Hey, Risers!
Worries a-plenty.
Conflict between Israel and Hamas in Gaza continues, Iran is threatening an oil embargo, and the U.S. House of Representatives still hasn’t elected a Speaker. The economy appears to be running hot, though, and as a result, U.S. Treasury yields continue to rise. Earnings season is also now in full swing. Buckle your seatbelts!
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Economy & Markets
Too Strong?
Shop ‘til You Drop
Retail sales came in much stronger than expected, up 0.7% in September vs. estimates of 0.3%. Excluding autos and gasoline, the figure remained strong, growing 0.6%.
Our take: People continue to buy even in the face of inflation — they just can’t buy as much.
Home Work
Housing remains incredibly weak, given rising rates. Rates for 30-year mortgages crossed 8%, and unsurprisingly, housing starts were lower than economists’ estimates. Existing home sales also fell 2% in September to the lowest level since 2010.
Our take: If inventories weren’t lower, housing would be much weaker.
Working
Initial jobless claims fell to 198,000, falling from 209,000 from the week prior, and well short of 210,000 Street estimates. Continuing claims, a proxy for the number of people receiving unemployment benefits, rose to 1.73 million in the week ended October 7.
Our take: Appetite for workers remains high
Learning Block: The Debt Burden
Default?
The U.S. government's liabilities breached an eye-watering $33 trillion.
It’s 24% higher than the U.S. gross national product.
It’s six times the U.S. debt figure in 2000 ($5.6 trillion).
Paid back interest-free at the rate of $1 million an hour, $33 trillion would take more than 3,750 years.
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