☕ Greased Alaska

Why mortgage rates hit a 23-year high... [Advertisement][Advertisement] October 06, 2023 [View Online]( | [Sign Up]( | [Shop]( [Morning Brew]( PRESENTED BY [Bose]( Good morning. For all the new managers in the house: Do you dread your 1:1s? Are you finally understanding what it means to have impostor syndrome? Do you wish there were something you could do besides watch Horrible Bosses and try to do the opposite? There is something you can do. Morning Brew’s one-week virtual course for new managers will begin on Monday, Oct. 9, and teach you how to communicate better, develop a D1 team, and make sure your bosses know how well you’re doing. Your employees will still talk about you behind your back, but with your newfound skills, way more of what they say will be positive. [Learn more here](. —Matty Merritt, Molly Liebergall, Cassandra Cassidy, Adam Epstein, Dave Lozo MARKETS Nasdaq 13,219.83 -0.12% S&P 4,258.19 -0.13% Dow 33,119.57 -0.03% 10-Year 4.708% -2.8 bps Bitcoin $27,503.13 -0.93% Clorox $124.93 -5.23% *Stock data as of market close, cryptocurrency data as of 11:00pm ET. [Here's what these numbers mean.]( - Markets: Stocks closed slightly lower yesterday as investors [await]( today’s key job market data. And for the second straight day, Treasury yields inched down after hitting 16-year highs earlier this week. Meanwhile, Clorox shares continued their slide toward a [52-week low]( as the company deals with the fallout of a cyberattack.  REAL ESTATE [Mortgage rates hit a 23-year high]( [An image showing a home with rising mortgage rates]( Francis Scialabba The good news: You’re seeing fewer “We did a thing!” posts from high-school acquaintances holding shiny new house keys. The bad news: You’re probably not getting your hands on shiny new house keys, either. The average 30-year fixed-rate mortgage [reached 7.8%]( this week, their highest level since 2000. Why is this happening? It’s due partly to a change in Treasury yields. Mortgage rates usually rise alongside the 10-year Treasury yield, which can signify investor optimism in the economy. And the 10-year Treasury yield hit 4.8% on Tuesday, a height it hadn't reached since 2007. So, investors thinking the economy looks good means you can’t buy a house? Yeah, kinda. It’s also the Fed. Over the last 40 years, the Federal Reserve has been slowly undoing a hike-a-palooza from the ’80s that bumped interest rates close to 19%. Mortgage rates drop when the Fed loosens its grip on the country’s monetary policy. But last year, Fed Chair Jerome Powell decided the party was over and started hiking rates again—and much more quickly than first-time home buyers are used to—to combat inflation. Meaning: Mortgage rates spiked, too. What this means for you: If you were one of the lucky ones who purchased a quiet bungalow at a mortgage rate of 3% during the pandemic, well, congrats. Now the housing market is basically at a standstill as high mortgage rates refuse to budge. Housing demand [dropped]( to its lowest level since 1996 last week, according to the Mortgage Bankers Association, since owners don’t want to sell and lose their lower mortgage rate. So there isn’t much inventory even for those looking to buy. Looking ahead…the Fed has signaled that interest rates will stay elevated, so we’re likely to see mortgage rates hit 8% (for some borrowers, they [already have](. If and when the job market weakens, the Fed could finally relax rates, which would make mortgages drop. Yay?—MM   PRESENTED BY BOSE [Sound just leveled up]( [Bose]( Attention audiophiles, music lovers, podcast junkies, and everyone in between : There’s a brand-new pair of earbuds ready to transform your listening experience. Meet Bose’s QuietComfort Ultra Earbuds. They offer [world-class noise cancellation and breakthrough spatialized audio]( for more immersive listening, no matter the content or source. Yep, sound just got real. The cherry on top? They’re built with an [elevated design and luxe materials]( so listeners can jam out and tune in with unrivaled comfort. It’s everything music makes you feel, taken to new heights. [Give your ears the VIP treatment](. WORLD [Tour de headlines](#) [A border wall in Texas]Patrick T. Fallon/Getty Images Biden’s building (some of) the wall. His administration is [waiving 26 federal laws]( to allow for the construction of a border wall in South Texas. Homeland Security Secretary Alejandro Mayorkas said there is “an acute and immediate need” to build physical barriers in Starr County, where 245,000 illegal entries have been recorded so far this year, according to government data. President Biden maintained his position that a wall is ineffective but said he was [left with no choice]( but to allow up to 