Morning Download from Invincible Money 

Personal finance + economics + markets

Good morning investors! It’s mid-week. I hope everyone is having a great week! Thank you everyone who joined me on Twitter yesterday. I hope to connect with you all. I’ll be posting more investing content there soon.

Today we cover:

1. Inflation numbers expected to be lower today

2. Microsoft can buy Activision

3. Another bank fined

4. Grease monkeys get their day

5. Investing in index funds - Part 1

📊 Economy 

Inflation to slow

Inflation is expected to cool further in June, but it is still expected to still be above the Federal Reserve's 2% target, suggesting that the Fed will continue to raise interest rates this year.

• Headline inflation, or the Consumer Price Index (CPI), is expected to be 3.1% over the prior year, a continued slowdown from May's 4% annual gain. A rise of 0.5% in June from May is also expected.

• The core CPI, which excludes food and energy prices, is expected to be 5% over last year and 0.3% in June from May.

Not so fun facts

Florida has the highest inflation in the U.S. due to very high housing costs. The Miami area has 9% inflation still!

The used vehicle market is strong, but the new vehicle market is expensive. According to Edmonds, only 8% of new vehicles cost under $30,000.

📰 News

Microsoft Buys Activision

Microsoft's $68.7 billion acquisition of Activision Blizzard has been cleared by the European Commission and is expected to clear later this year.

The deal, which was first announced in January 2022, is still subject to regulatory approval in other jurisdictions.

• The European Commission's approval is a major victory for Microsoft, as it was the last major regulatory hurdle the deal needed to clear.

• The deal is expected to create a new gaming powerhouse, with Microsoft gaining control of some of the most popular video game franchises in the world, including Call of Duty, World of Warcraft, and Candy Crush.

• The deal has been met with some criticism, with some people arguing that it will give Microsoft too much power in the gaming industry.

Our take: The FTC isn’t happy about this and may appeal as they’re trying to increase regulation on tech. If you believe in anti-trust, this is a big set back.

Quick hits:

🏷️ Amazon Prime Day is today and yesterday. The 2 day sale is facing increased competition from rivals like Target and Walmart, who are also holding overlapping sales.

• Amazon is responding to the competition by offering more personalized deals and invite-only events for Prime members.

• Prime Day has become a major shopping event, with Amazon reporting that it sold $11 billion worth of merchandise in 2022 and is projected to sell $12.9 billion this year. (No wonder Target and Walmart want a piece of the action.)

💵 Bank of America Caught Cheating. BofA has been fined $250 million by the U.S. government for creating millions of fake accounts, overcharging fees and withholding credit awards.

• The fake accounts were created as part of a sales incentive program that rewarded employees for opening new accounts, even if the customers did not want them.

• Wells Fargo settled a similar charge in 2020.

📈 Stocks

S&P 500 4,439.26 (+0.67%)
DJIA 34,261.42 (+0.93%)
NASDAQ 13,760.70 (+0.55%)
VIX 14.84 (-1.53%)

🛢️WD-40 Company [WDFC +18.49%] hit a 52-week high after beating Q3 earnings expectations with $141.7 million in revenue and EPS (Earnings per share) of $1.38 - up 29% over last year. Notably profit margin increased from 47.7% to 50.6%.

Well done, grease monkeys!

📈 The market liked the Microsoft - Activision news. Microsoft was up +0.19%, but Activision was up 10.02%.

🫰🏽Snap Inc [SNAP +8.15%], owner of Snapchat (that’s still around?), was up after announcing a revenue-sharing program to get creators back to the platform. All the other major social media platforms have had this for awhile. Welcome to the party Snap!

🔐 Crypto

Bitcoin $30,532.38 (+0.7%)
Ethereum $1,876.96 (+0.1%)
Total market cap $1.23 (-0.4%)
* Prices as of July 11th, 7:00 PM EST

BTC prediction: Standard Charter’s latest Bitcoin forecast is $120,000 by 2024.

Grayscale’s NAV gap for GBTC is the lowest since May 2022. They recently made news by criticizing the SEC for approving a leveraged Bitcoin ETF before a spot ETF. I think most people agreed that’s strange, since a spot ETF is much less risky.

💵 Personal Finance

Benefits of index funds - Part 1 of 3

A reader asked me about investing in index funds yesterday. Here’s why you should consider it for the bulk of your portfolio.

Index funds are a type of mutual fund or exchange-traded fund (ETF) that tracks a specific market index. This means that the fund's performance is designed to mirror the performance of the index it tracks.

Here are some of the benefits to investing in index funds:

• Low fees. Index funds typically have very low fees, which means that more of your money goes towards investing and less goes towards paying fees.

• Diversification. Index funds are diversified, which means that they hold a wide variety of assets. This helps to reduce your risk, as you are not putting all of your eggs in one basket.

• Passive management. Index funds are passively managed, which means that they do not try to beat the market. This makes them a good choice for investors who do not want to spend a lot of time managing their investments.

• Long-term performance. Index funds have historically outperformed actively managed funds over the long term. This is because index funds are designed to track the market, which has historically trended upwards.

If you are looking for a low-cost, diversified, and passively managed investment, then an index fund is a good option for you.

Stay tuned for Part 2 tomorrow

Have a question you want answered? Reply to this email and ask and I’ll try to cover it here.

💰 Be a Better Investor

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