Microsoft laying off several thousand employees globally
"We continue to implement organizational changes necessary to best position the company and teams for success in a dynamic marketplace," a Microsoft spokesperson said in an email.
The cloud computing tech giant did not disclose the total amount of lost jobs but as of June 2024 it employed 228,000 people, bringing the latest layoffs to about 9,000 people.
The job cuts follow a round in May that saw about 6,000 positions culled from its global workforce.
The company, which is advancing in its plans to deploy AI across all its products, said it was working to "empower employees to spend more time focusing on meaningful work by leveraging new technologies and capabilities."
"Even in the best of times, we have regularly adjusted our workforce to meet the strategic demands of the business," the company added.
The company, which celebrates its 50th anniversary this year, was one of the first tech giants to double down on artificial intelligence when the launch of ChatGPT in 2022 rocked the tech industry.
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Zawya
26 minutes ago
- Zawya
US fiscal folly could create big, beautiful debt spiral: Klement
(The views expressed here are those of the author, an investment strategist at Panmure Liberum.) LONDON - The U.S. tax and spending bill passed on July 3 is expected to add more than $3 trillion to the country's deficit over the next decade. If the current debt trajectory continues unabated, it could set off a slow motion debt spiral that could endanger the Federal Reserve's independence. The sobering long-term debt projections of the Congressional Budget Office may actually understate the likely impact on U.S. debt-to-GDP levels of President Donald Trump's "One Big Beautiful Bill". The CBO based its estimate on the assumption that temporary increases in government spending and tax cuts will sunset at a projected date. But this new budget bill, which extended previous tax cuts and other measures, has shown that this sunset often never arrives. Thus, the long-term projections in the U.S. Treasury's annual financial report may be more realistic since they assume the current rate of government spending will continue indefinitely. In the Treasury forecast, the U.S. debt-to-GDP ratio is projected to increase to over 200% in 2050 compared to the CBO's estimate of around 145%. Scarier still, the Treasury forecasts that the U.S. debt-to-GDP ratio will reach 535% by 2100 if current spending plans continue. Proponents of tax cuts argue that they boost GDP growth and thus will slow the rise in debt-to-GDP, but the CBO estimates that the House Bill will only increase real GDP by an average of 0.5% over 10 years or 0.04% per year relative to the CBO's January 2025 projections. The Tax Foundation estimates that the Senate Bill will boost GDP growth by 1.2% in the 'long run'. That hardly makes a difference compared to an expected debt increase totalling almost 10% of GDP. 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Since the pandemic, the average duration of U.S. government debt has declined significantly as the Treasury has favoured bills over longer-term instruments in an effort to keep interest expenses under control. One reading of Bessent's comments is that the Treasury is concerned about the country's ability to continue servicing its long-term debts if it borrows at today's elevated yields, a message that could push Treasuries' risk premium even higher, making long-term borrowing even less tenable. GREEK TRAGEDY This reminds me of a similar episode in which a heavily indebted country faced a sudden spike in its already large deficit. As investors lost trust in the country's ability to pay back its debt, long-term yields rose, which in turn forced the government to issue debt at shorter and shorter maturities. This signalled to the market that the government would struggle to pay the existing debt, and this pushed long-term government bond yields even higher. The country's debt entered a doom loop. The country in question: Greece after the 2009 financial crisis. To be clear, I do not expect the U.S. to experience a similar implosion. There are crucial differences between the U.S. and Greece that should prevent this, not least the ability of the U.S. to devalue the dollar and inflate away some of its debt. Greece, as a euro zone member, had no such flexibility. But the new U.S. budget increases the possibility that the U.S. could face a similar debt drama, only in slow motion. If long-term Treasury yields remain higher for longer, the Treasury is apt to continue shortening the duration of its debt. This, in turn, could create a vicious cycle by making government interest expenses more volatile, further imperiling U.S. fiscal health and making longer-term debt even riskier. OFF RAMPS There appear to be three main off ramps for the U.S. One: politicians could become fiscally prudent and significantly reduce the deficit to a sustainable level. This seems unlikely given both parties' recent track records. Two: the Treasury could impose capital controls to artificially increase demand for Treasuries. As I have written previously, this move would likely spell the end of the dollar as the main global reserve currency. Three: the Fed could create artificial demand for long-term Treasuries by scooping up bonds itself – that is, restarting quantitative easing – to keep yields low. The danger with this form of QE, however, is that it represents fiscal dominance, where the central bank loses control over monetary policy because of imprudent government actions. How such a development would play out is impossible to predict, especially when it involves a global superpower, but it's fair to assume the Fed won't want to find out. (The views expressed here are those of Joachim Klement, an investment strategist at Panmure Liberum, the UK's largest independent investment bank). Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, and X. (Writing by Joachim Klement; Editing by Anna Szymanski and David Gregorio)
Khaleej Times
an hour ago
- Khaleej Times
US to impose new tariff rates as Trump shifts trade strategy
