Morning Download from Invincible Money

Personal finance + economics + markets

Finance in 5 minutes a day to help you make better money decisions.

Good morning investors! The debt deal passed, U.S. labor markets are strong, everyone hates Spirit Airlines and Zuck beats Apple to the punch.

📊 Economy 

Debt Deal Passes

The US House of Representatives passed a bill to raise the debt ceiling, sending it to the Senate.

• The bill was passed by a vote of 314-117, with support from both Democrats and Republicans.

• The bill is expected to be passed by the Senate and signed into law by President Biden, averting a potential default on US debt.

Inevitable: Stocks were up slightly as everyone breathed a sigh of relief and others just went about their day knowing this will be the 78th time the U.S. raised the debt ceiling.

Payroll Surprise

Private payrolls in the United States rose by 278,000 in May, according to payroll processor ADP.

• This was well ahead of the Dow Jones estimate of 180,000.

• The distribution of job gains was fragmented, with increases concentrated in just a few industries. Salary growth is still strong, but showing signs of decelerating.

Takeaway: The strong job growth is a sign that the labor market remains strong despite rising interest rates and inflation.Fed May Take a Break

Fed Governor Jefferson said the Fed may “skip” a rate hike for the June 13-14 meeting. There’s now a 35% chance of a rate hike, down from 60%.

Inflation Up in the UK

Prices in the UK continue to rise as the cost of store items rose 9% for the past year to a record high in May.

Food prices are also the second-highest ever. In fact, they’re so high the UK Prime Minister is considering asking retailers to cap their prices.

📰 News

Meta announced a new mixed reality headset - the Meta Quest 3. Just before Apple is rumored to be announcing it’s high-end $3,000 headset with 4K displays in each eye.

• Headset will cost $499

• 40% thinner

• 2x the graphics performance

• Meta currently sells 80% of the 8.8 million VR headsets sold

📈 Stocks

Yesterday I shared the most admired brands. Well, today let’s look at the most hated brands in the U.S. per the 2023 Axios Harris Poll.

1. The Trump Organization

2. FTX

3. Fox Corporation

4. Twitter

5. Meta

6. Spirit Airlines

7. Tiktok

Slowing Sales - Slowing Economy?

Macy's [M +1.18%] cut its annual profit and sales forecast after shopper demand slowed in March and same-store sales were down 8.7%.

• “The US consumer, particularly at Macy’s, pulled back more than we anticipated,” said Macy’s CEO Jeff Gennette on an earnings call Thursday. Customers “reallocated” spending to food, essentials and services, he said.

Costco [COST +0.20%], on the other hand, beat analyst expectations for earnings and revenue in the first quarter.

• However, Costco said some customers were switching from pricier steaks to cheaper meats like pork and chicken, which has happened in previous recessions.

The two retailers' results offer a mixed bag for the retail industry, which is facing a number of challenges, including rising inflation and supply chain disruptions.

Some companies are benefiting from consumers changing to cheaper options. Like Walmart, as people shift to lower cost food and essentials.

Amazon’s [AMZN +1.82%] Ring doorbell business will pay a fine to the FTC (Federal Trade Commission) of $5.8 million over privacy violations.

✅ Salesforce [CRM -4.69%] beat on earnings with $1.69 EPS (vs. $1.61 expected) and sales with $8.25 billion (vs. $8.18 B expected).

Is Nvidia really worth $1 Trillion, while Intel is only worth $125 B?

I broke it down in a livestream last night.

🔐 Crypto

Bitcoin and Ethereum closed their first down month of the year and had their worst month since December 2022. It can’t always be Up Only, can it?

• BTC had a 7.8% loss for May

• Ethereum closed down 2.1% for May

However, they are both up 63% and 55%, respectively, for the year.

Bitcoin was down last Wednesday after comments from the Fed saying there’s not a compelling case to stop the rate hikes. BTC fell further on fears of a possible U.S. debt default, but was still down 1.3% yesterday.

Ethereum was able to do better than BTC largely by an increase in ETH staking. It was only down 0.8% yesterday.

💵 Personal Finance

I’ve talked to hundreds of people about their personal finances as a financial planner. The #1 fear people have is that they didn’t start investing early enough and now they’re 40+ with nothing saved.

If that’s you, it’s okay. You’re not alone. In fact, there are more of you than people who started early. You can get back on track!

Here are a few things you can do:

1. Set a goal. How much money do you want to have saved by the time you retire? Once you know your goal, you can start to make a plan to reach it. Wondering how much you need? Watch this video.

2. Make a budget. This will help you track your spending and see where you can cut back to free up more money for retirement savings.

3. Contribute to a retirement savings plan. If your employer offers a 401(k) plan, take advantage of it. Even if you can only contribute a small amount each month, it will add up over time. If your employer doesn't offer a 401(k) plan, you can open an IRA.

   NOTE: If you’re over 50, you can do “make up contributions” of an extra $7,500 for a 401k for a total of $30,000 or an extra $1,000 for an IRA for a total of $7,500.

4. Invest wisely. When you're investing for retirement, it's important to choose investments that are appropriate for your age and risk tolerance.

5. Don't give up. It may take some time and effort, but it's possible to save for retirement even if you're starting late. Just keep at it and don't give up on your goals.

The best thing you can do (and do it today):

💰 Be a Better Investor

👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.