Business

Why 'economic headwinds' are suddenly to blame for everything

Published

2 years ago

March 13, 2024

Why 'economic headwinds' are suddenly to blame for everything

An atmospheric disturbance is whipping through the job market.

When Volvo announced it was cutting more than a thousand jobs last year, its CEO cited a particular phenomenon for the cuts. When the founder of the Messenger announced to his hundreds of employees that they were all laid off without severance, less than a year after the online publication booted up, the same weather pattern got the blame.

Chief executives at accounting firms, cookie companies and Crypto.com have all laid off thousands of workers in the last year, and pointed the finger at one metaphorical culprit: economic headwinds.

The phrase evokes a solemn CEO scanning the sky from the deck of the corporate ship. Eye on the horizon, he senses a change in the weather, a different snap to the rippling canvas, a new chop to the sea. With a grim set to his jaw, he concludes that only one course of action can save the voyage: massive layoffs.

Headwinds have always blown around in business English, but the phrase economic headwinds serves a special purpose: a majestic waving of the hand, an abandon to the fates, an inkling of force majeure.

“It’s a useful term, because we can’t control the wind,” said Thomas C. Leonard, a historian of economics at Princeton University. “If you’re a corporation trying to sell unhappy outcomes to shareholders or regulators, it’s a way of saying it’s a tough environment, but more importantly it’s a tough environment beyond our control.”

It’s a phrase heard often these days in the tech and media sectors, which face real challenges.

Tech companies that could raise and spend cash freely when interest rates were close to zero are struggling to stay afloat. The ad market has hit the doldrums — in part because all those companies that used to have cheap cash to pump into ads now have to keep their powder dry — which has taken the wind out of the sails of many media businesses, which had been facing financial problems for decades. And in L.A., Hollywood studios have been slow to pick up the pace of production after last year’s strikes, as they face questions over the viability of the streaming business model.

Executives in these industries are using the term precisely because of the contrast between their challenges and the wider world, Leonard said.

“The wild thing is, notwithstanding the headwinds in media and technology, the economy is doing unbelievably well,” Leonard said. Inflation is down, unemployment is at historically low levels, the U.S. is outperforming other rich countries, the stock market is booming, and even inequality of wealth and income is falling, Leonard said.

This presents a conundrum for those tasked with swinging the ax: how to explain why your company is ailing when everybody can see blue skies above?

By leaning on economic headwinds, executives can acknowledge a problem while avoiding getting into the messy details — say an outdated business model or internal failings.

EDGAR, the online database of the Securities and Exchange Commission, confirms that economic headwinds are being evoked more now than ever. In the 2000s, only a slight breeze was blowing, with public filings showing a handful of economic headwinds mentions. Things picked up in 2008 and 2009, as the financial crisis battered corporate America, but conditions seemed to subside in the middle of the last decade.

Then high interest rates rolled in. Since 2022, when the Federal Reserve started ratcheting up the federal funds rate to cool down the economy, EDGAR has been logging record after record. Nearly 500 companies mentioned economic headwinds in 2022. In 2023, that more than doubled to over 1,000.

A scan of the Newspaper Archive, which stretches back to the 18th century, tells a similar story. Through the booms and busts of the Gilded Age, the cataclysms of the Great Depression and the whirlwind of the 1970s oil crisis and stagflation, economic headwinds were barely worth mentioning. Most early mentions are riffs on the metaphor of the ship of state, with entire nations beating against the breeze, or come as puns in stories about airplanes or shipping companies.

But something changes after Y2K. Press usage of the phrase follows the same trajectory as the SEC record — with mentions up through the recession, followed by a dip, and now heading to new heights.

The collective experience of the last few years — pandemic, recession, inflation and now interest rate hikes — may have led to a turning of the rhetorical tides, said Robert Reich, professor of public policy at UC Berkeley and former secretary of Labor.

“The dominant economic assumption for really the entire post-World War II era has been that Keynesian macroeconomic management can tame the uncertainties and extremes of the economy,” Reich said. But since 2020, it’s been difficult to avoid the sense that things are spiraling out of control. “Most people felt at sea, and there’s something not necessarily comforting but seemingly realistic about these metaphors now.”

The economy stopped feeling like a precision machine in need of a tuneup, pointed surely toward growth, and started feeling more like an unpredictable journey to an unknown shore.

“Seeing the economy as a boat, one of those old galleons, or a three-masted schooner, tossed on the great waves of uncertainty and the waves of this roiling system makes much more sense to people,” Reich said.

It’s also “a wonderfully convenient way of avoiding responsibility” when things go sideways, Reich added.

Nautical metaphors are nothing new for the world of commerce — trade, finance and the joint-stock company can all trace their roots to seafaring merchants engaged in risky adventures to haul holds full of goods across the world in capital-intensive ships. And business euphemisms aren’t just limited to the seas. Few parts of the natural world have been spared from the corporate lexicon, with its changing landscapes and seismic shifts. Even the cosmos is fair game, especially in a tech world known for its moon shots and escape velocities.

