• A coming recession could end up sparking a "violent correction" in stocks, Gary Shilling told BI.
• The top forecaster pointed to warning signs of a downturn, such as a weaker job market.
• A full-blown recession could kill investor speculation, sending stocks crashing, he warned.

Investors should be prepared for a recession with the potential to send the stock market plummeting this year, according to top forecaster Gary Shilling.

In an interview with Business Insider, the Wall Street vet — who was among the investors in the mid-2000s to call the subprime mortgage bubble — said he saw a recession coming by the end of the year as the job market continues to weaken. That could be the final blow to the stock market rally fueled by investor overconfidence, causing stocks to drop by as much as 30%, Shilling said. 

Shilling pointed to the recent run-up in risky assets, such as stocks and cryptocurrency. That itself is a sign the market is poised to drop, especially once a downturn gets underway, he said.

"You look at all the kind of speculation that we've had out there, it's indicative of a lot of overconfidence, and that usually gets corrected and corrected violently," he said. 

The economy has already been flashing key signs of weakness as high interest rates take their toll. The labor market is weakening, with the unemployment rate sticking close to a two-year high in March.

Meanwhile, quit rates slumped to around 2% in March, a sign that workers are waking up to difficult hiring conditions and are less willing to leave their jobs than they were in the past.

The job market, for one, is "obviously slipping" as firms pull back on hiring, Shilling said.

Shilling believes companies have held onto more workers than they needed due to the shortage of labor that slammed employers during the pandemic. Layoffs will escalate later this year, with unemployment peaking at 5%-7% as the economy continues to weaken, he predicted.

"Employers wanted to hang onto their workforce and even add to it, because they figured things were going to be tight forever. Well, they haven't been tight forever. The economy's growth has been slipping … Employers are simply cutting back," Shilling warned. 

Job losses could end up hitting Americans hard, especially since there are signs that many may be in worse shape financially than they were several years ago. Consumers probably blew through the last of their excess savings from the pandemic in March, San Francisco Fed economists estimated. 

Meanwhile, a handful of recession indicators have been sounding the alarm on the economy for months. The 2-10 Treasury yield curve, the bond market's most famous recession gauge, has been signaling a downturn since July 2022. The Conference Board's Leading Economic Index, another gauge of economic strength, ticked lower in April, though the measure is not yet in recessionary territory.

"When you start to see the softness in these indicators and the actual turn down in business can be long and variable, but they are reliable enough, and I think that the safe bet is for a recession starting later this year if we're not already in it," Shilling said.

Shilling is known for his contrarian and often bearish takes on the market. Previously, he told Business Insider he looks to actively disagree with other Wall Street strategists, as the consensus view is typically already discounted in markets.

"I think people are being overly optimistic and hopeful in the face of a lot of evidence to the contrary," he warned.

• The US economy may already be mired in recession, Danielle DiMartino Booth told Bloomberg TV.
• Downside labor revisions and rising job losses indicate a downturn has hit, the QI Research CEO said.
• She argues that by one unemployment indicator, a recession was triggered in October 2023.

The US is already mired in recessionary downturn, and rising job losses prove it, veteran forecaster Danielle DiMartino Booth told Bloomberg TV.

"Oh, my goodness, there's already been 22,000 job loss announcements in the month of May and it's still a fairly young month. So on a seasonal level, we're seeing a major pickup," the QI Research CEO said on Monday.

That a recession has arrived is not a new position for Booth, who has long been pointing at downward-revised labor figures to push against soft landing talk.

Booth supports this using an indicator developed by Goldman Sachs. It says that when the unemployment rate's three-month average moves up 0.3 percentage points from its 12-month low, it historically indicates a recession. 

By that standard, the rule was triggered in October of last year, according to recently published labor revisions through the third quarter of 2023, indicating job losses of 192,000.

"These revisions, they keep pushing us back further and further from where we thought we were," Booth told Fox Business late last month. 

And fresh data only points to a worsening labor environment, she now added. 

April's job report delivered fresh weakness to markets, with the number of nonfarm payrolls added coming in significantly below estimates. Unemployment also ticked up slightly month-to-month, rising to 3.9%.  

