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The Week in Business: WeWork’s Founder Rises Again


It will be reasonable to expect that Adam Neumann might need a difficult time attempting to win back Silicon Valley. But Mr. Neumann, whose shared office-space company, WeWork, imploded in 2019, doesn’t look like facing many challenges thus far. His latest enterprise, Flow, is a service for landlords of residential real estate that has already attracted the backing of Andreessen Horowitz, a enterprise capital firm known for its early support of tech giants like Facebook and Airbnb. It invested about $350 million in Flow, valuing the corporate at $1 billion. Andreesen Horowitz’s co-founder wrote in a note that the firm loved “seeing repeat-founders construct on past successes by growing from lessons learned.” Some may view this praise as misguided: Mr. Neumann was ousted from WeWork after a botched public offering and accusations of mismanagement caused the corporate to crash. At its height, it was value $47 billion. Today: about $4 billion.

Is the economy heading for a serious downturn? Are consumers beginning to tighten their purse strings? The answers to those questions usually are not clear, and one reason might be seen within the mixed second-quarter earnings reports of Walmart, Goal, Kohl’s and Home Depot. Walmart reported an increase in sales and issued a rather improved outlook for the remainder of the yr. However it also showed that it was struggling to navigate the inflation-related shifts in consumer behavior. That challenge was way more pronounced for Goal, whose profit within the second quarter fell 90 percent from the yr before because it removed excess inventory that price-conscious consumers didn’t want. Kohl’s saw an uptick in sales at its stores with Sephora shops, and Home Depot beat Wall Street expectations. It made note of unexpected interest in Halloween merchandise in July — specifically, a 12-foot-tall skeleton that sold out inside hours — suggesting that customers still have enthusiasm for discretionary spending.

Inflation in america appears to be beginning to moderate, but that’s not the case in Britain. Inflation rose 10.1 percent in July compared with a yr earlier, in keeping with latest data, squeezing household budgets which have already been strained by months of rising prices. Grocery stores are the source of a big chunk of those increases: Food costs rose 2.3 percent from June to July, the fastest monthly increase in over 20 years, and staples like milk and eggs have gotten noticeably costlier. Many Britons have been forced to make adjustments to their usual grocery lists. Inflation in Britain is anticipated to peak in the autumn, with sharply higher energy bills.

Last month, the Commerce Department reported that economic growth in america fell for the second consecutive quarter — a sure sign of a recession, in keeping with one accepted definition. But most economists look to a much wider set of indicators to evaluate the state of the economy, including measures of income, spending and employment. And besides, the newest gross domestic product data might be revised several times, including on Thursday, when the department will release one other reading based on more complete data. It’ll also share a primary have a look at gross domestic income for the second quarter, which could add to the uncertainty in regards to the economic outlook. While G.D.P. was down in the primary quarter, G.D.I. — the same but not equivalent measure that tracks what people earn, like wages and profits — was up. If G.D.I. is positive again, the info might be an important piece of evidence that america isn’t in a recession.

It has been a brutal yr for Peloton, which went from being a pandemic sweetheart to a cautionary tale in regards to the whims of consumers. In February, Peloton’s chief executive stepped down, and the corporate laid off 20 percent of its corporate work force. In May, it announced that it lost $757 million in the primary three months of 2022. And in July, Peloton said it could now not make bikes and treadmills at its factories and outsource all its manufacturing overseas to chop costs. What’s going to its second-quarter earnings report bring, then? Probably nothing especially upbeat. Peloton’s shares have plummeted nearly 75 percent since January, and although its latest head, Barry McCarthy, has said he’s confident that he can lead the corporate out of this low point, he has admitted to shareholders that “turnarounds are labor.”

Jerome H. Powell, the chair of the Federal Reserve, will speak on Friday in Jackson Hole, Wyo., where the Federal Reserve Bank of Kansas City has held an annual symposium for many years. Last yr, Mr. Powell reassured the group — made up of other central bankers in addition to economists and investors — that inflation was prone to be temporary. This time, he’ll must answer why the other appears to be true. He is anticipated to focus much of his speech on the trail ahead for inflation, which showed its first signs of easing last month. The financial markets might be listening closely for hints of whether the Fed will make one other three-quarter point increase in rates of interest at its September meeting or go together with a half-point increase. Mr. Powell might be speaking on the heels of fresh data from the non-public consumption expenditures price index, the Fed’s preferred inflation gauge, which last showed consumer prices climbing 6.8 percent over the yr through June.

Starbucks was ordered to reinstate seven employees who were fired in February after leading efforts to unionize the Memphis store where they worked. Brian Stelter is leaving CNN after the network canceled his show, “Reliable Sources.” House sales fell in July for the sixth consecutive month.

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