There is no good solution to the kind of inflation we're seeing right now

A customer pumps gas into their car at a gas station on May 18, 2022 in Petaluma, California.

Justin Sullivan/Getty Images

• Inflation is still running at four-decade highs, but the potential solutions all have major drawbacks.
• Higher interest rates are the Fed's top tool for cooling inflation, but they could spark a recession.
• Options for lowering gas prices are either geopolitically fraught or too short-sighted.

Pick your poison. Inflation sits at the highest levels in more than four decades, and every feasible solution for fighting it comes with serious drawbacks.

Faster-than-usual price growth first emerged in early 2021 as a side effect of the country's reopening. The reversal of nationwide lockdown measures unleashed a nearly immediate surge of pent-up demand. Businesses, meanwhile, were slow to catch up. Historic spending crashed into limited supply, and firms quickly got to raising prices.

The following year has seen inflation shift from a sector-specific phenomenon to an economy-wide pain. Prices rose 8.6% in the year through May, reflecting the fastest price growth since 1981. Skyrocketing food and gasoline prices lead the way, but there are few pockets of the economy that aren't experiencing elevated inflation.

Yet as high prices threaten to pull the country into a new economic crisis, viable solutions are few and far between. Practically every fix for the inflation problem is either too slow, too risky, or too divisive.

The inflation problem has to be addressed, but the answer won't please everybody.

Expect some pain from the Fed's efforts

No matter what's powering dangerously high inflation, it's up to the Federal Reserve to rein it in, and the central bank has already made some big moves to slow the price surge. The Federal Open Market Committee raised interest rates by 0.75 percentage point on June 15, backing the largest rate cut since 1994 just days after new data showed inflation ramping up again in May. Fed Chair Jerome Powell hinted similarly large hikes could follow at the committee's July meeting.

The aggressive hiking cycle stands a decent chance of cooling inflation. Higher rates raise borrowing costs on everything from mortgages to credit card debt, in turn weakening spending and helping close the supply-demand imbalance fueling inflation.

Yet it comes with a fair share of drawbacks.

For one, higher rates take some steam out of the broader recovery. Many bearish economists — including a former president of the New York Fed — fear the rate hikes will slow growth to a halt and lead businesses to lay off workers en masse. While labor demand currently sits at historic levels, rising rates could quickly choke off spending and throw the economy into a recession.

Even if the Fed can avoid a self-inflicted downturn, higher rates could leave countless Americans with hefty financial burdens. Mortgage rates are already nearly double what they were at the start of the year, leaving new homebuyers with much larger monthly payments. Credit card rates, meanwhile, are closing in on record highs. After months of record-high spending, the uptick could pose a bigger risk to those running behind on paying their balances.

Rate hikes are the Fed's top tool for fighting inflation, and they have a strong record at actually cooling price growth. But with inflation running extremely high, the effort will come at a cost.

"The process of getting inflation down to 2% will also include some pain, but ultimately the most painful thing would be if we were to fail to deal with it and inflation were to get entrenched," Powell told Marketplace in May.

Untangling supply chains will take some time

Shoring up supply could tackle the inflation problem as well, but several obstacles stand in the way. Recent COVID-19 outbreaks in China threw the country's manufacturing hubs back into partial shutdowns, roiling supply chains all over again just as it looked like the situation was starting to heal. The decades-long shift toward a globalized economy yielded cheap labor and lower prices across a range of goods, but untangling the current mess is likely to be a slow and turbulent process.

There are several logistics problems at home, too. Truck driver shortages, port backlogs, and overfilled warehouses hobbled the domestic supply chain throughout 2021, and many of the issues haven't been fully solved. The Biden administration touted its $1 trillion infrastructure bill as a solution, but such investment takes years to show results. Without any further and more timely action from Congress, it's up to the private sector to work out the supply-chain kinks.

There's no good option for lowering gas prices

Much of the inflation problem boils down to gas prices. Costs at the pump are up nearly 50% from year-ago levels, and the national average price for a gallon of gasoline now hovers just below $5. As with broad inflation, there's just too much demand for gas and too little supply to go around. And there aren't any appealing options for finding more gas to sell.

