ExclusiveFed lowers rates but sees fewer cuts in 2025

Hello. Good to see you guys. How are you guys doing? Not too bad. It's Wednesday. Here we are. Two days from Friday. Yeah, almost through the week. Once more. So starting off, a call to AT&T employees here. The telecom giant is issuing a return to office order. AT&T told all its staff they must work in the office five days a week, and that's starting in January next year. The company's 18,000 managers were required to return this year in a proxy statement. AT&T said the mandate is intended to drive collaboration, innovation, and long-term success. And the Supreme Court has agreed to hear TikTok's challenge to a potential ban. The Chinese-owned social media app faces a ban in the U.S. on January 19th if it fails to divest from its Chinese parent company ByteDance. And TikTok is asking the high court to delay the deadline. And the justices will hear oral arguments on January 10th. TikTok and its allies argue that the ban violates First Amendment rights, while supporters of the ban say TikTok's connection to communist China poses national security risks. Earlier this month, a federal appeals court upheld the ban. And California will be phasing out gas cars in the coming decade. The Environmental Protection Agency today approved California's landmark plan to end the sale of gasoline-only vehicles by 2035. EPA Administrator Michael Reagan granted California a waiver under the Clean Air Act to implement its plan. It requires that by 2035, at least 80 percent of new cars sold be electric and up to 20 percent plug-in hybrid models. The approval sets up a fight over the future of California's vehicle regulations. President-elect Trump has vowed to rescind such approvals. Opponents of California's plan argue that it will depress economic activity, increase costs and limit vehicle choice. California's Governor Gavin Newsom, who backs the plan, said, Clean cars are here to stay. And the Federal Reserve cut its key interest rate today by a quarter point. It's the third cut this year. The central bank also signaled that it expects to reduce rates more slowly next year amid persistent inflation. Inflation has eased significantly over the past two years, but remains somewhat elevated relative to our 2 percent longer-run goal. Estimates based on the Consumer Price Index and other data indicate that total PCE prices rose 2.5 percent over the 12 months ending in November, and that, excluding the volatile food and energy categories, core PCE prices rose 2.8 percent. And adding to that, the Fed projected they will cut their benchmark rate by a quarter point just twice in 2025 next year. That's down from the central bank's previous estimate in September of four rate cuts, and that means borrowers could continue to struggle next year for mortgages, auto loans, for example, and credit cards. The Fed's benchmark rate stands between 4.25 and 4.5 percent after today's decision. The move follows a half-point reduction in September and a quarter-point cut last month. Cutting Profits for Promotion General Mills has slashed its annual profit forecast to ramp up its investments in promotions to win cost-conscious consumers. The Cheerio cereal maker revived volumes by lowering its prices across the board, but warned that higher-than-planned promotions could weigh on annual profit. This sent shares down in trading. One analyst says that the investment in brand marketing is necessary for long-term growth. So most of us are getting a wave of holiday packages. Meanwhile, scammers are hoping to cash in on the holiday chaos. The USPS is warning customers about smishing scams. These are fraudulent text messages intended to steal a person's personal information. The USPS does send texts, but only when the customer registers for them, and the text never includes links. Customers who believe they have received smishing texts are asked to report to the Postal Service. The jewelry business in Los Angeles is busy this holiday shopping season. And according to the Beverly Hills Chamber of Commerce, pieces worth millions of dollars are also helping the local economy. NTD's Andrew Thomas has more on what's trending this year. On Beverly Hills Rodeo Drive, jewelry shines in store windows. At Eli & Co., an extremely large inventory can supply stores on very short notice. CEO Eli Knorr offers pieces that range from $25,000 all the way up to tens of million dollars apiece. We specialize in statement pieces. The trend for 2025 items that make, they're bold. When you walk into a room, they make a statement. From the rare to the exceptional is natural fancy colored diamonds and gemstones. At Veronica Tharliam, limited edition statement pieces have a global twist. The brand's founder and creative director says this holiday season, pearls and beads are big with shoppers. But it's the combination of elements that make certain pieces special. Colors, patterns, and material. By material, I mean it could be chains, it could be pearls, it could be beads. You just mix them all up together and it's messy. It's not like one after the other. It's all about collapsing all of them together. And, you know, it's about being more and making that statement. Todd Johnson is the president and CEO of the Beverly Hills Chamber of Commerce. He says holiday retail shopping is booming. Many businesses this year have a much more brighter outlook, not only on the end of this holiday season, but for 2025. We're glad that the election has passed us. The economy is moving forward. We're very optimistic that things are going to be much better. According to market forecasts by the Beverly Hills Chamber of Commerce, the average shopper is expected to spend more this year compared to last year. The