Tuesday's Scoop: Calm☀️

Hey friends - there will be no scoops on Thursday and Friday for the Thanksgiving holiday.

Here’s what you need to know today to inform your work, spending, and investments:

1. Coffee prices are surging.

2. Americans are more optimistic about the economy post-election.

3. Expensive mortgage rates have stalled homebuying.

Inflation Rate: +2.6% (YoY), +0.2% (MoM)
^{Policymakers aim for 2% YoY inflation (October CPI)}

Coffee prices are climbing to 25-year highs. Coffee future prices surged this week due to supply fears from key producers like Brazil, where a severe drought has damaged coffee trees, threatening next season's harvest. Even though October rains helped spur flowering, there's worry the flowers won't turn into beans. The US Department of Agriculture forecasts Brazil's coffee stockpiles could drop 26% by June. Prices have soared 64% this year, which may mean higher costs for your daily joe at cafes and stores.

Americans are feeling more optimistic about the economy after the election. The Conference Board’s Consumer Confidence Index rose to a 16-month high in November. This boost is partly due to optimism about tax cuts and deregulation following Donald Trump's presidential victory and the Republican Party's control of Congress. Younger individuals under 35 got the most excited. A record 56.4% of Americans expect stock prices to rise over the next year, and inflation expectations dropped to their lowest since March 2020. Despite the upbeat mood, the already-elevated cost of living remains a concern, with many hoping for things to get cheaper in the new year, not just for prices to stop climbing. However, some worry that Trump's proposed policies, like tariffs on imports from Mexico, Canada, and China, could fuel more inflation and keep borrowing costs high. Consumer spending powers the economy, so sentiment drives reality.

30yr Mortgage Rate: 6.9%
^{That’s down from 7.6% a year ago. (MBA)}
Median Existing Home Price: $407,200
^{That’s up from $392K a year ago. (NAR)}

Expensive mortgage rates stalled new home sales last month. The Commerce Department reported that sales of new homes dropped 17.3% in October to the fewest in nearly two years. This significant decline was mainly due to rising mortgage rates, which increased to 6.7% by the end of October, making home buying more expensive and causing many potential buyers to pause their plans. Additionally, hurricanes in the South disrupted the housing market there, with sales plunging 28% in that region. The number of new homes available also rose to the highest since early 2008. Despite fewer sales and more supply, the median price of a new home still climbed to $437,300, up 4.7% from a year ago. If you're thinking about buying a new home, be aware that purchase costs are rising.

The Market:⬆️ +0.6%
S&P 500: 6,021.63
1Mo: +3% | 1Yr: +32% | 5Yr: +92%

The market rose to a new record high on Tuesday as investors worked past initial worries about future President Trump's proposed tariff policies announced the night before. Trump suggested a 25% tax on Canadian and Mexican imports and a 10% tax on Chinese imports. Investors seem to assume this is a negotiating tactic, leading to less disruptive final implementation later on. Separately, minutes from the Federal Reserve's last meeting revealed that policymakers have confidence in the health of the economy and expect to keep lowering borrowing costs slowly next year.