Monday's Scoop: Bouyed ☀️

Hey friend - hope you had a phenomenal weekend.

There will be no scoops tomorrow and Wednesday, June 18 and 19. I’ll be headed to DC tomorrow to speak at Georgetown University, and then Wednesday is Juneteenth. Banks and markets will be closed.

Insiders, catch up with our Weekly Scoop. If you’re not an Insider, refer, open, vote, or upgrade to unlock your status!

Here’s what you need to know today to inform your work, spending, and investments…

1. The real estate market has stalled as homes remain unaffordable.

2. Americans are still struggling with the high cost of living.

3. China’s economy isn’t recovering as well as hoped.

Unemployment Rate: 4.0%
^{Still near the lowest rate in 50+ years}

China's economy isn’t recovering from the pandemic as well as hoped. In May, industrial production rose only 5.6%, falling short of economist expectations, while real estate investment and home prices continued to decline. Despite a slight increase in sales, overall spending remains weak compared to before the pandemic. The impact of the world’s second-largest economy spreads well beyond its borders. Slow growth in China drags down other nations’ economies.

Inflation Rate: +3.3% (YoY), 0% (MoM)
^{Policymakers aim for 2% YoY inflation (May CPI)}

Americans are still struggling with the high cost of living. The University of Michigan reported that consumer sentiment in the US hit a seven-month low in June, reflecting ongoing concerns over high prices and weakening incomes. Worries about economic stability overshadow any relief from lower fuel and food costs. This persistent pessimism could signal challenges ahead for consumer spending that powers two-thirds of the economy.

30yr Mortgage Rate: 7.0%
^{That’s up from 6.8% a year ago. (MBA)}
Median Existing Home Price: $407,600
^{That’s up from $386K a year ago. (NAR)}

The real estate market has stalled as homes remain unaffordable. Digital real estate platform Redfin reported that US home sales in May hit a decade-low as high mortgage costs and soaring prices have reduced the volume of both buyers and sellers in the housing market. The median home price rose to a record $439,716, up 1.6% from April and 5.1% from a year ago, while the average 30-year fixed-rate mortgage sits around 7%, pushing affordability to an all-time low. Despite a slight increase in new listings, the volume of home sales dropped 1.7% from April and 2.9% from last year. The number of homes for sale is roughly 25% below pre-pandemic levels, keeping prices high with limited supply.

The Market: ⬆️ +0.8%
S&P 500: 5,473.23
1Mo: +3% | 1Yr: +25% | 5Yr: +86%

The market floated to another new record high on Monday without any major news shaking the narrative that inflation is cooling and the economy is doing alright. Investors will wait to see if people are still shopping as much with May's retail sales report tomorrow.