Money in a Minute for the Week Ending Jan. 28

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Freeman / Money Talks News

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.

Money Supply Shrinks for the First Time. What It Says About Inflation and the Economy. (Jan. 24, Barron’s):

The annual pace of inflation in December cooled for six straight months and looks set to continue to slow.

There’s another sign that the Fed’s rate hikes are working: The amount of money in the economy contracted in December.

The money supply growth rate for December was a negative 1.3% versus a year ago, the lowest ever and marking the first-ever decline in M2 based on all data available.

DOJ Sues Google, Seeking to Break Up Online Advertising Business (Jan. 24, Wall Street Journal):

A lawsuit filed Tuesday, the Justice Department’s second against the unit following one filed in 2020, alleges that Google abuses its role as one of the largest brokers, suppliers and online auctioneers of ads placed on websites and mobile applications. The filing promises a protracted court battle with wide-ranging implications for the digital-advertising industry.

White House unveils new tenant protections amid soaring rental costs (Jan. 25, Washington Post):

Under pressure to address the nation’s soaring housing costs, the Biden administration on Wednesday announced significant new actions to protect tenants and make renting more affordable.

The announcement involves multiple federal agencies that will gather information on unfair housing practices. It also includes a “Blueprint for a Renters Bill of Rights” that, while not binding, sets clear guidelines to help renters stay in affordable housing.

Jittery Investors Turn to Cash in Hunt for Yield (Jan. 25, Wall Street Journal):

Increased cash allocations are the latest sign of caution among investors who are questioning whether the recent rebound in stocks and bonds will continue after last year’s steep selloff. Many expect markets to remain volatile because Federal Reserve officials have repeatedly said they are committed to fighting inflation with higher interest rates.

Is a US Recession Near? Making the Call Is Trickier Than Ever (Jan. 25, Bloomberg):

Economists are poring over labor market data, looking for signs of weakness. They’re not immediately apparent: Unemployment is at a half-century low, job gains each month are moderating but continue to beat expectations, and vacancies are still elevated.

The Conference Board’s widely watched Leading Economic Index is signaling a recession is approaching. Bloomberg Economics’s model puts the chance of a recession in 2023 at 100%…

Mortgage demand rises 7% as rates fall for the third week in a row (Jan. 25, MarketWatch):

As mortgage rates fall, homeowners are seizing the opportunity to refinance their mortgages. Mortgage demand rose seasonally adjusted 7% in the latest week.

Demand for both purchases and refinancing increased. That pushed the market composite index up, a measure of mortgage application volume, the Mortgage Bankers Association (MBA) said on Wednesday.

The US Hasn’t Noticed That China-Made Cars Are Taking Over the World (Jan. 25, Bloomberg):

Overseas shipments of cars made in China have tripled since 2020 to reach more than 2.5 million last year, according to data from the China Passenger Car Association.

China’s numbers, behind Japan but ahead of the US and South Korea, herald the emergence of a formidable rival to the established auto giants.

U.S. GDP rose 2.9% in the fourth quarter, more than expected even as recession fears loom (Jan. 26, CNBC):

Fourth-quarter gross domestic product, the sum of all goods and services produced for the October-to-December period, rose at a 2.9% annualized pace, the Commerce Department reported Thursday. Economists surveyed by Dow Jones had expected a reading of 2.8%. …

Inflation readings moved considerably lower. The personal consumption expenditures price index increased 3.2%, in line with expectations but down sharply from 4.8% in the third quarter. Excluding food and energy, the chain-weighted index rose 3.9%, down from 4.7%.

Smartphone shipments plunge to a low not seen since 2013 — their largest ever decline (Jan. 26, CNBC):

Global smartphone shipments plunged in the fourth quarter of 2022 — usually a big holiday shopping period — thanks to macroeconomic weakness and soft consumer demand, according to market research firm IDC.

Electronics firms shipped 300.3 million smartphones in the October to December quarter, an 18.3% year-over-year fall, IDC said in a report published late Wednesday. The drop marks the largest-ever decline in a single quarter.

Key Inflation Gauge Cools Further, Paving Way for Smaller Fed Rate Hike (Jan. 27, Bloomberg):

The personal consumption expenditures core price index, which excludes food and energy, rose 4.4% in December from a year earlier, Commerce Department data showed Friday. The overall gauge climbed 5% year-over-year, still well above the Fed’s 2% goal but both were the slowest paces since late 2021.

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