Such fanciful phrases might serve a more grounded purpose: smoothing things over with investors. Research has shown that euphemisms actually work to soften bad news in the financial markets.

Kate Suslava, a professor of accounting at Bucknell University, spent years tracking how the use of metaphors in corporate earnings calls changes how the stock market reacts to new information. She found that investors aren’t total rubes — the stock prices of companies whose executives used negative metaphors like speed bumps or economic headwinds, or mentioned the need to tighten our belt or sharpen our pencils to get back to work after a series of missteps, indeed went down on the day of the earnings call.

What surprised her was that over the following months, the stock prices of the companies in question continued to drift down. “Investors take it as bad news, but it should be even worse news,” Suslava said. “If the market was efficient, they would completely capture it on the date of the call.”

In other words, a softening metaphor gets investors to under-react to the bad news. “Which is exactly the point of euphemisms,” Suslava said. “They work.”

Business

A new delivery bot is coming to L.A., built stronger to survive in these streets

Published

7 hours ago

February 28, 2026

Press Room

A new delivery bot is coming to L.A., built stronger to survive in these streets

The rolling robots that deliver groceries and hot meals across Los Angeles are getting an upgrade.

Coco Robotics, a UCLA-born startup that’s deployed more than 1,000 bots across the country, unveiled its next-generation machines on Thursday.

The new robots are bigger, tougher and better equipped for autonomy than their predecessors. The company will use them to expand into new markets and increase its presence in Los Angeles, where it makes deliveries through a partnership with DoorDash.

Dubbed Coco 2, the next-gen bots have upgraded cameras and front-facing lidar, a laser-based sensor used in self-driving cars. They will use hardware built by Nvidia, the Santa Clara-based artificial intelligence chip giant.

Coco co-founder and chief executive Zach Rash said Coco 2 will be able to make deliveries even in conditions unsafe for human drivers. The robot is fully submersible in case of flooding and is compatible with special snow tires.

Zach Rash, co-founder and CEO of Coco, opens the top of the new Coco 2 (Next-Gen) at the Coco Robotics headquarters in Venice.

(Kayla Bartkowski/Los Angeles Times)

Early this month, a cute Coco was recorded struggling through flooded roads in L.A.

“She’s doing her best!” said the person recording the video. “She is doing her best, you guys.”

Instagram followers cheered the bot on, with one posting, “Go coco, go,” and others calling for someone to help the robot.

“We want it to have a lot more reliability in the most extreme conditions where it’s either unsafe or uncomfortable for human drivers to be on the road,” Rash said. “Those are the exact times where everyone wants to order.”

The company will ramp up mass production of Coco 2 this summer, Rash said, aiming to produce 1,000 bots each month.

The design is sleek and simple, with a pink-and-white ombré paint job, the company’s name printed in lowercase, and a keypad for loading and unloading the cargo area. The robots have four wheels and a bigger internal compartment for carrying food and goods .

Many of the bots will be used for expansion into new markets across Europe and Asia, but they will also hit the streets in Los Angeles and operate alongside the older Coco bots.

Coco has about 300 bots in Los Angeles already, serving customers from Santa Monica and Venice to Westwood, Mid-City, West Hollywood, Hollywood, Echo Park, Silver Lake, downtown, Koreatown and the USC area.

The new Coco 2 (Next-Gen) drives along the sidewalk at the Coco Robotics headquarters in Venice.

The company is in discussion with officials in Culver City, Long Beach and Pasadena about bringing autonomous delivery to those communities.

There’s also been demand for the bots in Studio City, Burbank and the San Fernando Valley, according to Rash.

“A lot of the markets that we go into have been telling us they can’t hire enough people to do the deliveries and to continue to grow at the pace that customers want,” Rash said. “There’s quite a lot of area in Los Angeles that we can still cover.”

The bots already operate in Chicago, Miami and Helsinki, Finland. Last month, they arrived in Jersey City, N.J.

Late last year, Coco announced a partnership with DashMart, DoorDash’s delivery-only online store. The partnership allows Coco bots to deliver fresh groceries, electronics and household essentials as well as hot prepared meals.

With the release of Coco 2, the company is eyeing faster deliveries using bike lanes and road shoulders as opposed to just sidewalks, in cities where it’s safe to do so. Coco 2 can adapt more quickly to new environments and physical obstacles, the company said.

Coco 2 is designed to operate autonomously, but there will still be human oversight in case the robot runs into trouble, Rash said. Damaged sidewalks or unexpected construction can stop a bot in its tracks.

The need for human supervision has created a new field of jobs for Angelenos.

Though there have been reports of pedestrians bullying the robots by knocking them over or blocking their path, Rash said the community response has been overall positive. The bots are meant to inspire affection.

“One of the design principles on the color and the name and a lot of the branding was to feel warm and friendly to people,” Rash said.

Coco plans to add thousands of bots to its fleet this year. The delivery service got its start as a dorm room project in 2020, when Rash was a student at UCLA. He co-founded the company with fellow student Brad Squicciarini.

