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| Bankrupt Hertz Suspends Plans for Stock Offering: Live Business Updates | |
| (32 minutes later) | |
| Hertz raised eyebrows last week when it asked, and received, a bankruptcy judge’s permission to sell stock. It was an unusual move. Shareholders usually get wiped out during bankruptcy proceedings. | |
| On Wednesday, Hertz reversed course on its plan to sell $500 million in shares, saying it had suspended further sale of its stock “pending further understanding of the nature and timing” of a review by the Securities and Exchange Commission. | |
| Earlier in the day, Jay Clayton, the agency’s chairman, said on CNBC: “We have let the company know that we have comments on their disclosure,” and added: “In most cases, when you let a company know that the S.E.C. has comments on their disclosure, they do not go forward until those comments are resolved.” | |
| It all seemed an unsurprising turn of events. In a prospectus on Monday, the company had warned that buying its stock was a risky move, and that investors who did should be prepared to end up losing money. | |
| The S.E.C. declined to expand on Mr. Clayton’s statement, and Hertz did not respond to repeated requests for comment. | |
| Hertz filed for Chapter 11 bankruptcy protection from its creditors last month. The company, which started with a fleet of a dozen Ford Model T’s a century ago, had piled up $17 billion in debt and was unable to pay its lenders after the coronavirus pandemic grounded business travelers and tourists. A sharp drop in used car prices has also decreased the value of its fleet. | |
| Target said on Wednesday that it would raise its hourly minimum wage for workers by $2 to $15 starting July 5. It will also offer a one-time “recognition bonus” of $200 to hourly employees in its stores and distribution centers at the end of July. | Target said on Wednesday that it would raise its hourly minimum wage for workers by $2 to $15 starting July 5. It will also offer a one-time “recognition bonus” of $200 to hourly employees in its stores and distribution centers at the end of July. |
| Target, which said in 2017 that it would raise its starting wage to $15 by the end of 2020, had already temporarily increased pay to that amount in March because of the pandemic. The increase, which was scheduled to run through July 4, will now be permanent. The additional pay will affect 275,000 employees at its stores and distribution centers, the company said. Target has nearly 1,900 stores and 41 distribution centers and more than 350,000 employees. | Target, which said in 2017 that it would raise its starting wage to $15 by the end of 2020, had already temporarily increased pay to that amount in March because of the pandemic. The increase, which was scheduled to run through July 4, will now be permanent. The additional pay will affect 275,000 employees at its stores and distribution centers, the company said. Target has nearly 1,900 stores and 41 distribution centers and more than 350,000 employees. |
| The retailer also said that as part of its response to the pandemic, it would offer free virtual doctor visits to workers via the CirrusMD app through the end of the year, and continue extending the option for a 30-day paid leave to employees who are 65 and older, pregnant or have an underlying medical condition. It will also continue to offer free backup care to workers through the end of August. | The retailer also said that as part of its response to the pandemic, it would offer free virtual doctor visits to workers via the CirrusMD app through the end of the year, and continue extending the option for a 30-day paid leave to employees who are 65 and older, pregnant or have an underlying medical condition. It will also continue to offer free backup care to workers through the end of August. |
| The announcement comes as retailers, particularly discount chains and groceries, have come under pressure to compensate low-wage employees for working during the pandemic and putting themselves at risk of contracting the virus. Target, which is based in Minneapolis, said that it would invest nearly $1 billion more this year in the “well-being, health and safety of team members” than in 2019. | The announcement comes as retailers, particularly discount chains and groceries, have come under pressure to compensate low-wage employees for working during the pandemic and putting themselves at risk of contracting the virus. Target, which is based in Minneapolis, said that it would invest nearly $1 billion more this year in the “well-being, health and safety of team members” than in 2019. |
| Economic lockdowns meant to contain the coronavirus pandemic have come with unusual side effects, from aggressive rats to the dawn of pouch cocktails. Add this to the list: America’s banks are running out of coins. | Economic lockdowns meant to contain the coronavirus pandemic have come with unusual side effects, from aggressive rats to the dawn of pouch cocktails. Add this to the list: America’s banks are running out of coins. |
