(LOS ANGELES) -- Taylor Swift fans will get their day in court on Monday, months after the botched release of tour tickets prompted widespread outcry.
A federal court in Los Angeles will hear arguments in a case brought by fans who allege that Live Nation -- and subsidiary company Ticketmaster -- violated antitrust and consumer protection laws.
The fall release of tickets for Swift's "New Era" tour, her first in five years, prompted government scrutiny of antitrust laws, including a Senate hearing in January at which Live Nation president and Chief Financial Officer Joe Berchtold apologized for the fiasco.
The lawsuit, filed in December, claims that the 2010 merger of Live Nation and Ticketmaster illegally stamped out competition in live events ticketing, allowing the company to charge exorbitant prices for tickets.
In a court filing last month, Live Nation tried to end the court proceedings and force the dispute into private arbitration, claiming that ticket buyers had agreed on multiple occasions over the course of online shopping to resolve any claims through arbitration.
Live Nation and Ticketmaster did not immediately respond to ABC News' request for comment.
"We are not going to just settle," Julie Barfuss, a lead plaintiff, told ABC News' Good Morning America. "We want to see some change."
Fans of Swift are expected to hold a rally outside the courthouse on Monday.
Days after the tickets were released, in November, Swift spoke out about the difficulty faced by ticket purchasers.
"There are a multitude of reasons why people had such a hard time trying to get tickets and I'm trying to figure out how this situation can be improved going forward," she said.
(NEW YORK) -- First Citizens Bank will buy about $72 billion in assets from the failed Silicon Valley Bank, the Federal Deposit Insurance Corporation said.
Silicon Valley Bank, a regional lender with about $210 billion in assets, collapsed earlier this month. The bank had been the 16th largest bank in the country.
"Today's transaction included the purchase of about $72 billion of Silicon Valley Bridge Bank, National Association's assets at a discount of $16.5 billion," FDIC officials said in a press release.
Seventeen former Silicon Valley Bank branches will open their doors on Monday as First Citizens Bank branches, the FDIC said.
About $90 billion of Silicon Valley Bank's assets will remain in receivership with the FDIC, the regulator said.
Spectre is a "Rolls-Royce first, electric car second," the company says. -- Rolls-Royce
(NEW YORK) -- It's a trend that's surprised even Rolls-Royce executives: Tesla owners frantically placing preorders for Spectre, the first all-electric Rolls-Royce that costs more than $400,000.
The 118-year-old British automaker begins production of Spectre, a chic, uber-luxe coupe that seats four, this fall. Pre-orders are already in the thousands -- with some customers forced to wait until 2025 for a slot on the production list.
Rolls-Royce has also seen astronomical demand for its Cullinan SUV, with customers, many of whom are in their 30s, waiting up to 14 months to get one.
Hip, edgier and performance-driven models, including the introduction of Black Badge, have attracted new clients and accelerated sales. Rolls-Royce delivered a record 6,021 vehicles last year, up 8% from 2021. Demand for bespoke commissions is surging and owners are paying more than $500,000 on average for their Rolls-Royce.
Martin Fritsches, president and CEO of Rolls-Royce Motor Cars Americas, credits younger buyers for pushing sales to historic highs, calling them a "driving force" behind the brand's blockbuster success. The average customer is 42 years old, down from 50 eight years ago.
"We continue to strengthen our order bank and models like Spectre are also bringing us new business and new clientele," he told ABC News. "[Rolls-Royce] is a brand that continues to evolve."
When the company unveiled a prototype of Spectre to customers last summer in Goodwood, England, Fritsches said executives were dumbfounded by the response.
"It was eye-opening for us, mind-blowing," he said. "Customers are waiting such a long time for the product -- there is no precedent in Rolls-Royce history. It's becoming a challenge to manage expectations. I have customers constantly texting me, 'Martin, where is my Spectre? When am I getting it?'"
Tesla owners in particular are now "finally adding a Rolls-Royce to their garage," he added.
Rolls-Royce, long celebrated for its hand-built automobiles, lavish interiors and mighty V12 engines, announced in September of 2021 that it would end production of its internal combustion conveyances and become an electric vehicle company by the end of 2030.
Spectre, which the company says is a "Rolls-Royce first, electric car second," can travel an estimated 260 miles on a full charge. It sprints from zero to 60 mph in 4.4 seconds and delivers 664 ft-lb of torque and 577 horsepower.
Two-time World Series champion Brandon Belt bought his first Rolls two years ago for weekend trips with the family. His growing auto collection includes the latest cars from Ferrari, McLaren, Mercedes and Porsche. Belt's Cullinan SUV, however, stands apart.
"Cullinan is the pinnacle of coolness, luxury, comfort and style," the 34-year-old first baseman for the Toronto Blue Jays told ABC News. "No other vehicle can match all these qualities."
Belt has a Black Badge Cullinan on order at his local Houston dealership, along with a Spectre.
"I am really excited about it. That will be a special one," he said.
More than half of Rolls-Royces produced between 2015 and 2022 are sold to Generation X customers, according to Jonathan Klinger, vice president of car culture at Hagerty.
"Younger buyers are partly why Rolls-Royce is doing so well. They're buying Rolls-Royces in greater quantities," he told ABC News. "A higher percentage of younger people is investing in a 'fun' vehicle -- they're not waiting until they're older."
The Cullinan helped shed the company's "unapologetically conservative luxury" label, Klinger noted, adding that Spectre will draw in deep-pocketed techies and early adopters of electric vehicles.
"The younger population is fascinated by EVs," he said.