20 miles to be built because Congress allocated funding specifically for it in 2019. “They have to use the money for what it was appropriated,” Biden told reporters. “I can’t stop that.” Amazon’s and Microsoft’s cloud services are under investigation. UK regulators [announced a probe]( yesterday into the tech companies’ cloud computing market dominance. Combined, the two owned 70%–80% of the UK’s public cloud infrastructure in 2022, which Britain’s media regulator, Ofcom, argued makes it hard for businesses to switch providers. Both Amazon and Microsoft said they would work “constructively” with regulators. The probe could foreshadow more inquiries into the companies’ stranglehold on global cloud computing—the US Federal Trade Commission sought public comment on the industry earlier this year. Belgian intelligence is monitoring Alibaba for spying. The country’s security service told the FT that it’s looking into “[possible espionage]( performed by Chinese entities at Alibaba’s logistics hub in Liège. Of particular concern is Alibaba’s use of software that can access data about merchants and pass along insights into any vulnerabilities to China. Alibaba denied the allegations, which come as several other European countries increase scrutiny of the possible security risks posed by Chinese companies. TRAVEL [Michelin will tell you which hotels are worth the trip]( [Michelin key logo]( Illustration: Francis Scialabba, Image: Michelin You’ve heard of Michelin stars for restaurants, if not from The Bear, then from your friend who ate at Eleven Madison Park once and reminds you of it every chance they get. Now, say hello to Michelin keys: Yesterday, [the French tire company announced]( that in 2024, it will start awarding “keys” to hotels around the world that meet its high standards, relying on its own judges checking into hotels anonymously to determine top-tier stays. The key program is Michelin’s latest move to grab a bigger piece of the rapidly growing travel and hospitality industry. - In 2018, Michelin acquired the hotel booking platform Tablet, enabling consumers to book their stays through the Michelin website. - Awarding keys will help the company compete with rivals World’s 50 Best and La Liste, both of which began ranking hotels for the first time this year. Zoom out: The company has come a long way since it started making the Michelin Guide, a series of physical books, in 1900 to convince people to drive long distances to restaurants (so Michelin would sell more tires). A Michelin star can change the career of a chef, and a Michelin Guide can transform a local economy—so much so that tourism boards have paid the company [hundreds of thousands of dollars]( to publish one for their cities.—CC   TOGETHER WITH BETTERMENT [Betterment]( Invest with ease. With Betterment’s tax-smart tools, expert-built [portfolios]( and automated rebalancing, investing just got a lot less tedious. Betterment’s array of diversified ETF portfolios (including stocks and bonds) make it easy to get into—and stay in—the market without stressing the nitty-gritty. [Simplify your investing](. ENERGY [Alaskans get a cut of the state’s oil money]( [An Alaska-shaped oil spill with a check written into it]( Francis Scialabba Sometimes, it pays to live in the tundra. Starting this week, Alaska residents will receive their annual dividend from the state’s [oil earnings fund]( year, it’s a check for $1,312. Dwellers of the wintry land—which is home to the biggest oil field in North America—have received a share of Alaska’s oil revenue every year since 1982. This year’s payments will amount to more than $881 million, according to the state’s Department of Revenue. How will Alaskans spend it? Caught between [collapsing fisheries]( and a [rising cost of living]( many people will spend their dividends on bills, groceries, and other necessities. But retailers also try to encourage a splurge: Sale signs like “101 Dividend Deals!” are all over Anchorage. But…as Alaska’s oil production [declines]( (it hit its lowest level since 1976 last year), lawmakers have tapped the unique fund to help cover the state budget, stoking concerns that the nest egg will crack. That’s why some are in favor of reinstating an income tax, which Alaska repealed decades ago…when oil production was booming.