"There were 115,000 [job losses] in the month of April, which was seasonally higher than that of January and again, we're about 22,000 with just a hop skip and a jump four days into May of data, so we're definitely seeing an acceleration of job cut announcements," she said.

Other analysts have also projected rising recession risk, hand-in-hand with a labor market fallout. For instance, a hard landing could hit at the end of this year and send unemployment surging to 5%, economist David Rosenberg has said.

With the ramp up in layoffs, Booth also noted that offered severance will drop to 60 to 90 days, as opposed to the six to nine-month packages offered in 2023.

• MrBeast is hitting the brakes on his relationship with his talent-management company, Semafor reported.
• Talent firm Night Media has been working with the superstar YouTuber for six years.
• Two sources told Semafor that Night would "no longer be his primary talent management agency."

Superstar YouTuber MrBeast and his talent-management company, Night Media, are growing apart, according to a new report from Semafor.

The 25-year-old creator, whose real name is Jimmy Donaldson, is taking increasing control over his business and told Texas-based Night that it would "no longer be his primary talent-management agency," Semafor reported, citing two anonymous sources who were briefed on the matter.

Night had been working with Donaldson since early 2018, when the company's CEO, Reed Duchscher, began helping Donaldson with his business.

"Reed has been with me since early on and has helped us grow to where we are," Donaldson said in the statement to Bloomberg. "As the company develops and our needs change, he and I continue to have a great relationship. At this point, it makes sense to put full focus into the growth of Feastables and for me to start building my own internal team."

Night declined to comment to Business Insider. The company told Bloomberg that Duchscher would still work with Donaldson on Feastables.

Night has developed into one of the biggest and most respected talent agencies in the creator space, and has developed a roster of clients, including YouTubers Dream, ZHC, and Safiya Nygaard. It's opened an early-stage venture-funding arm, a production studio, and a venture arm to help creators build their own companies. In 2023, it acquired another talent firm, LFM, which brought with it Kai Cenat, one of the largest Twitch streamers in the world, and it also bought a podcast network earlier this year.

At the same time, MrBeast's empire has continued to expand: the YouTuber told Time earlier this year he makes between $600 and $700 million in revenue a year. He's launched a variety of philanthropic initiatives, as well as a chocolate and snack brand, Feastables, and a virtual restaurant chain, Beast Burger.

The latter has been a source of conflict, and Donaldson has been trying to shut it down. A series of lawsuits were filed in 2023 and are still being litigated. Donaldson filed a suit against Beast Burger's partner company, Virtual Dining Concepts, alleging it had been serving "low quality," sometimes "inedible" food. The company responded with another lawsuit claiming that Donaldson and his company, Beast Investments, failed to keep contractual obligations.

Recently, Donaldson inked a partnership with Amazon Prime for a reality TV show. And MrBeast's main YouTube channel is about to snatch the top spot on the platform for the most subscribed channel in the world, with 256 million subscribers.

In this scenario of immense growth, it would make sense for Donaldson to be looking for a more bespoke approach. Other creators, like popular gaming YouTuber Preston Arsement, did just that with his company TBNR, as did TikTok star Charli D'Amelio.

• The US Air National Guard rebuke a proposal to shift space mission units to the Space Force.
• Internal surveys found that most personnel would rather retrain or retire than join the Space Force.
• Critics say it usurps state governors' authority and the wishes of the Guardsmen who want to stay.

Air National Guard leaders and enlisted Guardsmen on Friday called a legislative proposal to move units focused on space missions to the Space Force a threat to their existence and also said many of those personnel would rather retire or retrain into another job instead.

In a media roundtable with reporters, officers and enlisted from the Alaska, Colorado, and Hawaii Air National Guards took aim at the Air Force proposal, which seeks to move units in their states into the Space Force, usurping their state governors' authority and the wishes of most of the Guardsmen stationed in those areas. Internal polling from 14 Air National Guard units in seven states shows anywhere from 70% to 86% have no desire to become Space Force Guardians.

"Our internal survey indicates about 70% of our personnel would retrain or retire rather than join the Space Force," Air Force Col. Michael Griesbaum, commander of the Alaska Air National Guard's 168th Wing, told reporters Friday. "In our particular case, that would really represent an existential threat to the national security of the United States because the Space Force does not have the experience to replace my space operators who depart."

