inflation.
Some other sectors seem poised to experience price rises. Restaurants, for example, are complaining of severe labor shortages that are forcing them to curtail service or sharply raise pay for line cooks and dishwashers. If they try to reflect those higher costs in their prices, it will cause the price of food away from home to start rising faster than the (already fairly high) 3.8 percent figure over the last year.
Professional inflation-watchers are on close watch for signs that these forces might be unleashing a form of thinking about price dynamics unseen since the early 1980s, when prices rose in part because everyone expected them to.
The Fed is betting that won’t happen — that even if there are several months of surging prices, it will be at worst a one-time adjustment, and potentially something that reverses as old spending patterns return and workers return to their jobs.
“If past experience is any guide, production will rise to meet the level of goods demand before too long,” the Fed governor Lael Brainard said in a speech this week. “A limited period of pandemic-related price increases is unlikely to durably change inflation dynamics.”
For now, movements in key financial markets mostly align with the Fed view.
Futures contracts for major commodities like oil and copper, for example, suggest that traders expect prices to fall slightly in the years ahead, not rise further.
And in the bond market, even after a surge in longer-term interest rates following the high inflation reading Wednesday, most signs point to future inflation consistent with the 2 percent the Fed aims for.
Still, the level of future inflation implied by those bond prices has risen significantly in the last few weeks, meaning further moves are likely to increase worries that the inflation issues will be not-so-transitory after all. And the pattern could change abruptly if more evidence starts to arrive that the outlook for inflation is becoming unmoored.
“We aren’t obviously on the way to a very high and persistent inflation outcome,” said Brian Sack, director of global economics at the hedge fund D.E. Shaw and a former senior Federal Reserve official. “But we’re at an inflection point, in that the rise in inflation expectations to date has been a policy success, but a rise from here could become a policy problem.”
The Fed may believe that the evidence emerging in various corners of the economy is a one-time occurrence that will fade into memory before too long. The Biden administration is betting its agenda on the same idea.
Ultimately, what matters more than whatever the bond market does is how ordinary Americans who make everyday economic decisions — demanding raises or not, paying more for a car or not — view things. Can they wait for the complex machinery of the American economy to fully crank into gear?