Celebrity Cruises will be the first cruise line to resume sailing from a U.S. port.


Daily Business Briefing

June 25, 2021, 12:54 p.m. ET

June 25, 2021, 12:54 p.m. ET

The Celebrity Edge, docked at Port Everglades in Fort Lauderdale, Fla., will sail at 35 percent capacity on Saturday.
Credit…Lynne Sladky/Associated Press

The Celebrity Edge is poised to set sail out of Fort Lauderdale, Fla., on Saturday, becoming the first major cruise ship to restart operations from a United States port since the pandemic all but hobbled the industry over a year ago.

The ship will sail at 35 percent capacity, with around 95 percent of passengers and all crew members fully vaccinated, its owner, Celebrity Cruises, said in a statement. Vaccines are not mandated for the cruise because of a new Florida state law banning businesses from requiring proof of immunization, but unvaccinated guests will face more stringent coronavirus protocols.

All guests over the age of 16 who do not show proof of vaccination will be required to wear masks on board and take a series of antigen tests during the cruise at an additional cost. (Testing for vaccinated guests will be free of charge.)

“We’re definitely finding that cruisers prefer to be vaccinated and to share this information with us,” said Susan Lomax, associate vice president for global public relations at Celebrity Cruises.

The sailing is a major milestone for the $150 billion global cruise industry, which has been decimated by the pandemic and spent months in a battle with the Centers for Disease Control and Prevention over its requirements for the safe resumption of cruising.

Earlier this month, Celebrity Cruises tested its Covid protocols during a seven-day sailing in the Caribbean, the line’s first international cruise with American passengers. All adult passengers and crew members were fully vaccinated, and they were not required to wear masks or socially distance during the sailing.

Halfway through the cruise and following two shore excursions on the islands of Barbados and Aruba, a vaccinated couple tested positive for the virus and were immediately put into isolation. Other passengers who had come into contact with them were required to quarantine and get tested.

Before the ship reached its final destination, all passengers on board were tested, and no further positive cases were identified. Celebrity said the handling of the incident demonstrated that the company’s virus protocols worked in preventing the spread of the virus.

Other major lines, including Carnival Cruise Line and Royal Caribbean, are preparing to restart U.S. operations in July. As of July 18, cruise ships departing from and arriving in Florida will not be required to follow C.D.C. guidance, after a judge ruled last week that the order was based on “stale data” and failed to take into account the prevalence of effective vaccines.

Jerome Powell, the Federal Reserve chair, has said the rise in consumer prices will be short-lived as the economy reopens.
Credit…Pool photo by Graeme Jennings/Getty Images

Inflation climbed in May at the fastest pace since 2008, as businesses reopen from their pandemic shutdown and strong demand continues to push prices higher, fueling anxiety among some economists and debate in Washington.

The Personal Consumption Expenditures inflation index increased 3.9 percent in the year through May, in line with the median that economists in a Bloomberg survey had anticipated. That came on the heels of a big annual reading in April, and kept year-over-year inflation at levels not seen in more than a decade.

But the May inflation reading might be the high point.

On a monthly basis, the measure climbed 0.4 percent, compared with a 0.5 percent projection. That was more muted than the prior month, suggesting that although prices are up steeply this year, the speed of the increase is becoming more moderate. Plus, the annual numbers have been measured against very weak readings from spring 2020, and that so-called base effect should begin to fade.

“May will be the peak — probably — for the year-over-year numbers,” said Jim O’Sullivan, chief U.S. macro strategist at T.D. Securities. “Not to say that it is going to suddenly plunge.”

The data came alongside other figures that showed personal spending held steady in May even as people spent less money on goods, disappointing economists’ expectation for a continued pickup in consumption. Spending on services ticked higher as households opened their wallets for recreation, hotel rooms and restaurant meals — but it was not enough to offset the decline in merchandise purchases, which was lead by a drop-off in motor vehicle and parts spending.

Together, the data paints a picture of an unusual economic rebound, one that is happening in fits and starts as production bottlenecks dampen car buying and higher prices detract somewhat from the strong financial situation of American households. Consumers are flush with savings after months in lockdown and repeated checks from the government.

The spending stagnation reflects “the fading of the impact of the stimulus payments,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in a note following the release. He said it was nothing to worry about, and that consumer households remained strong. “We expect the underlying upward trends to re-emerge over the next couple months.”

The price increases extended to the core inflation index. Stripping out volatile fuel and food, the inflation gauge jumped 3.4 percent over the past year. Over the month, it climbed 0.5 percent, compared with a 0.6 percent projection. The annual reading was the highest since 1992.

Inflation has been climbing to levels well above the Federal Reserve’s target as prices bounce back from declines that came amid the pandemic and as demand picks up faster than supply. Republicans are using the rising prices as a political talking point to criticize President Biden’s stimulus spending and push back on his infrastructure plans, but the White House and top officials at the Fed have maintained that the recent pickup is more likely to prove short-lived.

“A pretty substantial part — or perhaps all — of the overshoot in inflation comes from categories that are directly affected by the reopening of the economy,” Jerome H. Powell, the Fed’s chair, said during June 22 congressional testimony.

