Fitch cuts Spirit Airlines' rating further into junk territory
"The downgrade reflects the heightened possibility that Spirit may be unable to avoid a default given its ongoing operating losses and declining liquidity," Fitch said in its report.
The move follows Spirit's warning earlier this week about 'going concern' risks, just months after the carrier emerged from bankruptcy. The airline's operations have been strained by weak domestic demand and shrinking cash reserves.
In its quarterly report Monday, Spirit said elevated domestic capacity and softer leisure travel demand in the second quarter have created a tough pricing environment, further pressuring results.
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The Guardian
43 minutes ago
- The Guardian
Trump's cold brew: New York coffee shops warn of higher prices amid steep tariffs
The Trump administration has targeted Brazil with steep US tariffs of 50%. Coffee shops in the heart of New York are bracing for impact. When the Trump administration announced another wave of sweeping tariffs, particularly on Brazil, Stone Street Cafe's managing partner was first confused. Then came fear. A cafe already runs on slim margins and extra costs passed on from tariffs could risk everything. 'If these tariffs are long term, it will put our business in jeopardy,' Antony Garrigues, managing partner of Stone Street Cafe, said. 'In New York City, the operating costs are already so high, and these tariffs will make everything much more expensive. 'In the end, if people cannot afford our coffee, and we do not have a profit margin, we will not make it.' Stone Street Cafe, based in Manhattan, sources green coffee beans from more than 35 different countries, including Brazil. But Brazil is not the only coffee-producing nation facing tariff pressures: Vietnam, Colombia, Ethiopia and Indonesia are also affected. 'These tariffs are not paid by the country. The costs are passed down to the business owner, and consumer,' noted Garrigues. 'For now, we are going to try and absorb as much [of] the cost as we can. But at the end of the day, this is a business – so we may have to increase the prices.' With the growing effects of climate change already inflating coffee prices, other cafes have already done so. Aside from coffee Ciao Gloria, in Brooklyn, also imports cocoa powder from Brazil. Jams sourced from Italy now face Trump's 15% tariff on exports from the European Union. The cafe raised prices by about 25 cents per cup, but plans to absorb any additional tariffs costs, at least for now. 'I'm selling sugar and caffeine – I'm basically a drug dealer,' joked owner Renato Poliafito. 'So I want to make sure the menu is affordable.' But then he turned serious. 'We have to be vigilant about analyzing the situation before jumping to price increases.' Customers are already scrutinizing their receipts. US coffee prices rose 14.5% in the year to July, according to official data. 'It's this idea of shifting baseline where we normalize something being expensive when it shouldn't [be], and it's very scary to see,' said Helina Seyoum, 29, who has reverted to making coffee at home. 'Now a morning coffee becomes a burden, because you're obsessing over the costs.' A daily cafe trip was how Aley Longo, 28, made sure she escaped the confines of her studio apartment and spoke to people outside work in an 'affordable' way. Now it's strictly a weekend activity. Trump's tariffs are 'bad for Americans, and our quality of life', Longo said, 'and we are suffering, whether it's as tiny as just being able to buy coffee out, or something so much bigger'. Those behind the counter know what it's like to watch the price of a regular purchase grow. Allon Azulai, who owns Kos Kaffe in Brooklyn, which imports beans from countries including Colombia, Honduras and Kenya, described nervously asking vendors for their latest prices each week, as tariffs and mounting demand looms large. 'Right now the industry is so unstable and what worries me if tariffs continue is cafes that do not have big pockets will not be able to survive,' said Azulai. As US cafes come under pressure, the coffee producers they source from are also preparing for disruption. Brazil is the world's largest coffee producer and exporter. The US is the leading destination of its coffee: about a third of its coffee imports are Brazilian. The Brazilian Soluble Coffee Industry Association, which represents producers, said the 50% US tariff on the country's exports amounted to a 'clear competitive disadvantage' as other leading countries for coffee production face lower rates, ranging from 10% to 27%. 'This decision not only harms the Brazilian industry but could also negatively affect American consumers, who benefit from the quality and competitive price of our coffee,' the association said. Brazilian producers and exporters still hope they can lobby for coffee to be exempt from US tariffs, arguing the US produces very little coffee domestically. The US commerce secretary, Howard Lutnick, had previously suggested products not cultivated on American soil could be granted zero tariffs, they note. If that fails Brazil's Coffee Exporters Council says it will at least seek to reduce the tariff on coffee to 10%, in line with other Brazilian goods, including oil, orange juice and aircraft. 'We remain optimistic and hopeful,' the council said. New coffee export deals with the US are on hold and shipments ready to go are stuck in storage, adding costs for exporters. China has meanwhile approved 183 new Brazilian firms to export coffee, although the exporters' council cautioned that sales may take time to materialize. In Vietnam and Colombia – the world's second and third largest coffee-producing nations, respectively – exporters hope that lower US tariffs on their coffee will help them steal a march on Brazil. 