Rebukes from Air National Guard officials join a chorus of criticisms for the proposal, including a letter of opposition signed by the governors of 48 states as well as five US territories earlier this week.

"Governors must maintain full authority as commanders in chief of these assets to effectively protect operational readiness and America's communities," according to the letter, which was promoted by the National Governors Association. "Legislation that sidesteps, eliminates or otherwise reduces governors' authority within their states and territories undermines long-standing partnerships, precedence, military readiness and operational efficacy."

Air Force officials' legislative proposal 480 to Congress would change the status of Air National Guard units conducting space operations "from a unit of the Air National Guard of the United States to a unit of the United States Space Force; deactivate the unit; or assign the unit a new federal mission" and would do so "without the approval of its governor," Military.com reported last month.

Air Force Secretary Frank Kendall, in response to Military.com last month, waived off the concerns, saying worries that the proposal would set a precedent undermining state governors' authority were overblown.

"We've had much, much more political attention over this than it deserves," Kendall said. "We need a way to integrate these space capabilities, which are very valuable to us, into the Space Force. This is a unique situation. I have no indication that either the Air Force or Army Guard, anybody, is contemplating any other changes."

But Air National Guard leaders have expressed concern, saying it would set a clear precedent for other services to potentially take more resources from the National Guard model.

"Nothing legislatively ever happens once," Griesbaum said. "If LP 480 is successful, it will open the door to a wholesale harvesting of National Guard resources, both from the Air National Guard and the Army National Guard to the regular components."

Enlisted Air National Guardsmen in space missions have concerns about losing the ties to their local communities, as well as potentially uprooting their families or civilian careers by being transferred to the active-duty force and the uncertainty that could come with that transition.

"I love this nation, and I love this state," Air Force Staff Sgt. Robert Brown with the Colorado Air National Guard's 233rd Space Group said. "I wanted to continue my service through the Air National Guard, and I didn't run the risk of getting stationed anywhere far from home. Currently, my wife and I are expecting a daughter in just about a month, so that really enforces our needs."

Since 2019, when the Space Force became the newest service branch under the Department of the Air Force, debates and conflicts have sprung up over what to do with the roughly 1,000 part-time Air National Guardsmen across 14 units operating space-related missions in Alaska, California, Colorado, Florida, Hawaii, New York, and Ohio.

Kendall as well as some members of Congress say that the number of those affected would be less than that. But Guard officials are skeptical, saying officials are not counting all the units and all the states supporting those missions, as well as the support personnel.

Brig. Gen. Michael Bruno, director of joint staff for the Colorado National Guard, told reporters Friday that space operators with his state are currently deployed overseas helping with missions, and he worries that if the legislative proposal is approved, it may leave them with an uncertain future.

"These space professionals may not have a military job to come back to when they return," he said. "They volunteered to serve and sacrifice for their nation, state, and communities. I can only imagine how they and their families must feel if we break that trust with them."

• South Dakota Gov. Kristi Noem's forthcoming book incorrectly said she had met with Kim Jong Un.
• After the passage leaked before publication, she said she asked the book's publisher remove it.
• She did her own narration for the audiobook. Why didn't she catch the error then?

South Dakota Gov. Kristi Noem may have been caught fibbing.

The rising Republican politician claimed last week she ordered changes to her soon-to-be-released book, "No Going Back: The Truth on What's Wrong with Politics and How We Move America Forward," after learning it falsely said she met with North Korean Supreme Leader Kim Jong Un.

"I remember when I met with North Korean dictator Kim Jong Un, I'm sure he underestimated me having no clue about my experience staring down little tyrants. I've been a children's pastor after all," Noem wrote in her book about an interaction with the North Korean leader that never happened, as Politico reported last week.

CBS News' "Face the Nation" host Margaret Brennan pressed Noem on Sunday about the false passage in her book.

"Did you meet Kim Jong Un?" Brennan asked the governor.

"I'm not going to talk about my specific meetings with world leaders, I'm just not going to do that," Noem said. "This anecdote shouldn't have been in the book, and as soon as it was brought to my attention, I made sure that that was adjusted."

