The Federal Reserve’s persistently high interest rate of above 5% is working. It is pushing down inflation by slowing the economy. Companies are adjusting their input costs by cutting jobs.
Technology
Amazon (AMZN) is cutting less than 5% of its staff in the Buy with Prime unit. It will cut 5% at its audiobook and podcast unit. In addition, it will reduce staff in streaming and studio operations, including Twitch. Despite Amazon’s founder Jeff Bezos selling $8.4 billion in shares, magnificent 7 investors should consider the job cuts as bullish.
Alphabet (GOOG) will cut dozens of staff at X Labs. It will be cutting hundreds more in each of its sales and the hardware unit responsible for Pixel, nest, and Fitbit.
Unsurprisingly, it will cut most of its augmented reality team. Alphabet is not in the running for VR or AR. Apple (AAPL) entered the segment with the Pro Vision headset while Meta Platforms (META) has the Quest Pro.
The automotive sector is bracing for a continued slowdown in car purchases, so Ford (F) will quietly cut jobs. However, the UAW threatened to strike at the largest plant. 9,000 workers are complaining about health and safety at the plant.
Speculators could trade on F stock, betting on a short-lived rebound.
Nike (NKE) is reportedly cutting 5% of its staff, or 1,600 positions. This is part of the $2 billion cost-cut program over the next three years. The savings are bullish for NKE stock
