Morning News: October 28, 2026
Posted by Eddy Elfenbein on October 28th, 2026 at 7:19 am

China Claims Strong Economic Growth, but Skeptics Question Official Figures

Port Snarls in Asia Show Signs of Easing After Seasonal Peak

Kevin Warsh Wanted the Fed to Be Quiet. Instead, It’s as Noisy as Ever

“Core” CPI Challenge

The Voters’ Verdict Must Be Respected — and Upheld

We Need Government That Threatens Fewer People With Bats

Brazil Exposed the Deficiencies of Prediction Markets

US Consumers Are Disillusioned About the Economy

A Punishing Housing Market Is Squeezing Renters

Wall Street’s AI Debt Machine Is Starting to Choke on Supply

Just How Much Is AI Contributing to the US Economy?

Investors Brace for Big Tech’s A.I. Spending Bill

Silicon Valley Is Grappling With a Flood of Bugs Found by A.I.

Elizabeth Warren Demands Answers from Anthropic on ‘Existential’ Risks

Data Centers Exemplify Global Cooperation, and Its Attendant Peace

GE Vernova to Buy High-Voltage Grid Equipment Manufacturer for $9 Billion

For India’s Richest Family, a Record I.P.O. and a Moment of Pride

China’s Car Industry Is Wowing the World—but Crashing at Home

Wanted: Robot-Dog Walkers. $20/Hour

Go 100 mph and Snap It: How a Teen Game Sparked Today’s Social Media Reckoning

Netflix Is Going Through an Identity Crisis

Amazon Debuts 16-Inch Echo Smart Display and Alexa Photo Frame

Samsung Joins Cuff-Shaped Earbuds Trend With $229 Galaxy Buds On

Drug Middlemen Will Soon Have to Share Details on How They Are Paid

GSK Shares Slide After Vaccine Sales Disappoint

Nelson Peltz’s Trian Offers to Buy Wendy’s for $1.4 Billion

Jersey Mike’s Posts Loss on Higher Revenue

Etsy Sales Rise as the Number of Active Buyers Increases

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CWS Market Review – October 27, 2026
Posted by Eddy Elfenbein on October 27th, 2026 at 7:06 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

The Federal Reserve started its October meeting today. Tomorrow afternoon at 2 pm ET, the Fed will release its policy statement. I’ll spare you the suspense: the Fed won’t raise interest rates — at least not at this meeting — but a rate hike may be coming in a few weeks at the December meeting.

What about for next year? That’s hard to say right now, but I think it’s very possible that we’ll see two more rate hikes in 2027. Of course, a lot of that will depend on the economy and inflation.

The two-year Treasury, which is a good proxy for what the market wants, has settled around 4.75%. We’re doing a lot better than French bonds which are suffering through their worst decade since 1803.

The stock market has suddenly gotten boring again. We had an exciting few days at the beginning of the month when the S&P 500 rallied 2.2% in four trading sessions to a new all-time high.

The big news this week was that Anthropic is filing for its IPO. Let’s take a closer look.

Anthropic to IPO in Massive Deal

Yesterday, Anthropic said that it’s going public, and Wall Street went absolutely ga-ga over the news — and Wall Street is a place that loves to go ga-ga over most anything. Folks have been waiting a long time for Anthropic to hit the market, and this deal will be massive. The news was enough to lift the entire tech sector.

Source: NYT

Anthropic is best known for Claude, its family of large language models. The company isn’t quite six years old, and it’s based in San Francisco. Anthropic plans to list on the Nasdaq under ticker symbol “ANT.”

As far as IPOs go, this will be one of the biggest of all time. The company was founded by the brother-sister team of Dario and Daniela Amodei. In 2021, Dario and a small group of researchers bolted from OpenAI to start Anthropic. OpenAI is now their big rival.

The consensus is that Anthropic will have a market value of $1.5 to $2 trillion. (When your margin of error is $500 billion, then you know you’re dealing with some very big numbers.) There are 15 companies with market caps over $1 trillion. Twelve are American. Zero are European.