The personal consumption index is important because it is the Fed’s preferred inflation gauge and how it defines its official goal: to average 2 percent annual price gains over time. Congress has charged the central bank with maintaining stable prices and fostering maximum employment.

Central bank officials are debating how to achieve those goals as the economy emerges from the pandemic downturn, short on jobs but high on demand. They are beginning to discuss when and how to scale back their $120 billion in monthly bond purchases, which are meant to keep many kinds of borrowing cheap.

They have also held interest rates at rock bottom since March 2020. Officials released new economic projections last week, showing that more than half now expect to raise interest rates by the end of 2023.

“The key question for the Fed” is whether the recent jump in prices increase raises inflation expectations and wages, Mr. Shepherdson wrote, making it more entrenched. “The jury is out, and a clear verdict is unlikely before late fall.”

Critics of the enhanced unemployment benefits argue they are discouraging people from looking for jobs and making it hard for businesses to find workers.
Credit…Mario Tama/Getty Images

A slim majority of Americans say it is time for enhanced unemployment benefits to end.

The federal government is providing jobless workers with $300 a week in benefits on top of their regular unemployment payments. Those benefits are set to last until September, although 26 states — all but one led by Republicans — have cut them off early or plan to do so in coming weeks.

Critics, including many business owners and Republican politicians, argue that the extra benefits are discouraging people from looking for jobs and making it hard for businesses to find workers. Proponents, including progressive groups and many Democratic politicians, contend that the benefits are needed as the economy continues to heal and while pandemic-related risks remain.

Republican arguments seem to be resonating with the public. Just over half of Americans — 52 percent — want the extra benefits to end immediately, according to a survey of 2,600 adults conducted this month for The New York Times by the online research firm Momentive, which was previously known as SurveyMonkey. Another 30 percent want the benefits to end in September as planned. Only 16 percent want the additional benefits to continue indefinitely.

Views on the benefits are divided along partisan lines. Of Republicans, 80 percent want the extra benefits to end right away, compared with 27 percent of Democrats. But even among Democrats, most respondents don’t want the benefits to last past September.

The survey also asked respondents who weren’t working what was keeping them off the job. Thirty-three percent said they were looking for jobs but “have not been able to find one that is worth taking,” and another 11 percent said they did not feel safe returning to work. Respondents volunteered a range of other explanations, including:

  • “I don’t want to wear a mask and I don’t plan to be vaccinated.”

  • “I am just recently fully vaccinated and will begin driving for Lyft again next week.”

  • “Child care and no luck on job search.”

  • “Age. Companies look at my age and pass.”

  • “Car broke down and no money to fix it.”

The survey included 65 respondents who said they were currently receiving unemployment benefits. Asked how they would behave if their benefits were cut off, 17 said they would still not return to work. Most of the rest said they would take a job that paid less than they wanted, made them feel unsafe or offered poor hours or working conditions.

As of early June, some 3.5 million people were receiving benefits in states that plan to end some or all of the emergency programs early. A handful of states, including Alabama, Indiana and Missouri, have already cut off extra payments; more than 700,000 people were receiving benefits in those states as of early June.

Sara Blakely, right, the Spanx founder, with her family in 2020.
Credit…Melissa Golden for The New York Times

Just as people are beginning to squeeze into form-fitting clothes again, the shapewear brand Spanx has tapped Goldman Sachs to explore options including a sale, reports the DealBook newsletter, based on multiple sources familiar with the situation.

Any deal could value Spanx at $1 billion or more and allow Sara Blakely, the brand’s founder, to keep some of her ownership in the company. Spanx generated $300 million to $400 million in revenue over the past year, and $50 million to $80 million in operating earnings.

The people spoke on condition of anonymity because the talks were confidential. Spanx did not respond to multiple requests for comment.

The brand has attracted interest from private equity firms, including Carlyle, whose past investments in brands include Beautycounter, OGX and Supreme, and TPG, which has invested in Anastasia Beverly Hills.

Sales of women’s dresses were up 50 percent the week before Easter compared with the same week in 2019, according to NPD, which could signal demand for shapewear as lockdowns lift and people return to the office and go out more. But key to shapewear’s post-pandemic success will be products that maintain a level of comfort many have become used to while working in loose clothing over the past year and a half. And post-pandemic style trends are hard to predict, with even professional forecasters conceding befuddlement.

Founded more than 20 years ago, Spanx has become synonymous with the product it sells, like Kleenex with tissue. It has spawned rivals such as Kim Kardashian’s Skims, recently valued at $1.6 billion, which distinguishes itself with modern cuts and a broader color assortment. And Spanx has faced pushback amid focus on body neutrality and the rejection of the “culture of perfection.” Seeking new growth, Spanx has expanded beyond undergarments into denim, swimsuits and undershirts for men.

Ms. Blakely has long resisted selling or taking the company public. But with private equity firms eager to spend idle capital and valuations on the rise, consumer brands are eyeing lofty paydays. The online fashion retailer Ssense announced the first fund-raising in its 18-year history earlier this month, which valued the company at more than 5 billion Canadian dollars ($4 billion). A slew of other brands — including Allbirds and Warby Parker — are planning public listings.

