Did This Employee Steal $154 Million?

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What You Need To Know

Macy’s recent discovery of a single employee hiding $154 million in expenses over three years is a tough blow for a company already facing challenges. While this amount is small compared to its total delivery expenses, it’s a red flag for internal controls and has delayed its quarterly earnings report until December 11. For a retailer like Macy’s, which has struggled with declining sales and an increasingly competitive market, this kind of news doesn’t help.

OpenAI is giving employees the chance to cash out $1.5 billion in shares through a new tender offer to SoftBank, offering liquidity in a private market that's becoming crucial for tech employees. SoftBank, led by Masayoshi Son, is doubling down on its AI bet, seeking a larger stake in OpenAI after its $500 million investment in the startup's last funding round. The deal values OpenAI at $157 billion, aligning with its latest funding round, and allows employees who’ve held restricted stock units for at least two years to sell at $210 per share. For OpenAI, this move helps retain talent while delaying pressure to go public in a volatile IPO market.

Federal Reserve officials are cautiously optimistic about the economy, as inflation continues to ease and the labor market holds steady, according to the minutes from their November meeting. Policymakers reaffirmed their plan to gradually reduce interest rates, but uncertainty lingers around how far they should go to reach a “neutral” rate that neither stimulates nor slows growth. The Fed unanimously cut rates by a quarter point to 4.5%-4.75% in November, but future moves may depend on how inflation trends and how President-elect Trump’s policies, including tariffs and deregulation, impact the economy.

Trump’s proposed tariffs on China, Mexico, and Canada signal a bold yet risky approach to trade policy that could shake markets and global economies alike. While his promise of a 10% tariff on Chinese imports is lower than the 20-30% feared by analysts, it still adds uncertainty to an already complex U.S.-China trade relationship. Beijing may opt for fiscal stimulus and currency adjustments rather than aggressive retaliation, but any escalation could pressure U.S. businesses relying on Chinese imports. The 25% tariff threat on Mexico and Canada adds further strain to North American trade. Mexico, the U.S.’s largest trading partner, has already promised countermeasures, and this tit-for-tat could disrupt cross-border industries, especially autos and agriculture.

UPCOMING
What You Need To Watch

On Tuesday, the Institute for Supply Management (ISM) will release its Manufacturing Purchasing Managers' Index (PMI) for November. This index offers insights into the health of the manufacturing sector, with readings above 50 indicating expansion and below 50 signaling contraction.

On Wednesday, the ADP National Employment Report will provide a snapshot of private-sector job growth for November. In October, the report showed an increase of 233,000 jobs, indicating robust hiring despite economic uncertainties.

On Friday, the Bureau of Labor Statistics will release the November Employment Situation Report, providing a comprehensive look at job creation and unemployment rates. In October, the U.S. economy added 12,000 jobs, falling short of expectations.

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Market Cap

Market capitalization, or market cap, measures the total value of a company’s outstanding shares. It’s calculated by multiplying the share price by the total number of shares. For example, if a company has 1 million shares trading at $50 each, its market cap is $50 million. Companies are often categorized as small-cap, mid-cap, or large-cap based on their market cap, with each category having different risk and growth potential. Understanding market cap helps investors compare companies of different sizes and choose investments that align with their goals and risk tolerance.

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