The Santa Monica-based company has completed more than 500,000 zero-emission deliveries and its bots have collectively traveled around 1 million miles.

Coco chooses neighborhoods to deploy its bots based on density, prioritizing areas with restaurants clustered together and short delivery distances as well as places where parking is difficult.

The robots can relieve congestion by taking cars and motorbikes off the roads. Rash said there is so much demand for delivery services that the company’s bots are not taking jobs from human drivers.

Instead, Coco can fill gaps in the delivery market while saving merchants money and improving the safety of city streets.

“This vehicle is inherently a lot safer for communities than a car,” Rash said. “We believe our vehicles can operate the highest quality of service and we can do it at the lowest price point.”

Business

Trump orders federal agencies to stop using Anthropic’s AI after clash with Pentagon

Published

20 hours ago

February 27, 2026

Press Room

Trump orders federal agencies to stop using Anthropic’s AI after clash with Pentagon

President Trump on Friday directed federal agencies to stop using technology from San Francisco artificial intelligence company Anthropic, escalating a high-profile clash between the AI startup and the Pentagon over safety.

In a Friday post on the social media site Truth Social, Trump described the company as “radical left” and “woke.”

“We don’t need it, we don’t want it, and will not do business with them again!” Trump said.

The president’s harsh words mark a major escalation in the ongoing battle between some in the Trump administration and several technology companies over the use of artificial intelligence in defense tech.

Anthropic has been sparring with the Pentagon, which had threatened to end its $200-million contract with the company on Friday if it didn’t loosen restrictions on its AI model so it could be used for more military purposes. Anthropic had been asking for more guarantees that its tech wouldn’t be used for surveillance of Americans or autonomous weapons.

The tussle could hobble Anthropic’s business with the government. The Trump administration said the company was added to a sweeping national security blacklist, ordering federal agencies to immediately discontinue use of its products and barring any government contractors from maintaining ties with it.

Defense Secretary Pete Hegseth, who met with Anthropic’s Chief Executive Dario Amodei this week, criticized the tech company after Trump’s Truth Social post.

“Anthropic delivered a master class in arrogance and betrayal as well as a textbook case of how not to do business with the United States Government or the Pentagon,” he wrote Friday on social media site X.

Anthropic didn’t immediately respond to a request for comment.

Anthropic announced a two-year agreement with the Department of Defense in July to “prototype frontier AI capabilities that advance U.S. national security.”

The company has an AI chatbot called Claude, but it also built a custom AI system for U.S. national security customers.

On Thursday, Amodei signaled the company wouldn’t cave to the Department of Defense’s demands to loosen safety restrictions on its AI models.

The government has emphasized in negotiations that it wants to use Anthropic’s technology only for legal purposes, and the safeguards Anthropic wants are already covered by the law.

Still, Amodei was worried about Washington’s commitment.

“We have never raised objections to particular military operations nor attempted to limit use of our technology in an ad hoc manner,” he said in a blog post. “However, in a narrow set of cases, we believe AI can undermine, rather than defend, democratic values.”

Tech workers have backed Anthropic’s stance.

Unions and worker groups representing 700,000 employees at Amazon, Google and Microsoft said this week in a joint statement that they’re urging their employers to reject these demands as well if they have additional contracts with the Pentagon.

“Our employers are already complicit in providing their technologies to power mass atrocities and war crimes; capitulating to the Pentagon’s intimidation will only further implicate our labor in violence and repression,” the statement said.

Anthropic’s standoff with the U.S. government could benefit its competitors, such as Elon Musk’s xAI or OpenAI.

Sam Altman, chief executive of OpenAI, the company behind ChatGPT and one of Anthropic’s biggest competitors, told CNBC in an interview that he trusts Anthropic.

“I think they really do care about safety, and I’ve been happy that they’ve been supporting our war fighters,” he said. “I’m not sure where this is going to go.”

Anthropic has distinguished itself from its rivals by touting its concern about AI safety.

The company, valued at roughly $380 billion, is legally required to balance making money with advancing the company’s public benefit of “responsible development and maintenance of advanced AI for the long-term benefit of humanity.”

Developers, businesses, government agencies and other organizations use Anthropic’s tools. Its chatbot can generate code, write text and perform other tasks. Anthropic also offers an AI assistant for consumers and makes money from paid subscriptions as well as contracts. Unlike OpenAI, which is testing ads in ChatGPT, Anthropic has pledged not to show ads in its chatbot Claude.

The company has roughly 2,000 employees and has revenue equivalent to about $14 billion a year.

Business

Video: The Web of Companies Owned by Elon Musk

Published

1 day ago

February 27, 2026

Press Room

Video: The Web of Companies Owned by Elon Musk

new video loaded: The Web of Companies Owned by Elon Musk

In mapping out Elon Musk’s wealth, our investigation found that Mr. Musk is behind more than 90 companies in Texas. Kirsten Grind, a New York Times Investigations reporter, explains what her team found.

By Kirsten Grind, Melanie Bencosme, James Surdam and Sean Havey

February 27, 2026