Today's Scoop:

Hey friends - hope you had a nice weekend. Catch up with our last Weekly Scoop, and don’t miss our Explained about the state of growing economic inequality.

FYI from the Founder: There will be no scoops for the week of July 30th as I take leave for my wedding. All marriage advice and song recommendations are welcome!

Here’s what you need to know today…

1. People are feeling very confident about the economy.

2. Russia’s trying to make food more expensive.

3. US manufacturing hasn’t been able to rebound.

S&P 500: 4,522.79
1Mo: +3% | 1Yr: +18% | 5Yr: +61%

The market floated to another 2023 high today as investors continued celebrating lower inflation. Last week’s inflation report and other economic data have pointed to living costs rising at a much more normal pace.

People are feeling more optimistic about the economy than they have in years. The University of Michigan's index of consumer sentiment rose to a new two-year high in July as people felt more confident about their job security and falling grocery prices.

US manufacturing is still struggling. The Federal Reserve’s measure of New York state factory activity barely expanded in July. Manufacturers responded to the survey with a wide range of forecasts. An equal percentage expected improving conditions as deteriorating conditions.

Russia’s trying to make food more expensive by not renewing a grain export agreement with Ukraine. Before the Russian invasion, Ukraine produced nearly a fifth of the world’s wheat exports, but the interruption of trade pushed global food prices to record highs. The agreement expired this week, making it difficult for shipments to continue and threatening a global food crisis.

Click to dig in & vote your reaction, see how others feel

• United Airlines boosts pilot pay by 40%

• JPMorgan Chase profits surge 67% [🤓]

• Citigroup gains on lending but struggles with investment banking [🤓]

• General Electric builds more wind turbines in Japan

• Microsoft beats regulators to build gaming powerhouse

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Bank Business Models

Wall Street bank business models can be opaque and confusing. They mainly earn revenue from lending, managing investments, executing trades, and brokering corporate deals.

The traditional banking business model entails taking deposits, paying some interest to the depositor, then lending that money to someone else at some higher interest rate. Banks profit from the spread between the rate they pay the depositor and what they earn from their loans.

Investment banking isn't actually the investing arm of the bank. Investment banks assist companies with large transactions, earning fees for their advice. In the same way that a real estate broker earns a commission for helping sell your house. Investment banks earn a hefty commission for helping you value and sell your company to other companies or the public (IPO).

The investing arm of the bank is called asset or wealth management. These divisions earn fees to oversee clients’ money, provide advice, and invest on their behalf.

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