Later Sunday, Noem's book publisher released a statement. "At the request of Governor Noem, we are removing a passage regarding Kim Jong Un from her book No Going Back, upon reprint of the print edition and as soon as technically possible on the audio and ebook editions," it said.

In other words, the audiobook version of Noem's memoir narrated by the governor herself will have to be edited as well, meaning Noem read the false North Korea statement aloud for the recording without correcting it.

A representative from Noem's office did not respond to Business Insider's question about why the governor didn't report the error sooner. CBS News asked Noem a similar question during their interview, leading the governor to accuse the host of treating her "differently than every other person" she's spoken with on the show.

The rollout for Noem's forthcoming book has been a diaster.

The Guardian obtained an early copy of Noem's book in late April, and revealed that Noem wrote about shooting her family's 14-month-old dog in a gravel pit.

She's since defended the passage, adding that she recently also killed three horses. Noem has also said that President Joe Biden's dog, Commander, should be put down after it reportedly bit several Secret Service agents.

The Daily Beast reported on May 3 that sources close to former President Donald Trump said Noem's recent negative attention effectively disqualified her from becoming his vice presidential running mate, calling it "political suicide."

But a fundraiser in Mar-a-Lago over the weekend, Trump was recorded saying she was "somebody that I love."

Hamas said in a statement Monday that it's accepted a cease-fire proposal from Qatar and Egypt in the war with Israel, according to multiple reports.

It's unclear if Israel has accepted the terms of the Qatari and Egyptian cease-fire plan.

The militant group's leadership announced it had agreed to the deal, Reuters reports.

Hours earlier, Israel had dropped leaflets on the Gaza city of Rafah, warning citizens to evacuate ahead of military operations.

This is a developing story. Please check back for updates.

• Amazon founder Jeff Bezos is the second richest man in the world.
• He's no longer CEO of Amazon, but he now spends extra time with his space company.
• Business Insider rounded up what Bezos and his fiancee have said over the years about his daily routine.

Jeff Bezos may no longer be running Amazon, but he's kept busy.

The Amazon cofounder has a net worth of $203 billion, according to Forbes. In addition to founding the online retail behemoth Amazon, Bezos also owns The Washington Post and an aerospace company, Blue Origin. 

Bezos stepped down as CEO of Amazon in 2021 to focus on his rocket company Blue Origin.

Bezos has been dating his fiancée Lauren Sánchez since 2019.

So what does daily life look like for the tech mogul? Sánchez described their morning routine in an interview with Vogue.

Here's a look inside his daily routine:

He wakes up every morning naturally, without the aid of an alarm clock.

Bezos makes sure to get enough rest — he sleeps for eight hours every night. The former CEO told CNBC in 2021 that while he could sleep less and be more productive, the quality of his decisions would be lower, which isn't worth it to him. 

"I like to putter in the morning," Bezos told a gathering of Economic Club of Washington, DC. "So I like to read the newspaper. I like to have coffee."

Source: Axios

Bezos and his fiancee like to start off their morning with journaling instead of going straight to looking at their phones.

"We're not quite there," Sánchez said in the interview. "We'll do it, like, three days a week."

Whoever wakes up first makes the coffee, Sánchez said.

While the billionaire Amazon founder drinks his morning coffee in a self-heating Ember mug, Sánchez says she uses a mug Bezos got her from Amazon that says, "woke up sexy as hell again."

Bezos reportedly never schedules early-morning meetings, in order to spend quality time with his family.

Bezos has said he likes a slow morning to spend time with his family. 

Sánchez told Vogue Bezos calls out, "don't learn anything I wouldn't learn," every morning before she drops her daughter Ella off at school. The line has become a staple in their everyday routine and her daughter now finishes it for him.

Bezos also reads the newspaper and chats with his fiancé before heading to the gym for cardio and weightlifting, he said.

"Most days, [going to the gym is] not that hard for me, but some days it's really hard and I do it anyway," he said.

The billionaire said he goes to the gym almost every day.

 

 

But Sánchez said they don't do the same exercises.

"He's on a whole different level than I am," Sánchez said in the Vogue interview. "He is a monster in the gym."

Bezos said in a Lex Fridman podcast on a good day he does 30 minutes of cardio and 45 minutes of weightlifting or resistance training of some kind.