| “What’s happened is that with the partial closure of the economy, the flow of coins through the economy, it has gotten all — it’s kind of stopped,” Jerome H. Powell, the chair of the Federal Reserve, told lawmakers while testifying on Capitol Hill on Wednesday, noting that places where people exchange their quarters and pennies for cash and stores have closed, disrupting the normal flow. | “What’s happened is that with the partial closure of the economy, the flow of coins through the economy, it has gotten all — it’s kind of stopped,” Jerome H. Powell, the chair of the Federal Reserve, told lawmakers while testifying on Capitol Hill on Wednesday, noting that places where people exchange their quarters and pennies for cash and stores have closed, disrupting the normal flow. |
| “We’ve been aware of it, we’re working with the Mint to increase supply, we’re working with the reserve banks to get the supply to where it needs to be,” he said. | “We’ve been aware of it, we’re working with the Mint to increase supply, we’re working with the reserve banks to get the supply to where it needs to be,” he said. |
| Mr. Powell was responding to questions from Rep. John Rose, Republican of Tennessee, who said a bank in his district had reported that the Fed had notified them that they would receive only a “small portion” of their weekly coinage order. | Mr. Powell was responding to questions from Rep. John Rose, Republican of Tennessee, who said a bank in his district had reported that the Fed had notified them that they would receive only a “small portion” of their weekly coinage order. |
| “His institution will likely run out of coins by Friday,” he said, and after some research, he found that many banks were having similar problems. “I know we don’t want to wake up to headlines in the near future, such as: ‘Banks out of money.’” | “His institution will likely run out of coins by Friday,” he said, and after some research, he found that many banks were having similar problems. “I know we don’t want to wake up to headlines in the near future, such as: ‘Banks out of money.’” |
| The Fed said in a June 15 notice that coin circulation has been disrupted by the pandemic, and the U.S. Mint’s production of coin also decreased because of measures put in place to protect its employees. Bank coin orders have increased as states reopen, causing the coin inventory — which the Mint prints but the Fed manages — to dip below normal levels. | The Fed said in a June 15 notice that coin circulation has been disrupted by the pandemic, and the U.S. Mint’s production of coin also decreased because of measures put in place to protect its employees. Bank coin orders have increased as states reopen, causing the coin inventory — which the Mint prints but the Fed manages — to dip below normal levels. |
| “It’s something we’ve been working on,” Mr. Powell said. “We believe it’s just temporary.” | “It’s something we’ve been working on,” Mr. Powell said. “We believe it’s just temporary.” |
| For now, the Fed’s regional banks are allocating pennies, nickels, dimes and quarters to banks “as a temporary measure,” the Fed said in its notice, based on historical order volume and other factors. | For now, the Fed’s regional banks are allocating pennies, nickels, dimes and quarters to banks “as a temporary measure,” the Fed said in its notice, based on historical order volume and other factors. |
| Online for-profit colleges have seen an opportunity to increase enrollment during the coronavirus pandemic. Their flexible programs may be newly attractive to unemployed workers, to those seeking to change careers, or to college students whose campuses are closed. | Online for-profit colleges have seen an opportunity to increase enrollment during the coronavirus pandemic. Their flexible programs may be newly attractive to unemployed workers, to those seeking to change careers, or to college students whose campuses are closed. |
| But few of the largest for-profit colleges operating primarily online have track records to justify their optimistic advertising pitches, Sarah Butrymowicz and Meredith Kolodner of The Hechinger Report, a nonprofit newsroom, report in an article for The New York Times. Some have put students deep in debt while posting dismal graduation rates amid a history of investigations by state and federal agencies, including many that have led to substantial financial settlements. | But few of the largest for-profit colleges operating primarily online have track records to justify their optimistic advertising pitches, Sarah Butrymowicz and Meredith Kolodner of The Hechinger Report, a nonprofit newsroom, report in an article for The New York Times. Some have put students deep in debt while posting dismal graduation rates amid a history of investigations by state and federal agencies, including many that have led to substantial financial settlements. |
| Eileen Connor, the legal director at the Project on Predatory Student Lending at Harvard Law School, said she was worried by the prospect of a resurgence for such schools. “In times of economic downturn, that’s when the for-profit colleges start to thrive,” she said. | Eileen Connor, the legal director at the Project on Predatory Student Lending at Harvard Law School, said she was worried by the prospect of a resurgence for such schools. “In times of economic downturn, that’s when the for-profit colleges start to thrive,” she said. |
