Morning Download from Invincible Money 

Personal finance + economics + markets

Good morning investors! Yesterday was a bad day for the market as stocks fell for a third consecutive day. However, we want you to stay positive and focus on what’s good.

Read today’s issue for more on the market, some future predictions, and money saving tips.

Today we cover:

• Time to reconsider vehicle stocks?

• Where’s Ripple heading?

• Saving income tax money.

📊 Economy 

Bonds: 10-year yield is at its highest level since October 2022

The 10-year US Treasury yield hit its highest level in about 10 months as investors digested the news coming out of China and Fed meeting that boosted inflation concerns and more possible rate hikes.

Benchmark 10-year yields hit the 4.312% mark, very close to October’s 4.338%, which, if it breaks, would then be the highest since 2007. As a result, the stock market was mostly red and the crypto industry also suffered leading to Bitcoin falling below $27,000 for the first time in two months.

Mortgage rates hit a high

Thanks for continual rate hikes from the Fed, mortgage rates just hit their highest point in 23 years years. The market is currently digesting the Fed minutes (link) released yesterday which suggested more rate hikes may be necessary, so we may be going even higher. 😬

Quick hits:

• The global smartphone market takes a beating.

•  Walmart raises full-year earnings forecast.

• Weekly jobless claims see a decline.

📈 Stocks

S&P 500 4,370.36 (-0.77%)
DJIA 34,474.83 (-0.84%)
NASDAQ 14,715.81 (-1.08%)
VIX 17.89 (6.62%)
* Prices as of Aug 18th, 12:20 AM UTC

Time to reconsider vehicle stocks

It seems the United Auto Workers union may go on a strike against some of the biggest automakers, namely General Motors, Stellantis, and Ford Motor.

A work stoppage by about 150,000 UAW workers would cause a loss of over $5 billion in just 10 days, according to estimates. This, however, isn’t the first time the union is planning such a strike.

A breakdown in 2009 resulted in a 40-day strike against General Motors, which caused the company a loss of about $3.6 billion.

The upcoming strike has experts divided. Some believe that it’s time to buy these stocks, whereas some are of the idea that it’s time to sell these stocks. In fact, Warren Buffett’s Berkshire Hathaway was recently in the news for reducing its stake in GM by almost 50%.

🔐 Crypto

Bitcoin 27,565.00 (-3.96%)
Ethereum 1,711.10 (-5.23%)
Total market cap $1.11T (-3.64%)
* Prices as of Aug 18th, 12:20 AM UTC

Where’s Ripple headed?

The cryptocurrency market has been hit and Ripple is among the most beaten down of the crypto currencies, having fallen about 3.9% to reach $0.56. However, according to Google Bard, it’s going to hit $1 in 2024. (Bard also hallucinates.)

The coin has fallen about 22% since July but is still up about 72% since the beginning of the year. It jumped after the positive verdict in the SEC case; however, it couldn't sustain the momentum. But, now that Ripple has filed its opposition to an SEC motion, it may again jump a little.

Based on the image above, we can say that Ripple may be undervalued. The asset’s 30-day moving average (yellow) has fallen below its 200-day average (blue) on a number of occasions. This indicates that the asset is set for a rebound but not before a few more drops.

💵 Personal Finance

Do this to save income tax money - Part I

Nobody likes to pay taxes and while you can't (legally) evade taxes altogether, there are ways to reduce taxes on your income. The government offers a variety of programs, known as tax credits, designed to help people, especially low-earners, save money.

What is a tax credit?

A tax credit is a "sum that can be offset against a tax liability." In simple words, it’s the amount of money taxpayers can subtract from the amount they owe in taxes.

There are a variety of tax credits, we’ll discuss them below:

The Earned Income Tax Credit

The Earned Income Tax Credit allows low-income Americans to claim credits up to $7,430.

The amount of your tax credit depends on a variety of factors, including the number of children you have.

The American Opportunity Tax Credit

The American Opportunity Tax Credit is designed for students. It offers up to $2,500 per year to eligible students. A little complicated to calculate, this tax credit covers the first four years of higher education.

The Lifetime Learning Credit

Those who want more should look at the Lifetime Learning Credit, which covers qualified tuition and related expenses. You must be enrolled in an eligible institution and meet other eligibility requirements to qualify for this credit.

It covers undergraduate, graduate, and professional degree courses with no yearly limits, going up to $2,000 per tax return.

The Saver’s Credit

Retirement Savings Contributions Credit, also known as Saver's Credit, is for people making eligible contributions to IRAs or employer-sponsored retirement plans. Moreover, contributions to Achieving a Better Life Experience (ABLE) account may also be eligible in some cases.

The credit can be up to 50% of your contributions based on a number of factors, including your adjusted gross income.

The Child and Dependent Care Credit 

Last on the list is the Child and Dependent Care Credit that covers qualified expenses for the care of disabled dependents and children. Only up to $3,000 (expenses) are covered for one individual and up to $6,000 for two or more individuals. The percentage, however, depends on your adjusted gross income.

We’ll continue our ‘how to save tax’ piece next week so stay tuned and let us know what else you'd like us to talk about by replying to this email.

💰 Be a Better Investor

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