Joe Wierda, general manager of Rolls-Royce Motor Cars Orlando, said he has a long list of clients who have put down $10,000 deposits on a Spectre. He's received more preorders for Spectre than any other Rolls-Royce vehicle in the last decade.
"This is new territory for Rolls-Royce," he told ABC News. "The design alone is so attractive that people want it and the torque and silence fit Rolls-Royce perfectly."
He's sold many Rolls-Royces to clients in their early 30s, individuals who "want to get the best car they can get," he said.
"A Rolls-Royce shows 'I have made it,'" he explained.
Sean Sleiman, 37, is one of Wierda's regular clients. He and his business partner own four Rolls-Royces, with two Spectres scheduled to arrive in January.
"It's one of the coolest cars I've ever seen," Sleiman told ABC News. "It bumps Rolls-Royce up to the next level. We thought they did a great job on it."
Sleiman, who already owns a Tesla Model X Plaid, said he will have to install a home charger for his Spectre. He splits his time between Orlando and Miami, a distance of 235 miles. Sleiman said charging his Spectre on the go, however, may be challenging.
"I am not so sure about the charging experience on the road. We will have to figure this out," he said.
Paul Dumont, general manager of Manhattan Motorcars, said Rolls-Royce's transformation in the last few years has been remarkable. There is so much buzz about Spectre that Dumont's clients may have to wait more than a year for one.
"This is the first electric Rolls-Royce. It's a big deal," he told ABC News.
Rolls-Royce has been adding jobs at its Goodwood factory to keep up with production, including a future electric sport utility vehicle. Cullinan is the company's bestselling model globally and the U.S. is the largest market for Rolls-Royce.
The Ghost, a genteel sedan with all-wheel drive, four-wheel steering and a turbocharged 6.7-liter V12 engine, has become the top Rolls-Royce in the Asia-Pacific region, though more Americans, especially families in the Northeast, are choosing one over a Cullinan. The Ghost accounts for 35% of the company's sales.
Dumont said he sells a lot of Ghosts to his New York City and northern New Jersey clients who prefer the coach rear doors, sharp handling, opulent cabin and pillowy ride.
Younger buyers may choose Rolls-Royce for the utility, technology and provocative styling. The company, however, will always stay true to its original mission.
"Rolls-Royce is more about refinement. That's what sets it apart -- the craftsmanship is unbelievable," Dumont said. "To some degree the brand is peerless."
(NEW YORK) -- The banking crisis that erupted earlier this month elicited some predictions of a halt in interest rate hikes, since previous borrowing cost increases garnered blame for the financial distress.
Instead, the Federal Reserve on Wednesday imposed another hike, extending a yearlong blitz of rate increases that risks further banking woes and squeezes a different group: consumers in need of a loan.
The supercharged rate hikes have ballooned loan costs for mortgages, car loans and credit cards, weighing on the budgets of U.S. households or forcing them to delay buying big-ticket items.
However, some loan costs have ticked down slightly since the onset of the banking crisis in response to renewed recession fears, suggesting that relief for borrowers could arrive in the coming months but alongside a possible economic downturn, experts told ABC News.
"For ordinary families who need a new car or need to move, when the Fed hits the brakes hard and loan rates go up, that really constrains them," Andrew Levin, an economics professor at Dartmouth College and a former Federal Reserve Board special adviser, told ABC News.
The Fed has put forward a string of borrowing cost increases as it tries to slash inflation by slowing the economy and choking off demand. That means borrowers face higher costs for everything from car loans to credit card debt to mortgages.
The average 30-year fixed-rate mortgage rate stands at 6.6%, a sharp increase from a year ago, when it registered at 4.6%, a Bankrate analysis found.
Each single percentage point increase in a mortgage rate can add thousands or tens of thousands in additional cost each year, depending on the price of a house, according to Rocket Mortgage.
Consumers tempted to offload heightened costs onto a credit card have encountered skyrocketing rate increases for that debt, too.
The average credit card interest rate offered in the U.S. over the last three months of 2022 stood at 21.6%, according to WalletHub, a jump from 18.2% a year prior.
"Higher interest rates mean you really can't spend as much on big-ticket items," Derek Horstmeyer, a finance professor at George Mason University's School of Business, told ABC News. "There's a direct connection."
To be sure, the Fed has raised interest rates as part of an assault on sky-high inflation, a separate source of financial angst for U.S. households.
Inflation has fallen significantly from a summer peak, though it remains more than triple the Fed's target of 2%.
"When you raise rates a lot it can feel like slamming the brakes and be pretty uncomfortable for passengers," Levin said.
"On the other hand, families have been hit really hard in recent years by high inflation," he added. "Passengers don't want to go down a mountain at high speed either."
While loan costs remain well above where they stood a year ago, the recent banking crisis has delivered a burst of unexpected relief, experts said.
Mortgage rates inched downward for the second week in a row, according to data released by Freddie Mac on Thursday.
The fall in mortgage rates owes to a quirk in the relationship between interest rates and home loan costs.
Mortgage rates track closely with rates for 10-year treasury bonds, which themselves correlate with expectations for the Fed's benchmark interest rate over the next few years, Levin said.
If investors think interest rates will soon reverse downward, a drop in mortgage rates often precedes the interest rate pivot.
The financial distress has heightened recession fears, prompting investors to expect a significant lowering of interest rates over the next 12 to 18 months, which in turn has pushed down mortgage rates, Levin said.
"If that expectation continues, then the 10-year treasury rate will drop quite a bit," Levin said. "Then it pulls down mortgage rates and that improves the affordability of families looking to move or first-time homebuyers looking to buy a house."
Car loans will likely experience a trajectory similar to that of mortgage rates, though credit card costs should lag behind, Levin said.
