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Good morning investors! Investors and analysts are eying the upcoming Fed meeting on December 12-13 to see if additional rate hikes are needed — and the direction of future mortgage rate movements.

Fun fact: In terms of frequency of growth, December has historically been the best month to own stocks.

Today we cover:

• Find out more about the US economy, including price and housing trends.

• Trouble continues for Tesla with the delayed Cybertruck.

• PayPal and Venmo taxes could impact you.

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📊 Economy and News 

All that’s changing

It seems oil is finally preparing to go up after several OPEC+ countries agreed to voluntarily cut oil production by a total of 2.2 million barrels per day in the first quarter of 2024.

Prices have remained flat on a global scale despite the ongoing Hamas-Israel situation. In fact, gas has gotten cheaper in the US. However, a reduction in supply could change things.

But, that’s not the only news people are talking about. It seems inflation is finally cooling off. The core PCE price index is at its lowest annual rate since April 2021, marking another step toward the Fed’s target of 2% inflation. Annually, the headline index is up 3%, which is the lowest it’s been since March 2021.

Mortgage rates continued to drop this week. It’s the fifth straight week rates have moved lower.

The 30-year fixed-rate mortgage fell to an average of 7.22% in the week ending November 30, down from 7.29% the week before. A year ago, the average 30-year fixed-rate was 6.49%.

The average rate jumped above 7% in mid-August and kept rising for seven straight weeks, reaching as high as 7.79% at the end of October. But the recent declines could be a sign that mortgage rates have peaked for this cycle.

Despite this, US pending home sales fell to their lowest level in 20 years last month.

Global hits:

• ‘Pay any price.’ Alibaba’s Jack Ma urges reform as rival rattles e-commerce giant.

• British banks announce sweeping job cuts weeks before Christmas.

• US fines PwC $7 million for allowing cheating in audit exams in China.

• Dr Martens shares slide 27% as the British bootmaker warns on profits.

📈 Stocks

S&P 500 4,567.80 (+0.38%)
DJIA 35,950.89 (+1.47%)
NASDAQ 15,947.87 (-0.25%)
BRENT CRUDE 81.04 (+0.22%)
* Prices as of Dec 1st, 12:20 AM UTC

What’s up with the Cybertruck?

Tesla CEO Elon Musk presided over the delivery of the company’s long-awaited Cybertruck, four years after it was first unveiled. Analysts had hoped the truck would help boost Tesla but that doesn’t seem to be the case anymore.

We still do not know much about the vehicle except for one thing – it’s more expensive than ever. 🚘

With a starting price of $60,990 before federal tax credits, the Tesla Cybertruck comes in at just over $20,000 more than the base model that was originally discussed at the vehicle’s debut in 2019. The company originally said the Cybertruck would cost less than $40,000, but a pandemic and an ensuing period of high inflation forced the company to move away from that promise.

The delayed vehicle will not be available until 2025. Unfortunately, by then it might be too late as the vehicle is no longer as unique as it once was. It still looks good but there already are more powerful trucks on the market and we might have more competition by the time the truck reaches public.

Tesla has over a million reservations for the Cybertruck but not all are expected to be converted into sales, according to experts.

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🔐 Crypto

Bitcoin $38,607 (+2.38%)
Ethereum $2,096 (+2.03%)
Total market cap $1.45T (+2.22%)
* Prices as of Dec 1st, 12:20 AM UTC

What’s happening in the crypto world

Here’s all you need to know:

• IOTA jumps 43% after registering ecosystem foundation in Abu Dhabi. It claims to be the first foundation to be registered under the emirate's regulatory framework for blockchain foundations. 😯 

• Binance is set to exit another market after the US. According to reports, the Philippines' SEC is set to block access to the world's largest crypto exchange Binance. 🛑 

• Approval of a spot ether product from BlackRock will bring a surge of institutional capital into the world’s second-largest crypto network. Experts think Bitcoin could hit $28,000 after approval. 🤩 

• Cristiano Ronaldo faces a $1 billion class-action lawsuit for endorsing worthless NFTs related to Binance. 😮

💵 Personal Finance

Here’s how to avoid tax issues related to PayPal, Venmo, and ecommerce platforms

P2P payment apps such as PayPal and Venmo are extremely popular in the US. A large number of people use them to make purchases, investments, receive payments, and more. Yet, very few know about the tax implications of using these apps.

Similarly, sites like Etsy and eBay are also heavily used. Back in the day, most people didn’t have to report transactions related to these apps but now things are changing due to lower income thresholds.

Beginning this fiscal year, these companies are required to adopt a revised, reduced threshold when providing tax forms to individuals engaged in business transactions via their platforms. The threshold for the tax year 2023 has been adjusted to a mere $600, applicable even to a single transfer, a significant decrease from the previous requirement of over 200 transactions totaling more than $20,000.

As a result of the change, more taxpayers are likely to receive Form 1099-K, which reports third-party business payments to the IRS.

The IRS postponed the contentious modification, originally slated to take effect for the 2022 tax year. Certain legislators are advocating for an elevation of the reporting threshold, indicating that further adjustments may be in store.

Here’s what you can do to make things easier:

• Discover more about the potential impact of the 1099-K reporting modification on your situation. Additionally, bear in mind that personal peer-to-peer payments among friends and family members will remain non-taxable.

• Maintain a record of all your transactions. While platforms like PayPal offer transaction lists, we recommend establishing a user-friendly and foolproof system for your personal use. Creating an Excel file documenting income received and possible business expenses, complete with receipts, can be a good practice to decrease tax obligations.

• Talk to your kids and other family members, including teens, who receive payments for online work or rewards related to apps and games as they may be taxable.

This is an important yet complicated matter. Check this video for more:

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