A house divided… (Caspar Benson/Getty Images)
A house divided… (Caspar Benson/Getty Images)
Hey Snackers,
The LA Times did some hard-hitting reporting on the biggest mystery in La La Land: why apartments often come without fridges. Absolutely zero chill.
We’re all seeing red after an extra-rough week for the markets: the S&P 500 teetered near a bear market on Friday, down almost 20% from its January record. The techy Nasdaq index plunged about 4% for the week, while the broader market was dragged down by bummer retail earnings from Target, Walmart, and others.
FYI: Next Monday is Memorial Day, a time to honor those who’ve sacrificed their lives to serve and protect the US. The markets will be closed, so we’ll be back in your inbox on Tuesday.
Bingeing “Selling Sunset”... While scrolling Zillow listings under $100K (spoiler: not many). The median price for a previously owned home sold in April hit a record $391K, up 15% from a year ago. Despite soaring mortgage rates, low housing supply is keeping ownership out of reach for many Americans. Now some startups are offering a way to get in on the housing boom — minus the house.
Cry me a duplex... While still small, the rise of fractional home ownership underscores how many people are priced out. Over the past year, US home prices have risen 20%. But as the Fed raises rates, the situation may be shifting:
Housing’s hitting a wall… There’s a reason higher borrowing costs aren’t sinking prices: brutally low inventory. There’re only 1M homes for sale in the US. Cue: the average home gets snatched up within 17 days. Some fear we may be heading into a housing bubble, though mortgage lenders now have strict debt-to-income ratios to protect against an ’08-style crash. As rates rise, fewer people will be eligible (or willing) to take out loans. Yet home prices won’t cool until supply improves, which could take a while.
Better late than never… After decades of neutrality, Finland and Sweden last week applied to join NATO (the transatlantic political and military alliance) to beef up security against Russia. Both countries were already tied to Europe’s economy via the EU. NATO’s expected to welcome them with (mostly) open arms within months, which will further isolate Russia from Western markets willing to buy its gas. If trade relationships keep shifting, a “multipolar” world could emerge: one anchored by the US and the EU on the one side, and Russia and China on the other.
Gelato-nomics… Last year a US dollar got you about 0.82 euro (not much gelato). Now the currencies are almost equal. The USD has appreciated this year as global investors parked more cash in USD than in other currencies, like the war-shaken euro. A strong dollar is good for American tourists, making summer trips to Rome less expensive. Bigger picture, it could cool soaring US inflation, since it makes imports (relatively) cheaper. On the flip side: a strong USD makes US exports pricier (think: fewer Ford EVs sold in Europe), which could check economic growth.
Inferiority complex... During a gold rush, sell shovels. During a downturn, sell McDoubles. In tough times, consumers trade down pricey products for budget alternatives (economists call these “inferior goods”). Think: ditching Clif Bars from Whole Foods for granola bars from Costco. Discount stores like Dollar Tree, Dollar General, and Costco, which all report this week, thrive when inflation spikes — if they can keep their own rising supply costs down. That’s easier said than done: last week other discounters, including Walmart and Target, dropped unexpectedly low quarterly profits.
Mission possible?… “Top Gun: Maverick” opens Friday after two years of delays. The $170M sequel could answer Hollywood’s biggest question of the Covid era: will people go to theaters for something that isn’t a superhero flick? With “Top Gun,” Paramount is betting some films justify the big-screen experience. The summer will test that bet, with the major studios, from Universal (“Jurassic World”) to Warner Bros. (“Elvis”), all releasing “event” movies. The pandemic-scarred industry needs some wins: total box office this year is still down 40% from 2019.
An owl’s eyes can account for 3% of its entire body weight, compared to .0003% for humans
Authors of this Snacks own shares of Canopy Growth, Ford, Twitter, Walmart, and Amazon
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