The surge in energy prices accelerated when Russia invaded Ukraine in late February, raising concerns of new supply snags in the natural gas and oil markets. The rally intensified in March when the US, UK, and European Union slapped Russia's energy sector with severe energy embargoes. The measures aimed to cripple one of the Kremlin's biggest sources of revenue, but it left the West paying sharply higher energy prices. The US and its allies could reverse those sanctions to provide some quick relief, but doing so would mark a stunning hit to Ukraine and capitulation to Putin.

The US could also turn to Saudi Arabia as an emergency source of oil, but that option has its own hurdles. President Joe Biden is slated to visit the kingdom in July and meet Saudi Crown Prince Mohammad Bin Salman, and some expect the president to ask for increased oil production.

Yet Biden promised to reprimand Saudi Arabia for its reported role in the 2018 killing of journalist Jamal Khashoggi, and many Democratic allies in Congress aren't comfortable with the visit. Meeting with MBS is a "bad idea," Sen. Tim Kaine of Virginia told Insider's Joseph Zeballos-Roig earlier in June.

"I see very little evidence that the Saudis are going to lower gas prices," Sen. Ron Wyden of Oregon said. "I see a lot of evidence of their horrendous human rights violations." 

Left with few other forms of relief, the Biden administration on Wednesday urged Congress to approve a three-month pause to the federal gas tax. The option would temporarily levy the 18 cent tax per gallon of gas and 24 cent tax on every gallon of diesel, but it resembles more of a band-aid than a meaningful solution. The stark imbalance between gas supply and demand could continue to lift prices even after the approval of a tax holiday.

There are also doubts on both sides of the aisle that the savings would reach consumers. House Speaker Nancy Pelosi withheld her support for such a measure back in March, raising concerns that oil companies would take the lion's share of the relief. With Republicans uniformly against such a holiday, even the most temporary aid to soaring gas prices is unlikely to win Congressional backing.

"Whatever you thought of the merits of a gas tax holiday in February it is a worse idea now," Jason Furman, a top economist in the Obama administration, wrote on Twitter.

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Sen. Josh Hawley predicts the overturning of Roe v. Wade will cause a 'major sorting out across the country' and allow the GOP to 'extend their strength in the Electoral College'

Republican Sen. Josh Hawley of Missouri speaks at the Conservative Political Action Conference in Orlando, FL on February 24, 2022.

AP Photo/John Raoux

• Sen. Josh Hawley predicted that the overturning of Roe v. Wade will help Republicans in the long run.
• He argued the decision would polarize the country in a way that benefits Republicans in the Electoral College.
• He also said the alliance between big business and social conservatives that underpins the GOP is now "over."

On the heels of a 6-3 Supreme Court decision overturning Roe v. Wade and revoking the constitutionally-protected right to an abortion in America, Republican Sen. Josh Hawley of Missouri predicted a dramatic shift in the country's political fabric.

"I really do think that this is going to be a watershed moment in American politics," he said on a call with reporters on Friday. "The first decision — the 1973 Roe decision —  fundamentally reshaped American politics, it ushered in the rise of the Christian conservative movement, it led to the forming of what became the Reagan coalition in 1980."

"I think another period of transformative change in American politics is now upon us," he added.

Hawley, a leading social conservative who's thought to harbor presidential ambitions himself, said the ruling would further polarize the country as abortion laws shift on a state-by-state basis.

"I think we will see a major sorting out across the country that is already underway, as we speak, as states move to change their laws or adopt new laws in response to this decision," he said. "I think it'll probably redraw some demographic lines around the country, and will lead to impacts in voting patterns, I think, all around the country."

Hawley said that individuals may make decisions about where they choose to live in the United States based on those laws, possibly relocating in the process.

"More and more red states, they're going to become more red, and purple states are going to become red, and the blue states are going to get a lot bluer," he said.

That, in turn, may give Republicans an even greater advantage in the Electoral College, the country's system for electing presidents. Under that system, the president is decided based on the votes of 538 electors allocated to each state based on their populations.

