Inflation still not completely down

According to the Consumer Price Index (CPI) data for November 2023, headline inflation is moderate and has increased by 0.1% on a seasonally adjusted basis. Notably, core inflation—which does not include volatile food and energy prices—remains persistently high at 4% per year. A 6% decrease in gas prices was countered by rises in used vehicle and hotel costs. A little increase in food costs contributed to the ongoing core inflation. According to the survey, housing expenses have increased by 0.5%, while used vehicles and trucks have increased by 1.6%. According to the November Survey of Consumer predictions, there will be a little decrease in inflation predictions to 3.4% after a year. Analysts point out that a Fed rate decrease in March 2024 looks less probable despite the deceleration, highlighting the difficulty of striking a balance between inflation control. 

Source: https://www.jpmorgan.com/insights/outlook/economic-outlook/cpi-report-november-2023#:~:text=While%20Wall%20Street%20tends%20to,same%20period%2C”%20Snyder%20observed.

Dow closes at new record highs

 The Dow Jones Industrial Average closed above 37,000 for the first time as Federal Reserve Chairman Jerome Powell suggested a halt in interest rate hikes and potential cuts. Powell mentioned being at or near the peak rate for the current cycle, with projections indicating the possibility of three rate cuts. The Dow gained 1.4%, marking its first record close since January 2022. Analysts, including Wharton University's Jeremy Siegel, see this as positive for the equity market and the U.S. economy, predicting a potential rate cut in March. Notably, UnitedHealth Group contributed the most points to the Dow, while Apple reached a $3 trillion market cap. Inflation, though easing, remains a concern for policymakers.

Source: https://www.foxbusiness.com/markets/dow-closes-above-37000-first-time-ever-powell-hints-rate-cuts 

Increase of minimum wage 2023

Four states have boosted their minimum wages this summer: Connecticut, Nevada, Oregon, and Washington, D.C. This change resulted in 765,000 workers getting paid more. It is projected that this rise in wages will total more than $615 million. Since the summer, fifteen cities and counties were scheduled to raise their minimum wage, offering some needed financial relief to low-paid workers who are struggling with the effects of rising costs. 

Those who are living off a lower wage in these states should benefit from a positive wage increase as a result of these increments. Based on the analysis of all workers impacted—both those who will directly benefit from the increased minimum wage and those who will be indirectly impacted when employers modify their pay structures—it is projected that the average hourly wage change in Nevada, Oregon, Connecticut, and Washington, D.C. will be $0.40, $0.42, $0.57, and $0.74, respectively. These adjustments should result in a $675 increase for the average full-time minimum wage worker in Oregon and a $1,354 increase in Washington, D.C.

Bitcoin Has More Than Doubled This Year In Resurgence

 https://www.bloomberg.com/news/articles/2023-10-25/bitcoin-has-more-than-doubled-this-year-in-unforeseen-resurgence

Goldman Sachs says India will overtake the U.S. to become the world’s second-largest economy by 2075

India is poised to become the world’s second-largest economy by 2075, leapfrogging not just Japan and Germany, but the U.S., too, says Goldman Sachs.

Currently, India is the world’s fifth-largest economy, behind Germany, Japan, China and the U.S.

On top of a burgeoning population, driving the forecast is the country’s progress in innovation and technology, higher capital investment, and rising worker productivity, the investment bank wrote in a recent report.

“Over the next two decades, the dependency ratio of India will be one of the lowest among regional economies,” said Goldman Sachs Research’s India economist, Santanu Sengupta.

https://www.cnbc.com/2023/07/10/india-to-become-worlds-second-largest-economy-by-2075-goldman-sachs.html

International Students Contributed Over $40 Billion to US Economy in 2022/23

 

More than one million international students studying in the United States during the 2022/23 academic year contributed $40.1 billion to the American economy, according to NAFSA: Association of International Educators. 

Although it remains below the pre-pandemic record of $40.5 billion in 2018/19, this figure is an increase of $6.3 billion or 19 percent compared to 2021/22, Erudera.com reports.

The NAFSA’s report published on November 13 highlights that the number of international students at US universities and colleges has now recovered from the decline reported during the pandemic era. 

Data showed that international students have supported a total of 368,333 jobs, both within their educational institutions and in their communities. This is a significant increase of almost 10 percent compared to a year earlier and a 20 percent rise compared to the year when the COVID-19 pandemic forced the closure of America's borders.

California benefited the most from international students, with 138,393 students contributing a total of $6 billion to the state's economy and supporting over 55,000 jobs.

https://erudera.com/news/international-students-contributed-over-40-billion-to-us-economy-in-202223/

Macy's mulling $5.8 billion buyout offer

Macy's is facing a $5.8 billion buyout offer valuing it at $21 a share and sees a 32.4% premium to its recent stock price. Shareholders must be feeling hopeful about this potential buyout offer, as it could mean a significant shift in Macy's trajectory. It'll be interesting to see how the company's board responds and whether this offer aligns with their strategic goals. However, it seems like Macy's is at a crossroads with this buyout offer since they have declined to comment on the matter and the offer was extended over a week ago without a confirmed deal taking place. 

Additionally, the potential disruption of a buyout amidst the ongoing holiday season and an impending CEO transition adds complexity to the situation (Tony Spring is set to take over as CEO in 2024). Balancing the offer's financial benefit against the company's standalone potential and the impact on operations during this crucial period presents a challenging decision for Macy's stakeholders. The board, led by seasoned retail veterans, grapples with this offer considering Macy's historic high stock price of $70.99 in 2015 and its substantial real estate assets valued between $6 billion to $8 billion, notably the iconic Herald Square location in NYC worth $3 billion to $4 billion alone.

 Do you feel that Macy's will take the buyout offer considering the value of their assets and track record of success?

https://finance.yahoo.com/news/macys-mulling-58-billion-buyout-offer-source-230606275.html

 Fed Rate-Cut Exuberance Ebbs After Jobs Data, Boosting US Yields

The enthusiasm for a Federal Reserve rate cut diminished after a stronger-than-expected jobs report, causing a surge in Treasury yields. Two-year yields, linked closely to the central bank's policy outlook, rose significantly. Swaps traders reduced expectations of aggressive rate cuts next year, adjusting from over 120 basis points to about 110 basis points. The employment report showed better-than-expected nonfarm payrolls and a lower-than-anticipated unemployment rate, leading analysts to believe that the Fed may not rush into rate cuts in the early part of the next year. 

This repricing countered earlier market expectations of rate cuts starting as soon as March. The shift in sentiment affected both U.S. and European markets, with traders scaling back bets on interest-rate cuts. Despite this setback, some investors remain optimistic about buying bonds, anticipating a more moderate pace of rate cuts in the future. The upcoming Fed meeting and inflation readings for November will be crucial in shaping market expectations.

https://finance.yahoo.com/news/fed-rate-cut-exuberance-ebbs-162809736.html