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Do Lower Mortgage Rates Matter if House Prices Are Still High?

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Mortgage rates are hitting lows not seen since 2016. But do low rates even matter if housing prices are unaffordable? MarketWatch's Jacob Passy reports: “There is a tug of war in the financial markets between weaker business sentiment and consumer sentiment,” Freddie Mac FMCC, -1.54% said in its report. “Business sentiment is declining on negative trade and manufacturing headlines, but consumer sentiment remains buoyed by a strong labor market and low rates that will continue to drive home sales into the fall.” Ultimately, the low supply of homes available for sale will at least partially … [Read more...]

Are Munis a Shelter from the Storm? Not so Fast

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The Wall Street Journal reports that Americans in high tax states like New York and California are jumping into municipal bonds to shelter their investments from taxation. Maybe these are residents who can flee from the high tax states they call home, as so many others have. Now that the federal government has stopped subsidizing these states' high taxation, residents are feeling the full burden of their states' big-spending ways. The Journal reports: Investors in high-tax states like New York and California are piling into municipal bonds this year, fueled in part by the 2017 tax overhaul … [Read more...]

This Has Never Happened to German Bonds Before Now

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For the first time ever, Germany's yield curve is completely negative. Bunds from 2 year to 30 year are all yielding negative rates. Bloomberg's John Ainger reports: German 30-year bonds rallied to send yields across the whole of its debt market below 0% for the first time after President Donald Trump ratcheted up the U.S. trade war with China. The euro area’s biggest economy joined Denmark and Switzerland in the region in offering negative returns to investors should the notes be held to maturity, taking the total stock of investment-grade debt yielding less than 0% to $14 trillion … [Read more...]

Can You Guess Which Regulator is Upset With Elon Musk Now?

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Back in September of 2018, the SEC sued Elon Musk over tweets in which the agency claimed he had made “false and misleading statements.” The issue involved statements Musk had made about potentially taking Tesla private, and funding for that effort which he told his followers was "secured." Now another federal agency is coming for Musk over statements he's made regarding Tesla. This time, it's the National Highway and Traffic Safety Administration (NHTSA). The agency is upset over Musk's claims that the Model 3 sedan Tesla is building has the “lowest probability of injury of any vehicle … [Read more...]

Can You Guess Where Financial Firms Are Going When they Flee the Northeast’s High Taxes?

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If you answered Palm Beach County in Florida, you're right. When tax reform capped state and local tax deduction from federal returns, financial firms and their employees were exposed to the naked truth about the high state taxation in the Northeast. With governments in New York, Massachusetts, and Connecticut drowning in obligations, taxes aren't coming down soon. That's why so many financial firms and employees are voting with their feet and heading for low tax Florida instead. Many wealthy retirees have already made this sound financial choice, and it's no surprise to see profit-making … [Read more...]

Has Amazon Been Caught in an Anti-Trust Trap?

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Regulators are looking hard at all of the major tech companies with an eye toward anti-trust violations. At Bloomberg, Spencer Soper reports that one particular Amazon practice may fall into that category. He writes: Amazon.com Inc.’s determination to offer shoppers the best deals is prompting merchants selling products on its marketplace to raise their prices on competing websites, a testament to the company’s growing influence over the e-commerce market. Amazon constantly scans rivals’ prices to see if they’re lower. When it discovers a product is cheaper on, say, Walmart.com, Amazon … [Read more...]

This Small State is Beating its Neighbors in a Debt Race. That’s Not Saying Much.

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Despite being surrounded by the two states ranked by Moody's as having the worst debt service to state revenue ratios in the country, Rhode Island managed to come in 18th highest. Connecticut was worst, and Massachusetts just behind in second place. Is there a lot of work to be done in Rhode Island? Absolutely, but in New England, 18th worst is cause for celebration where debt is concerned. Rhod Island certainly has its weak points. Woonsocket is much deeper in debt than the State's Public Finance Management Board recommends. The Newport Daily News reports: “At the state level, the debt of … [Read more...]

Can You Put the American Dream on Your Credit Card?

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According to reporting from The Wall Street Journal, Americans are increasingly turning to debt to finance what many consider typical parts of the middle-class American lifestyle; cars, college, houses, and healthcare. AnnaMaria Andriotis, Ken Brown and Shane Shifflett report: Consumer debt, not counting mortgages, has climbed to $4 trillion—higher than it has ever been even after adjusting for inflation. Mortgage debt slid after the financial crisis a decade ago but is rebounding. Student debt totaled about $1.5 trillion last year, exceeding all other forms of consumer debt except … [Read more...]

Apple Stops Listening to You

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After years of eavesdropping on Siri users to improve the product's voice recognition, Apple has announced that it will suspend its "grading" system of listening to users. This comes as Google and Amazon are also coming under increased scrutiny for listening to customers' conversations. Bloomberg's Mark Gurman reports: Apple Inc. said on Thursday it is suspending its global internal program for “grading” a portion of user Siri commands after some consumers raised concerns about the program. The Cupertino, California-based technology giant employs people that listen to less than 1% of Siri … [Read more...]

Spy Trains? Are Chinese Trains and Buses Spying on Americans?

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Congress is working on legislation aimed at banning the purchase of Chinese bus and rail infrastructure by Americans. Some advocates are happy about protecting U.S. manufacturers, but others are more focused on the possibility that cameras and location tracking devices in Chinese manufactured buses and trains could pose a surveillance threat to Americans. The Wall Street Journal's Terfor Moss and Lindsay Wise report: The effort threatens to further fray U.S. trade talks with China, which wants to become a global player in transport and is already fuming over the U.S. decision to blacklist … [Read more...]