"There might be a glimmer of hope," he added.
Tempering such optimism, however, is the economic force that would push down interest rates: a recession.
"This crisis where we broke a few banks – that's probably going to push us into a recession," Horstmeyer said, noting that the adjoining job losses and decline in demand should bring down inflation and allow the Fed to ease interest rates.
"That kind of did the Fed's job for it," he added.
(NEW YORK) -- Gordon Moore, the co-founder and former chairman of tech giant Intel, died Friday at the age of 94, the company and the Gordon and Betty Moore Foundation announced.
A press release stated Moore died "surrounded by family" in Hawaii.
Moore and Robert Noyce founded Intel in 1968. Moore initially served as executive vice president until 1975, when he became president. In 1979, Moore was named chairman of the board and chief executive officer, positions he held until 1987, when he stepped down as CEO and continued as chairman.
Moore became chairman emeritus of Intel in 1997, stepping down in 2006.
"Those of us who have met and worked with Gordon will forever be inspired by his wisdom, humility and generosity," said foundation president Harvey Fineberg in a statement. "Though he never aspired to be a household name, Gordon's vision and his life's work enabled the phenomenal innovation and technological developments that shape our everyday lives. Yet those historic achievements are only part of his legacy."
Pat Gelsinger, the CEO of Intel, said, "Gordon Moore defined the technology industry through his insight and vision. He was instrumental in revealing the power of transistors, and inspired technologists and entrepreneurs across the decades."
Prior to Intel's founding, Moore and Noyce were involved in the founding of Fairchild Semiconductor, where they played central roles in the initial commercial production of diffused silicon transistors and later the world’s first commercially viable integrated circuits.
"The world lost a giant in Gordon Moore, who was one of Silicon Valley’s founding fathers and a true visionary who helped pave the way for the technological revolution," Apple CEO Tim Cook tweeted. "All of us who followed owe him a debt of gratitude. May he rest in peace."
Along with his wife of 72 years, Betty Irene Whitaker, he established the Gordon and Betty Moore Foundation, which has donated more than $5.1 billion to charitable causes since its founding in 2000, according to the foundation.
Moore received the National Medal of Technology from President George H.W. Bush in 1990, and the Presidential Medal of Freedom from President George W. Bush in 2002.
In addition to his wife, Moore is survived by his sons, Kenneth and Steven, and four grandchildren.
(NEW YORK) -- United Nations Secretary-General Antonio Guterres said that the world is "on thin ice" and called for "climate action on all fronts" earlier this week while revealing the latest U.N. climate report.
The report said that greenhouse gas emissions continue to grow as chances of slowing climate change shrink — unless those emissions are cut drastically by the 2050s.
Ford CEO Jim Farley unveiled the company plans to reduce those emissions, including its new green manufacturing plant and the plant's first vehicle, an electric truck codenamed Project T3. Farley joined "GMA3" to discuss the plans and what they mean for the future of manufacturing.
DEMARCO MORGAN: The U.N. secretary general says it will take a quantum leap and climate action to mitigate global warming. Can you tell us about the BlueOval City plant behind you and how it's a game changer in your eyes?
JIM FARLEY: It's a game changer for us. And good afternoon to you. Game changer for us, because we're really starting to scale EVs. We're number two in the U.S., and with this plant, we're adding not only 6,000 American jobs, but, you know, hundreds and hundreds of thousands of capacity and the plant will be completely green. All the electrons that power the plant will be green electricity. So it's not just a story about an electric vehicle. It's actually a much bigger story about modernizing and decarbonizing our American manufacturing industrial system.
EVA PILGRIM: And today, Ford's announcing the first vehicle to be built at that plant you're at today, an electric vehicle codenamed Project T3. It's a truck. What are we going to see that we haven't seen yet in other EVs? And when will it roll out?
FARLEY: Well, you know, our Lightning is the best-selling electric pickup in the U.S., but this will be its successor and it will be fully software updatable. So over the air we'll be able to change and improve the truck every day for our customers. And we think it'll be the first technology we're going to land where on a sunny day in the highway, you'll be able to go to sleep in your Ford truck. So we don't have autonomous features for commuters where you know you're going to get the most precious thing in your life back, which is time.
MORGAN: And Jim, it is no secret that Ford has clearly embraced the electrical vehicle market as have others, and yet EVs have faced their share of problems. About 18 Ford F-150 Lightnings had to be recalled for a battery fire issue earlier this year. There have been Tesla battery fires, GM, BMW, Volvo, all had recalls due to EV fire risks. How can you assure people that your EVs are safe?
FARLEY: Well, I mean, I'm so proud of the Lightning team. They stopped production. We stopped the battery production. We did everything we needed to do. We found that fire. It happened at Ford, not in customer's hands. We did exactly the right thing. Unlike other brands, we stopped the production. None of them got out in customer's hands. And that's exactly what we have to do to build a trusted brand on EV. We're also going to diverse battery chemistry that has less risk, like the LMP battery plant we're building in Michigan.
PILGRIM: We have to talk about money. EVs are expensive, more expensive than traditional cars. So if this is supposed to be better for our planet, how do you make these vehicles affordable so everyone who wants one can actually have one?
FARLEY: Yeah, great question. And that's a big part of Ford, obviously. You know, we democratized affordable vehicles, so that's a big part of our DNA. I think the first part is we have to design the vehicle differently to be a lot simpler. We have to scale to hundreds of thousands from tens of thousands. Like today, we're going to have a more efficient distribution without inventory like we have today with our dealers. And we're going to have to build it with less labor content. So we have to change everything, basically.
