Every Friday I recap “news you can use” from the week: a handful of quotes from major (and often expensive) news sources, so you can stay up to date on the news that affects your money without spending a dime and in less than a minute.
Here’s an overview of what happened this week.
A $1.5 Trillion Wall of Debt Is Looming for US Commercial Properties (April 8, Bloomberg) “Refinancing risks are front and center” for owners of properties from office buildings to stores and warehouses, Morgan Stanley analysts including James Egan wrote in a note this past week. “The maturity wall here is front-loaded. So are the associated risks.”
The investment bank estimates office and retail property valuations could fall as much as 40% from peak to trough, increasing the risk of defaults.
Investors View Corporate Earnings Season as Next Test for Stocks (April 9, Wall Street Journal)
This week’s kickoff to the corporate earnings season offers the next trial for the market as investors consider whether U.S. stocks can hold on to recent gains in the face of deteriorating profits.
Analysts expect companies in the S&P 500 to report a second consecutive decline in quarterly earnings. First-quarter profits are projected to drop 6.8% from the same period a year earlier, according to FactSet.
Bitcoin tops $30,000 for first time in 10 months, as some tout crypto as ‘safe haven’ (April 10, MarketWatch) Bitcoin rallied Monday to its highest level in 10 months, as some industry proponents touted the asset as a potential “safe haven,” like gold, as recession fears return to the forefront, and after fears rose last month about potential instability in the banking system.
The world’s largest cryptocurrency topped $30,000 Monday night for the first since June 10, 2022, according to Dow Jones Market Data, peaking at $30,321 before pulling back.
IMF cuts GDP forecasts, says global economy heading for weakest growth since 1990 (April 11, CNBC) The International Monetary Fund on Tuesday released its weakest global growth expectations for the medium term in more than 30 years.
The D.C.-based institution said that five years from now, global growth is expected to be around 3% — the lowest medium-term forecast in an IMF World Economic Outlook since 1990.
AI Can Write a Song, but It Can’t Beat the Market (April 12, Wall Street Journal) Wall Street has long used automated algorithms for tasks such as placing trades and managing risk. But investors haven’t made much progress relying on AI to tackle their biggest challenge: beating the market. While some see ChatGPT as a way to boost sales and research efforts, the investing results using AI haven’t been especially impressive.
Inflation Shows Signs of Cooling as Fed Weighs Next Move (April 12, New York Times) The Consumer Price Index climbed 5 percent in the year through March, down from 6 percent in February.
A so-called core index that aims to get a clearer sense of price trends by stripping out food and fuel costs, both of which can be volatile, picked up by 5.6 percent from a year earlier. That was up slightly from February’s 5.5 percent increase, and the first acceleration since September.
Fed expects banking crisis to cause a recession this year, minutes show (April 12, CNBC) Fallout from the U.S. banking crisis is likely to tilt the economy into recession later this year, according to Federal Reserve documents released Wednesday.
“Given their assessment of the potential economic effects of the recent banking-sector developments, the staff’s projection at the time of the March meeting included a mild recession starting later this year, with a recovery over the subsequent two years,” the meeting summary said.
Wholesale inflation posts biggest drop since start of pandemic, PPI shows, as price pressures ease (April 13, MarketWatch) Wholesale costs often herald future inflation trends. The increase in wholesale prices over the past 12 months also slowed again to 2.7%, from 4.9% in the prior month. That’s the lowest reading since January 2021.
A separate measure of wholesale prices that strips out volatile food and energy costs as well as trade margins rose a scant 0.1% last month, the government said. That was also below Wall Street’s forecast.
Fed Official Backs Higher Interest Rates as Banking Stresses Fade (April 14, Wall Street Journal)
A Federal Reserve official said he was prepared to approve another interest-rate increase because recent banking-system stresses haven’t produced a significant pullback in lending while high inflation remains supported by strong growth.
“Monetary policy needs to be tightened further,” Fed governor Christopher Waller said in a speech Friday in San Antonio. “I would welcome signs of moderating demand, but until they appear and I see inflation moving meaningfully and persistently down toward our 2% target, I believe there is still more work to do.”
JPMorgan Chase posts record revenue that tops expectations on higher interest rates (April 14, MarketWatch) JPMorgan, the biggest U.S. bank by assets, is watched closely for clues on how the industry fared after the collapse of two regional lenders last month. Analysts had expected JPMorgan to benefit from an influx of deposits after Silicon Valley Bank and Signature Bank experienced fatal bank runs.
Indeed, JPMorgan saw “significant new account opening activity” and deposit inflows in its commercial bank, CFO Jeremy Barnum told reporters.
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I founded Money Talks News in 1991. I’m a CPA, and I have also earned licenses in stocks, commodities, options principal, mutual funds, life insurance, securities supervisor and real estate.