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Today's Scoop:
Drifting ๐ฅ๏ธ
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Hereโs what you need to know todayโฆ
Big Picture
The government asked for another shutdown extension.
More Americans own their homes outright, protecting them from higher rates.
Construction keeps chugging amid a housing shortage.
The Market: โฌ๏ธ +0.7%
S&P 500: 4,547.38
1Mo: +8% | 1Yr: +15% | 5Yr: +73%
The market floated higher for the fifth day today as investors maintained passive optimism.
The government narrowly avoided another shutdown by procrastinating again. Congress passed a short-term funding bill that maintained the same spending levels to keep the government open and operating while delaying the need to finalize negotiations on this yearโs spending plan until January for some departments and February for the rest. This is the second time in two months that Congress has opted to delay negotiations for their annual budget, pushing the final resolution at least four months past the deadline.
More Americans now own their homes outright. According to the Census Bureau, the percentage of mortgage-free homes in the United States rose to a record of just under 40% last year. A majority of these homeowners are retirement-age baby boomers who locked in interest rates at a fraction of what mortgages cost today. Low or no mortgage costs make homeowners much more resilient against the rising rates making homes less affordable today.
Home construction increased in October, but it might be short-lived. The Commerce Department reported a surprising jump in permits and construction for new homes last month. Permits for future single-family homes rose to the highest level in nearly 1.5 years as builders looked to fill the massive shortage of available homes. Multi-family home construction keeps surging, but vacancies have reached a 2.5-year high. Amidst low home affordability, homebuilders have turned more pessimistic. This could signal lower rents and less construction ahead.
How are you feeling about the economy? |
Company Scoops ๐ฃ๏ธ๐๐ฐ
๐กAct like a boardmember and judge how companies behave. Engaging helps build your financial confidence and hold corporations accountable.
Microsoft | Dramatic Shift Microsoft hired Sam Altman, the co-founder of OpenAI, to lead their new in-house artificial intelligence team within days of his unexpected and covert firing as OpenAI CEO. Microsoft is OpenAI's biggest investor, contributing $13B for 49%. |
Zoom | New Hope Zoom has successfully added and retained more users with its new suite of artificial intelligence tools like note-takers and content generators. The video conference platform surprised investors with higher sales and a more optimistic forecast. |
General Motors | Finally Approved Auto workers ratified contracts with GM, Ford, and Stellantis, including over 25% raises, cost of living adjustments, easier promotions, and unionization rights for electric vehicle workers. GM workers only narrowly voted their approval. |
PG&E | Fire Safety California's biggest power company earned approval to bury 1,230 miles of power lines by 2026 to reduce the risk of starting wildfires. PG&E's faulty equipment has sparked several recent wildfires, including the deadliest in state history. |
Gap | Falling with Style Gap has improved its appeal as an affordable clothing option amid inflated prices for other brands and customers' dwindling savings. New CEO Richard Dickson has lowered inventory by 22% and increased sales at its sub-company Old Navy. |
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Inside Scoop ๐ค
What is a Continuing Resolution?
When Congress needs a last-minute extension for their main assignment, they pass a Continuing Resolution. A Continuing Resolution (CR) is a temporary funding measure used by the US Congress to keep the federal government running when the annual budget hasn't been finalized by the start of the fiscal year (October 1).
Instead of passing a full budget, Congress approves a CR to provide funds for a short period, allowing more time to negotiate and finalize the budget details. It typically maintains the previous year's funding levels for agencies and programs.
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