"I have a trainer who you know I love who pushes me," Bezos said in the podcast. "Which is really helpful."

 

 

But he does like to get his more intensive meetings rolling before noon. "I do my high-IQ meetings before lunch," he told the Economic Club of Washington, DC.

"Like anything that's going to be really mentally challenging, that's a 10 o'clock meeting," Bezos said back in 2018, according to Axios.

Bezos usually keeps his afternoons clear of high-intensity meetings.

If something that necessitates a "high-IQ meeting" pops up later in the day, Bezos typically puts it off until the next day.

"By 5 p.m., I'm like, 'I can't think about that today. Let's try this again tomorrow at 10 a.m,'" he told the Economic Club of Washington, DC in 2018.

 

When it comes to meals, Bezos has a taste for unusual dishes.

He was photographed eating an iguana once.

And, during a meeting with Woot founder Matt Rutledge, he ordered octopus with potatoes, bacon, green garlic yogurt, and eggs for breakfast.

"When I look at the menu, you're the thing I don't understand, the thing I've never had," Bezos said. "I must have the breakfast octopus."

 

Bezos and Sánchez like to cook. Sanchez said Bezos makes churros in his deep fryer, a recipe passed down from his Cuban grandfather.

"Abuelo made churros whenever we were with him," Bezos said.

 

 

Bezos also has a fondness for food trucks.

In 2014, he told Henry Blodget, who was then Business Insider's editor-in-chief, about a phenomenally popular truck outside of Amazon's headquarters. "It's out of control, actually," he said.

Bezos said he's never worked harder than he has since he left Amazon.

His day revolves around reading documents and having meetings in person or over Zoom, he told Lex Fridman in a podcast.

Architecture and technology meetings almost every day about different subsystems inside the vehicle and engines.

"My favorite part of it is the technology," Bezos said.

His least favorite part is building the organization, he said. 

Bezos does "little thinking retreats."

The billionaire said he's very good at focusing but he doesn't keep to a strict schedule.

He told Lex Fridman he believes in wandering and his "messy" meetings often go overtime.

 

Family movie nights are a Saturday night tradition in the Bezos household, according to his fiancee.

"Of course, Jeff's favorite movie was Oppenheimer, and I love Barbie. And there you have us summed up in two movies."

Amazon now runs several popular original series, like "The Man in the High Castle" and "Transparent," but the former Amazon CEO is a Trekkie.

Bezos even made a surprise cameo in the 2016 film "Star Trek Beyond."

Other than watching "Star Trek," Bezos has another space-related hobby: gliding about in a submarine looking for old NASA rockets.

He's brought his kids along for the adventure.

Bezos is a big believer in getting enough shut-eye. The billionaire strives for eight hours.

"I prioritize it," he said at a dinner hosted by the Economic Club of Washington, D.C. "I think better. I have more energy. My mood is better."

Bedtime is 9:30 p.m., according to his fiancee. 

"As a senior executive, you get paid to make a small number of high-quality decisions. Your job is not to make thousands of decisions every day," he said, according to Axios.

"Is that really worth it if the quality of those decisions might be lower because you're tired or grouchy?" Bezos asked the Economic Club of Washington, D.C.

• Tesla's Model Y may offer unlocked range for an extra $1,500 to $2,000.
• Elon Musk said the new range provides an extra 40 to 60 miles and is pending regulatory approvals.
• This isn't Tesla's first instance of offering increased range for an extra fee.

Tesla CEO Elon Musk says its recent Model Y models have more range than you thought — but you'll have to pay to get it.

Musk said in a post on X that Model Y vehicles built over the past few months have an extra 40 to 60 miles of range that can be unlocked, depending on the battery.

Musk said Tesla would charge an extra $1,500 to $2,000 for the upgrade and that he's "working through regulatory approvals to enable" the new range.

Musk's range revelation was in response to Tesla investor Sawyer Merritt's post about Tesla launching a new Long Range RWD Model Y.

Merritt said in the X post that the previous Model Y was discontinued.

Tesla replaced the Standard Range Model Y with a 320-mile Long Range rear-wheel drive for about $2,000 more.

