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Monday's Scoop: Snooze 🌤️
Boeing leaves astronauts behind & Uber ditches drivers
Scoops Team
August 26, 2024
Hey friends - hope you all had a phenomenal weekend!
Insiders, catch up with the Weekly Scoop and don’t miss this weekend’s Explained: Is my money safe with digital banking apps?
Last week to sign up for our sustainability competition with Future to win $500!
Notice: There will be no scoops during the weeks of Labor Day, the 9th and 16th, as I’ll be traveling for my honeymoon. The team is here, and I’ll still be available, but if I don’t take a break now, my wife might murder me, and there will never be scoops again, lol. If you need anything or have any questions about what’s happening in the world, don’t hesitate to email [email protected].
Here’s what you need to know today to inform your work, spending, and investments:
🌎 Big picture
Businesses are tightening their budgets.
Tensions in the Middle East are pushing up oil prices.
New home sales spiked last month as mortgage costs dropped.
How are you feeling about the economy? |
💼 Work trends
Unemployment Rate: 4.3%
Relatively normal, low
Business investment lost some steam in July. The Commerce Department reported that core capital goods orders, a key indicator of business spending plans, unexpectedly dipped by 0.1%, while shipments fell by 0.4%. Despite a sharp rebound in durable goods orders, driven mainly by a surge in aircraft orders, the overall momentum in business spending on equipment appears to be slowing. This could signal slower business activity in the fall as companies tighten their budgets.
👜 Cost of living trends
Inflation Rate: +2.9% (YoY), +0.2% (MoM)
Policymakers aim for 2% YoY inflation (July CPI)
Oil prices jumped on Monday amid tensions in the Middle East. Politically-driven production lockdowns in Libya and military strikes between Israel and Hezbollah pushed oil prices 3% higher. The Libyan government announced the closure of all of its oil fields, responsible for around 1.18 million barrels per day, after a political power struggle escalated with the leader of its central bank. It’s unclear how long the supply will be offline. Meanwhile, Israel and Hezbollah traded missile attacks in the latest moves between the enemies. Everyone’s watching to see if the conflict turns into a larger-scale war that could increase oil prices.
🏠 Housing trends
30yr Mortgage Rate: 6.5%
That’s down from 7.2% a year ago. (MBA)
Median Existing Home Price: $422,600
That’s up from $406K a year ago. (NAR)
Homebuyers flocked to the market in July as mortgage rates dipped. The Commerce Department reported that new home sales surged by 10.6% to the highest level in over a year. This sharp increase, the largest since August 2022, signals a recovery in the housing market after months of stagnation. Median new home prices are down slightly from last year’s peak, and the average 30-year fixed-rate mortgage is down to 6.5% from nearly 8% last year. Affordability is improving slowly.
🤓 Inside Scoop: How do I know if I can afford a mortgage or loan?
Buying a home is a big decision and a long-term investment of time and money. It’s important to consider more than just the monthly interest payments in evaluating the affordability of a home, including recurring property taxes, maintenance costs, and the initial down payment. The upfront cash needed includes bank fees and a down payment of some percentage of the home value, usually at least 10%. The monthly and upfront costs increase with the value of the home.
When evaluating whether we can afford the monthly costs of a mortgage or loan, it’s a good idea to calculate how much of our monthly income will need to go toward these payments. Most lenders like to see a debt-to-income ratio of less than 36%. We don’t want the monthly payments to strain our other finances.
📈 Investment trends
The Market: ⬇️ -0.3%
S&P 500: 5,616.84
1Mo: +3% | 1Yr: +27% | 5Yr: +92%
The market drifted lower on Monday amidst a slow news week. After last week’s comments from the Federal Reserve Chairman, investors expect policymakers to start reducing borrowing costs next month as long as inflation stays under control.
🏭 Companies worth watching
👍👎 APPROVAL RATINGS
Act like a boardmember and judge how companies behave. Engaging helps build your financial confidence and hold corporations accountable. (+2pts)
 Boeing | Galactic Failure Boeing will return its Starliner capsule from the International Space Station without astronauts after NASA deemed the ship unsafe and gave the mission to competitor SpaceX. The aerospace firm’s setbacks in this program have already cost it $1.5B in losses.
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 Uber | Data Detour Uber was served a record $324M fine by Dutch regulators for improperly transferring European drivers’ data to the US, allegedly failing to protect sensitive information. This is the rideshare giant’s third data security penalty from a key market.
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 IBM | China Checkout IBM will shut down its roughly 1,000-person research and development operations in China, citing intensifying competition and declining infrastructure business there. The tech giant is the latest to shut down operations in China as geopolitical tension intensifies.
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 Norfolk Southern | Railway Cleared Norfolk Southern reached tentative five-year agreements with four labor unions, covering about 30% of its union workforce, ahead of the next major contract negotiations. The deal includes wage increases, more vacation time, and enhanced healthcare benefits for workers.
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 General Motors | Robo Revival General Motors will partner with Uber to offer driverless rides as soon as next year, aiming to revive its Cruise’s robotaxi business after a safety incident halted operations in late 2023. The automaker still plans to launch its own rideshare app and has been testing in Phoenix, Dallas and Houston.
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💭 Broader perspectives… (+2pts)
Would you get in a driverless car today? |
🛠️ Recommended resources (+2 pts)
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