Republicans already have an advantage under the system, and Donald Trump was elected president in 2016 despite coming millions of votes short of Hillary Clinton in the popular vote.

"I would look for Republicans, as a result of this in time, to extend their strength in the Electoral College," he said. "And that's very good news for those of us who want to see Republican presidents elected, that want to see a Supreme Court that remains conservative."

Hawley was the first Republican senator to announce that he would object to the certification of electoral votes from Pennsylvania during a joint session of Congress on January 6, 2021.

'That alliance is over'

Beyond predicting good fortune for his party, Hawley took aim at "corporatists, "neoliberals," and "globalists" within the GOP.

"For years on the conservative side of the ledger, social conservatives have been told that they had to form an alliance with the corporatists, the neoliberals, in order to get elected," he said. "I think that alliance is over today. There's no reason for social conservatives to go along with a corporatist agenda that frankly never had much support in the country."

He added that the agenda of the so-called corporatists has "been a free rider in the Republican coalition for years now."

"I think the skepticism you see in that coalition towards big business, towards the multinational corporations, and all that entails, I think that will become more pronounced as we go forward," he said. "And I look forward to that."

Hawley counts himself among the "populist" wing of the Republican Party, recently declaring opposition to a $40 billion aid package to Ukraine because he believes the US needs a more "nationalist" foreign policy.

During the COVID-19 pandemic, he partnered with Independent Sen. Bernie Sanders of Vermont on a proposal to provide $2000 stimulus checks to Americans.

More recently, Hawley has sought to fuse anti-corporate sentiment with burgeoning social conservative priorities on the right.

In the wake of Disney's criticism of the "Don't Say Gay" law in Florida, he introduced a bill purportedly taking on Disney, which he said was "increasingly pandering to woke activists."

In effect, the bill simply shortened general copyright protections down to 56 years.

 

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Spirit Airlines was the most complained about US carrier in April, followed by American Airlines, amid flight cancellations and delays

Spirit Airlines A319 aircraft.

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• Spirit Airlines received the most complaints from US passengers in April, a DoT report said.
• American Airlines had the second-highest number of complaints, per the report.
• There were more than 5,000 complaints lodged against US airlines in April, the report said.

The American airline that received the most complaints in April was Spirit Airlines, according to the US Department of Transportation (DoT).

Spirit racked up 637 complaints in April, the DoT said in a report titled "Air Travel Consumer Report." Most of the carrier's complaints were filed over flight problems, including cancellations, delays, and misconnections, per the report.

Overall, Spirit had 394 complaints for flight problems, 122 complaints over refunds, and 30 complaints each for baggage and reservations, ticketing, and boarding, the DoT said in its report. Other complaints were filed for fares, customer service, and oversale, per the report.

The DoT said in the report there were a total of 5,079 complaints lodged against US airlines by American airline passengers in April. This was more than a 320% increase from April 2019, before the COVID-19 pandemic began, when the number of complaints came to 1,206, per a previous DoT report.

Complaints in April this year were up 15% from the previous month of March, when US passengers reported 4,423 problems with airlines, per a DoT report last month.

Trailing behind Spirit as the second most-complained about airline was American Airlines, per the DoT's latest report. Travelers filed 491 issues against American — the highest number of complaints were over flight cancellations and delays, according to the report.

Spirit and American didn't immediately respond to Insider's request for comment made outside of normal working hours.

Spirit flight attendants protested at airports in Dallas, Las Vegas, and Orlando in mid-April over staff shortages and flight cancellations, which meant some crew ended up stranded overnight in airports and sometimes left without hotel accommodation, according to the Association of Flight Attendants – Communications Workers of America.

Passenger complaints come as the airline industry grapples with a staffing shortage during the busy summer travel season, causing delays and cancellations to flights.

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Vienna was just ranked the world's most livable city. No US cities made the top 10.

Vienna has a population of around 2 million.

Pintai Suchachaisri/Getty Images

• Vienna is the world's most livable city, per rankings by the Economist Intelligence Unit (EIU).
• No US cities made the top 10, which was dominated by western Europe and Canada.
• Auckland topped the list in 2021 because of its rapid pandemic response.

