Business Highlights
Roundup of top economy stories
WASHINGTON — Stagflation. It was the dreaded “S word” of the 1970s. For Americans of a certain age, it conjures memories of painfully long lines at gas stations and shuttered factories. Stagflation is the bitterest of pills: High inflation mixes with a weak job market to cause a toxic brew that punishes consumers and befuddles economists. For decades, most economists didn’t think such a nasty concoction was even possible. But a confluence of events has economists reaching back to the days of disco and the bleak high-inflation, high-unemployment economy of nearly a half century ago. Few think stagflation is in sight. But as a longer-term threat, it can no longer be dismissed.
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NEW YORK — Computer chip and software maker Broadcom will spend about $61 billion to acquire the cloud technology company Vmware, one of the biggest deals of the year despite rising inflation and some economic uncertainty. As part of the transaction, Vmware shareholders can choose to receive either $142.50 in cash or 0.2520 shares of Broadcom common stock for each Vmware share.
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SAN FRANCISCO — Twitter shareholders have filed a lawsuit against billionaire Elon Musk, accusing him of unlawfully sowing doubt about his bid to buy Twitter. They say the Tesla CEO’S aim has been to drive down Twitter’s stock price because he wants to walk away from the deal or negotiate a substantially lower purchase price. Twitter is also named as a defendant in the lawsuit, which was filed late Wednesday in the U.S. District Court for the Northern District of California. A representative for Musk did not immediately respond to a message for comment on Thursday. Twitter declined to comment.
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BERLIN — Government officials say Western allies are considering whether to allow Russian oligarchs buy their way out of Western sanctions and use the money to rebuild Ukraine. Canadian Deputy Prime Minister and Finance Minister Chrystia Freeland proposed the idea at a G-7 finance ministers’ meeting in Germany last week. One official said Freeland raised the issue after oligarchs spoke to her about it. The Canadian minister knows some Russian oligarchs from her time as a journalist in Moscow. One official says the Ukrainian leadership is aware of the discussions and have “some comfort” with the idea since Ukraine badly needs the additional liquidity.
••• WASHINGTON — Average long-term U.S. mortgage rates fell this week for the second week in a row, though interest rates on the key 30-year home loan remain at decade-high levels. Economic uncertainty and weakened homebuyer demand continue to loom over mortgage rates. Mortgage buyer Freddie Mac reported Thursday that the 30-year rate declined to 5.1% from 5.25% last week. By contrast, the average rate stood at 2.95% a year ago. The average rate on 15-year, fixed-rate mortgages, popular among those refinancing their homes, dipped to 4.31% from 4.43% last week. Earlier this month, the Federal Reserve intensified its fight against the worst inflation in 40 years by raising its benchmark interest rate by a half-percentage point and signaling more big rate hikes to come.