MORGAN: Jim, before you go, the U.N. climate report says we have to cut global emissions in half by 2030 and net-zero by 2050 to limit global warming to 1.5 degrees. Are you optimistic that the world can reach that goal? Is it possible?
FARLEY: It's possible if companies like Ford do what we've got to do. It's absolutely possible.
(NEW YORK) -- One woman who said her family was in debt and one step away from financial disaster made a change in her spending at the grocery store that's paying off big.
Becky Guiles, known as the "Freebie Lady" on social media, shared her money-saving method with ABC News' Good Morning America, which she said helped her save $1,000 a month on her grocery bills.
"Since we've been doing this, we save about $1,000 a month, which equals out to about $12,000 in [the] entire year," she said.
The mother of two told GMA she uses five easy steps, which she said can be remembered using the acronym "B.O.R.E.S.": B stands for "budget," O stands for "organized," R is for "reuse," E is for "eliminating waste," and S stands for "simplify."
"These are just basic principles that anybody can do, no matter where you are in life or what your family situation is like," Guiles said. "B.O.R.E.S. is the method that I have used to cut our groceries down from $1,200 to $1,400 a month to only $400 a month."
Guiles recommended putting aside $100 a month for food per person in the household.
"I go into my pantry and I take out everything that is expired or we're not going to eat," she said of the second letter in the acronym to get organized. "And that'll just kind of give you a clear plate for what you have and what you need to get."
She said that you can repurpose -- or "reuse" -- food, by turning things like chip crumbs into breading, stale bread into croutons and vegetable scraps into vegetable broth.
For her next letter of advice, "E," Guiles said, "We try to eliminate waste as much as possible."
"Every time you throw food away, you're actually throwing money away," she continued. "Once you start thinking about food like that, it totally changes your mindset."
The final letter stands for simplify and Guiles suggested "the more you do it, the more you are going to save."
(NEW YORK) -- From the iconic Egg McMuffin at McDonald's to French Toast Sticks at Wendy's, the competition among fast food chains to serve Americans breakfast has registered another entry.
Dunkin' launched its latest menu offering, Breakfast Tacos, on Wednesday to capitalize on consumers' love of on-the-go options to start the day.
The tacos are made with a flour tortilla, scrambled eggs, melted sharp white cheddar cheese, fire-roasted corn and a drizzle of lime crema. Customers can enjoy the tacos as they come or order them topped with crumbled bacon.
The quick service coffee and doughnut chain noted in a press release that the tacos have "spring-forward ingredients" including the fire-roasted corn, though it wasn't clear whether those ingredients are fresh, frozen or canned. According to the Seasonal Food Guide, corn is at its peak from May through September, so whatever the case, Dunkin' seems to be getting a head start.
Jill McVicar Nelson, Dunkin's chief marketing officer, said in a statement that the culinary team developed the tacos with "the vibrancy of Spring in mind" and hailed them as "undoubtedly one of the tastiest savory items we've launched."
The Massachusetts-based chain's tacos differ in ingredients and flavors from that of the beloved Tex-Mex breakfast item.
Breakfast tacos have a long history as a beloved favorite across Texas, from San Antonio to Austin, where chains like Veracruz All Natural and Torchy's offer a variety of fresh, locally made tortillas filled with flavorful fillings, such as the classic Migas taco -- made with eggs, tortilla chips, tomatoes, onion and peppers or chiles, cheese and, most times, avocado.
Dunkin's new offering leans more towards Southwestern flavors, treating the corn like a traditional Mexican street food, esquites, which are charred kernels with white cheese, spices, mayonnaise and lime.
With its new Breakfast Tacos, Dunkin' is going up against the likes of Taco Bell, which offers an array of breakfast burritos and breakfast quesadillas, McDonald's, which offers sausage breakfast burritos and more traditional breakfast sandwiches, Burger King's eggnormous burrito, Carl's Jr.'s Big Country Breakfast Burrito and even more from regional chains.
The new menu item is slated to be served any time of day as breakfast, a midday snack or late night bite and can be purchased for $2.59 without bacon or $2.99 with the crispy crumbled bacon topping.
(WASHINGTON) -- A high-stakes standoff between the U.S. government and social media app TikTok over a potential ban is set for a reckoning on Thursday when TikTok CEO Shou Zi Chew testifies before a committee of House lawmakers.
The China-based app, which counts more than 150 million U.S. users each month, has faced growing scrutiny from government officials over fears that user data could fall into the possession of the Chinese government and the app could be weaponized by China to spread misinformation.
There is no evidence that TikTok has shared U.S. user data with the Chinese government, but policymakers fear that the Chinese government could compel the company to do so.
Here's how the news is developing. All times Eastern:
Mar 23, 3:38 PM EDT
Texas representative calls on TikTok to remove his state from name of data privacy project
Rep. August Pfluger, R-Texas, implored Chew to remove “Texas” from the company’s data privacy project.
Chew previously touted Project Texas, an ongoing effort that he says keeps all data on U.S. users within the country through a partnership with Oracle.
"Please rename your project. Texas is not the appropriate name,” Pfluger said. “We stand for freedom and transparency and we don’t want your project.”
Mar 23, 3:25 PM EDT
Who is TikTok CEO Shou Zi Chew?
Despite the booming popularity of TikTok, Chew is relatively unknown compared to rival executives like Facebook CEO Mark Zuckerberg or Twitter CEO Elon Musk.
Chew, 40, interned at Facebook and graduated from University College of London as well as Harvard Business School on his way to becoming TikTok CEO in 2021.
"I am responsible for all the strategic decisions at TikTok," Chew told The New York Times in November.
He currently lives with his wife and two children in Singapore, where he was born and raised.