Vienna is the world's most livable city, according to a report published Thursday by the Economist Intelligence Unit (EIU).

Austria's capital was followed in the EIU ranking by Copenhagen, Denmark. Zurich, Switzerland and Calgary, Canada ranked joint third and Vancouver rounded out the top five.

No US cities made it into the top 10, which was dominated by western Europe and Canada. Osaka, Japan and Melbourne, Australia came in joint 10th.

The EIU bases its annual Global Liveability Index on a range of factors including healthcare, culture, education, and stability.

Vienna – which has a population of around 2 million – topped the ranking in 2018 and 2019 before dipping to 12th in early 2021 because of waves of lockdowns. The city's emergence from the pandemic and reopening of entertainment and cultural venues helped push it back up to the top spot.

Vienna also topped the rankings in 2018 and 2019.

Jorg Greuel/Getty Images

"Stability and good infrastructure are the city's main charms for its inhabitants, supported by good healthcare and plenty of opportunities for culture and entertainment," the EIU wrote of Vienna.

Here's the top 10:

1. Vienna, Austria

2. Copenhagen, Denmark

3. Zurich, Switzerland and Calgary, Canada

5. Vancouver, Canada

6. Geneva, Switzerland 

7. Frankfurt, Germany 

8. Toronto, Canada 

9. Amsterdam, Netherlands 

10. Osaka, Japan and Melbourne, Australia

The EIU said scores for culture and environment, healthcare, and education fell during the pandemic but had since risen after COVID-19 restrictions were lifted or eased. Globally, however, scores for stability have fallen since 2021's report.

Rankings for Moscow and St Petersburg fell after Russia invaded Ukraine, which led to increased instability, censorship, Western sanctions, and some companies withdrawing from the country, the EIU said.

The pandemic meant the EIU didn't release its Global Liveability Index in 2020 but it returned in 2021 with Auckland, New Zealand topping the list. The EIU attributed this to the city's rapid pandemic response, which allowed it to lift restrictions earlier than many other cities.

Auckland, New Zealand topped the list in 2021.

Scott E Barbour/Getty Images

However, Auckland fell dramatically in the new rankings, to 34th, which the EIU attributed to New Zealand no longer having a COVID-19 response advantage after vaccines were rolled out globally.

Six of the top 10 cities in the EIU's spring 2021 survey were in New Zealand or Australia, which implemented tight border controls during the pandemic, meaning they needed to introduce fewer COVID-19 restrictions. The top 10 also consisted of two Japanese and two Swiss cities.

"In general, mid-sized cities in the wealthiest countries tend to fare exceptionally well in the survey," the EIU wrote.

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First lady Jill Biden appeals for unity during cancer speech delivered on Trump and DeSantis' home turf

First lady Jill Biden delivered a speech in West Palm Beach, Florida, on June 23, 2022, to highlight the administration's Cancer Moonshot.

Patrick Semansky/AP Photo

• First lady Jill Biden urged unity on cancer screenings and treatments in Palm Beach on Thursday. 
• "We need to fight this disease, not each other," she said. 
• The first lady will visit Surfside on Friday to mark the one-year anniversary of the condo collapse.

WEST PALM BEACH, Florida — First lady Jill Biden appealed for unity on Thursday just 4 miles from former President Donald Trump's perennial Mar-a-Lago home and on the home turf of Republican Gov. Ron DeSantis — one of her husband's most vocal critics.

The fist lady was promoting the Biden administration's cancer initiative, which she called a "key pillar" of what President Joe Biden is calling his "Unity Agenda." 

"Cancer has the power to change us, but it connects us as well," Jill Biden said to an audience gathered in the Hilton West Palm Beach's ballroom. "It forces us to reach out for answers for help, for healing. It tears away the things that divide us, reminding us that we need to fight this disease, not each other." 

The remarks came as the Biden administration and Ron DeSantis continue to clash on numerous issues, including COVID-19 vaccination policies. Trump has moved from his private Mar-a-Lago club to Bedminster, New Jersey, for the summer, but continues to mock Joe Biden in speeches. 

