HUIG's 3 Things this Week: Oct 28

Britain, Tech, and US Consumers: Rough Road Ahead

1. Britain: So where are we now? (The Economist)

With Liz Truss stepping down, the central bank panic buying Gilts to prevent wide spread panic and a largely failed attempt to revamp the economy as a whole, where is Britain heading next? In this article by the Economist, highlights the rollercoaster that is bond yields in the past few months and how the future government and chancellor faces an uphill battle to reinstall the public’s faith in gilts. Will it work? We shall see…

2. Tech Earnings Slums (WSJ)

As earnings are released over the last week, the one major thing that stand out to investors were the increase costs and forecasts that suggests pain ahead. Over the last month, due to a confluence of factors including the strengthening of the US dollar, as well as supply chain and energy crisis, firms all over are experiences increase costs and hindered revenue streams. So tech interested investors... beware.

3. Credit Card Debt Data (WSJ)

Since the pandemic, lockdowns and work from home resulted in the decline of credit card debt in the US market. However, this number has rebounded to its pre-pandemic numbers. Experts believe that this is a combination of people’s spending habits reverting to how they used to be coupled with laxed bank underwriting measures allowing people with less than ideal credit scores to participate in raking up credit card debt. However, with the trajectory of credit card debt facing the headwinds of a potential recession, danger looms.

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Bibliography

Andriotis, A. M. (2022, October 28). Credit-card debt returns to levels before covid-19 pandemic. The Wall Street Journal. Retrieved October 30, 2022, from https://www.wsj.com/articles/credit-card-debt-returns-to-levels-before-covid-19-pandemic-11666928540?mod=hp_lead_pos9

Bobrowsky, M. (2022, October 28). Tech boom ends as companies from Amazon to Meta adjust to turbulent times. The Wall Street Journal. Retrieved October 30, 2022, from https://www.wsj.com/articles/tech-boom-ends-as-companies-from-amazon-to-meta-adjust-to-turbulent-times-11666957789?mod=hp_lead_pos3

The Economist Newspaper. (2022, October 20). Can Britain escape the "Moron Risk Premium"? The Economist. Retrieved October 30, 2022, from https://www.economist.com/finance-and-economics/2022/10/20/can-britain-escape-the-moron-risk-premium

Image from: https://www.wsj.com/articles/tech-boom-ends-as-companies-from-amazon-to-meta-adjust-to-turbulent-times-11666957789?mod=hp_lead_pos3