Anthropic filed in June, but it gave the SEC some time to review all the details. The lead underwriters are Goldman Sachs and Morgan Stanley.

Anthropic is growing rapidly. For the first half of last year, they lost a measly $12.9 billion. For the first half of this year, Anthropic lost $80.7 billion. Now that’s some impressive growth.

Via: WSJ

For all last year, Anthropic lost $41.9 billion. In 2024, it had a loss of $8.3 billion. Anthropic said that as of June 30, it had $112.4 billion in cash and cash equivalents. International revenue made up for 27.8% of the company’s total revenue.

Interestingly, Anthropic’s customer base is far more diversified than those of other AI stocks. For example, Anthropic said that no single customer represents more than 10% of its revenue. Compare that with Nvidia which has five clients with more than 10% of its revenues.

Anthropic said it will use the funds from its IPO for general corporate expenses. The company also said that it may use the money to buy out other firms, which I almost certainly expect. The benefit of an elevated share price is that it can be used as cheap currency to buy out your rivals.

Anthropic is a classic “asset-light” company, meaning it doesn’t own much of anything. Instead, it leases what it needs. Anthropic currently has just over $1 billion in property and equipment. That includes $432 million of net property and equipment associated with finance leases. At the end of 2025, Anthropic’s future undiscounted lease obligations were just $50.2 billion. Now that’s at $321 billion.

Anthropic has an unusual corporate structure. Founder LLC owns 50.1% of the stock. The LLC has just seven members: Dario and Daniela Amodei, plus five other executives.

At the end of Q3, Anthropic said it had 5,300 employees. That works out to $6.6 million in revenue per employee. Anthropic said that internally it refers to its employees as Ants. I’m not sure what to think of that.

Anthropic said it will pay SpaceX around $3.1 billion per month to “access compute powered by NVIDIA GPUs.” SpaceX said in its Q3 report that Anthropic paid them $5 billion which is more than one-third of its total revenue. In its prospectus, Anthropic only named two competitors, OpenAI and Google.

The company listed 90 pages of risk factors. There’s been a backlash against data centers across the county. A few states and cities have passed moratoriums on new data center construction, and many more are considering the idea. Anthropic listed as a business risk having so much of its chipmaking done in Taiwan, especially at Taiwan Semi.

After the IPO, Google will have the option to become a very significant shareholder of Anthropic. In March, Anthropic agreed to give Google an option to buy up to $10 billion worth of shares in a private placement.

Amazon also has had a very close relationship with Anthropic. Since 2023, Amazon has invested $13 billion in Anthropic, and it may invest $20 billion more. Amazon owns convertible notes that could be worth $1.84 billion once Anthropic IPOs.

I’m not going to be an investor in Anthropic’s IPO, but I will be watching it closely. I expect to see them use their cash infusion to buy out a lot of competitors.

Hawkins Inc. Soars on Earnings

If you’ve been following me for a while, you’ll know that I’m a big fan of little-known stocks that are great businesses even though they’re not followed by any analyst on Wall Street (in other words, the exact opposite of Anthropic). A great example is little Hawkins Inc. (HWKN) of Roseville, Minnesota. Hawkins is one of those small- to mid-cap industrial stocks that I love. It has a market value of $3 billion.

The company describes itself as “a leading specialty chemical and ingredients company.” Snoresville, right? No, Hawkins isn’t the most exciting business, but it’s an important one, and it’s something people need. Hawkins “formulates, distributes, blends, and manufactures products for its Industrial, Water Treatment, and Health & Nutrition customers.”

I first told you about Hawkins in June 2024. Since then, it’s up over 72%. Hawkins has been around since 1938. The company has 64 facilities across 28 states. Hawkins has about 1,200 employees and last year, it generated revenue of $1 billion.

Now for the best part. Since 1992, Hawkins is up by more than 150-fold. The S&P 500 (in blue) looks like a flat line in comparison. Hawkins has also raised its dividend consistently for nearly 40 years.