But the first lady's focus on Thursday was squarely on an issue meant to cross partisan lines, as she broadly appealed for public support toward cancer screenings and treatments.

"The disease doesn't care who you voted for," Jill Biden said. "It's not a red or blue issue. It's an American issue. It's a global issue. It will take all of us to end cancer as we know it."

Earlier in the day, Jill Biden took a tour of FoundCare Palm Springs, a federally qualified health center nearby.

The trip was intended to spotlight private sector collaborations. FoundCare receives assistance from The Promise Fund of Florida, which pays for cancer screenings and treatments for women who are uninsured or don't have adequate coverage to pay for their healthcare.

The organization also connects patients with "navigators," meaning staff who help patients with transportation, translation, childcare, and other logistical services. Jill Biden on Thursday praised the organization for finding gaps in healthcare and meeting patients' needs. 

Joe Biden announced in February that he was reigniting the Cancer Moonshot started under his former boss, then-President Barack Obama. The initiative's goals are to reduce the death rate from cancer by at least half in the next 25 years and to improve the lifes of people living with cancer, and of their families.

The disease is personal to the Bidens, who lost their son Beau to brain cancer in 2015. On Thursday, Jill Biden called their cancer work the "mission of our lives" for herself and the president.

Last year, Congress partially funded Joe Biden's request for a new agency called the Advanced Research Projects Agency for Health, or ARPA-H, with plans to authorize more. The Biden administration has pitched the agency as a way to fund ambitious, risky biomedical research that would aim to to develop transformative new technologies, whether it be cancer or Alzheimer's cures. 

"There is nothing political about this," Nancy Brinker, a Republican and co-founder of The Promise Fund, told Insider in an interview. "I have always respected Dr. Biden. She's wonderful, she's as sincere as she can be and she gets things done and they both have caring hearts." 

Brinker was United States Ambassador to Hungary from 2001 to 2003 and Chief of Protocol of the United States from 2007 to the end of the George W. Bush administration. Brinker also founded Susan G. Komen for the Cure, a breast cancer research and advocacy non-profit.

The Promise Fund is set to receive a $1 million federal grant appropriated by Congress, and also received a grant from the state of Florida, which increased funding for cancer research this year to $100 million. 

The record funding increase in Florida was encouraged in part by Florida first lady Casey DeSantis, who underwent chemotherapy for breast cancer and was declared "cancer-free" in March. In another sign that the issue has bipartisan resonance, Casey DeSantis has spoken about the importance of screenings and the Florida governor's office has hinted that a messaging campaign on cancer is forthcoming. 

Jill Biden's comments on Thursday were delivered as part of a two-day visit to Florida. On Friday, Jill Biden will attend a remembrance ceremony in Surfside, Florida, to mark the one-year anniversary since the Champlain Towers South collapse that killed 98 people.

A year ago, Ron DeSantis and Joe Biden demonstrated bipartisan unity after the tragedy, with the governor calling the president "very supportive." The governor's office hasn't yet released the DeSantises' schedule for Friday. 

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Advocates are asking lawmakers for a major increase in federal funding as the January 6 hearings highlight threats to election workers

Wandrea "Shaye" Moss, a former Georgia election worker, and her mother Ruby Freeman, right, listen as the House select committee investigating the Jan. 6 attack on the U.S. Capitol continues to reveal its findings of a year-long investigation, at the Capitol in Washington, Tuesday, June 21, 2022

AP Photo/Jacquelyn Martin

• Bipartisan election advocates are asking Congress for $2 billion in federal election funds. 
• A proposed spending package would allocate $400 million in election security grants. 
• Advocates warned local election offices are "chronically underfunded" in a letter obtained by Insider. 

A bipartisan group of election advocates is asking House lawmakers to significantly increase proposed federal funding for elections in a federal spending bill as the January 6 Committee hearings spotlight ongoing threats to election workers. 

"The federal government hasn't meaningfully invested in our election infrastructure in over a decade, and as a result, local election offices around the country are chronically underfunded," a bipartisan coalition of advocacy groups and election officials wrote in a Thursday letter exclusively shared with Insider asking congressional leaders for $2 billion in election funds. 