Mar 23, 3:24 PM EDT
TikTok CEO on national security fears: ‘I have not seen any evidence.'
Raising national security concerns, Rep. Debbie Lesko, R-Ariz., listed a slew of Western countries as well as the FBI that have warned about the Chinese government accessing and exploiting user data.
"How can all of these countries and our own FBI director be wrong?" Lesko asked.
"I think a lot of risks that are pointed out are hypothetical and theoretical risks," Chew responded. "I have not seen any evidence."
"I'm eagerly awaiting discussions where we talk about evidence," he added. "And we then can address the concerns that are being raised."
TikTok has not shared U.S. user data with the Chinese government, nor would it comply if asked to do so, Chew previously said.
Mar 23, 1:12 PM EDT
Heated questions over internal memo calling on TikTok employees to ‘downplay’ China ties
Rep. Kat Cammack, R-Fla., directed heated questions at Chew over an internal memo at TikTok that called on employees to "downplay the parent company ByteDance, downplay the China association, downplay AI."
Cammack displayed an excerpt of the memo, first reported by Gizmodo, on a placard behind her.
"You've said repeatedly that there is no threat, that this is a platform for entertainment and for fun," Cammack said, pointing her finger at Chew. "Why, if you had nothing to hide, would you need to downplay the association with ByteDance and China?"
Shou replied: "Congresswoman, I have not seen that memo."
"You cannot answer that question, Mr. Shou," Cammack said.
Mar 23, 12:41 PM EDT
House member on TikTok’s misinformation plan: ‘That’s not enough for me’
Rep. Diana DeGette, D-Colo., asked a series of questions about the spread of misinformation on TikTok, citing a viral post in 2021 that falsely instructed viewers on how to make antimalarial drug hydroxychloroquine from grapefruit and lemon peel.
“What is TikTok doing to try to strengthen its review to keep this information from coming across to people?” DeGette asked.
Chew said misinformation violates TikTok’s rules but acknowledged that the app fails to remove every false post. “I don’t think we can sit here and say we’re perfect,” he said.
“We invest a significant amount in our content moderation work,” Chew said.
DeGette later said: “I’m going to stop you right now. I asked you specifically how you were trying to increase your review of this, and you gave me only generalized statements that you’re investing, that you’re concerned, that you’re doing more.”
“That’s not enough for me,” she added. “That’s not enough for the parents of America.”
Mar 23, 11:58 AM EDT
Chew says US should ‘preserve’ Section 230
Facing questions about harmful acts allegedly prompted by TikTok posts, Chew said he supports continued liability protection for social media platforms as a means of protecting free speech.
Liability protection, stipulated in Section 230 of the 1996 Communications Decency Act, safeguards social media platforms and other sites from legal responsibility that could result from content posted by users.
“[Section] 230 has been very important for freedom of expression on the internet,” Chew said. “It’s one of the commitments we’ve made to this committee and our users.”
“I do think it’s important to preserve that,” he added.
Mar 23, 11:35 AM EDT
Chew grilled over China’s reported opposition to sale of TikTok
Hours before Chew began testimony on Thursday, China said that a sale of TikTok by China-based parent company ByteDance would require the approval of the Chinese government, the Wall Street Journal reported.
At the hearing, lawmakers asked Chew about the report.
“Despite your assertions to the contrary, China certainly thinks it is in control of TikTok and its software,” said Rep. Michael Burgess, R-Texas. “Is that not correct?”
Chew replied, “TikTok is not available in mainland China, and today we’re currently headquartered in Los Angeles and Singapore.”
“I’m not saying that the founders of ByteDance are not Chinese, nor am I saying that we don’t make use of Chinese employees, just like many other companies around the world," he added.
Mar 23, 11:12 AM EDT
Chew faces repeated questions over TikTok’s China ties
In an early exchange, Chew faced repeated questions about TikTok’s relationship with the Chinese government and alleged content moderation on its behalf.
Rep. McMorris Rodgers asked Chew about a process known as “heating content,” in which a social media promotes or moderates posts that appear on its platform.
“In your current or previous positions in Chinese companies, have employees engaged in heating content for users outside of China?” McMorris Rodgers asked.
“Our heating process is approved by our local teams in various countries,” Chew responded, noting that potentially controversial content, such as posts about the 1989 Tiananmen Square Massacre, is currently present on the app.
McMorris Rodgers appeared to doubt the veracity of the remark, saying, “I will remind you that making false or misleading statements to Congress is a federal crime.”
Mar 23, 10:48 AM EDT
TikTok CEO addresses lawmaker concerns over data safety and manipulation
Chew addressed lawmaker concerns over data safety and content manipulation in opening remarks, emphasizing steps taken by the company to protect user data.
Chew touted Project Texas, an ongoing effort that he says keeps all data on U.S. users within the country through a partnership with Austin-based cloud computing company Oracle.
“Trust is about actions we take,” Chew said. “We will firewall protect the U.S. data from unwanted foreign access.”
“TikTok will remain a place for free expression and will not be manipulated by any government,” he added.
Mar 23, 10:56 AM EDT
Hearing opens with bipartisan criticism of TikTok
Opening remarks at the House hearing echoed bipartisan criticism of TikTok that has grown on Capitol Hill in recent weeks.
“TikTok surveils us all,” said Rep. Cathy McMorris Rodgers, R-WA, chair of the committee.
After McMorris Rodgers finished her comments, Rep. Frank Pallone, D-NJ, the senior Democratic member, said: “I agree with much of what you said.”
“While TikTok videos provide a new fun way for people to express their creativity and enjoy the videos of others, the platform also threatens the health, privacy and security of the American people,” Pallone added. “I'm not convinced that the benefits outweigh the threats it poses to Americans in its current form.”