Hawkins used to have a practice of announcing 10% or 15% stock dividends each year. These tended to be in line with the stock’s long-term performance. As a result, the nominal share price didn’t move much. That might you lead you to believe that the stock hasn’t done well, but it’s been a huge winner. Despite all its success, still only two Wall Street analysts bother following Hawkins.

After yesterday’s closing bell, Hawkins released another good earnings report. For its fiscal Q2, which ended on September 27, Hawkins had sales growth of 12%, and earnings were up 23% to $1.34 per share. I can’t say whether that beat earnings since there is no consensus. The average of the two analysts was for $1.18 per share.

The market loved the earnings report. At one point, Hawkins was upv17% today before settling for a gain of 13.6% today. This was a great bargain hiding in plain sight.

That’s all for now. The Fed will release its policy statement tomorrow at 2 pm ET. Don’t expect any rate increase for now. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Morning News: October 27, 2026
Posted by Eddy Elfenbein on October 27th, 2026 at 7:12 am

Lula’s Winning Political Instincts Raise Brazil’s Financial Risk

This Oil Tanker Tycoon’s WhatsApp Messages Drive Big Market Moves

India Turns Kitchen Grease to Fuel in Drive to Cut Crude Imports

How Trump Unwittingly Boosted Green Energy

Why I’m Excited About a Bucket of White Paint

Florida Sues Climate Modeler First Street Over Home Risk Scores

USTR Offers China a Subsidy Reprieve While Issuing the EU a New Threat on Airbus

Boeing Aircraft-Division Loss Widens as Deliveries Stagnate

America Needs Canada’s Aluminum. Trump’s Tariff Exposed Just How Badly

Brace Yourself, GOP. Trump’s Iran War and Tariffs Are Going to Sting

The White House Will Fail to Overturn Any Elections

We Need Taxation That Maximizes Luck Most of All

The Cruelty of Government Consumption Is Felt By Us All, Now

The Fed Is Expected to Hold Rates Steady. Warsh Will Have to Explain Why

GM to Leave NYSE for Stock Listing on Tech-Focused Nasdaq

U.S. Pensions Are Riding the A.I. Wave. For Better or Worse

Anthropic’s IPO Sets Up Defining Moment for Wall Street and AI Boom

In Anthropic I.P.O., Goldman and Morgan Stanley Slug It Out for Top Bank

Anthropic’s Big Tech Backers Await Payoff in IPO

Who Stands to Gain From an Anthropic I.P.O.

BlackRock’s Rieder Spent Weekend Doing Deals in AI Debt Rush

AI Talent War Has Quant Firms Racing to Fund PhDs, Build Labs

Microsoft Is Trying to Shed a Lot of Workers. Just Don’t Call It a Layoff

Apple’s Foldable iPhone Duo Draws Early Complaints of the Screen Cracking

Moderna’s Billionaire Co-Founder Is Betting on More Improbable Ideas

Could ‘You Can See Everything’ Be Up for Best Picture but Not Documentary?

Hollywood’s Female Executives Are Easy Targets in a Crisis

Harley-Davidson Wanted an Electric Revolution. That Dream Is in Trouble

Coca-Cola Raises Guidance, Buoyed by Soda Sales Abroad

The Scariest Part of Halloween This Year? The Candy Prices

Burger King Posted the Boss’s Number for Feedback. He Got 100,000 Calls

Mbappé Apologizes for Perceived Mao Insult After China Backlash

DraftKings Faces Growing Pressure Over How It Targets Customers

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Morning News: October 26, 2026
Posted by Eddy Elfenbein on October 26th, 2026 at 7:09 am

