💳 Is The US Drowning in Credit Card Debt?

Good morning. US stock futures ticked higher in Wednesday morning trading as Wall Street snapped a three-day losing streak. Investors also looked to claw back more of the losses suffered earlier in the week.

💳 US credit card debt soars to new record

📝 Our report: Americans have collectively racked up a record $1.14 trillion in credit card debt, according to a new report on household debt from the Federal Reserve Bank of New York. Credit card balances rose by $27 billion in the second quarter of 2024, a 5.8% jump from a year ago.

 🔑 Key points:

• Credit card delinquency rates were also higher — especially among younger adults, or borrowers between the ages of 18 to 29 and 30 to 39, who were likely harder hit by the Covid-19 pandemic, the New York Fed found.

• The New York Fed also reported that over the last year, roughly 9.1% of credit card balances transitioned into delinquency.

• According to a survey by financial research firm Achieve, 57% of consumers rely on credit cards to make ends meet with 36% of consumers saying it is difficult to pay recurring debts on time.

💡 So what: Soaring U.S. credit card debt has several implications for consumers, financial institutions, and the economy at large. For consumers, it indicates rising financial strain, potentially leading to higher default rates and increased financial instability. For financial institutions, the increased debt heightens credit risk, potentially leading to tighter lending standards and higher interest rates. On a macroeconomic level, this trend could prompt policymakers to scrutinize lending practices and consider regulatory changes to prevent a potential debt crisis.

Wednesday - Consumer Credit

Thursday - Richmond Fed President Tom Barkin Speaks

Friday - No Major Economic News

📈 Seth Klarman shares these 6 investing lessons!

💰 Everything you need to know about high-yield checking accounts

💸 Here’s why it’s important to stay invested when the stock market fluctuates

 📈 Get 5.1% APY For Your Extra Cash

Many of you ask where we’re putting our extra cash to earn the highest interest while still having access to it.

I’ve looked through plenty of high yield options and my top pick is Moomoo. It’s offering one of the highest yields available today at 5.1% APY.

And the best part? No minimum deposits, no cap on interests, and you can withdraw your cash at anytime.

Moomoo is offering Daily Market Briefs subscribers a limited-time deal: earn 5.1% APY on your cash and get up to 15 free stocks.

PS: Despite the funny name, Moomoo is a registered broker dealer with the SEC and is a member of SIPC meaning you’re insured up to $500,000.

📺 Media giant set to raise streaming prices

WHAT: Disney has announced that it is hiking prices on its streaming platforms. Starting mid-October, most plans for Disney+, Hulu, and ESPN+ will cost an extra $1 to $2 per month, according to a company press release. The price hikes come as Disney continues to push its customers toward bundles to get a bigger bang for their buck.

WHY: For some time, Disney has offered a bundle of its own services, either Hulu and Disney+, or the two streaming services plus ESPN+. The existing bundle of Disney+ and Hulu, with ads, will also get a price hike this fall, up $1 to $10.99 per month. The same bundle without ads won’t see any price increase from the current rate of $19.99 per month.

✈️ Airline, labor union enter into negotiations

WHAT: United Airlines has kicked off negotiations with the Teamsters union, which is vying for a new contract for 10,000 aviation maintenance and related workers in the U.S., the labor union recently announced. The Teamsters National Negotiating Committee is seeking industry-leading wages, a faster timeline for reaching the top pay rate, improved healthcare benefits and higher safety standards.

WHY: The negotiations — which have begun four months before the current contract is set to become amendable — come at a time when thousands of maintenance staff members and flight attendants across airlines are demanding higher wages and more benefits after carriers posted record profits helped by a rebound in travel demand post-pandemic.

🧾 Social media platform sues over advertiser boycott

WHAT: Elon Musk’s social media platform X has sued a global advertising alliance and major companies, including Mars and CVS Health, accusing them of unlawfully conspiring to boycott the site and causing it to lose revenue. The lawsuit said advertisers, acting through a World Federation of Advertisers initiative called Global Alliance for Responsible Media, collectively withheld “billions of dollars in advertising revenue” from X, previously known as Twitter.

WHY: Ad revenue at X slumped for months after Musk bought the company in 2022. Some advertisers had been wary of ad spending under Musk amid questions and fears that their brands would appear next to harmful content that under prior owners might have been removed.

✏️ DMB Insider Quiz ✏️

🧑‍💻 We read your emails and poll replies daily.

Hit reply and let us know what you want more of!

See ya next time, Daily Market Briefs