'The US can't grow coffee at scale, so tariffs won't bring production back home,' Timen Swijtink, founder of Lacàph Coffees in Vietnam, said. 'With the tiny margins in our industry, any tariff cost goes straight to the American consumer.' Even with 20% US tariffs on Vietnam, the country's farmers 'are resilient and will find new markets', added Swijtink, 'with global demand strong and China's demand growing like a rocket ship'. With the US tariff on Colombia only at the baseline 10%, small coffee growers across the country are shrugging off any immediate impacts. 'The average coffee farmer won't feel it, at least for now,' said José David Posada, a fourth-generation coffee farmer and owner of Capilla del Rosario, a finca in Medellín. 'It's the exporters who will be impacted.' There is also a sense among some that, given Brazil's tariffs are at 50%, Trump's tariff war could even help Colombian business. The country's coffee cultivation is vital to the national economy, representing 8% of total Colombian exports. Posada said: 'The fact that Brazil has a higher tariff, obviously that's going to have a positive impact on us, right?' Guilherme Morya, a coffee analyst at Rabobank, said the 50% tariff on Brazilian coffee may, at least in the short term, shift American buyers toward other sources. 'Colombia gains a price advantage, and being the second-largest supplier, it becomes the most obvious candidate to fill this gap,' he said. But Alejandro Lloreda, a farmer at family-run Cafetal de la Trinidad, which produces specialty coffee, cautioned the difference would only give Colombia 'a temporary advantage'. 'A coffee tree can take two to three years to produce, and the tariff situation could well change before then,' he said. Back in New York, cafe owners find themselves in an equally uncertain position. 'The tariffs are to small businesses' detriment,' said Poliafito, of Ciao Gloria. 'Big businesses can find a way around it. But we will suffer the costs.' 'It's scary to not know if we can continue our business,' added Nick Kim, manager of Koré Coffee in Manhattan. 'It's really a shame, and sad, that you know bad things are coming, but you cannot do anything to change it. We have no option but to see what will come.'
Geeky Gadgets
2 hours ago
- Geeky Gadgets
From Idea to App in Hours : How Claude Code Turns Ambition Into Reality
What if you could create anything—from a innovative AI-powered app to a dynamic website, without being a coding wizard? Imagine turning your most ambitious ideas into reality using a tool designed to simplify even the most complex development tasks. Enter Claude Code, a innovative platform that's reshaping how we approach software creation. With its intuitive design and AI-driven capabilities, Claude Code enables developers and enthusiasts alike to build solutions that are not only functional but also scalable. Whether you're crafting a customer relationship management (CRM) system or experimenting with AI-driven automation, the possibilities are as vast as your imagination. The real question is: how do you unlock its full potential? David Ondrej guides you through the essentials of working with Claude Code, from mastering its core principles to overcoming common challenges. You'll discover how to optimize workflows with tools like sub-agents and precise prompting, and why clarity of purpose is your greatest ally in development. Along the way, we'll explore strategies for debugging, scaling, and making sure your projects remain future-proof. Whether you're a seasoned developer or just starting out, this journey into Claude Code will leave you with actionable insights and the confidence to bring your boldest ideas to life. After all, innovation thrives when creativity meets the right tools. Claude Code Development Guide The Four Pillars of Claude Code Success To fully harness the capabilities of Claude Code, it is essential to focus on four foundational pillars: Setup Optimization: Use hooks, commands, prompts, and sub-agents to simplify your development process and improve the reliability of your application. These tools help automate repetitive tasks and ensure consistency. Use hooks, commands, prompts, and sub-agents to simplify your development process and improve the reliability of your application. These tools help automate repetitive tasks and ensure consistency. Clarity of Purpose: Clearly define your project's goals and requirements. A well-defined purpose serves as a roadmap, keeping your efforts focused and aligned with your objectives. Clearly define your project's goals and requirements. A well-defined purpose serves as a roadmap, keeping your efforts focused and aligned with your objectives. Technical Skill: Build a robust foundation in software development and computer science. This knowledge equips you to address complex challenges and implement advanced features with confidence. Build a robust foundation in software development and computer science. This knowledge equips you to address complex challenges and implement advanced features with confidence. Prompting and Context Engineering: Develop precise prompts and manage context effectively to guide AI tools toward achieving desired outcomes. This ensures that the AI operates within the intended parameters. By prioritizing these pillars, you establish a strong framework for your project, allowing you to unlock the full potential of Claude Code and deliver high-quality results. The Development Process: From Planning to Deployment Building an AI-powered application involves several critical stages, including planning, coding, testing, and deployment. For example, a