 

The House Appropriations Committee is soon set to take up a $29.8 billion Financial Services and General Government spending package for Fiscal Year 2023. The bill would allocate $400 million in federal support for elections.

But that amount falls significantly short of the $2 billion in federal election funding for FY-2023 and support for voting by mail that advocates requested and President Joe Biden asked for in his March budget proposal to Congress.

Signatories of the Thursday letter include advocacy groups, Protect Democracy, Issue One, and the Center for Tech and Civic Life, in addition to seven state and local officials, including Michigan Secretary of State Jocelyn Benson and Connecticut Secretary of State Denise Merrill. 

The full Appropriations Committee will take up the proposal, which includes $400 million in federal election security grants and an additional $34 million in operating expenses for the Election Assistance Commission, in a markup set for 9 a.m. on Friday morning. 

The letter said that $2 billion in "funding is necessary to provide for essential election resources at the local level, such as physical and cyber security systems, reliable and updated voting equipment, and adequate office space and personnel." 

Congress' last major investment in elections was $3.5 billion with the Help America Vote Act of 2002, passed in the wake of the 2000 presidential election debacle in Florida.

Groups like CTCL argue that federal funding since then hasn't kept up with the skyrocketing costs of running elections, the complexity of the technology involved, and the mounting threats to election security since then. 

"Many local election offices are struggling to provide for even the basics, lacking reliable internet access or storage space for election equipment," the letter from advocates said. "We can't let this continue."

Congress allocated $380 million in election security funds in its Fiscal Year 2018 spending bill, another $425 million in the following year, and $400 million of emergency funds for elections right after the COVID-19 pandemic hit — which fell far short of what advocates called for at that time.

Federal support during the pandemic was augmented by private funds from philanthropists distributed as grants by organizations including CTCL, but many states have since banned election officials from taking private grants.

"As we look at the needs across the country over the next decade, we estimate that there is going to be north of $50 billion of election infrastructure costs, most of those born at the local level," CTCL's executive director Tiana Epps-Johnson, told Insider in 2021. 

In addition to rising costs and continuing cybersecurity threats, election officials in 2022 are contending with struggles recruiting poll workers, paper shortages, and increasing threats to their personal safety, as highlighted by the ongoing January 6 Committee hearings. 

In the House committee's fourth hearing on Tuesday, former Fulton County, Georgia election worker Wandrea "Shaye" Moss and her mother Ruby Freeman testified about receiving a torrent of harassment and abuse in the wake of the 2020 election as Trump and his allies targeted the two by name in pushing their false claims of election fraud.

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The high-flying energy sector is suffering one of its worst streak of losses in 40 years as oil prices pull back

The EU is planning a complete ban on Russian oil imports.

iznashih/Getty Images

• The S&P 500 Energy Sector has hit one of its worst run of losses in more than 40 years, Bespoke Investment Group said Thursday. 
• The sector's 10-trading-day decline of 23.7% is the third worst in four decades. 
• Energy stocks have been hurt by a drop in oil prices but remain the only sector with gains this year on the S&P 500. 

The S&P 500 Energy Sector is the only sector on the broad-market index sporting gains so far in 2022, but a slide in oil prices has pulled the group into one of its worst rough patches in decades. 

The sector has hit its third worst 10-trading-day decline over the last 40+ years in registering a fall of 23.7%, Bespoke Investment Group noted in tweets it posted Thursday. 

"The 23%+ drop for Energy over the last two weeks has left it basically right where it was trading when Russia invaded Ukraine at the end of February," Bespoke wrote. 

The only such slumps that saw bigger drops occurred in October 2008 and March 2020 – during the global financial crisis and the early stages of the COVID-19 pandemic, respectively. 

The sector, which includes oil heavyweights Exxon Mobil  and Chevron, lost nearly 5% during Thursday's session. 

The energy group shot higher four months ago as oil prices soared on supply worries streaming out of the invasion of Ukraine by Russia, one the world's top oil producers. 

"The Energy Sector had gotten more than 40% above its long-term 200-day moving average at its highs on June 8th," the firm said. "That 40%+ spread above the 200-DMA was the widest since at least 1990 for the sector." 

