In an era of economic uncertainty and high interest rates, lenders are making fewer loans.
Category: TRENDS ON THE U.S. ECONOMIC FRONT – Oct 31 2023
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ANOTHER BAD JOKE: BIDEN NAMES 31 U.S. REGIONAL TECH HUBS
The Biden administration has designated 31 locales around the country as “Regional Innovation and Technology Hubs.”
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HIGH INTEREST RATES THREATEN TO SPARK RECESSION
On 23 October, the yield on the 10-year U.S. treasury bond broke up through 5 percent for the first time in 16 years. On 27 October, the average national interest rate on a 30-year, fixed-rate home mortgage topped 8 percent, according to Bankrate. The average credit card interest rate has reached 22 percent, the U.S. Federal Reserve reported.
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U.S. ECONOMY GREW 4.9 PERCENT IN THIRD QUARTER
U.S. GDP grew at an annual rate of 4.9 percent in this year’s third quarter, the commerce department reported.
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INVESTORS GO LONG IN LONG-DATED BONDS
Blackrock, Janus Henderson, Pacific Investment Management (Pimco), and Vanguard are among the growing number of money managers padding their portfolios with treasury bonds maturing in 10 years or longer.
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HIGH T-BOND YIELDS DETERS CORPORATIONS FROM BORROWING
U.S. companies issued less than $70 billion in new bonds in October, making it the slowest month this year for new issues and the weakest October since 2011, the Financial Times reported.
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INVESTORS BEAT UP COMPANIES THAT MISS EARNINGS TARGETS
Companies whose third-quarter earnings reports disappoint investors are seeing their share prices drop more sharply than usual, the Financial Times reported.
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MORE AMERICANS FEELING THE FINANCIAL PINCH
Two in three Americans have seen their household expenses climb over the past 12 months, while only one in four says their household income has increased, according to a new poll from The Associated Press-NORC Center for Public Affairs Research.
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ECONOMIC UPDATE MARKET OVERVIEW
As we had forecast in July, when the U.S. equity markets were still rising high, they would decline sharply in September and October.