Mar 23, 9:53 AM EDT
TikTok CEO will likely face opposition from lawmakers
TikTok CEO Shou Zi Chew will likely encounter sharp criticism from some members of the Republican-led House committee, which oversees energy and commerce.
A number of Republican members of Congress have backed a ban of the app.
The House Foreign Affairs Committee, a separate body, voted earlier this month to approve a bill that would give Biden the authority to ban TikTok.
The Biden administration this month endorsed a different bipartisan bill, which does not specifically target TikTok but empowers the federal government to ban electronics or software with foreign ties, such as TikTok.
Stiffening its stance further, the Biden administration last week demanded that TikTok's owner, ByteDance, sell its stake in the app or risk getting banned, the company and a U.S. official previously told ABC News.
Mar 23, 9:39 AM EDT
TikTok CEO expected to directly confront possible ban
TikTok CEO Shou Zi Chew will address a potential ban, outlining how such a measure would ultimately harm the U.S. economy, according to his prepared remarks posted on the House committee's website.
TikTok hosts accounts for 5,000 U.S.-based businesses and employs 7,000 workers across the country, Chew said in a video posted on Tuesday.
"We do not believe that a ban that hurts American small businesses, damages the country's economy, silences the voices of over 150 million Americans, and reduces competition in an increasingly concentrated market is the solution to a solvable problem," his prepared remarks say.
Chew plans to tout Project Texas, an ongoing effort that he says keeps all data on U.S. users within the country through a partnership with Austin, Texas-based cloud computing company Oracle.
"Bans are only appropriate when there are no alternatives. But we do have an alternative," Chew will say.
(NEW YORK) -- Foot Locker plans to close 400 stores in North America by 2026 as it rebrands part of its business, the company announced Monday.
The company plans to close many underperforming stores in shopping malls while focusing on strengthening its standalone stores with new concepts, Foot Locker said during its Investor Day presentation.
"We are entering 2023 with a focus on resetting the business -- simplifying our operations and investing in our core banners and capabilities to position the company for growth in 2024 and beyond," Foot Locker president and CEO Mary Dillon said in a news release on the company's website.
One of its announced plans is called "Lace Up," which aims to target consumers and focus on "all things sneakers," the company announced in its presentation.
"We are incredibly excited to introduce our 'Lace Up' plan with a new set of strategic imperatives and financial objectives that are designed to set us up for success for the next 50 years," Dillon said.
Next year Foot Locker celebrates its 50th anniversary.
Despite the plan to close hundreds of stores in North America within the next three years, the company plans to expand its footprint by opening 280 stores that focus on its community, power store and house of play concepts.
The sports apparel company also announced the closing of 125 of its Champ Sports stores in 2023 and resetting the brand to focus heavily on people who are more active in sports and fitness.
As of January, the company operates over 2,700 stores in 29 countries in North America, Europe, Asia, Australia and New Zealand.
Sales decreased by 0.3% during the company's fourth quarter compared to the same quarter in 2021.
According to the company, Foot Locker plans to decrease its overall real estate footprint by 10% in 2026, leaving it with 2,400 stores.
(WASHINGTON) -- Federal Reserve Chair Jerome Powell on Wednesday called the U.S. banking system "strong and resilient," voicing confidence in the nation's financial system and the safety of bank deposits less than two weeks after the failure of Silicon Valley Bank, the second-biggest bank collapse in U.S. history.
"All depositors' savings in the banking system are safe," Powell added in remarks made at a press conference in Washington, D.C.
While characterizing recent financial problems as limited to a small part of the banking sector, Powell defended the swift and extraordinary actions undertaken by the Fed and other federal agencies to protect the financial system.
"In the past two weeks serious difficulties at a small number of banks have emerged," Powell said. "History has shown that isolated banking problems, if left unaddressed, can undermine confidence in healthy banks and threaten the ability of the banking system as a whole to play its vital role in supporting the savings and credit needs of households and businesses."
The remarks from Powell came minutes after the Fed announced a 0.25% increase of its benchmark interest rate, intensifying the central bank's fight against inflation despite concern that previous rate increases helped trigger the nation's banking crisis.
Inflation has fallen significantly from a summer peak, though it remains more than triple the Fed's target of 2%.
"Inflation remains too high," Powell said. "We remain strongly committed to bringing inflation back down to our 2% goal."
The rapid rise in interest rates, however, tanked the value of bonds held by Silicon Valley Bank, precipitating its failure and cascading damage for the financial sector, including the collapse of New York-based Signature Bank.
Fearing wider spread of the crisis, the Federal Deposit Insurance Corporation, the Treasury Department and the Fed took a major step, telling depositors in Silicon Valley Bank and Signature Bank that the FDIC would protect all of their funds, including those that exceed the $250,000 limit.
Some members of Congress have criticized Powell for allegedly lax bank oversight at the Federal Reserve, as well as an aggressive series of interest rate hikes, which they say led to the collapse of Silicon Valley Bank.
On Wednesday, Sen. Elizabeth Warren, D-Mass., and Sen. Rick Scott, R-Fla., proposed legislation that would establish an independent inspector general to oversee the Federal Reserve.
Speaking on Wednesday, Powell said the Federal Reserve is watching developments in the financial sector and remains open to taking further action.
"We will continue to closely monitor conditions in the banking system and are prepared to use all of our tools as needed to keep it safe and sound," Powell said.
He went on, "We’re committed to learning the lessons from this episode and to work to prevent events like this from happening again."