Credit…David Degner for The New York Times

Larry Summers spent his last White House stint as a top economic adviser, and his policy advice during the Great Recession — he panned a more robust fiscal stimulus package for political reasons — has since been criticized for contributing to a sluggish recovery.

He has spent 2021 warning that the $1.9 trillion spending package the Biden administration passed in March was too large for reasons both political and economic, while fretting that the Federal Reserve will be too slow to sop up the mess. The result, he warned, could be overheating and runaway inflation, Jeanna Smialek reports for The New York Times.

Mr. Summers combined the swagger of a former Treasury secretary with the gravitas of a respected academic and punchy lines — the stimulus wasn’t just a bad idea, according to him, it was the “least responsible” policy in four decades — to set off a debate that was hard to ignore. Reactions spilled out of the White House and Janet Yellen’s Treasury, which voiced respectful but firm disagreement.

When Mr. Summers began to warn about overheating early this year, it looked, for a moment, like his clout might crack. Leading Democrats dismissed his ideas and his loudest critics labeled them the dying gasp of a failed ideology of economic centrism.

But Republicans seized on his arguments as evidence of the administration’s imprudent largess. Inflation became a primary political talking point on the right, and as the data confirmed that prices were moving up — something that was widely expected, albeit not so rapidly — the White House was forced to answer question after question about prices.

All evidence suggests the Biden administration has accepted Mr. Summers’ role as unofficial economics whisperer and frequent gadfly. Although the administration has refuted his most damning critiques — “it’s just flat-out wrong that our team is, quote, ‘dismissive’ of inflationary risks,” the economic adviser Jared Bernstein said during a February news conference, referencing a particularly snippy Summerism — his students and protégés pepper its ranks. Natasha Sarin, one of his co-authors, is now a deputy assistant secretary for economic policy at the Treasury Department. Brian Deese, the current head of the National Economic Council, was one of his aides during the financial crisis. The White House also benefits from Mr. Summers’ support for Mr. Biden’s infrastructure spending push.

  • Shareholders of the scandal-plagued industrial giant Toshiba threw out the company’s chairman on Friday. The ouster of Osamu Nagayama, 74, is a breakthrough for foreign investors who have been pushing to make Japan’s insular corporations more transparent and accountable. It followed an investigation that revealed that top Toshiba executives had worked with the Japanese government to inappropriately pressure investors who sought to shake up the company’s management.

  • The Federal Reserve said on Thursday that its latest round of stress tests showed that Wall Street lenders were most likely strong enough to fully resume shareholder payouts, the latest sign that the economy is returning to normal. That means the nation’s biggest lenders — including JPMorgan Chase and Bank of America — can increase the amount of cash they pay out to shareholders through stock buybacks and dividends. In March, the Fed’s governors unanimously approved plans to end limits on buybacks and dividends after the second quarter as long as banks passed their so-called stress tests — the annual evaluations established by the Dodd-Frank financial reform law established after the 2008 financial crisis.

  • The White House announced steps on Thursday to crack down on forced labor in the supply chain for solar panels in the Chinese region of Xinjiang, including a ban on imports from a silicon producer there. A significant portion of the world’s polysilicon, which is used to make solar panels, comes from Xinjiang, where the United States has accused China of committing genocide through its repression of Uyghurs and other Muslim minorities. In one of the newly announced actions, U.S. Customs and Border Protection banned imports of silica-based products made by Hoshine Silicon Industry Company as well as goods made using those products. The agency “has information reasonably indicating that Hoshine uses forced labor to produce its silica-based products,” Alejandro N. Mayorkas, the homeland security secretary, said at a news conference.

  • U.S. stocks rose after a measure of inflation remained high as prices climbed at the fastest pace since 2008.

  • The Personal Consumption Expenditures inflation index, the Federal Reserve’s preferred measure of price increases, rose 3.9 percent in the year through May, in line with economists’ expectations.

  • The S&P 500 climbed 0.2 percent. It’s heading for its biggest weekly gain since early April, reversing last week’s losses.

  • The yield on 10-year U.S. Treasury notes was little changed at 1.50 percent.

  • European stock indexes were mixed. The Stoxx Europe 600 was little changed on Friday but 1.1 percent higher since the end of last week.

  • Nike shares surged 15 percent to a record high on Friday after the company reported results that beat analysts’ expectations. The American sports brand said its revenue rose nearly 20 percent in the year through May to $44.5 billion, from the previous year. Its earnings per share more than doubled to $3.56. Nike’s results helped raise the share prices of other sportswear brands: Adidas rose 5.5 percent and Puma rose 1.4 percent in Germany.

  • Shares in Virgin Galactic soared 16 percent after the company said it had received approval from the Federal Aviation Administration to fly customers to the edge of space. Its planning its first test flight with a full crew this summer.

  • Oil prices rose. Futures on West Texas Intermediate, the U.S. crude benchmark, climbed 0.3 percent to $73.50 a barrel.


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