Brazil’s Markets Set for Sharp Selloff After Lula’s Reelection

Brazil’s Real Plunges After Lula Wins Presidential Election

Markets Are Mispricing Brazil After Lula’s Epic Comeback

French Bond Risk Gauge Falls as Moody’s Keeps Rating Stable

Is Debt Really the Villain? Ask China, Singapore, and Greece

Trump’s Midterm Affordability Crisis

Trump’s Trade Chief Is Trying to Sell Americans on an Unpopular Product

There Are Solutions to This Crazy Economy. Voters Will Hate Them

Why Economic Health No Longer Dictates Stock-Market Returns

The War Bump Is a False Victory for S&P 500 Profits

The Search for a Sure Thing Beyond Bonds or Cash

Warsh Tells Traders to Watch the Data. They Still Follow the Fed

The Messy Fight Over California’s Proposed Billionaire Tax Divides Democrats

The Best Border Policy Is a Good Paycheck

Milwaukee, Berlin and Paris Show Us the Way to Prosperity

South Korea Holds a Key to America’s Shipbuilding Revival

U.S. Manufacturing Is Adding Jobs Again, but the Hiring Rules Have Changed

AI Cuts Some Deutsche Bank Corporate Loan Decisions to Minutes

Hunting for AI Gains Outside Magnificent 7

What’s Riding on Anthropic’s Market Debut? Nearly Everything

Anthropic’s Pitch to Investors Starts With Taking Their Jobs

Meta Seeks Up to $95 Billion in Equity to Fund AI Spending

Starlink Doubts Have Put a Rocket Under SpaceX’s Rivals

Musk’s Dream of SpaceX-Tesla Merger Rests on Carmaker’s Shareholders

Why So Many Shoppers Think Retailers Are Using AI to Jack Up Prices

Verizon Lifts Outlook, Inks Amazon Deal Worth More Than $2 Billion

Netflix Users Are Watching Less, Not Opening the App as Often

Radisson Is Growing at a Time When ‘Instability Is the Norm’

Pints Alone Won’t Save the British Pub. Activate the Knitting Circle

Why Some People Are Paying to Make Friends

Chiquita Sees Cheap Bananas at Risk on El Niño Supply Threat

The Long Life of the ‘Snacking Occasion’

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Morning News: October 23, 2026
Posted by Eddy Elfenbein on October 23rd, 2026 at 7:02 am

Pandering to Vladimir Putin Won’t Bring Peace to Ukraine

How Does the Ukrainian Military Use Starlink?

See How Airlines Are Navigating the Dangerous Skies to Avoid Global Conflicts

Suhasini Haidar: India No Longer Sees the US as Benign

Trump’s Plan to Import More Ground Beef Is Falling Short

Canadian Cheese Was About to Become the Next Big Thing. Then Came the Tariffs

How Tariffs Became the Most Hated Word in Politics

As Inflation Continues to Lose Its Sole Meaning, Liberty Is Lost

Treasuries’ AI Link Shows Sharp Shift as Haven Trade Returns

A Tech Rotation Roils the Markets, Again

Market Signals Are An Essential Tax On Bad Information

Why Investors Must Stop Treating Research Reports As Truth

AI Tech Fears Push Global Credit Spreads to 17-Month High

Credit Score Competition Is Good News for Housing Affordability

Dodgers Owner Mark Walter Wins Partial Nod to Slash Pile of Scrutinized Loans

The Obscure Rule Helping to Supercharge Retail Trading

Bitcoin Billionaires Are Racing to Ride a 3,000% Crypto Boom

A Simple Way to Benefit From Rising Rates: Buy Money Market Funds

CFOs Are First in Line for a C-Suite Shake-Up

A.I. and New Rules for Accounting Are an Opportunity for Start-Ups

Amex Shares Drop After Transaction Volume Misses Estimates

China’s Parcel Sales Are Shrinking as They Become Tax Targets

US Mortgage Rates Decline for First Time in Nine Weeks, to 7.32%

That Grad School Loan May Cost You. It’s About Time

There’s Nothing Special About Factory Jobs

Jane Street and Rivals Are Now Fighting for AI Power as Well as Pace

To Shape AI, Use AI

Meta’s Muse Can’t Be a Freeloader’s Paradise Forever

Apple’s iPhone Duo Hits Stores in Face of Short Supply and High Demand

First-of-Its-Kind Vaccine Ushers in New Hope for Cancer Patients

Novartis’ Kisqali Cuts Death Risk 19% in Breast Cancer Study

An Existential Threat to THC Drinks Pits Willie Nelson Against Mitch McConnell

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Morning News: October 22, 2026
Posted by Eddy Elfenbein on October 22nd, 2026 at 7:12 am