(WASHINGTON) -- The Federal Reserve on Wednesday raised its short-term borrowing rate another 0.25%, intensifying the central bank's fight against inflation despite concern that previous rate increases helped trigger the nation's banking crisis.
The Fed's benchmark interest rate has contributed to the financial emergency facing U.S. banks.
Inflation has fallen significantly from a summer peak, though it remains more than triple the Fed's target of 2%.
The rapid rise in interest rates, however, tanked the value of bonds held by Silicon Valley Bank, precipitating its failure and cascading damage for the financial sector.
In a statement, the Fed rejected concerns about the financial system. "The U.S. banking system is sound and resilient," the central bank said.
The Fed left the door open for further rate increases, noting that "additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2% over time."
Nearly 190 banks are at risk of collapse amid high interest rates and declining asset values, according to a study released by a team of university researchers earlier this month.
A continuation of rate hikes risks further intensifying the banking crisis, nudging additional financial institutions toward the brink of collapse.
A pause on rate increases, however, could have undermined the Fed's fight against inflation, allowing high prices to persist and eat away at household budgets, economists previously told ABC News.
A survey by Bloomberg last week found that most economists expected the Fed to raise interest rates by 0.25% on Wednesday, matching the increase that the central bank imposed at its most recent meeting last month.
Over the last year, the Fed has raised its benchmark interest rate by 4.5%, the fastest pace since the 1980s.
The Fed has put forward a string of borrowing cost increases as it tries to slash price hikes by slowing the economy and choking off demand. The approach risks tipping the U.S. economy into a recession and putting millions out of work.
Persistent rate hikes also threaten the stability of the banking system.
Still, the Fed could avoid facing a choice between slowing price increases and preserving financial stability, since tighter lending practices taken up by private sector banks in response to the financial distress may cool the economy on its own accord, allowing the Fed to forego raising rates while still bringing down inflation.
"No matter what the Fed does later this month, financial conditions are tightening," Julia Pollak, chief economist at Zip Recruiter, said last week.
(NEW YORK) -- TikTok is facing growing scrutiny from government officials over cybersecurity fears about Americans' data. U.S. officials are reportedly demanding that Chinese owners sell its stake in the app or risk a nationwide ban.
Later this week, TikTok CEO Shou Zi Chew is set to face questions from congressional lawmakers about the platforms' data security practices and relationship with the Chinese government. Meanwhile, a proposed bill with bipartisan support and backed by President Joe Biden would empower the executive branch to ban TikTok and other apps owned by Chinese companies.
Former Under Secretary of State Keith Krach, who worked to crack down on TikTok under the Trump administration, joined "GMA3" hosts DeMarco Morgan and Eva Pilgrim to discuss why he views the app as a major cybersecurity threat.
PILGRIM: You believe TikTok is a national security threat. What concerns you the most?
KRACH: Well, I think the biggest thing is that TikTok can track keystrokes. Here's what that means. That means that they have access to your passwords, all your data. They have access to your health records, your bank records. They have access to your geopolitical information or your geospatial information. That means that they can track where you are, where you've been and where you're going. But I think one of the things that's worse is that it's not just about you. It's about the people you digitally interact with. So look at it as a digital virus, because it can infect the people around you. And the only vaccine for this is a total ban.
MORGAN: Well, Keith, experts have called a potential TikTok ban unchartered territory. They've been talking about this for quite some time and a huge undertaking. And experts say a nationwide ban may not stop the app from collecting Americans' data. How exactly would one work? And how concerned are you that Americans would be able to get around a ban?
KRACH: You know, it's actually not unprecedented. We did the same thing with Huawei and 5G. And if you look at Huawei and 5G, that's the backbone for the surveillance state, and TikTok is one of those key appendages that comes off of that. So right now in Congress, Sen. Warner, Sen. Thune, have a bill, the Restrict Act, that actually gives the Secretary of Commerce, Gina Raimondo, the authority to ban applications, technology from our adversaries.
PILGRIM: A bipartisan bill to give the president power to ban the app is gaining support in the Senate. You've discussed TikTok concerns with members of Congress and the Biden administration. But how real of a possibility is this? What are you hearing from them?
KRACH: Oh, this is certainly real. You know, I can tell you, as undersecretary, I had a lot of closed-door sessions with Congress. I couldn't tell the difference between a Democrat and Republican when it came to Chinese technology. You know, this is our biggest national security threat. And I can tell you, if they can weaponize a balloon, they can certainly weaponize 150 million American TikTok users at their mercy.
MORGAN: So with that said, what's your response to critics of this ban, including the ACLU, who argue it would limit free speech and violate the First Amendment?
KRACH: Look, I'm all for free speech. A big advocate for that. But the fact is, TikTok limits free speech. If you don't believe me, just try to post something on Tiananmen Square or post something on Taiwan, and you'll see what happens. You know, the other thing, too, is that TikTok has been used to limit freedom of the press. I was just talking to a reporter yesterday from the Financial Times, and she shared with me how TikTok, they actually use TikTok to track down one of their journalists and try to intimidate him writing an unflattering story about China.
PILGRIM: One of the thing a lot of parents talk about when it comes to TikTok and social media. According to recent CDC data, nearly one in three high school girls considered attempting suicide in 2021, up nearly 60% from a decade before. And now schools across the country are suing social media companies for allegedly contributing to the youth mental health crisis. TikTok says they prioritize safety and wellbeing of teens with age-restricted features, screen time limits and parental controls. But my question to you, what can Silicon Valley do to better protect our kids?
