Chart of the Week
Revenge spending is back.
After a low growth decade and a lockdown where travel stopped, people want to live it up.
With unemployment still relatively low at 4% and savings accounts still flush, consumers continue to open their wallets.
Higher interest rates have yet to dampen on discretionary spending like travel.
The latest data from TSA Checkpoints shows airplane travel is back to 2019 levels. The run rate is up over 200,000 people. If the trend continues, we should see the highs eclipsed by the end of summer.
What We’re Reading
June Consumer Checkpoint: The Kids are Alright (for now) – Bank of America
Social Security’s Financial Outlook: The 2024 Update in Perspective – Boston College, Center for Retirement Research
Are We on the Brink of an AI Investment Arms Race? – Bridgewater
My Month Without a Smartphone – Collaborative Fund
Podcast of the Week
Pre-IPO Market, AI Hype Cycle, Is Software Dead? – BG2
Last Week
Services data came in better than expected for May. The payrolls report showed 272,000 jobs while the unemployment increased from 3.9% to 4.0%. Average hourly earnings were above estimates, rising at a 4.1% annual rate. Wednesday was busy. Inflation came in low, which opened the door a bit wider to interest rate cuts. The Fed held interest rates steady. With four Federal Open Market Committee meetings left in the second half of 2024, the focus on the data, the election, and interest rates comes into greater focus.
The Week Ahead
Over the next week, we will see how the consumer is doing with the sentiment report from the University of Michigan along with retail sales. The housing starts data will be of interest as homebuilders have shrugged off higher mortgage rates lately.
Thank you for reading.
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