average person spent $985 last year. This year is expected to be $1,065. I'm seeing a ton of people on the street. There's a lot of energy and I think the holiday season is going to be bright and very cheery. For the wealthy in Beverly Hills and beyond, Rodeo Drive has options for those looking to dazzle a special someone this holiday season. Andrew Thomas, NTD News. And a deal for jet setters. For a limited time, Frontier Airlines is offering an all-you-can-fly Go Wild pass for $299. It covers a year of unlimited flights from May 2025 to April 2026. And to get the deal, the flyer must be a U.S. resident and a member of the loyalty program Frontier Miles. Then the flyer can book select flights covered by the pass for just a penny plus taxes and associated fees. Reservations can be made the day before a domestic flight takes off and 10 days before an international flight. The $299 deal ends by the end of the day today and after that, the pass sells for $499. Meanwhile, a record-high current account deficit hit in the third quarter. The current account deficit measures the flow of goods, services, and investments into and out of the country. The Commerce Department reported that it increased to an all-time high of nearly $36 billion. And this was fueled by strong growth in imports and lower income receipts. As for the overall U.S. budget deficit, a reflection of government outspending revenue that grew to nearly $2 trillion this year. This is the highest reading outside of the pandemic. Now, two Japanese auto-making titans are in talks about a possible merger. Honda and Nissan said in a statement they have been in discussions, but offer no details or time frame for when a deal, if any, may be reached. In March, Honda and Nissan announced they would partner on electric vehicles. Months later, in August, the automakers said they will collaborate on battery technology. Now, both companies have struggled this year. Nissan's operating income between March and September fell 90% from the same period last year. Meanwhile, Honda, which is roughly five times the size of Nissan, has also faced challenges. Honda plans to sell only zero-emission vehicles in major markets by 2040. However, a combination of lower gas prices, insufficient charging infrastructure, and increased competition have lessened demand for EVs in the U.S. and Europe as well. Disney has cut a transgender storyline from its new animated series as part of its approach to content made for kids. The company told The Hollywood Reporter that, When it comes to animated content for a younger audience, we recognize that many parents would prefer to discuss certain subjects with their children on their own terms and timeline. Win or Lose is about a co-ed middle school softball team. The episode focuses on a transgender character, which has been cut, but the character will still be on the show. Bitcoin's soaring value has caught the attention of high-end fashion brands and retailers, prompting further interest in offering cryptocurrencies as a means of payment to tap into fresh pockets of wealth and build loyalty with crypto investors. Until recently, only a handful of luxury brands, including LVMH, Gucci and Balenciaga, have experimented with crypto payment offers. But in recent weeks, upscale French luxury department store Prontemps announced it was teaming up with the world's largest crypto exchange Binance and French financial tech company Lizzy to accept cryptocurrencies. It will include Bitcoin and Ethereum in its stores in France, and will become the first European department store to do so. Luxury lighter and pen maker Estee DuPont told Reuters it aims to accept cryptocurrency payments in two Paris stores before the holidays. Cruise company Virgin Voyages began this month offering its first product, accepting Bitcoin as a payment option. It's for a $120,000 annual pass for up to a year of sailing on its cruise ships. Regulators have long warned that cryptocurrencies like Bitcoin are high-risk assets, with limited uses in the real world. High volatility has been another barrier to wide adoption as a means of payment. It's noting that blockchain innovation in financial markets could increase predictability for cryptocurrencies. Luxury labels have long sought to cater to affluent shoppers from the tech industry. And it comes as the luxury industry faces its biggest slump in years and searches for new sources of growth. An official said today that the seven foreign tourists who were hospitalized in Fiji after drinking cocktails at a resort bar were not poisoned by alcohol or illicit drugs. Fiji's tourism minister said the cause of the tourist illness over the weekend remains under investigation. He also said that all seven tourists have fully recovered. They became ill at the five-star Warwick resort near the town of Sigatoa on Saturday. The tourists were hospitalized with nausea, vomiting and neurological symptoms. Elon Musk made his first comments since Indian authorities seized two Starlink devices in recent weeks. One in an armed conflict zone and another in a drug smuggling bust. Musk wrote on X late on Tuesday that Starlink satellite beams are turned off over India and were never on in the first place. He was responding to a post from the Indian army about a search operation last week in India's northeast where a conflict has raged since early last year. Starlink is seeking approval in India to provide satellite broadband services. The company is trying to address any potential security concerns as part of the process. Meanwhile, as Christmas approaches, children are writing up their wish lists. In the UK, a panel of toy industry experts has compiled a list of the most sought-after products this holiday