Time To Suck It Up

Forwarded this email by a friend? Subscribe here.

Hi there,

It’s been a week packed full of economic reports, earnings releases, shareholder meetings, and chatter about a brand-new Apple product for the Metaverse, giving markets plenty to chew on. The overarching concern at this point is the US defaulting on its debt next week if lawmakers don’t raise the debt ceiling. Economists at Goldman Sachs say one-tenth of all economic activity would stop if the federal government ran out of cash in this scary scenario.

Here are some of the big stories we’ve been watching:

• Good news on the economic front: Factories are humming, and Americans are still spending (but carefully). Last month, industrial output was up, and retail sales grew, but Americans are cutting back on things they don’t need (a.k.a. discretionary items). This was reflected in Home Depot’s disappointing Q1 with a drop in big home-improvement projects and fewer big-ticket items (patio sets, grills) being sold.
• Solar projects won’t be delayed: President Biden has vetoed a bill that would have brought back tariffs on Chinese solar panels made in four Southeast Asian nations. China is accused of unfair trade practices, but a supply chain shortage would slow US renewable energy growth. The New York Times has a fascinating new piece about China also dominating each stage of lithium-ion battery production.
• Tesla’s annual shareholder meeting: On Tuesday, the biggest EV manufacturer in the world announced it will deliver the first Cybertrucks this year, teased two new models, and mentioned it may finally start advertising (you know, like every other car company). It’s working on a new drive unit that will use no rare earth elements and promised audits to ensure no child labor in its cobalt supply chain. CEO Elon Musk doesn’t plan on stepping down and says he’ll spend less time at Twitter. Tesla stock, which has halved in value since April 2022, climbed in response.

Lastly, it’s not just in your (heavy, achy) head — allergy seasons are getting longer and more intense, and they’re affecting more adults for the first time due to climate change. Yet another reason to aim for sustainable choices in all areas of your life, including investing, which we’re here to help you with. Keep reading to learn about carbon capture, a technology the government may push power companies to use.

News you can use

• Job satisfaction is at a 40-year high, according to a new survey, leading many to ask “Are employers doing something right?” The Conference Board says the tight labor market gave American workers better work-life balance and compensation. Of course, continued layoffs are a concern with a looming recession, and they can cost shareholders too. A new study from Gartner found that the forecasted savings tend to be offset by unforeseen consequences like low morale, high turnover, and customer loss.
  
• Earth is likely to cross a climate-change threshold — a global temperature rise of 1.5 degrees Celsius — within the next five years. That’s according to the World Meteorological Organization, which says there’s a 66% chance the mercury will reach that tipping point. While the warming trend may be temporary, it underscores how quickly climate change is accelerating.
  
• New exchange-traded fund for gender-based investing just launched. The BNY Mellon Women's Opportunities ETF includes companies that have gender-equitable practices or sell products and services that “enhance the ability of women to meet their work or other personal life responsibilities and needs.” Holdings include tech giants like Microsoft, Amazon, The Cooper Companies, and Progyny.

Like what you see, but this is your first time here? Sign up for our free newsletter.