What we’re reading (6/29)
“Baird Suspends GameStop stock coverage, Citing Continued Reddit Influence And Lack Of Company Plan” (CNBC). “Baird is throwing in the towel on GameStop coverage, saying speculative trading by retail investors makes it hard to give “reasonable” recommendations on the stock. GameStop made headlines in January and earlier in June as individual traders flocking to Reddit’s WallStreetBets forum rallied around the meme stock. The shares have surged more than 1,000% in 2021, though the stock has dropped about 6% this month.”
“Regulators Must Get Ahead Of The Coming Wave Of Loan Defaults” (The Hill). “The 2008 financial crisis showed us how poorly prepared many lenders were to offer successful debt workouts. Distressed borrowers were steered toward so-called debt settlement companies, which would collect front-end fees without producing results. Now is the moment for policymakers and financial regulators to learn from their mistakes during the Great Recession in leaving people on their own to determine how to manage their debts. In a recent paper, we advocate for a public intervention in consumer debt contract modifications designed to steer people into affordable modifications or, if there are no affordable options, guide people to the consumer bankruptcy system.”
“Office Re-Entry Is Proving Trickier Than Last Year’s Abrupt Exit” (The Economist). “Some shareholders, including big institutional investors, are keen to promote flexible working not only to retain talent but also to burnish companies’ environmental, social and governance (ESG) credentials. S&P Global, an analytics firm, says that under its assessments, the ability to work from home is one measure of employees’ health and wellbeing, which can influence up to 5% of a company’s ESG score. This is roughly the same weighting attached to risk and crisis management for banks, or human-rights measures for miners. It may also affect things like gender and racial diversity. Studies find that mothers are likelier to favour work from home than fathers are. Research by Slack found that only 3% of black knowledge workers want to return to the office full-time in America, compared with 21% of their white counterparts.”
“America’s Workers Are Exhausted And Burned Out — And Some Employers Are Taking Notice” (Washington Post). “Employers across the country, from Fortune 500 companies such as PepsiCo and Verizon to boutique advertising firms and nonprofit organizations, are continuing pandemic benefits such as increased paid time off and child- or elder-care benefits as well as embracing flexible work schedules and remote work in recognition that a returning workforce is at high risk of burnout.”
“US Workers Are Quitting Jobs At Historic Rates, And Many Unemployed Are Not Coming Back Despite Record Job Openings” (Peterson Institute for International Economics). “Transitions from unemployment to employment have likely been reduced by several factors, many of which interact with each other, including time needed to find a job, the lingering effects of the pandemic and the pace of vaccinations, and increased and expanded unemployment insurance. The good news is that most of the factors holding back transitions from unemployment are probably temporary, and if the rate at which people are leaving unemployment for jobs returns to what would be expected given the overall strength of the economy, the pace of job growth could rise to 750,000 or more a month. There may be a speed limit on job growth, but it is likely to be well above the recent pace.”
