🎄Christmas Eve and Holiday Volatility.
Gas prices, GDP, home sales, and more.
GM friends and investors.
The national average price at the pump sank to its lowest level since September 2021 —A 15-month low.
A major reversal since the price at the pump was $5 per gallon for the first time ever.
Analysts expect the national average could sink below $3 quickly.
A happy holidays and merry Christmas to all of you. We are going to keep it short and sweet this Saturday.
Highlights
GDP numbers are out
Government shutdown?
$250M bail for FTX Ex-CEO
Real Estate is in the Gutter
S&P 500
Major indexes dropped on Thursday as the holidays approached.
At one point, Dow Jones was down 700 points as the end-of-year sell-off started to ramp up.
Why the selloff?
Investors are still covered that central banks around the world are going to raise interest rates. The fear of a tighter economic policy will push us into a recession.
Economy
On Thursday, the Commerce Department released more data on the U.S. economy. Specifically, this quarter’s GDP.
The report showed that the U.S. economy grew at an annual pace of 3.2% between July and September.
Is that a good thing?
Well, sort of.
Stocks dropped after the better-than-expected GDP numbers because investors fear this giving the fed more ammunition to raise rates.
The GDP was strong due to increases in exports and consumer spending but partially offset by a decrease in new housing.
Avoiding a ShutDown
The U.S. Senate approved a $1.7T government funding bill on Thursday.
Just merely in time to avoid another government shutdown.
What’s in the bill?
$772.5B for nondefense discretionary programs
$858B in defense funding.
$44.9B in aid for Ukraine.
Crypto
FTX founder Sam Bankman-Fried caught a lucky break and will be released on $250M bail.
Now, he awaits his trial for fraud and other criminal charges while living at his parent’s house in California.
Hacking as a business?
According to the South Korean spy agency, North Korean hackers have stolen about $1.2B in crypto over the past 5 years.
Experts are saying that North Korea has turned crypto hacking into a business that is struggling to support its weakening economy.
The UN already imposed sanctions on North Korea in 2016-2017, so you could say they’re on thin ice.
Real Estate
Home sales dropped -7.7% on a monthly basis in November, which marks the 10th month straight of declines.
Sales are down 35.4% compared to this time last year, and of homes sold, the median sale price rose 3.5% from October.
Why the fuss?
The housing market is struggling to change its environment.
The market went weak during the early days of covid. Then strong in 2021 (super strong) and now declining in 2022.
The Fed’s policy moves have had a direct impact on interest rates making the mortgage rates skyrocket into volatile territory.
On the Bright Side
Applications to refinance a house jumped 6% last week.
Mortgage rates recently hit their lowest level since September, and homeowners are looking for ways to save on their monthly mortgage payments.
For many, refinancing is a great option at a lower rate.
(Remember last week when we talked about new homeowners being underwater.)
Thank you for reading!
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