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- Wednesday's Scoop: Tumult🌤️
Wednesday's Scoop: Tumult🌤️
Amazon Prime warehouse injuries & Deere's diversity rollback
Scoops Team
July 17, 2024
Hey friend - don’t forget to hydrate. It’s the hottest summer on record.
Here’s what you need to know today to inform your work, spending, and investments:
🌎 Big picture
Policymakers think the economy is steady, but red flags are popping up.
New home construction continues to slow.
High mortgage costs have led home builders to increasingly cut prices to boost home sales.
How are you feeling about the economy? |
💼Work trends
Unemployment Rate: 4.1%
Not far from 50-year lows
Policymakers think the economy is steady, but red flags are popping up. The Federal Reserve's Beige Book report showed slight economic growth heading into the third quarter, with some regions experiencing flat or declining activity. Employment grew only slightly, with businesses becoming more selective in hiring. Consumer spending remained stable, but there were signs of caution as people focused on essentials and sought the best deals to stretch their budgets. Wages have started gaining ground on the cost of living, but people have tempered their optimism amid growing uncertainties around the upcoming election and geopolitical conflicts.
🏠Housing trends
30yr Mortgage Rate: 7.0%
That’s down from 7.1% a year ago. (MBA)
Median Home Price: $419,300
That’s up from $397K a year ago. (Existing homes - NAR)
New home construction continues to slow. The Commerce Department reported that single-family housing construction starts fell to an eight-month low in June, dropping 2.2%. Permits for future construction of single-family homes also decreased by 2.3% to a one-year low. Higher mortgage rates have contributed to this slowdown, making homeownership less affordable for many Americans and decreasing buyer demand. The construction slowdown will likely perpetuate the nationwide housing shortage, which is keeping home prices high.
High mortgage costs have led home builders to increasingly cut prices to boost home sales. The National Association of Home Builders reported builder sentiment fell again to a seven-month low in July. With record home prices and mortgage rates near decade highs, buyer demand has slowed. Nearly a third of homebuilders reported discounting to attract buyers in July, up from 29% in June and 25% in May. Without more construction or a steep drop in mortgage costs, it doesn’t seem like there will be much relief for the affordable housing shortage anytime soon.
📈Investment trends
The Market: ⬇️ -1.4%
S&P 500: 5,588.27
1Mo: +2%| 1Yr: +24%| 5Yr: +88%
The market sank lower today as investors started taking profits on their tech investments and rotating into other sectors. The AI-fueled surge in tech stocks has been the main driver of the broader market rally this year, but now investors have started gaining optimism in a broader rebound as inflation subsides, and the Federal Reserve looks poised to lower borrowing costs. Also, the increased probability of a Republican administration has fueled optimism for tax and regulation cuts.
🏭 Companies worth watching
👍👎 APPROVAL RATINGS
Vote and practice your board member voice. It accelerates your comprehension and comfort with these topics. (+2 pts)
 Amazon | Primed for Injuries Amazon’s heightened Prime Day sale volumes create unsafe working environments, with nearly half of warehouse staff suffering injuries during the period, according to a Senate investigation. The e-commerce giant pledged to invest $750M in safety initiatives this year amid heightened criticism of its workplace safety failures.
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💭Broader perspectives… (+ 2pts)
Did you shop Prime Day? |
 PepsiCo | Sustainable Farming PepsiCo hopes to decrease the emissions and soil damage from its supplier farms by providing European potato farmers with low-carbon fertilizers and precision farming tools. The snack giant aims to reduce its fertilizer-related carbon emissions by 25% by 2030 and to reach overall net zero emissions by 2040.
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🤓 Inside Scoop: How do companies track their emissions?
Whether motivated by regulatory, stakeholder, or strategic pressure, more companies have started tracking and reducing the volume of climate change-causing greenhouse gases emitted into the atmosphere from their operations, supply chain, and products.
Companies have started taking responsibility for the broad spectrum of pollution emitted from each aspect of their company. That includes setting emission reduction targets for their Scope 1 (direct), Scope 2 (power-related), and Scope 3 (indirect) emissions. Scope 1 & 2 result from its core operations and the power it purchases to support those operations. Those are a critical first step. Most big companies have targets for reducing those emissions. The best ones have already neutralized them.
Scope 3 is much more significant but more complex to tackle. It includes the Scope 1 & 2 emissions from all of their suppliers, the emissions from using their products, and even things like employee commutes. It's the complete evaluation of how much greenhouse gas is emitted yearly because the company exists.
 Johnson & Johnson | Challenges Ahead Johnson & Johnson had a strong second quarter thanks to climbing sales of its cancer treatment Darzalex and top-selling psoriasis drug Stelara. However, several Stelara competitors will hit the market next year. The drugmaker still faces tens of thousands of lawsuits alleging its talc powder products cause cancer.
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 Apple | Housing Help Apple committed another $50M to affordable housing projects in the Bay Area as part of its $2.5B pledge to address California's housing affordability crisis, which has been exacerbated by the region's tech sector growth. The tech giant has already allocated over $1.6B, benefiting over 60,000 residents.
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 Deere | Anti-Woke Retreat The world's largest farm machinery maker will stop supporting LGBTQ Pride events and scale back employee diversity initiatives following conservative media backlash. Deere has already struggled with diversity and recently agreed to pay $1.1M in back wages for racial discrimination in its hiring process.
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🛠️ Recommended resources (+2 pts)
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