Looted Goods From French Stores Flood Resale Sites After Riots

Two Wealthy Americans Face Off in Bitter Feud Over Panama Port

London Stock Exchange Group Agrees to Buy Octus From Permira For $3.5 Billion

Two Cheers For Kevin Warsh’s “Quiet” Fed

Hedge Funds Pile Into Shorts as Goldman Flags Stock Squeeze Risk

Private Credit Group Says Market Fears Are Divorced From Reality

Blackstone Profit Drops 9.2% as Rates, Inflation Curb Dealmaking

Rubin: In Six Decades of Public Life, I Never Thought I Would Write This Piece

Reliably Red Iowa in Play as Economic Woes Mount

This Deportation Blitz Isn’t Happening as Advertised

Employers Shift Rising Health Care Costs Onto Millions of Workers

A US Family’s Annual Healthcare Plan Now Costs More Than $28,000

The CEO Who Turns ‘Touchy-Feely’ Leadership Into Profits

Bosses Want the Secrets of the Family Firm That Has Never Had a Layoff in 75 Years

Data Center Restrictions Will Hurt Small Business the Most

It’s AI 0, German Philosophers 1

IMF, OECD Warn AI Could Widen Rich-Poor Country Divide

Global Rush to Fix Security Flaw Uncovered by A.I. Leaves Sites Offline

The Good Guys Notch a Victory in the AI-Cybersecurity Age

For Clues About How A.I. Will Change Work, Look to the Past

Soaring AI Bills Are Vexing Wall Street Executives

Meta Reports $825 Billion in Future Spending Commitments

How Mark Zuckerberg Pushed Meta to Shield Him From California’s Proposed Wealth Tax

Tesla’s Lowered Capex Plan Fuels Doubt on AI, Robotics Goals

Musk Tries to Lock In His Tesla-SpaceX Dream Before Trump’s Exit

Carrier Plans $600 Million Texas Plant to Make Cooling Gear for AI Data Centers

Gray Paint Has Never Had It as Good as in the A.I. Boom

Bosch to Separate Auto-Parts Unit as Chinese Rivals Gain Ground

Lockheed Martin Bumps Up Yearly Outlook as Backlog Hits Record

American Air Cuts Outlook Again, Sees Higher Fuel Bill This Year

P&G Price Plan Spurs Sales Beat Without Sacrificing Profits

‘We Cannot Be Paralyzed by Fear’: Hollywood Execs on the Future of AI

The Live Nation Empire That Music Fans Hate Is at Risk of a Break Up

Would You Listen to A.I. Music? Maybe You Already Do

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Morning News: October 21, 2026
Posted by Eddy Elfenbein on October 21st, 2026 at 7:09 am

Musk Ordered Starlink Slowdown That Crippled Ukraine’s Drones and Sowed Panic in Kyiv

Oil Rises as Mideast Ship Attacks Mount But Hormuz Flows Persist

Britain Approves Long-Stalled Gas Drilling Project in the North Sea

Trump’s Arm-Twisting for a New York Pipeline May End in Regret

Bond Selloff Revives Debate About Euro Zone Banks’ ‘Doom Loop’

The AI Boom Is Setting Up the Fed for a Rate Seesaw

Sticky Inflation Is Testing the Fed’s Resolve

The Treasury Market’s New Power Brokers Are Pickier Than Ever

Contra Bloomberg News, U.S. Taxes Aren’t “Too Low”

Are Dividend ETFs a Shortcut to Early Retirement?