CRM system might incorporate features such as contact management, task tracking, and AI-assisted interactions. However, the development process is rarely linear and often presents challenges. Common obstacles include debugging version mismatches in tools like the Versel AI SDK (V5) or addressing limitations caused by outdated AI training data. To overcome these issues, consider using tools such as Playwright MCP for front-end testing and debugging. This ensures that your application's user interface functions as intended. Additionally, platforms like Perplexity can provide up-to-date web research and documentation, helping you bridge knowledge gaps and stay informed about the latest advancements. How to Build Scalable Apps & Websites With Claude Code Watch this video on YouTube. Browse through more resources below from our in-depth content covering more areas on Claude Code development. Optimizing Your Workflow Efficiency and scalability are crucial when working with Claude Code. Implementing the following strategies can help you optimize your workflow and focus on innovation: Sub-Agents: Incorporate sub-agents, specialized modules designed for tasks such as web research or data processing. These modules automate complex or repetitive operations, improving accuracy and saving time. Incorporate sub-agents, specialized modules designed for tasks such as web research or data processing. These modules automate complex or repetitive operations, improving accuracy and saving time. Hooks and Commands: Automate deterministic actions using hooks and commands to reduce manual effort and maintain consistency across your application. Automate deterministic actions using hooks and commands to reduce manual effort and maintain consistency across your application. Internal Documentation: Maintain clear and accessible documentation to support context engineering and ensure continuity throughout your project. This can include markdown files or other structured formats. By streamlining these processes, you can allocate more time to refining your application's features and addressing user needs, ultimately enhancing the overall quality of your project. Debugging and Problem-Solving Debugging is an integral part of the development process, and Claude Code is no exception. A methodical approach to identifying and resolving issues can significantly improve your application's stability and performance. Consider the following strategies: Debug Log Statements: Use detailed log statements to isolate and identify the root causes of issues, such as API errors or SDK compatibility problems. This approach provides clarity and accelerates problem resolution. Use detailed log statements to isolate and identify the root causes of issues, such as API errors or SDK compatibility problems. This approach provides clarity and accelerates problem resolution. Iterative Testing: Continuously test and refine your application to enhance reliability and performance. Iterative testing ensures that your final product meets user expectations and functions seamlessly. By addressing issues systematically, you not only resolve immediate problems but also strengthen the overall robustness of your application, paving the way for long-term success. Best Practices for AI Development Achieving success with Claude Code requires more than technical expertise. Adopting best practices can enhance your development process and ensure the delivery of high-quality applications: Logical Problem-Solving: Combine AI tools with structured problem-solving techniques to address challenges effectively. This approach fosters innovative solutions and improves decision-making. Combine AI tools with structured problem-solving techniques to address challenges effectively. This approach fosters innovative solutions and improves decision-making. Continuous Learning: Stay updated on the latest advancements in AI and software development. Regularly refining your skills ensures that you remain competitive and capable of using new technologies. Stay updated on the latest advancements in AI and software development. Regularly refining your skills ensures that you remain competitive and capable of using new technologies. Documentation and Collaboration: Use platforms like GitHub to document key learnings, track version control, and assist collaboration within your team. Comprehensive documentation supports knowledge sharing and streamlines future development efforts. For instance, when designing a CRM system, document how specific prompts or commands were crafted to achieve desired outcomes. This practice not only aids future development but also fosters a collaborative environment where team members can contribute effectively. Key Takeaways Claude Code enables developers to create sophisticated, AI-driven applications, but success requires a combination of technical expertise, strategic planning, and effective use of tools. By focusing on clear objectives, precise prompting, and efficient workflows, you can overcome challenges and deliver reliable, scalable solutions. Whether you are developing an AI-powered CRM, a dynamic website, or an innovative mobile app, mastering the principles and tools of Claude Code will enable you to transform your ideas into reality. With a commitment to iterative development, thorough debugging, and comprehensive documentation, you will be well-prepared to unlock the full potential of AI-driven development and achieve your project goals. Media Credit: David Ondrej Filed Under: AI, Guides Latest Geeky Gadgets Deals Disclosure: Some of our articles include affiliate links. If you buy something through one of these links, Geeky Gadgets may earn an affiliate commission. Learn about our Disclosure Policy.