President Donald Trump said Washington will start sending letters to countries on July 4 specifying what tariff rates they will face on imports to the US, a clear shift from earlier pledges to strike scores of individual deals. Acknowledging the complexity of negotiating with over 170 nations, Trump told reporters before departing for Iowa on July 3 that the letters will be sent to 10 countries at a time, laying out tariff rates such as 20 per cent to 30 per cent. "We have more than 170 countries, and how many deals can you make?" Trump said. "They're very much more complicated." Stay up to date with the latest news. Follow KT on WhatsApp Channels. The Republican president said he expected "a couple" more detailed agreements with other countries after Wednesday's announcement of a trade deal with Vietnam. However, he said he preferred to notify most other countries of a specific tariff rate, skipping detailed negotiations. Trump's comments underscored the challenges of completing trade agreements on everything from tariffs to non-tariff barriers such as bans on agricultural imports. Top Trump aides said in April they would work on 90 deals in 90 days, an ambitious goal that was met with skepticism from trade experts familiar with arduous and time-consuming trade deals of the past. Treasury Secretary Scott Bessent told Bloomberg Television that about 100 countries are likely to see a reciprocal tariff rate of 10 per cent and predicted a "flurry" of trade deals announced before a July 9 deadline when tariffs could rise sharply. If 10 per cent tariffs were given to 100 countries, that would be fewer than originally envisioned by the Trump administration. Its original reciprocal tariff list showed 123 jurisdictions that would be given a 10 per cent tariff rate — mostly small countries — along with some territories such as Australia's uninhabited Heard and McDonald Islands. Trump sent markets into a tailspin on April 2 with sweeping reciprocal tariff rates ranging from 10 per cent to 50 per cent, although he temporarily reduced the tariff rate for most countries to 10 per cent to allow time for negotiations through July 9. Many countries with an initial 10 per cent duty rate have not had any negotiations with the Trump administration, with the exception of Britain, which reached a deal in May to keep a 10 per cent rate and won preferential treatment for some sectors including autos and aircraft engines. Major trading partners now involved in negotiations were hit with much higher tariff rates, including 20 per cent for the European Union, 26 per cent for India and 24 per cent for Japan. Other countries that have not engaged in trade talks with the Trump administration face even higher reciprocal tariffs, including 50 per cent for the tiny mountain kingdom of Lesotho, 47 per cent for Madagascar and 36 per cent for Thailand. Trump on Wednesday announced an agreement with Vietnam that he said cuts US tariffs on many Vietnamese goods to 20 per cent from his previously threatened 46 per cent. Many US products would be allowed to enter Vietnam duty free.
Khaleej Times
an hour ago
- Khaleej Times
'One Big Beautiful Bill': Trump wins 'phenomenal' victory as Congress passes draft law
US President Donald Trump boasted of a "phenomenal victory" to cheering supporters at a rally in Iowa on July 3 after Congress narrowly passed his signature tax and spending bill, cementing his radical second-term agenda. The jubilant president kicked off America's year-long 250th birthday celebrations with a victory lap hailing the unpopular bill, which has caused deep concern within his own Republican Party — as well as, polls show, among many Americans. Many fear that it will balloon the national debt, gut health and welfare support as well as clean energy, and supercharge Trump's migrant crackdown. "There could be no better birthday present for America than the phenomenal victory we achieved just hours ago," Trump told supporters in the state capital, Des Moines. "Very simply, the one, big beautiful bill would deliver the strongest border on Earth, the strongest economy on Earth, the strongest military on Earth, and ensure the USA will remain the strongest country anywhere on this beautiful planet of ours." The bill squeezed past a final vote earlier Thursday, 218-214, after a small group of Republican opponents in the House of Representatives finally fell in line, corralled by Speaker Mike Johnson. Trump said he would sign the bill into law on Friday, American Independence Day, adding that pilots who had carried out US strikes on Iran two weeks earlier would be in attendance. Mass deportations, tax breaks The legislation is the latest in a series of big wins for Trump, including a Supreme Court ruling last week that curbed lone federal judges from blocking his policies, and US air strikes that led to a ceasefire between Israel and Iran. His sprawling mega-bill narrowly passed the Senate on Tuesday and had to return to the lower chamber for its approval of the senators' revisions. The package honours many of Trump's campaign promises: boosting military spending, funding a mass migrant deportation drive and committing $4.5 trillion to extend his first-term tax relief. "Everything was an absolute disaster under the Biden-Harris radical regime, and we took the best effort that we could, in one big, beautiful bill, to fix as much of it as we could," Johnson said. "And I am so grateful that we got that done." But it is expected to pile an extra $3.4 trillion over a decade onto the country's fast-growing deficits, while shrinking the federal food assistance program and forcing through the largest cuts to the Medicaid health insurance scheme for low-income Americans since its 1960s launch. Some estimates put the total number of recipients set to lose their insurance coverage under the bill at 17 million. Scores of rural hospitals are expected to close. While Republican moderates in the House fear the cuts will damage their prospects of reelection next year, fiscal hawks chafed over savings that they say fall far short of what was promised. Johnson had to negotiate tight margins, and could only lose a handful of lawmakers in the final vote, among more than two dozen who had earlier declared themselves open to rejecting the 869-page text. Trump spent weeks hitting the phones and hosting White House meetings to cajole lawmakers torn between angering welfare recipients at home and incurring the president's wrath. Democrats hope public opposition to the bill will help them flip the House in the 2026 midterm election, pointing to data showing that it represents a huge redistribution of wealth from the poorest Americans to the richest. "This bill, this one big, ugly bill -- this reckless Republican budget, this disgusting abomination -- is not about improving the quality of life of the American people," House Minority Leader Hakeem Jeffries said. After the bill was passed, Trump's predecessor, Joe Biden, said it was "not only reckless — it's cruel." Extra spending on the military and border security will be paid in part through ending clean energy and electric vehicle subsidies — a factor triggering a bitter public feud between Trump and former key advisor Elon Musk.