How Trump Accounts Have Attracted the World’s Wealthiest Donors

It’s No Secret What the Best Financial Advice for Retirement Is — But Most People Ignore It Anyway

Todd Boehly Defiant in Pivotal Moment for Billionaire-Owned Insurers

Senator Asks 4 Accounting Giants to Describe Malta Tax Advice

Why Your Home Insurance Costs More Than Your Property Tax

Governments Take Websites Offline After PHP Security Warnings

Meta Earnings Will Provide a Gut Check for Struggling AI Trade

Nvidia CEO Huang Pushes Europe on All Industries Adopting AI

Asia’s Chip Exports Soar as AI Bubble Debate Rages

SpaceX Boosts the A.I. Rally

SpaceX, Tesla Boards Study Possible $3.5 Trillion Merger

The Biggest Blue Origin Investment Opportunity May Not Be Blue Origin

How Toyota’s Top-Selling SUV Suddenly Became So Hard to Find

FAA Clears the Way for Airlines to Put Boeing’s Long-Delayed 737 Max 10 into Service

A Battle for Control of India’s Biggest Business Empire

Netflix Is Great at Making Money. Its Problem Is Keeping Viewers Hooked

Daily Pill to Keep Breast Cancer Away Is Roche’s Next Frontier Drug

Abbott Spins Off Embattled Business That Sells Baby Formula

How Coca-Cola Got Burned With a $5 Billion Bet on Costa Coffee

Starbucks China Will Require Purchases to Sit in Its Cafes

Eight Years Ago, Saudi Women Couldn’t Attend Football Matches. Now They’re Playing in Them

Philip Morris Profit Falls Despite Higher Sales

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CWS Market Review – October 20, 2026
Posted by Eddy Elfenbein on October 20th, 2026 at 6:09 pm

The S&P 500 went 53 days in a row without a daily drop of more than 1%. Then it happened twice in three days. Last week was the worst week for the Nasdaq Composite since June.

Many AI stocks got shaken up over the last few days. Anthropic’s Q3 revenue was “allegedly” $16.8 billion. While that may sound like a lot to us mortals, some folks are getting worried about the pace of the growth of AI.

Over in the bond market, investors are starting to question CoreWeave’s sustainability. The research firm Gartner also poured cold water on the AI trade by saying that AI may not be as profitable as investors think.

Another concern about the AI buildout is that (some folks fear) it’s a one-time event. Once it’s done, AI will only need upgrades. We’ve also seen AI valuations decline in recent days. For example, the valuation of Nvidia (NVDA) has been headed downward. NVDA’s forward P/E Ratio has fallen from 23 to 15. Indeed, the stock has done very well, just not as well as its expected earnings.

Monday and Tuesday appear to have been relief rallies for AI, but there’s still a lot of nervousness out there. The S&P 500 Tech ETF (XLK) recently underperformed the S&P 500 ETF (SPY) for 10 days in a row.

There’s going to be a slew of Q3 earnings reports coming soon. Some of the biggies will be stocks like Meta (META) and Tesla (TSLA) which report this week.

This morning, we got some key earnings reports. RTX Corp. (RTX), for example, reported very good earnings. The company made $2.26 compared with expectations for $1.78. GE (GE) made $2.25 per share versus the Street’s view of $2.01 per share. GM (GM) made $3.70 per share which was a seven-cent beat, but the stock took a hit. 3M (MMM) made $2.50 per share versus $2.38. The stock rose more than 5% today. Several of our Buy List stocks will report soon as well.

I like to track how well High Beta stocks have been doing relative to Low Vol stocks. That’s a quick and easy way to see how receptive the market gods are to riskier, more speculative stocks. Since October 5, the Low Vol ETF (SPLV) has beaten up on the High Beta (SPHB) side of the market.

I’m careful not to say this is the start of a long-term sector rotation. The High Beta ETF had a nice run this summer, but that, too, was another head fake. Soon, the High Beta names re-grabbed the spotlight. The AI stocks have dominated the market for so long that it’s hard to imagine that another sector can lead the market.

More Problems for Housing

More data is coming out that’s showing serious problems for the housing market. On Tuesday, the National Association of Realtors said that pending home sales for September fell 7.3% from August. Over the last year, pending home sales are down by 11.3%.

