Today's Scoop:

Hey friends, here’s what you need to know today…

1. Small business owners are growing increasingly pessimistic.

2. Americans are still concerned about rising living costs.

3. Consumers are struggling with higher interest rates.

S&P 500: 4,358.24
1Mo: -3% | 1Yr: +21% | 5Yr: +58%

The market floated higher today as investors continued debating the fate of the economy.

Small business owners keep losing hope for an economic rebound. The National Federation of Independent Business (NFIB) said the number of small business owners expecting more challenging operating conditions over the next six months rose to the highest since May. Small firms say getting a loan is more difficult than a few months ago. Amidst rising costs for supplies and higher wages, many businesses have been forced to raise their prices and cut back on hiring.

Americans are worried about living costs getting worse. According to the Federal Reserve Bank of New York survey, US consumer expectations for inflation over the next few years increased this month, expecting prices to rise by 3.7% over the next year and roughly 3% annually for the next three years. Inflation expectations are important because they can be self-fulfilling. If consumers and businesses expect higher costs, they’ll buy more and raise prices now in anticipation. Although the prices of goods and services aren’t rising as quickly as last year, inflation is still higher than policymakers want.

Consumers are struggling with higher interest rates. The New York Federal Reserve's survey showed that people are more worried about missing debt payments than they have been since May 2020. More people say they’re worse off than they were a year ago, finding it harder to increase their income or borrow money.

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• General Motors autoworker strikes spread to Canada

• Walgreens pharmacists stage walkouts over working conditions

• MGM casino workers start picketing

• Disney investor tries to take over its board [🤓]

• PepsiCo sees a slowdown in snack and beverage sales

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What is an activist investor?

Activist investors are individuals or groups who acquire a significant stake in a public company to influence its direction. They are often hedge funds, professionally managed pools of money that aim to deliver above-average investment returns for the investors who contribute money to the fund and pay fees to the professional portfolio managers.

By acquiring substantial shares, they strengthen their presence to voice opinions on company strategies, management decisions, and more. Their primary goal is to improve the company in a way that makes the stock price increase, earning profit for themselves and their investors. These activist investors believe that specific changes can improve the company's performance, so they engage with the company's board, collaborate with other shareholders, and sometimes pursue positions on the board to increase their direct influence on policies.

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