KRACH: Yeah. You know, Eva, I've got 11-year-old twins, a boy and a girl. So obviously, this is a big issue. You know, there's social media and then there's TikTok. TikTok is programed to be addictive. It preys actually on children. It's kind of disguised as candy, but it's actually cocaine. And this is one of the big things. If you look at how TikTok is actually being used inside of China-- I'm not talking outside of China-- they use it as an educational app for STEM, for science, technology, engineering and math. So there's two big differences there. And TikTok is by far the worst.
(WASHINGTON) -- Treasury Secretary Janet Yellen said Tuesday that "the situation is stabilizing and the U.S. banking system remains sound," after regional bank failures have shaken the U.S. banking system.
"The Fed's facility and discount window lending are working as intended to provide liquidity to the banking system," she said during a speech at a meeting of the American Bankers Association in Washington. "Aggregate deposit outflows from regional banks have stabilized."
She said the government's intervention in the failures of Silicon Valley Bank and Signature Bank were "necessary" -- and said "similar actions could be warranted" to protect smaller banks.
"The steps we took were not focused on aiding specific banks or classes of banks," she said. "Our intervention was necessary to protect the broader U.S. banking system, and similar actions could be warranted if smaller institutions suffered deposit runs that pose the risk of contagion."
She argued that the existence of smaller banks was important.
"Large banks play an important role in our economy, but so do small- and mid-sized banks," she said. "These banks are heavily engaged in traditional banking services that provide vital credit and financial support to families and small businesses. They also increase competition in the banking sector, and often have specialized knowledge and expertise in the communities they invest in.
"Large banks play an important role in our economy, but so does small and mid-sized banks," she said. "These banks are heavily engaged in traditional banking services that provide vital credit and financial support to families and small businesses. They also increase competition in the banking sector and often have specialized knowledge and expertise in the communities they invest in. Indeed, many of these banks have played an important role in supporting our economic recovery in the depths of the pandemic."
"The Treasury is committed to ensuring the ongoing health and competitiveness of our vibrant community and regional banking institution," she said.
(NEW YORK) -- As fallout continues from the Silicon Valley Bank collapse -- the second-biggest bank failure in U.S. history -- people across the country are simultaneously feeling the impact of inflation in their pocketbooks.
The Federal Reserve will meet Wednesday to decide whether to raise or pause interest rates after continuously raising them over the past year in order to help curb inflation.
The Fed's decision will have an impact on everything from individual credit card bills to the costs of everyday items to the banking crisis, experts say.
To help explain it all, ABC News chief economics correspondent Rebecca Jarvis and Good Morning America consumer correspondent Becky Worley answered viewers' questions on topics including credit card payments, home buying and more.
1. What would a change in interest rates mean for people's credit card payments?
Jarvis said that if the Fed decides to pause interest rates, as some experts predict will happen, it would have a "significant impact" on credit card payments.
"This will mean that some of those rates that have been climbing won't climb as much in the near future," Jarvis said, citing mortgage rates and higher interest rates on credit cards.
Jarvis added that even if the Fed takes a pause on raising interest rates this week, the rates could "still climb going forward." Because of that, she said the most important step people should take is to continue paying off their credit card debt.
"If you have that credit card bill, you want to keep making those payments," she said.
2. Is housing sitting on a bubble, like in 2007?
Jarvis said that fortunately today, we are in a "very different world" than the housing crisis of 2007, when interest rates went up and people were unable to repay their mortgage, leading to foreclosures and bankruptcies.
"First of all, the jobs market is as strong, historically, as it's ever been," Jarvis said. "Second of all ... 85% of people who own homes have mortgages below 5%. What that means is if you were going to go out and buy a new house right now, you'd have to take out a far more expensive mortgage, so people don't want to sell because they already have the best deal sitting in their own home."
Jarvis said because people aren't selling their homes, there is less inventory, which is leading to higher home prices.
"We don't see the foreclosure we saw last time [in 2007], which is what makes this a much more sound market and housing," she explained.
3. If I'm looking to buy a home, should I expect mortgage rates to improve?
According to Jarvis, one upside to the current banking crisis, combined with the potential for the Fed to pause interest rates, is that mortgage rates have decreased slightly, going from 7.15% to 7% over the past week.
"It's tiny but that incremental difference can make a difference in what you pay," Jarvis said.
When it comes to deciding whether or not now is the right time to buy a home, Jarvis said people should consider whether they will stay in the home for at least five years and whether they are staying within their budget with the purchase.
"Those are the most important questions that anyone should be asking if they're thinking about buying a home, not just 'Can I time this market properly?'" Jarvis said, adding that "renting is always an option, and there are great calculators at Bankrate.com and Realtor.com [to] check the whole thing out."
4. Is now a good time to buy a car?
According to Worley, many people are paying the equivalent of a monthly mortgage or rent payment for their car.
The average car payment at the end of 2022 was $716 for a new car and $526 for a used car, according to Experian, a financial data analysis company.
Worley said that unfortunately for people either in the market for a car or who are currently making high car payments, it is now a "waiting game."
"We're waiting for those interest rates to stabilize or for them to go down," she said.
Worley said one step people can take in the meantime, is to work on improving their credit score.
"If you have a higher credit score, you'll get a lower interest rate when you can finally, hopefully, get into a lower rate and refinance or renegotiate," Worley said. "But that's really all we can do right now if you're already locked into a high payment."
5. Are cars still in short supply?
Yes, according to Worley.
"The supply chain is still a little bit messy," Worley said. "And then dealers are, on many high-demand cars, putting a markup on top of the sticker price, and then you have high interest rates, so it is painful out there."
Worley said her advice is to keep driving your current car for as long as you can, saying, "If you can eat 5,000 or 10,000 miles out of the old car, you should do it until those rates come down, if those rates come down."