It’s no secret as to what’s causing the problems for housing. At the start of September, mortgage rates were at 6.8%. By the end of the month, mortgage rates reached 7.6%. In the South, sales fell by 8.2% and in the West, sales were off by 9.2%.

Home construction also took a hit in September. Both single-family housing starts and building permits fell much more sharply than analysts had predicted. Starts were down 4.56% to 859,000 annualized, according to the U.S. Census. That is the lowest level since September 2025. Building permits, which are a measure of future construction, fell 4% for the month.

The National Association of Home Builders said that homebuilder confidence fell to a 14-year low. The index for housing market conditions fell 3 points to 29. That’s the lowest since June 2012. The median estimate of economists was 31. Any reading below 50 means that homebuilders see conditions as not good. Housing starts fell 4.56% to 859,000 annualized.

A measure of current sales dropped to 33 which was also a 14-year low. Sales over the next six months fell to its lowest figure since November 2022. Buying a home has simply become too expensive for many Americans and we’re now seeing prices come down. Of the homebuilders, 43% have said they’ve cut prices.

Housing is crucial to the health of the overall economy. So many different sectors are closely tied to the fate of the housing sector.

This week, Goldman Sachs said the housing market’s problems may last for a long time. The financial firm says that affordability will still be an issue in 2027. Goldman pointed out an interesting stat: “More than 95% of mortgage borrowers have interest rates below current market rates, and 65% have rates 2 percentage points below market rates.”

For next year, Goldman expects existing home sales to be 26% below the level from 2019.

The latest data also shows that homebuyers are canceling sales at a near-record pace. In September, 14.5% of homes fell out of contract. That’s the highest since the early onset of the pandemic.

There are a lot of reasons why a home can fall out of contract. Sometimes the buyers just get nervous at the high price. Even popular markets like Jacksonville, Tampa and Las Vegas have cancellation rates near 20%.

The iShares U.S. Home Construction ETF (ITB) has badly lagged the market. Over the last two years, the S&P 500 ETF (SPY) is up by 34.64% while the ITB is down by 30.19%.

Trex (TREX), a stock we used to love and which was on our Buy List, has fallen on hard times. The stock is down 60% from its 2021 high. To be fair, the stock has improved this year. Deutsche Bank recently upgraded Trex to Buy from Hold. They said that demand “appears to be turning the corner.” Trex could be a good buy once the broader sector starts getting better.

This is actually a great time to buy a home, if you’re paying all cash. That’s because the price drops are being driven by higher mortgage rates. If you don’t need to borrow, then buying now is a good deal.

According to the WSJ, “in 33 of the top 50 metro areas, luxury home prices are rising faster or falling slower than starter home prices.” In San Francisco, much of that AI wealth is going into new homes. The luxury market is up by 4.6% while the starter home market is down by 1.7%. Toll Brothers said that 25% of the company’s buyers are paying in cash.

For now, I would encourage investors to forego trying to find bargains in housing stocks. The problems in that sector are getting worse, and the Fed will most likely raised rates again before the end of the year. Don’t be fooled by low prices.

That’s all for now. This will be a big week for earnings reports. On Thursday, we’ll also get the regular jobless claims report. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Morning News: October 20, 2026
Posted by Eddy Elfenbein on October 20th, 2026 at 7:05 am

Russia Ships the Least Oil in a Month as Major Baltic Port Halts

Is Trump’s Plan to Import Diesel From Russia Legal?