| Many companies have emphasized the quality of the education they provide. “We’re going to continue to focus on maintaining the highest possible academic quality figuring that that’s really the best way to sort of position yourself vis-à-vis any kinds of regulatory or legislative initiatives,” Karl McDonnell, the chief executive of Strategic Education, told investors in March. | Many companies have emphasized the quality of the education they provide. “We’re going to continue to focus on maintaining the highest possible academic quality figuring that that’s really the best way to sort of position yourself vis-à-vis any kinds of regulatory or legislative initiatives,” Karl McDonnell, the chief executive of Strategic Education, told investors in March. |
| Amid fears that Chinese firms will exploit the pandemic to buy European companies at bargain prices, the European Commission unveiled proposals on Wednesday intended to prevent foreign investors from using government subsidies to outbid competitors. The measures were clearly aimed at China, which is often accused of providing financial support to key industries. | Amid fears that Chinese firms will exploit the pandemic to buy European companies at bargain prices, the European Commission unveiled proposals on Wednesday intended to prevent foreign investors from using government subsidies to outbid competitors. The measures were clearly aimed at China, which is often accused of providing financial support to key industries. |
| In a report, the European Union’s executive branch outlined legislation that would compel foreign investors to disclose whether they receive state support. European officials could also investigate companies suspected of receiving subsidies and impose conditions on subsidized investors or block them altogether. | In a report, the European Union’s executive branch outlined legislation that would compel foreign investors to disclose whether they receive state support. European officials could also investigate companies suspected of receiving subsidies and impose conditions on subsidized investors or block them altogether. |
| There isn’t yet much evidence that Chinese companies are on a buying spree in Europe; Chinese investment in Europe has been declining steeply. But analysts say that Chinese investors, often backed by the government, still covet European companies as a source of technological expertise, access to international markets and political leverage. | There isn’t yet much evidence that Chinese companies are on a buying spree in Europe; Chinese investment in Europe has been declining steeply. But analysts say that Chinese investors, often backed by the government, still covet European companies as a source of technological expertise, access to international markets and political leverage. |
| “The worry is not the volume of investment,” said Agatha Kratz, a specialist in Europe-China relations at Rhodium Group, a research organization. “The worry is about one or two or three acquisitions that could affect European competitiveness.” | “The worry is not the volume of investment,” said Agatha Kratz, a specialist in Europe-China relations at Rhodium Group, a research organization. “The worry is about one or two or three acquisitions that could affect European competitiveness.” |
| A growing number of start-ups have moved quickly to go public as the initial shock of the coronavirus pandemic has worn off. The stock market, which plummeted when the outbreak swept the United States, has rallied strongly in recent weeks. Since its nadir in late March, the S&P 500 index has climbed 40 percent. | A growing number of start-ups have moved quickly to go public as the initial shock of the coronavirus pandemic has worn off. The stock market, which plummeted when the outbreak swept the United States, has rallied strongly in recent weeks. Since its nadir in late March, the S&P 500 index has climbed 40 percent. |
| As the market has bounced back, several companies have gone public, including SelectQuote, an online insurance provider; ZoomInfo, a sales software data provider; Warner Music Group, a record label; and Vroom, a start-up that sells used vehicles online. And more initial public offerings are on the way. | As the market has bounced back, several companies have gone public, including SelectQuote, an online insurance provider; ZoomInfo, a sales software data provider; Warner Music Group, a record label; and Vroom, a start-up that sells used vehicles online. And more initial public offerings are on the way. |
| Some of the biggest Silicon Valley start-ups are also taking steps toward an I.P.O. Airbnb, the home rental start-up valued at $31 billion, said it had not ruled out going public this year. Palantir, a digital surveillance company valued at $20 billion, is preparing to file for an I.P.O. in the coming weeks, said a person briefed on the start-up’s plans, who declined to be identified because the talks were private. | Some of the biggest Silicon Valley start-ups are also taking steps toward an I.P.O. Airbnb, the home rental start-up valued at $31 billion, said it had not ruled out going public this year. Palantir, a digital surveillance company valued at $20 billion, is preparing to file for an I.P.O. in the coming weeks, said a person briefed on the start-up’s plans, who declined to be identified because the talks were private. |
