For better or worse, we're all stuck in our current economic situations.
A "trapped in place" economy is in full swing. Bad buying conditions coupled with everyday high prices means consumers can't make any major life changes, writes Business Insider's Emily Stewart.
The housing market is the most obvious casualty of this economic game of freeze tag. High prices, unrelenting mortgage rates, and low inventory have kept buyers and sellers mostly on the sidelines.
But it's not the only area of the economy that's stuck, Emily writes. The car-buying and job markets are also stalled.
There is one thing that could melt the economic freeze.
High borrowing costs are one of the key things keeping the status quo firmly in place. It's tough to take big swings when the cost of capital is so high.
But regardless of when rates are cut, consumers might still need to do a bit of soul searching to realize the past is the past. Plenty of financial experts — including one of the most successful hedge fund managers — predict high inflation will stick around for years.
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And the idea the Fed will snap back to a zero-rate environment — partly what got us into this economic mess in the first place — seems like a pipedream. Mortgage rates under 3% are likely a relic of the past.
So, while consumers lament being stuck in place, they should also avoid getting stuck looking to the past.
3 things in markets
Pain in commercial real estate means opportunities for Wall Street. Investors like Blackstone and Steve Mnuchin are wading into the troubled CRE market, indicating the industry could be ready to rebound. The signs are there, from an increase in single-family rental dealmaking to prices on commercial mortgage-backed securities rising.
Is investing in sports fair or foul? JPMorgan just set up its own sports investment banking team as hype builds ahead of a crucial NFL meeting. Some have questioned whether sky-high team valuations could be entering bubble territory, buta study showed why sports investments remain a good deal for firms. The MLB and NFL outperformed stock, bonds, and private equity on a 20-plus-year basis, according to the authors.
You can thank bankers for the US's "vibrant" economy. That's according to Bank of America CEO Brian Moynihan, who shrugged off calls for regulation after NYCB's recent wobble. Capitalism and the banking system have helped the US economy weather the pandemic, higher interest rates, two wars, trade debates, and shipping restrictions, he said.
3 things in tech
How Instagram got its mojo back. Just a few years ago, it felt like Instagram's relevance was fading. But after beating out TikTok in growth last year, the app is on a comeback tour, thanks partially to the rise of Threads.
OpenAI is poised to release the next version of ChatGPT. It's on course to put out GPT-5 sometime mid-year, two people familiar with the company told BI. "It's really good, like materially better," one CEO who recently saw the new version of the intelligent language tool said.
A PIP spike at Amazon. An official HR document shows the number of Amazon staff put on performance-improvement plans spiked from spring 2022 through early 2023 — a time when the company was going through major layoffs. Some employees saw it as a "quiet firing" tactic.
Domo's CEO stepped down in 2022 after being accused of sexual assault. Josh James stepped down as the data analytics company's CEO after the alleged assault in late 2021, according to police reports and employees. He was never charged, and returned as CEO in 2023.
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