How US Satellites Became Crucial to Ukraine’s Defense

Saudi Arabia Postpones ‘Davos in the Desert’

Political Risk Makes France a Go-To Market for Short Sellers

CoreWeave’s Bond Rout Should Make the Fed Cautious

Yes, the Fed Can Kill the AI Boom

Where to Shelter as AI Fears Rattle Markets

Everybody Seems to Hate This Bull Market — Except Me

Private Equity’s $12 Billion Self-Dealing Problem

Private Jets, Investor Pressure Push Polymarket CEO to Grow Up

Not Even Bowling Alone

Four Financial Lessons From the Hedge-Fund Divorce Captivating Wall Street

Home Insurance Tops Property Taxes in Squeeze for US Households

The Worst-Case California Wealth Tax Scenario Is That It ‘Succeeds’

Tax the Consumption of the Rich, Not Their Wealth

The Ultrawealthy Are Reshaping the US South

Black Unemployment Hints at a Job Market in Worse Shape Than It Seems

Home Depot Is Thrust Into Trump’s Crosshairs

Trump Announces $8 Billion Plan to Cover Farm Losses

AI Debutant’s Flameout Stokes Fears the Boom Is Ending

Insurer Rolls Out Policy to Protect Data Centers Against Growing Backlash

U.S. Bans DeepSeek from Government Agency Systems Amid AI Rift with China

Investors Await Musk’s Next Big SpaceX Deal

From Astro Boy to RoboCop, Son’s Robot Dreams Get Wilder

GE Aerospace Once Again Lifts Outlook as Profit, Revenue Climb

General Motors Drops After Tempering Outlook for Earnings Upside

General Motors Plans $20 Billion in Buybacks to Shore Up Share Price

Halliburton Logs Sharply Higher Profit as Revenue Climbs

3M Lifts Earnings Outlook as Profit Jumps

Nurses Are in High Demand—but They’re Quitting in Droves

GLP-1 Boom Fuels Dangerous Black Market for Smuggled Weight-Loss Drugs in Brazil

Walmart Launches Joint Membership with Sam’s Club as It Leans Into Delivery, Gas Discounts

See a Knicks Opener for Under $1,000? Oh, Those Were the Pre-Title Days

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Morning News: October 19, 2026
Posted by Eddy Elfenbein on October 19th, 2026 at 7:06 am

Gold Rises Amid Falling Oil Prices

The US-Iran War Is Making World Hunger Much Worse

‘A Ticking Time Bomb’: An Economic Crisis Looms in Indonesia

China’s Economy Expanded 4.5% in Third Quarter, Powered by Exports

China’s Export Boom Masks Deep Economic Problems at Home

Liberte, Egalite, Misery? Why France is Burning

JPMorgan Announces $5 Billion in Investments in Companies Critical to US National Security

How Patriotism Shapes Jamie Dimon’s Leadership

Bond Market’s Big Short Bet Gets Wakeup Call as AI Trade Wobbles

Billionaires Warn of a Bubble Yet Howard Marks Is Unconvinced

Gen Z Investors Are Switching Up Their Portfolios Ahead of The Midterms

A Bank That Closes My Account Should Be Required to Tell Me Why

Stop the 50 State Shakedown of Prediction Markets

America’s New Housing Market Is All About Luxury—and It Runs on Cash

A Serious Housing Agenda Has To Account for Capital and Credit

The Internet Told Them Owning a Laundromat Was Easy Money. It Was Anything But

U.S. Political Money Funnels to Indian Bots to Lure Voters

California’s Strange Addiction Politics: Cannabis Is Fine, Nicotine Not

There Is No Quick Fix for High Beef Prices

Startups Are Extracting More Copper Using Microbes

For Three Buffetts, a $150 Billion Puzzle Over Warren’s Riches

Anthropic’s I.P.O. Charity

Why Oracle’s Debt Load Could Be Your Problem

Meta Says Claude AI Tool Triggered No Kings Instagram Suspension

AI Agents Are Only as Good as the Personal Information You Share. That Raises Privacy Concerns

Musk Vows to Give Each U.S. Child a SpaceX Share

What Tesla’s Flying Roadster Really Means for the Global Auto Race

The VW Bus, Now Electrified, Keeps on Truckin’

United’s C.E.O. Says It Should Cost More Not to Sit in the Middle Seat

United Is Putting the Final Nail in the Loyalty Coffin

Merck KGaA to Buy Silence Therapeutics for $1.1 Billion

The Booming Business of Women’s Sports Owes Its Success to These Athletes

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