End of Week Finance News

Inflation & Interest Rates Stay Put

We had a couple of economic reports in the U.S. this week. Starting with the Inflation Report, The U.S. Bureau of Labor Statistics released its Consumer Price Index Summary for May. May had a net zero change in inflation, with 3.3 12-month rolling inflation. Gasoline led the drop in inflation overall, as gasoline prices went down 3.6%. After the news on inflation, the Federal Open Market Committee (FOMC) released its report on Wednesday regarding interest rates. The Committee stated “The economic outlook is uncertain, and the Committee remains highly attentive to inflation risks. In support of its goals, the Committee decided to maintain the target range for the federal funds rate at 5-1/4 to 5-1/2 percent.” Essentially, interest rates will stay the same for now, while the economy stabilizes. Until the Federal Reserve determines the economy is strong enough to reduce interest rates and prices start to drop (or stabilize consistently), we will continue to see high prices for mortgages, cars, and other major loans.

What Happens When You Get Caught

The last few years have created new ways of working for the masses, including remote work. While remote work is not new to the world, the pandemic in 2020 created a large opportunity for many employees to work from the comfort of their own homes. It also created an opportunity for employees to reduce their workload if they were creative enough.

Bloomberg recently reported that Wells Fargo fired several employees who were “discharged after review of allegations involving simulation of keyboard activity creating impression of active work.” Employees used software and devices that can be bought from Amazon to simulate the activity of work, ensuring their screens and chats would appear active.

It can be tempting to purchase these devices, especially when employees are working from the comfort of their own homes, but now we know these devices are not perfect and can be detected. A better approach for employees is honesty with their managers. When employees need to run errands throughout the day, discussing these options with management is better than losing a career completely.

How’s the Market?

This week was an odd one for the market, as GameStop (GME) continued to dominate the headlines, but long-term investment funds are looking strong. While GME continues to be unstable and unpredictable (opening the week at $28.90, hitting highs of nearly $32, and lows of $23, while currently trending towards a week close at the same price as open), the S&P 500 has made strong improvements. Opening the week at $5,341.22 and trending to a close of $5,422, the S&P 500 looks to be the strongest it ever has in its history. Popular S&P 500 ETF VOO (Vanguard S&P 500 ETF), is trending towards an all-time high close at $498. Long-term funds that align with top businesses are usually the better bet for investors than unstable investments like GME, and this week shows that trend.

Why It All Matters

Inflation, interest, lay-offs, firings, and stocks… How does this affect us all? Well to start, inflation and interest rates are indicators of the strength and well-being of the economy. Inflation staying low is a good thing, but we only get a small look at interest rates for May. If June continues the same trend, we might be able to see some good news for the end of 2024. The Fed will wait for that good news before they decide to lower interest rates if they do so at all. Interest rates remain high due to the instability of the economy, and the ambiguity of price increases of the last few years. During this time, we must take our careers seriously and avoid losing jobs over avoidable mistakes like those at Wells Fargo. For more information on career resources or stock and markets, check out our growing library below.