RAT MONEY
RadioAustinTexas.com
08/22/2024
Inspiring, uninspiring, and down right messed up financial news of the day. RAT date 08/22/2024
The media on this page is taken largely from a financial newsletter now published by Sherwood Media. They enfolded the company Robinhood, which is an online stock trading company and financial company. Its CEO has done some really wild things in the stock trading game, and is one of the most impressive people known.
Around a year ago, he led the stampeded of investors at Robinhood in the GameStop market takeover, which made them billions, and cost many billionares and large hedgefunds billions, and made them the laughing stock of Wall Street. He named his copmpany well.
However, I am referring to Robinhood’s previous CEO. Now it is Bulgarian born Vladamir Tevin, 36 years old.
Robinhood Financial
Volkswagen debuted an all-electric update of its iconic hippie van. But with just 234 miles of range, it’s not exactly cut out for #VanLife. Burners headed from San Francisco to Black Rock City this weekend would need to find a charging oasis mid-desert.
Stocks rose yesterday as July’s Fed meeting minutes boosted rate-cut hopes. Also juicing bets on a September slash: a massive downward revision in payroll growth. The Labor Department said the US had created 818K fewer jobs than originally reported in the year through March.
HIKE
Healthcare premiums are set to spike as Americans get squeezed by medical costs
Health’s at a premium… That cost-of-living pay raise may be even less exciting next year. Health-industry forecasts say that employers’ healthcare costs will jump by 9% next year — up from this year’s 6% hike (which was already above the five-year average). That would push the cost per employee to more than $16K, which could see a larger chunk taken out of paychecks.
Blockbusters: More than half of employers say GLP-1s (think: Novo Nordisk’s Ozempic and Wegovy) are driving up their costs. Drug costs rose to 27% of companies’ health bills, up from 21% two years ago.
In the middle: Last month the FTC dropped a scathing report saying that the biggest pharmacy benefit managers from companies like UnitedHealth and CVS could be inflating drug costs. Meanwhile, 37% of companies say they plan to find a new PBM next year.
Flashing the card: Major insurers have reported spiking medical costs as patients return to hospitals and doctors’ offices. UnitedHealth said its costs rose 9% last quarter. Aetna parent CVS this month said its medical costs could continue to climb this year.
The affordability crunch… Healthcare’s bite out of Americans’ budgets is getting bigger. Over the past decade, the cost of prescription drugs has risen 37% in the US, where medical debt is the leading driver of bankruptcy. Americans spend more on healthcare than people in any other major country, and about half said they’ve struggled to cover medical costs recently.
THE TAKEAWAY
Climbing costs tend to trickle down… While employers have swallowed the bulk of swelling healthcare costs in recent years, more could be passed on to workers in a weaker labor market. The chunk of the premium footed by employees rose more than 3% this year to nearly $5K/worker (more than the five-year average annual hike of about 1%). Nearly half of employers said they’re likely to shift rising costs onto their workers next year.
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BULL’S-EYE
Target hits an earnings bull’s-eye as folks start reaching for “nice to have” products
Quick Tarjay run… Target stock popped 11% yesterday after the retailer beat second-quarter expectations with sales rising 3% from a year earlier. It was an improvement from Q1, when sales dipped 3% as shoppers cut back on everything from paper towels to home decor. Target’s profit popped 40% as folks spent more on higher-margin discretionary items (groceries are generally not that profitable). Notably, Target’s apparel sales were up 3% (and sundresses are more lucrative than salad dressing).
In my discretionary era… Americans may be shifting back into the “don’t need it but want it” ethos. Target said that last quarter it saw an uptick in visits to its stores and website, and that consumers were starting to spend more on nice-to-have products like bathing suits and scented candles. Walmart also unloaded strong sales growth as merch sales (think: air fryers, sports gear) rose for the first time in 11 quarters. Meantime, discount-clothing retailers were humming along as folks treasure-hunted for deals like $12 Levi’s.
Maxx’d out: TJX — the parent of TJ Maxx, Marshalls, and HomeGoods — said yesterday that its same-store sales popped 4% last quarter, and that the boost was “entirely driven” by more transactions. Rival Ross reports today.
THE TAKEAWAY
If the price is right, they might bite… Retailers are focusing on value to lure inflation-weary shoppers, and it seems to have paid off. In May, Target said it would cut prices on 5K+ consumer staples, and its CEO said the price reductions drove higher traffic last quarter. Walmart said it cut prices on 7K+ items, and it also unloaded a strong quarter. Walmart and Target have also hosted Amazon Prime-rivaling summer sales events to drive demand.
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ON SHERWOOD
The most luxurious luggage is the kind you don’t have to carry
No matter how shiny and chrome a suitcase, we all must heave our bags from place to place. Read more.
What else we’re Snackin’
Alphabet’s Waymo doubled its paid robotaxi rides to 100K/week.
Beyoncé teamed up with LVMH to launch a whiskey line.
Ford’s chopping its EV budget and scrapping some planned electric models.
Amazon is letting sellers refund some returns without getting the product back.
“Call Her Daddy” host Alex Cooper signed a major pod deal with SiriusXM.
Snack Fact of the Day
Out-of-network ATM withdrawal fees hit a record average high of $4.77
Last updated 08/22/2024