The Guardian
2 hours ago
- The Guardian
How Spain put up wealth taxes - without chasing away the billionaires
With its green curtain of hanging gardens, the Planeta building is one of Barcelona's most recognisable office blocks. Earlier this summer, it was acquired as part of a Monopoly board spending spree by Spain's richest man, the Zara fashion label founder Amancio Ortega. Through his Pontegadea family office, which invests his personal wealth, Ortega has also just snapped up the five-star Hotel Banke in Paris, an apartment building in Florida, and a half-share in the operator of Teesport in the north-east of England, adding to a property portfolio already worth €20bn. Why the rush? Ortega is poised to receive a record dividend of €3.1bn (£2.7bn) this year from his shares in Zara's parent group, Inditex. He is reportedly racing to spend the windfall, which would otherwise be subject to wealth taxes. Sources close to Pontegadea told the Guardian it was not investing to avoid tax, but following its mandate 'to create wealth from the original assets, maintain it, make it grow, and consolidate it over generations'. It invests all dividends from Inditex 'and any other income from its own economic activities every year, no matter the amount', they said. Whatever the reason, the Ortega property portfolio has grown rapidly in recent years, making his family office one of Europe's biggest real estate owners. As chancellors around Europe cast about for ways to repair the damage to public finances caused by successive global shocks, there is a growing clamour for more effective ways to tax the largest private fortunes. Spain is one of only three European countries (along with Switzerland and Norway) to still collect wealth taxes, and policymakers are looking to Madrid for lessons in what works – and what doesn't. In the UK, the former Labour leader Neil Kinnock and the party's former shadow chancellor Anneliese Dodds have joined those calling for Rachel Reeves to introduce a wealth tax when she sets out her budget in the autumn. As the chancellor looks at the options, which could also include changes to inheritance tax, members of her own party are pushing for a debate in parliament about introducing a 2% annual levy on those with assets over £10m, which they say could raise £24bn. In France, a similar proposal aimed squarely at the ultra-rich with assets of more than €100m was approved by the lower house but was rejected by the senate. Wealth taxes are designed to take a percentage of a person's assets each year. Once fairly common, they have gradually fallen out of use, replaced by levies that bite when money changes hands, for example, through dividend payments, inheritance and sales of shares or property. Spain's wealth tax dates to 1978, a year that marked the transition to democracy from dictatorship under Franco. Regional governments receive the revenues collected by the levy, a system that worked well until, after a brief pause during the financial crisis, it was brought back in 2011. On its return, Madrid's conservative administration responded by discounting the rate to zero. The move benefited the high-earning footballers at Real Madrid, attracted new residents from other regions, and incomers from Venezuela and other Latin American countries, boosting property prices. In 2022, the conservative-run region of Andalucía in the south, announced that it, too, would cut the rate to zero. In a play on the Spanish term for tax haven, paraíso fiscal, Madrid's regional leader posted on X: 'Andalucíans: welcome to paradise.' Then Galicia, in the north-west, where Ortega is resident for wealth tax, joined the fray by offering a 50% discount. A source of income that had been providing hundreds of millions of euros a year to support local services, including healthcare, was under threat. The battle to save it became a tussle between the socialist-led central government, headed by Pedro Sánchez, and conservative-run autonomous regional governments. At the end of December 2022, Sánchez took action, with the solidarity tax on large fortunes. Initially for two years, to help with public spending after the pandemic, it has now been rolled over until the regional financing is revised, which is not likely to happen soon. It was designed in such a way that whatever revenue was forfeited by the regions would be collected centrally. The rate starts at 1.7% for those with net wealth of €3m, rising to 3.5% for fortunes over €10m. It is payable on worldwide assets. There are allowances: the first €700,000 is exempted, as is €300,000 for the main residence. A cap to help the asset rich and cash poor means that combined income and wealth taxes cannot exceed 60% of income. Numbers shared with the Guardian by the Ministerio de Hacienda (the Spanish Treasury) show that in the first year, 2023, the regions collected €1.25bn, and the central government €630m; a total of €1.88bn. In 2024, the regions took the logical step of keeping the income for themselves. The total take rose to €2bn. 