The EV costs between $44,990 and $49,490, depending on add-ons. Owners who qualify for the $7,500 federal EV tax credit can get the new version for as low as $37,490.

Tesla is known to use its remote software rollouts to add features or make fixes to its EVs. And this isn't the first time Tesla has locked an EV's range and offered access to it for an additional charge.

Tesla's Model S 70 originally had a 70kWh battery and 220-mile range, but the company later revealed the battery pack had a higher capacity of 75kWh with a 237-mile range, which could be unlocked for an additional $3,000.

Tesla has also made the opposite move by disabling software features like Autopilot when someone buys one of their EVs from a third-party vendor.

When a user asked why the unlocked range isn't offered for free, the CEO replied, "We have to pay the bills somehow."

The decision to attach a fee to locked updates is a growing trend in the auto industry. BMW received backlash for adding a subscription to its heated seats. Mercedes offered an add-on "acceleration increase" for $1,200 a year. Meanwhile, Polestar offered a horsepower upgrade for a fee of $1,195.

With the EV market slumping, these kinds of subscriptions and unlocked offerings seem to be giving companies another ways to generate revenue.

• Ukraine used an exploding naval drone to destroy a Russian military speedboat in Crimea on Monday.
• Footage shows the drone navigating through heavy aerial fire to strike the Russian boat. 
• It's the latest attack on Russia's Black Sea Fleet, which has largely been dispersed.

Ukraine's exploding drone boats appear to be hunting down smaller, high-speed vessels in the Black Sea after Russia pulled back its larger warships following a spate of devastating attacks.

The Ukrainian Main Directorate of Intelligence, or HUR, said on Monday that its forces destroyed a Russian military speedboat with a Magura V5 naval drone in Uzka Bay, located in the northwestern corner of the occupied Crimean peninsula.

The attack marks Ukraine's latest strike against the Russian Black Sea Fleet. This months-long drone and missile campaign has forced Moscow to relocate many of its vulnerable assets away from the fleet's headquarters in Crimea and closer to Russia, on the other side of the sea.

"Since the fear of Ukrainian attacks forces the occupiers to hide large ships of the Black Sea Fleet away from the peninsula, combat work continues against the high-speed maneuverable military vessels of the Russians," the HUR, an arm of Ukraine's defense ministry, wrote in a statement on the Telegram messaging platform, per translation.

Footage of the attack shared by Ukraine shows one of the naval drones take heavy fire from above, most likely from an aircraft. The drone manages to evade the fire, which lands in the surrounding water, and makes its way toward the Russian boat sitting at a pier.

The Russian boat appears to be covered by a camouflage tarp. It's unclear if it was manned by any troops at the time of the attack. The video cuts just as the Ukrainian drone slams into the vessel. Kyiv did not say whether it lost any drones in the attack.

Russia's defense ministry claimed on Monday that the Black Sea Fleet had destroyed five of the Ukrainian drone boats near Crimea's northwestern coast. Moscow published footage to Telegram showing a helicopter open fire on the surface of the water, and at one point, an explosion can be seen. It did not acknowledge any of its own losses.

Business Insider was unable to immediately verify the footage from the two militaries.

The HUR identified the Russian vessel as a "Mongoose," a $3 million multi-purpose ship first produced in 2000 that is capable of engaging in combat operations, patrolling, and carrying out search and rescue operations. These boats can be up to 65 feet long and are equipped with machine guns, automatic grenade launchers, and portable air-defense systems.

Ukrainian forces have heavily relied on their arsenals of Magura V5s and Sea Babies — another type of exploding naval drone — to damage and destroy scores Russian warships in the Black Sea. Many of those targets were larger vessels, unlike the one that was struck on Monday.

Russia has been unable to consistently defend against this asymmetrical style of warfare, despite recent reshuffling in its naval leadership and new efforts to curb the threat. These efforts include added protections in port and outfitting its crews with more machine guns, as well as additional combat air patrols.

A general in the Security Service of Ukraine, or SBU, previously told Business Insider that Moscow constantly has planes and combat helicopters patrolling around the western Black Sea, which would be consistent with the video shared earlier by the Russian defense ministry. Still, Kyiv has managed to find success in targeting Russian vessels with its drones.