Chapter 1: What is the main topic discussed in this episode?
It's Fed Day. We'll look at the divide among policymakers on the wisdom of interest rate cuts. Plus, Australia bans teens from social media in a world first.
Today, we change a generation. Today, we change a culture. Today we change lives for the better.
And Miami swings Democratic for the first time in decades. It's Wednesday, December 10th. I'm Luke Vargas for The Wall Street Journal, and here is the AM edition of What's News, the top headlines and business stories moving your world today.
We begin in Australia, where a landmark social media ban for children under the age of 16 is now in effect, with governments around the world keeping a close eye on how it'll work in practice.
Chapter 2: What landmark law did Australia implement regarding social media for children?
Politicians, parents, and mental health experts have been calling for the bans, as more studies have shown that social media can worsen feelings of anxiety and depression. Here was Australian Prime Minister Anthony Albanese speaking alongside Communications Minister Annika Wells in Sydney.
Technology can have an amazing impact on making our life easier. But it is important as technology develops that humans keep control, that we assert our authority as a society and to back families and to say that enough is enough. We will take back control.
For many years, the world has allowed the idea that the internet can have different rules from real life, that somehow it can be a free space unregulated by any of the values by which we govern ourselves. The people the Prime Minister has gathered here today are the people who refuse to leave this dilemma in the hands of someone else. You are the people that took this on
and demanded children come before trillion dollar companies. So this is about the parents who have kids who could not be here today.
Children younger than 16 will now be banned by law from holding accounts on platforms including Facebook X and TikTok, with social media companies facing fines of more than $30 million if they fail to take reasonable steps to remove the accounts. Meta was the first tech giant to react. It began deactivating accounts on Facebook, Instagram, and Threads ahead of the ban last week.
At the same time, teenagers have argued that the ban hurts free speech, with Australia's high court agreeing to hear a challenge to the ban. Tech companies have made the same argument. And as tech reporter Sam Schechner explained in our latest Sunday episode, these types of bans present a real threat to their future profits.
In many cases, these companies aren't perhaps currently actively monetizing their young teen users. That's sort of one of the concessions that they made in efforts to stave off just this kind of legislation. That being said, we know in part from our Facebook files reporting that the social media companies look at these young users as their future adult user base.
And now is the time when they can help attract users, build habits that will continue to keep their companies with healthy user bases that generate revenue into the future.
And it seems that big tech could be facing a seismic shift now with other countries, including Malaysia, Denmark and Norway, looking to implement similar bans. And U.S. states like Florida and California are also moving to curtail young people's access to social media. For more on Australia's social media ban, check out the latest Sunday episode in your podcast feed.
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Chapter 3: What are the reasons behind the push to ban social media for kids?
And so if they say something, it's likely to track with what he's thinking.
Has that been the trajectory of this cohort? I'm a little bit more in favor of a cut the last few months because we stand at a strange point, nagging inflation on one hand and then concerns about weakness in the labor market on the other. Normally, those would be pulling in sort of separate directions.
Correct. So for a while, the Fed has had this kind of difficult trade-off to balance. But it has been reasonably united behind cuts. If you recall, there have been two cuts so far this fall. In the second of those, at the end of October, there were two dissents, actually. But they were notable because they went in both directions.
So one governor, the governor of the Kansas City Fed, wanted to hold off on a cut. Jeffrey Schmid. And then on the other hand, we had Stephen Moran, who is Trump administration economic advisor, who's on leave from that position to serve as a Fed governor. And he actually dissented in favor of a bigger cut. So he really thinks the Fed should go big in easing policy.
Finally, Quinton, how might President Trump's opinion fit into this? We know he wants to lower rates. He also tried to have one of the Fed governors removed, albeit unsuccessfully so far. But do you see politics factoring more into how the Fed goes about its decisions here or at least in the future?
unquestionably going to factor more into Fed decision making in future. So Chair Powell's term as chair is up in May, and markets are pretty convinced that his replacement will be Kevin Hassett, a close economic advisor to the president who has shown interest in lowering rates, making policy easier.
And then the Trump administration seems to be considering potential levers it could also pull to change the makeup of the committee. More broadly, we've just seen a willingness from the Trump administration, including Treasury Secretary Besant, to be much more vocal about what they perceive as the shortcomings of the Fed and its decision making.
And on both sides, the people who are hawkish and the people who are dovish, we have seen this kind of increasing willingness to be public and voice your contesting opinion loudly, I think, because everyone feels they need to stake their position. So we may see, at the very least, a kind of more contentious decision-making process in the months ahead, even before a change of the chair.
It will make your job putting together articles like this maybe a bit easier in the future. We'll see what the effect will be. I've been speaking to Wall Street Journal Deputy Finance Editor Quinton Webb. Quinton, thanks as always for stopping by. Thanks so much. Coming up, we'll get the reaction from Tokyo after Chinese and Russian bombers hold a joint exercise near Japan.
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