| “The window is open,” said Previn Waas, a partner focused on I.P.O.s at the accounting firm Deloitte. “Everyone has figured out that a virtual I.P.O. is possible. There’s an appetite for companies to go public.” | “The window is open,” said Previn Waas, a partner focused on I.P.O.s at the accounting firm Deloitte. “Everyone has figured out that a virtual I.P.O. is possible. There’s an appetite for companies to go public.” |
| Stocks fell on Wednesday, giving up an early gain as investors regrouped after days of turbulent trading fueled by a cascade of news about the coronavirus and its impact on the global economy. | |
| The S&P 500 fell less than half a percent, retreating after three days of back-to-back gains that had lifted the index by 4 percent. | |
| Oil prices also fell, and oil companies were among the worst performers in the market. Cruise ship operators, which have become prone to large price swings as sentiment in the market shifts, also fell sharply.Late on Tuesday, Norwegian Cruise Line had said it would extend a shutdown of its operations until September. Its shares fell more than 8 percent. | |
| Markets have been on a wild ride as investors have reckoned with the notion that the economic recovery will not be as quick as they had hoped. | |
| The S&P 500 plunged last week amid concerns about the rising number of coronavirus infections in states like Florida and Texas. A fresh outbreak in Beijing has also raised questions about China’s efforts to contain the outbreak. | |
| At the same time, investors were optimistic over efforts by governments to address the economic damage, and data showing that things are getting better. The latest data point came on Tuesday, when stocks were buoyed by a report showing retail sales in the United States jumped 18 percent in May, a stronger-than-expected bounce. | |
| A businessman in Evanston, Ill., tried to fraudulently obtain a $440,000 loan through the Paycheck Protection Program, a government relief fund for small companies harmed by the pandemic, by using false tax and payroll records, the Justice Department said on Tuesday. | A businessman in Evanston, Ill., tried to fraudulently obtain a $440,000 loan through the Paycheck Protection Program, a government relief fund for small companies harmed by the pandemic, by using false tax and payroll records, the Justice Department said on Tuesday. |
| Rahul Shah describes himself on LinkedIn as the chief executive of Katalyst Technologies, which says on its website that it makes business software. In late April, he applied for a P.P.P. loan for a different company, N2N Holdings, which does business as Boardshare and lists Mr. Shah on its website as its chief executive. | Rahul Shah describes himself on LinkedIn as the chief executive of Katalyst Technologies, which says on its website that it makes business software. In late April, he applied for a P.P.P. loan for a different company, N2N Holdings, which does business as Boardshare and lists Mr. Shah on its website as its chief executive. |
| Mr. Shah’s loan application claimed that N2N had 10 employees and an average monthly payroll of $176,455, according to a criminal complaint filed against him in the United States District Court for the Northern District of Illinois. But it raised alarms at the bank — not named in the complaint — because tax records from the Internal Revenue Service showed a far more modest payroll, with N2N’s employee wages dropping to $0 at the end of last year. The bank declined to make the loan. | Mr. Shah’s loan application claimed that N2N had 10 employees and an average monthly payroll of $176,455, according to a criminal complaint filed against him in the United States District Court for the Northern District of Illinois. But it raised alarms at the bank — not named in the complaint — because tax records from the Internal Revenue Service showed a far more modest payroll, with N2N’s employee wages dropping to $0 at the end of last year. The bank declined to make the loan. |
| When federal law enforcement agents interviewed Mr. Shah last month, he acknowledged that there were “errors” in his documentation, the complaint said. He is charged with bank fraud and making false statements to a financial institution. Mr. Shah did not immediately respond to request for comment. | When federal law enforcement agents interviewed Mr. Shah last month, he acknowledged that there were “errors” in his documentation, the complaint said. He is charged with bank fraud and making false statements to a financial institution. Mr. Shah did not immediately respond to request for comment. |
