• Scoops
  • Posts
  • Thursday's Scoop: Stumble🌤️

Thursday's Scoop: Stumble🌤️

Live Nation gets a breakup notice & Norfolk Southern pays for negligence

 
Hey friends - it’s time for a three-day weekend. There will be no scoops on Monday in observance of the Memorial Day holiday.
Want to support Scoops? Sign up for a free Cache account and build your savings through simple automated transfers. There’s absolutely no cost to you, but every signup supports Scoops. As with all of our recommendations, I use it and like it.
Don’t miss our Live Talk tomorrow with Cache’s founder on Instagram:
Insiders, look out for the Weekly Scoop tomorrow.
Here’s what you need to know today to inform your work, spending, and investments…

 

🌎 Big picture

  1. Companies are still hanging onto their employees.

  2. The economy showed new signs of life this month.

  3. The housing shortage keeps pushing prices higher and stalling sales.

How are you feeling about the economy?

Login or Subscribe to participate in polls.

 💼 Work trends

Unemployment Rate: 3.9%
Still near the lowest rate in 50+ years

Layoff rates are still very low. The Labor Department reported initial unemployment claims dropped for the second straight week last week to 215,000, roughly average for a healthy economy. Unemployment is historically low, and there are still more than 1.3 available jobs for every unemployed person.

The economy showed new signs of life this month. S&P Global’s composite Purchasing Managers Index (PMI), which tracks manufacturing and service sectors, surged to the highest level in over two years in May. Manufacturing snapped out of a downturn, and the services industry accelerated to a twelve-month high. New orders picked up, but so did costs. Businesses reported rising materials and labor costs that they expect to pass on to customers, a warning sign for more potential price inflation.

 

🏠 Housing trends

30yr Mortgage Rate: 7.0%
That’s up from 6.7% a year ago. (MBA)
Median Home Price: $407,600
That’s up from $386K a year ago. (Existing homes - NAR)

High mortgage costs and rising home prices have stalled sales. The Commerce Department reported sales of newly-built homes dropped 4.7% in April as the median sale price rose to $433,500. This aligns with an earlier report that existing home sales, which comprise most of the market, also slumped in April. High mortgage costs have deterred buyers and kept sellers on the sideline, shrinking the number of homes available for resale. That’s pushed buyers to new construction over the past several months, but that appears to be slowing. The volume of new home sales, which account for 13% of all sales, was 8% lower in April than the year before.

 

 📈 Investment trends

The Market: ⬇️ -0.7%
S&P 500: 5,267.84
1Mo: +4% | 1Yr: +27% | 5Yr: +86%

The market slumped on Thursday as the AI enthusiasm fueled by Nvidia's blowout earnings report faded into renewed concerns about inflation. New economic data pointed to a May rebound that might drive higher prices.

 

🏭 Companies worth watching

👍👎 APPROVAL RATINGS

Join the board at America’s biggest companies. Vote and judge their decisions. (+2 pts)

Live Nation

Breakup Battle

Federal regulators have sued Live Nation, claiming the event promoter used its 2010 purchase of Ticketmaster to monopolize the live ticketing industry, stifle competition, and inflate prices.

The event conglomerate controls more than 80% of primary ticketing for concerts and a growing share of the resale market, according to the Justice Department.

Tell Live Nation's CEO how you feel

Login or Subscribe to participate in polls.

 💭 Broader perspectives… (+2 pts)

Do concert and event ticket prices feel fair?

Login or Subscribe to participate in polls.

Johnson & Johnson

No Texas Two-Step

Cancer victims filed a lawsuit claiming Johnson & Johnson committed fraud by repeatedly trying and failing to limit its baby powder lawsuit payouts by transferring liability to a shell company and filing bankruptcy.

The health giant faces over 50,000 lawsuits alleging its baby powder caused cancer.

Tell J&J's CEO how you feel

Login or Subscribe to participate in polls.

 🤓 Inside Scoop: What is a Texas Two-Step?

The Texas Two-Step bankruptcy has recently faced much controversy and media attention, particularly regarding Johnson & Johnson's handling of its cancer victim lawsuits.

The corporate restructuring move allows companies to limit their exposure to legal claims on the whole company by transferring the liability to a smaller company with fewer assets. The larger company will split off a smaller part of its business, assign the issue's legal liability and some assets to it, and then file for bankruptcy with the smaller company. The bigger company and its assets are then shielded from future lawsuits on the issue, and any legal payouts will be limited to the new company's assets. It gets its name from a state with business-friendly policies that allow the maneuver.

PepsiCo

Electrified

Pepsi will shift a substantial portion of its delivery fleet in California to electric vehicles, purchasing 50 Tesla semi-trucks and 75 Ford electric vans.

The snack and beverage giant aims to emit net zero carbon emissions by 2040.

Tell PepsiCo's CEO how you feel

Login or Subscribe to participate in polls.

Norfolk Southern

Crash Costs

Norfolk Southern agreed to pay $310M to cover past and future environmental cleanup costs related to its 2023 train derailment in Ohio that contaminated East Palestine with toxic chemicals.

The train company already agreed to pay $600M to local residents.

Tell Norfolk Southern's CEO how you feel

Login or Subscribe to participate in polls.

Ralph Lauren

Brand Power

Ralph Lauren maintained sales growth last quarter despite broader shopper fatigue, reporting strong demand in China.

The fashion house has increased profitability by growing direct-to-consumer to more than two-thirds of its sales.

Tell Ralph Lauren's CEO how you feel

Login or Subscribe to participate in polls.

 

 

 🛠️ Recommended resources (+2pts)


💸 Get Paid: Earn over 5% with SaveBetter’s Savings Account Aggregator

🔄Automate Your Savings: Build savings faster with Cache’s AI transfer buddy

📈 Start Investing: Automate investing with our favorite M1 Finance

💼 Monetize Your Experience: Consult on the side for GLG 

💰 Save More Money: Stash a percentage of every purchase with Guac

🌎 Divest From Fossil Fuels: Bank sustainably with Atmos

📒 Budget Better: Track and manage your spending with Simplifi

💎 Insure Your Stuff: Protect your family and make an impact with Lemonade

🔍 Keep Your Money: Roll over your 401(k) for free with Capitalize

💡 Get More Ideas: Access investment research from the Motley Fool

🪙 Explore Crypto: Invest through the most trusted platform, Coinbase
 

Reply

or to participate.