What we’re reading (6/25)
“What To Expect From A Recession ‘Everyone’ Sees Coming” (Yahoo! Finance). “And if so many people believe that a recession is inevitable does that make it, well, inevitable? Or does it mean that a recession won’t occur? Or that any recession will at least be mild in nature? Ask this question enough ways and we're quickly into late-night dorm territory: What even is the economy?”
“Night Moves: Is The Overnight Drift The Grandmother of All Market Anomalies” (Haghani, Ragulin, Dewey, working paper). “The overnight effect refers to the fact that, over at least the past three decades, investors have earned 100% or more of the return on a wide range of risky assets when the markets are closed, and, as sure as day follows night, have earned zero or negative returns for bearing the risk of owning those assets during the daytime, when markets are open. The effect is seen over a wide range of assets, including the broad stock market, individual stocks (particularly those popular with retail investors, and Meme stocks most of all), many ETFs, and cryptocurrencies.”
“What It Takes To Buy Your First Home Now” (Wall Street Journal). “First-time home buyers are facing an exceptionally difficult housing market, threatening to lock younger households out of homeownership and the wealth-building it can provide. Even with prices rising, homeownership became more affordable for many families in late 2020 and early 2021 due to record-low interest rates. But now rates have shot upward, and prices are still climbing.”
“Self-Employed? Weird Credit Profile? Unconcerned By Soaring Inflation And Mortgage Rates? Venkat Would Like To Get You Into A Nice New Semi-Detached” (Dealbreaker). “Seemingly all are agreed: Mortgages are a bad business to be in right now, what with the rising rates and inflation and generally pervasive sense of economic anxiety ringing the world. And the Bank of England has made clear that it doesn’t look to kindly on the growing concentration of the U.K. mortgage market in the hands of big banks. Which means, on both counts, Barclays is right on cue.”
“They Don’t Sell Corn Dogs At Royal Ascot” (Vanity Fair). “You can’t find a corn dog at Royal Ascot. England’s preeminent thoroughbred event is nothing like the horse races I grew up around in Georgia. Order a Diet Coke and get lectured on social graces by a guy who is visibly inebriated at 10 a.m. Ask if they have chicken tenders instead of Peking duck salad and it’s as if you picked up after your dog with a Union Jack.”