But the 200-DMA spread has narrowed to just 5% in two weeks time, Bespoke said. 

Investors have yanked down oil prices in recent sessions, repricing them in the face of ongoing concerns about a potential recession as central banks — led by the Federal Reserve — raise interest rates to combat high inflation.

West Texas Intermediate crude on Thursday fell 2% to about $104 per barrel and Brent crude, the international benchmark, slipped to trade around $106 per barrel.

Oil prices came under more pressure this week after President Joe Biden called on Congress to suspend federal gas taxes for three months to alleviate the pressure from high gas prices for American drivers. Biden's proposal, however, appears to have few backers on Capitol Hill. 

The S&P 500 Energy Sector was still up about 32% in 2022 even with the dismal showing over the past two weeks. WTI and Brent crude oil prices were also hanging around year-to-date gains of about 37% each.

Bespoke's rolling 10-day chart of the S&P 500 Energy Sector's performance.

Bespoke Investment Group

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Why billionaire Ken Griffin is moving Citadel's HQ to Miami from Chicago: riots, an employee stabbed, and the attempted hijacking of his own car

Ken Griffin, Citadel's founder, speaks with executive Kelly Brennan at the firm's Palm Beach, Florida, bubble in 2020.

Citadel

• Citadel, which has been in Chicago since its inception, is moving to Miami.
• Citadel founder Ken Griffin has already moved to the sunshine state.
• The moves comes after Griffin has made complaints about safety in Chicago. 

Billionaire Ken Griffin's Citadel is moving to the sunshine state. 

In a memo to employees on Thursday, Griffin said he was moving $51 billion hedge fund Citadel and market maker Citadel Securities headquarters to Miami, Florida, from its headquarters in Chicago, where it's been based since 1990. 

"Many of our Chicago teams have asked to relocate to Miami, New York, and our other offices around the world" over the past year, Griffin said in a letter to employees. Griffin himself has moved to Miami with his family, he said. 

According to Citadel spokesman Zia Ahmed, some Citadel Securities employees have already moved to temporary offices in Miami's Southeast Financial Center, and hedge fund Citadel teams are set to follow. Citadel has more than 1,000 employees based in Illinois across its two businesses. The firm said it expects a few hundred people to be based in Miami in the next year.

Over the past year, Griffin has been outspoken about his colleagues' safety in the Windy City. 

"It's becoming ever more difficult to have this as our global headquarters, a city which has so much violence," he said last October at the Economic Club of Chicago.  "I mean Chicago's like Afghanistan on a good day and that's a problem."  

When asked how long he planned to stay in Chicago, Griffin said at the time: "It's probably measured in years not decades if we don't change course."

While not mentioned in Griffin's note to employees, Ahmed cited crime as another reason for the move. Over the last few years there had been an attempted carjacking of Griffin's car, a stabbing of a Citadel employee while walking to work, shoplifting in the neighborhoods where Citadel employees live, shootings near the homes of some employees, and mass shooting, riots, and looting near Griffin's home in River North.

Citadel has been no stranger to Florida. The firm made headlines in April 2020 when it set up a "bubble" at the Four Seasons in Palm Beach, Florida, for its Citadel Securities trading floor because of the fallout of COVID-19. It booked the resort for the last two summer intern classes, too. 

This year, Citadel Securities interns stayed at the Palm Beach Four Seasons, and interns of the $47 billion hedge-fund manager stayed at the Four Seasons in Fort Lauderdale for the first week of the summer internship program. 

A slew of other financial firms have built a presence in Miami including Blackstone, Goldman Sachs, Thoma Bravo, and Elliot Management. Other hedge funds like D1 Capital Partners and Melvin Capital Management also have locations in Florida. 

Citadel is building a new office tower in Miami's finance hub of Brickell, which will take several years to complete. The company also plans to open its 425 Park Avenue location in New York City later this summer. 

"With our new office opening at 425 Park Avenue, our expansion at 350 Park Avenue and our new headquarters opening on Brickell Bay, in the heart of Miami's booming financial district, we are in a strong position to support these transitions," Griffin said in his letter. 

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