| Lawmakers and government officials have said they will seek out and prosecute those trying to bilk the loan program, a rushed and often chaotic effort to distribute $660 billion to needy small companies devastated by coronavirus shutdowns. Last month, two New England men were arrested and charged with using false documents to seek loans totaling more than half a million dollars. | Lawmakers and government officials have said they will seek out and prosecute those trying to bilk the loan program, a rushed and often chaotic effort to distribute $660 billion to needy small companies devastated by coronavirus shutdowns. Last month, two New England men were arrested and charged with using false documents to seek loans totaling more than half a million dollars. |
| As restaurants around the country look to reopen during the coronavirus pandemic, outdoor seating is becoming a survival option, and local governments are helping by cutting red tape. | As restaurants around the country look to reopen during the coronavirus pandemic, outdoor seating is becoming a survival option, and local governments are helping by cutting red tape. |
| With the spread of the coronavirus still a danger, many states are requiring that restaurants reduce their capacity to 25 to 50 percent of normal operations to ensure there is at least six feet between tables. Some, like New Jersey, are prohibiting indoor dining altogether for the time being. | With the spread of the coronavirus still a danger, many states are requiring that restaurants reduce their capacity to 25 to 50 percent of normal operations to ensure there is at least six feet between tables. Some, like New Jersey, are prohibiting indoor dining altogether for the time being. |
| However, local officials are trying to give at least some of that capacity back by allowing eating establishments to expand onto patios and parking lots, and even city sidewalks and streets. And they are reducing or waiving fees and quickly approving plans that previously may have taken months to process. | However, local officials are trying to give at least some of that capacity back by allowing eating establishments to expand onto patios and parking lots, and even city sidewalks and streets. And they are reducing or waiving fees and quickly approving plans that previously may have taken months to process. |
| The effort appears to be paying off. OpenTable, a provider of online restaurant reservations, has counted a tenfold increase in outdoor seating this spring compared with a year ago. | The effort appears to be paying off. OpenTable, a provider of online restaurant reservations, has counted a tenfold increase in outdoor seating this spring compared with a year ago. |
| J.C. Penney, the 118-year-old department store chain that filed for bankruptcy last month, started store-closing sales at 136 locations on Wednesday. The company, which said earlier this month that it would shut 154 stores, said online that “a handful of previously announced store closing locations remain on hold pending further review.” J.C. Penney, which listed the liquidating stores online, previously said the closing sales would take 10 to 16 weeks to complete. | J.C. Penney, the 118-year-old department store chain that filed for bankruptcy last month, started store-closing sales at 136 locations on Wednesday. The company, which said earlier this month that it would shut 154 stores, said online that “a handful of previously announced store closing locations remain on hold pending further review.” J.C. Penney, which listed the liquidating stores online, previously said the closing sales would take 10 to 16 weeks to complete. |
| Cinemark, the nation’s third-largest movie theater chain, said on Wednesday that it would reopen three cinemas in the Dallas area on Friday as a test. The majority of the company’s United States locations will begin showing films again by July 17, ahead of the first major release from Hollywood since March, “Mulan,” which is scheduled for July 24. As it tests its coronavirus safety protocols — staggered seating, limited capacity, seat wipes available for customer use, no cash payments at the concession counter — Cinemark will show movies like “Goonies” and “Raiders of the Lost Ark” at discounted prices. Attendees will not be required to wear face masks, except in areas where government health officials have mandated it. | Cinemark, the nation’s third-largest movie theater chain, said on Wednesday that it would reopen three cinemas in the Dallas area on Friday as a test. The majority of the company’s United States locations will begin showing films again by July 17, ahead of the first major release from Hollywood since March, “Mulan,” which is scheduled for July 24. As it tests its coronavirus safety protocols — staggered seating, limited capacity, seat wipes available for customer use, no cash payments at the concession counter — Cinemark will show movies like “Goonies” and “Raiders of the Lost Ark” at discounted prices. Attendees will not be required to wear face masks, except in areas where government health officials have mandated it. |
| Reporting was contributed by Jeanna Smialek, Sapna Maheshwari, Brooks Barnes, Sarah Butrymowicz, Meredith Kolodner, Erin Griffith, Jack Ewing, Mohammed Hadi, Stacy Cowley, Jane Margolies and Kevin Granville. | Reporting was contributed by Jeanna Smialek, Sapna Maheshwari, Brooks Barnes, Sarah Butrymowicz, Meredith Kolodner, Erin Griffith, Jack Ewing, Mohammed Hadi, Stacy Cowley, Jane Margolies and Kevin Granville. |