Hey friends - I’ll be down in Dallas next week demo-ing for the Financial Planners Assoc at their next-gen conference. If you’ll be there, let’s link up.

There won’t be a Scoops Spotlight next Friday, though. Hopefully you won’t even notice because you’ll be out enjoying the last weekends of the summer. Go enjoy this one!

🌎 The Big Picture

Some good and not-so-good trends starting this summer.

👎 Americans are really falling behind on their debts. 

The Federal Reserve Bank of New York reported that total household debt dipped slightly to $18.8 trillion in the second quarter, the first quarterly decline in years. That’s the headline, but the absolute number doesn't ever really mean much. Balances include stuff that’s not a problem, like charges on a credit card that you pay down before interest hits. And it’s very dependent on the actual cost of stuff. If stuff costs more, the debt is higher. A decline is nice, but it’s just one month. They go up every month even if things are good. The thing you want to look at is how many people are behind on their payments, and how quickly more people are falling behind. Right now, those numbers are bad. People are struggling to keep up with credit cards, auto loans, and student debt.

Balances more than 90 days past due have hit some of the highest levels on record outside of a recession.

Credit card delinquencies reached 13% of all balances in the first half of the year, the highest in 15 years.

Student loan delinquencies climbed to 10.6% in Q2, the highest since 2020 (not an impactful point, given payments were paused during that time, but delinquencies are rising).

Auto loans aren't looking great either, with 5.5% severely past due, the most in at least two decades.

People aren't falling into delinquency faster than usual, which is what policymakers watch for, because it signals a notable turning point of things getting worse. But the steady climb of past-due balances makes it clear: borrowers just can't keep up when living costs and interest rates won't quit rising. And things are just getting steadily worse.

👍 Americans caught a small break from rising prices this summer, mostly because gas prices pulled back from their peak.

The Bureau of Labor Statistics reported that CPI rose just 0.1% for the month, after falling 0.4% in June. Things are cheaper overall compared to earlier this summer, but the cost of living's still 3.4% higher than a year ago. Rent and housing costs have driven most of that inflation.

Energy's the main source of relief, still down from its war-driven peak last spring.

Gasoline fell 2.9% in July, but you're still paying nearly 25% more at the pump than a year ago.

Groceries got a tiny bit cheaper too, down 0.1% in July.

Core prices, which strip out food and energy, rose 0.2% for the month and 2.5% over the past year. Even with these improvements, prices are still rising faster than the 2% annual rate policymakers consider healthy.

Medical care rose 0.4%, and airfare jumped 2.2%, two spots where costs are still outpacing the rest of the household budget.

For families, it's a welcome breather from the relentless squeeze on purchasing power, but it's not enough to change behavior until it becomes a real trend.

Businesses got the same break this summer too, meaning these stable prices could hold for a little longer.

The Producer Price Index, which tracks what companies pay for goods and services before they reach consumers, held flat in July after edging down slightly in June. This slowdown is welcome news for businesses' bottom lines and puts a little less pressure on businesses to pass on higher costs to customers.

👍 Small business owners are feeling optimistic again. 

The NFIB Small Business Optimism Index jumped to 99.8 in July, its highest point in 11 months and back above the 52-year average. The turnaround's real: owners planning to hire jumped to 20%, the highest since October 2022 and way up from pandemic-era lows of 9% just two months ago. Capital investment plans also bounced back from some of their weakest levels since the Great Recession, with 25% of owners now ready to put money into infrastructure, equipment, and growth.

Costs have a lot to do with it. Inflation worries have eased for the first time this year, dropping to 14%. Even with uncertainty still running higher than normal, small business owners are clearly ready to push through it.

Feeling confident and acting on it are two different things, though.

Finding good workers is now the top challenge, with 27% of owners pointing to labor quality or availability as their biggest problem, and 36% reporting unfilled job openings.

That matters a lot, since small businesses employ nearly half the workforce, so a real pickup in hiring plans is encouraging for job seekers navigating a sluggish market.

If you’re looking for a job, small businesses may be the best place to look right now.

🏭 The Companies Everyone’s Talking About

❔ The Big Question of the Week

Scoops app users: We have taken the beta app offline for a short period for some major updates. Can’t wait to show you all what we’ve been working on! Reach out if you have any questions.

We’re going to switch up the content in this spotlight for a bit to make sure you all have the info you need to master your week.