'The solidarity tax is not a tool to collect revenues for central government, it is a way of forcing regions to collect more,' says Dirk Foremny, associate professor of economics at the University of Barcelona. In that respect, it has worked perfectly. As a revenue raiser, it is limited. The approach from Madrid has been light touch, though the rules could be changed to raise more. The sums collected are on a par with inheritance tax – already heavily discounted by the regions – which raises about €3bn a year. By contrast, income taxes bring in €130bn. But Foremny says the solidarity tax has a social value. 'This tax is a tool to achieve a more equitable distribution of wealth across individuals. There are good arguments why we don't want to have a very large concentration of wealth in the hands of very few. Wealth is correlated with political influence and power.' He points to the US and its billionaire tech barons as a warning of what can happen when the scales tip too far. What is clear is that, two years on, a predicted exodus of the rich, trumpeted in endless alarmist headlines, has not materialised. Forbes counted 26 Spanish billionaires in 2021. This year, it lists 34, with a combined net worth comfortably over $200bn. 'The big fortunes mostly stayed put, filed protective appeals, and hired better structuring teams,' says Marc Debois, the founder of FO-Next, which advises family offices. 'A handful decamped to Lisbon or Dubai or any other location; enough for newspaper headlines, not enough for a flight.' Could the billionaires be made to pay more? Experts point to a big exemption: the one for 'family companies'. Originally designed to encourage small- to medium-sized businesses, these structures are also being used by the very biggest fortunes to manage their assets. There are restrictions. A taxpayer must demonstrate that assets are being used for economic activity, that is, a trade or business. Cash and shares held simply for investment purposes are taxable. Real estate that earns rents is not. If the family exemption is abolished, Debois says the billionaires won't necessarily decamp. They are more likely to lawyer up, reduce profits by leveraging (taking on debt), and create holding companies in low-tax jurisdictions such as Luxembourg. 'Some money already half‑abroad would finish the move,' he says.' The bigger issue is tens of thousands of mid‑sized family firms rely on the same rule; torching it is politically radioactive.' Estimates by Julio López Laborda, a professor of public economics at the University of Zaragoza, suggest that 80% of the assets of the richest 1% are not subject to the wealth tax. He says the family company exemption could represent a loss to the Treasury of about €2bn, while the cap on tax as a proportion of income, mentioned above, could account for another €2.5bn uncollected. Susana Ruiz, tax justice policy lead at Oxfam, which is working with López Laborda on a forthcoming report about wealth taxes, says: 'We could be raising at least two to three times more than we are at the moment.' Cutting public services in order to fund tax breaks, or simply balance the books, can create a doom loop, because it reduces the quality of provision, undermining the consensus on which taxation depends. In Madrid, declines in healthcare provision fuelled resentment among working people and created a sense that private provision was more efficient, says Ruiz. She believes the solidarity tax has helped rebuild confidence. 'There is a lot of citizen support behind it. It helps in the perception that the system is fair.' So far, there is no sign that it has affected growth. Spain was the world's fastest-expanding major advanced economy last year, outpacing even the US, with GDP up 3.2%. By contrast, growth in the UK and France last year barely scraped above 1%. On the balconies of the Planeta building, and in the country at large, the green shoots are alive and well.