season. NTD's Andrew Thomas has more on the top toys. This holiday season, Dream Toys has unveiled its list of the top 20 Christmas toys. Among the top picks is Spin Master's Kinetic Sand Squish Motion. Kids love sensory toys because it just allows them that quiet time to decompress and whether it's stuff going on in the world or just the pressures of school, kids like naturally find themselves doing relaxing things and Kinetic Sand's very good at doing that, just like decompressing. Another top 20 pick is the Hatchimals Alive Mystery Hatch Pufficorn. The interactive toy allows children to care for a speckled egg that eventually hatches into a magical creature. Paul Reeder chairs the selection panel every year at Dream Toys. What we do here is, we have a panel of specialists that come together and pick what we believe to be some of the must-have toys this Christmas. So, the sole intention is to help gift-givers, parents. The Real FX Disney Stitch toy features an animatronic puppet. Richard North, founder of Wow Stuff, calls it puppetronic. So, when you stroke him, he'll purr. You've got a sensor on his nose, so he can actually sniff you and he'll tell you whether you smell good or not. And he's got a sensor on his tongue as well. Hot Wheels Ultra Shark Car Wash Playset offers an interactive experience. Temperature-sensitive features allow kids to watch their cars change color as they pass through the car wash. The classic Lego took three of this year's top spots. Seven-year-old toy tester Abasola inspected Lego icons Tiny Plants, Disney Stitch and Lego Speed Champions McLaren F1 race car. My favorite one is the one with the Lego. Why? Because you can, like, take the heads off and replace them with others and you can make new people with it as well. Ava is also a toy tester. For her, Christmas is an opportunity to be close to her loved ones. Christmas is special to me because I get to spend time with, like, my friends and my family. And it, like, makes my day to see my family because they live quite far away. And I get lots of presents from, like, my family and my friends. Melissa Simmons is the executive toys director at Circana, a market research company. She says the UK toy market has withstood challenges. But the toy market as a whole is pretty resilient. We tend to, sort of, be pretty consistent. We don't have huge drops and huge peaks because there's always Christmas, birthdays. There's always something that people want to buy toys because it just sparks that joy and that fun in people when they purchase toys. According to Dream Toys, consumers spent more than a billion dollars on toys in the UK last year. Andrew Thomas, NTD News. A British court ruled today that police can, in fact, to cover years of unpaid taxes from influencer Andrew Tate and his brother, Tristan. Police force went to court to claim the money from the Tates and a woman only identified as the letter J. The chief magistrate ruled that financial transactions by the brothers were a clear tax cheat. Andrew Tate accused the government of stealing by freezing his accounts and seizing his assets. A lawyer for the brothers said that the bank transfers were normal for people who run online businesses. Both Tate brothers face criminal allegations in Romania, including claims of human trafficking. They are then set to be extradited to the UK to face further allegations in Britain. The Tates deny all the allegations. The top watchdog agency for consumer finance warned credit card companies that denied the full value of rewards points may be breaking the law. That also includes devaluing or canceling cashback in miles that cardholders have earned. The watchdog said authorities can punish card issuers that slash the value of such rewards based on fine print, hidden terms, or technical glitches. The watchdog said in recent years, three-quarters of all general-purpose credit cards were rewards cards, and many consumers choose them based on reward incentives. Presidents like Trump has yet to name someone to run the watchdog next year. Trump ally Elon Musk has called for abolishing the agency. Colonel Sanders is getting saucy to entice Gen Z. KFC is opening up a spinoff store in Orlando that has reimagined the original recipe. Saucy is a prototype restaurant centered on chicken tenders and 11 new dips. These are both favorites of Gen Z eaters, apparently. The sauce count is a nod to KFC's 11 spices and herbs in its fried chicken. It will be served in flights of four. U.S. stocks plunged today. It erased earlier gains after the Fed cut interest rates. The Dow suffered its 10 straight sessions of declines to mark its longest daily streak of losses since an 11-session skid in October 1974. So the Fed's projections indicated that it will make rate cuts totaling half a percentage point by the end of 2025. And this is in light of the solid labor market and the recent stalling in lowering inflation. And just by the way, higher interest rates are usually seen as a drag to the equity market. All right, that's it on today's Business Matters. Back to you. Thanks, Don. Lots happening. Anything catch your eye, Fiona? Well, I gotta say those kids testing those toys. I mean, I would have liked that job when I was a kid. Yeah, I mean, toys nowadays, they look pretty fancy compared to, I mean, to a certain degree compared to what I grew up with. Toys were a bit simpler, I guess. Well, it's not a holiday movie, but reminds me of my favorite Tom Hanks movie where he becomes an adult, but he still has a kid's mindset and he goes to work at the toy company. Right here in New York City. I remember that one. I think we can all relate to Tom Hanks to a certain level. Thanks, Don. We'll see you back here tomorrow. Thank you, Don.