—ML   GRAB BAG [Key performance indicators](#) [Homeless encampment in Denver, Colorado]Hyoung Chang/Getty Images Stat: Score one for universal basic income proponents. [The Denver Basic Income Project]( funded partly by the city, has been giving vulnerable people up to $1,000 a month as part of an experiment to reduce homelessness. At the start of the trial, only 10% of the group had their own housing. Now, halfway through the yearlong study, more than a third have a house or apartment. Rates of sleeping outdoors also dropped dramatically. The results are similar to those of an experiment in San Francisco, in which two-thirds of participants who were experiencing homelessness at the start had found permanent housing by the end. Quote: “This month was, in my professional opinion as a climate scientist—absolutely gobsmackingly bananas.” There are times when describing something as “gobsmackingly bananas” is a good thing, like landing a cool skateboard trick. You don’t, however, want to hear it used in reference to the [global temperature]( as climate scientist Zeke Hausfather did this week. Last month was a whopping 1.7 degrees Fahrenheit hotter than the historical average for September, making it the most anomalously hot month ever [by a large margin](. Researchers don’t understand all of the contributing factors, but they know greenhouse gases are making the situation worse. Read: America’s factory boom brings billion-dollar projects to tiny towns. ([Bloomberg]( QUIZ [Quiz: The Musical]( [New Friday quiz image]( The feeling of getting a 5/5 on the Brew’s Weekly News Quiz has been compared to getting Final Jeopardy right. It’s that satisfying. [Ace the quiz](. NEWS [What else is brewing](#) - [Norwegian playwright]( Jon Fosse won the Nobel Prize in Literature. Congrats to Jon—and to whoever bet on him to win at [5/1 odds](. - [Elon Musk]( demanded that X remove story headlines from posts in another blow to the platform’s usability. - [Ozempic]( could be linked to three severe stomach conditions, including bowel obstruction, according to a new study. - [Constellation Brands]( beat revenue estimates thanks to the growth of its Modelo brand, which has overtaken Bud Light as the top-selling beer in the US. - [Pat Fitzgerald]( the Northwestern football coach who was fired following a hazing investigation into the program, is suing the school for $130 million for wrongful termination. RECS [Friday to-do list] Learn: The unexpected names of the [asteroids]( in the asteroid belt between Mars and Jupiter, which include “Mother Teresa,” “James Bond,” “Ocasio-Cortez,” and “Lancearmstrong.” Watch: English musician Jacob Collier turns the thousands of random strangers in his audience into the most [epic choir]( you’ve ever heard. Laugh: A fox smoking a cigar, a kangaroo playing air guitar, and an owl looking even more miserable than usual are all among [the finalists]( for the Comedy Wildlife Photography Awards. Shop: You may not be able to live inside of Dungeons & Dragons, but you can enhance your home with these fantasy-themed [lifestyle products]( like parchment-scented candles. Soar to new heights: And dive into a world of relaxation with [Indacloud]( federally legal, dispensary-grade cannabis edibles, vapes, and more. Save 35% and get free shipping to all 50 states with [code BREW35]( *A message from our sponsor. GAMES [The puzzle section](#) Jigsaw: Have no fear, the Sphere is here for your puzzling entertainment. Help put the Las Vegas Sphere [back together again](. Friday puzzle [Puzzle A Day]( is a gem of a website if you’re into word games and math riddles. Here’s a clever brain teaser they recently posted: Write down the name of a famous singer whose first name contains six letters and whose last name contains four letters. Remove from the singer’s name the first, third, fifth, seventh, and tenth letters. The remaining five letters in the singer’s name will, in order, spell out the repeating part of a well-known song. Who is the singer and what is the song? SHARE THE BREW [Share Morning Brew]( with your friends, acquire free Brew swag, and then acquire more friends as a result of your fresh Brew swag. We’re saying we’ll give you free stuff and more friends if you share a link. One link. Your referral count: 0 [Click to Share]( Or copy & paste your referral link to others: [morningbrew.com/daily/r/?kid=4904f90a]( ANSWER Singer: Celine Dion Song: “Old MacDonald Had a Farm” (E-I-E-I-O) Word of the Day Today’s Word of the Day is: anomalously, meaning “in a way that is different from what is usual.” Thanks to Kristine and Michelle for the unusually good suggestion. Submit another [Word of the Day here](. ✳︎ A Note From Betterment Investing involves risk. Written by [Neal Freyman]( [Adam Epstein]( [Matty Merritt]( [Cassandra Cassidy]( [Molly Liebergall]( and Dave Lozo Was this email forwarded to you? Sign up [here](. Interested in podcasts? - Check out ours [here]( [ADVERTISE]( // [CAREERS]( // [SHOP]( // [FAQ]( Update your email preferences or unsubscribe [here](. View our privacy policy [here](. Copyright © 2023 Morning Brew. All rights reserved. 22 W 19th St, 4th Floor, New York, NY 10011