Monday Morning Quarterback

Silver Banana goes to... [Bloomberg Prep. ]() Market Snapshot Stocks rallied across the board Friday, putting a bow on the first positive week for the market in a month. While September is historically a negative month for equities, investors have piled back into stocks with a vengeance. Market participants are digesting the Fed’s hawkish stance and taking advantage of much cheaper valuations in rate-sensitive tech stocks as 10-year Treasury yields dropped to 3.3%. Led by the tech and energy sectors, the S&P ended Friday up 1.53%, while the Nasdaq rose 2.11%, and the Dow gained 1.19%. We’re excited to announce WSO has partnered with Bloomberg Exam Prep to offer a whopping 100 ‘naners off any CFA exam prep plan. Pick your exam & pass it, guaranteed, by working smarter-not-harder using their premium content & renowned expert tutors. [Use Code WSO100]() Let’s get into it. Banana Bits - Joke all you want, but holding a [CFA charter]() will set you apart from your peers - EU countries tussled over how to address the ongoing energy crisis at an [emergency meeting](=) held on Friday - “The Mooch,” aka Anthony Scaramaucci, may be rebranding yet again from hedge fund boss to Capitol Hill crony to cryptobro after it was announced that FTX Ventures took a [30% stake]() in SkyBridge Capital - [Francis Tiafoe]( was the first American man since Andy Roddick in 2006 to reach the US Open semi-final - While remote work is still in full force, you can pay $900/night for a private villa in a [Balinese tree resort]() Banana Brain Teaser Friday — Alive without breath, As cold as death, Clad in mail never clinking, Never thirsty, ever drinking. What am I? A fish. Today — It’s 100 bananas off of our [VC Course]() for the first 15 correct respondents. Happy Monday! In 1990, a person was 15 years old. In 1995, that same person was 10 years old. How can this be? Shoot us your guesses at [vyomesh@wallstreetoasis.com](mailto:vyomesh@wallstreetoasis.com?subject=Banana%20Brain%20Teaser) with the subject line "Banana Brain Teaser" or simply [click here to reply!](mailto:vyomesh@wallstreetoasis.com?subject=Banana%20Brain%20Teaser) Macro Monkey Says What’s Up?... Mortgage Rates, That’s What — Mortgage rates in the US now sit at their highest levels since 2008, climbing for the 3rd week in a row. Your run-of-the-mill 30-year loan will now cost about 5.9%, according to weekly data released by Freddie Mac. While this pales in comparison to the 16% rate your boomer-grandfather paid in 1980, that was back when he could buy a 3-bedroom house for $80k. Times have changed, and home prices have soared more than 10x during that time. Now, paying 6% a month on a $1mn Manhattan starter home is unreasonable for most people and is squeezing many millennials out of the housing market. Part of the culprit for the rise in rates is the Federal Reserve’s recent hawkish position. While the Fed does not directly influence mortgage rates, monetary policy indirectly does. When the Fed raises rates, making it more expensive for banks to borrow, the higher cost gets passed to consumers (homebuyers). Typically, there is an inverse relationship between mortgage rates and home prices, providing buyers some relief in a rising rate environment. However, a confluence of factors, including a sharp increase in demand post-pandemic combined with a housing inventory that is well below pre-pandemic levels, have kept housing prices propped up despite higher rates. Potential homebuyers might be starting to see early signs of relief, though, as activity is slowly contracting. Among 148 large regional housing markets, 98 have seen home values fall from their peak, with the largest drops occurring in high-cost cities such as San Francisco and Seattle, both down 8% from their peaks. It will be interesting to see how this market compares to the last housing recession in 2005-07, when home prices didn’t fall until inventory levels increased dramatically. While that doesn’t seem to be happening anytime soon, more people are getting priced out of the market, which could force a massive reset across the country. The Fastest, Most Effective Way to Pass the CFA Exam [image]() WSO has partnered with Bloomberg Exam Prep to offer a whopping 100 ‘naners off any CFA exam prep plan. Pick your exam & pass it, guaranteed, by working smarter-not-harder using their premium content & renowned expert tutors. Their adaptive learning technology will take you straight to the point & help you pass on your first shot. Save 100+ hours compared to the other guys’ prep courses, leveraging AI to focus on your personal curriculum target areas. Don’t miss out; grab your prep plan today. [Use Code WSO100](=) What's Ripe Zscaler ($ZS) — The cloud-based security software company had its best-performing day since its IPO. Zsacler posted Q4 earnings that beat the Street’s expectations on stronger billings demand from customers. They also provided upbeat guidance for the second half of the year that far exceeded analysts’ expectations. In response, $ZS ended Friday up 21.88%. Kroger ($KR) — Grocery chain Kroger has been treated as a safe-haven stock in a volatile market backdrop. While the S&P has declined 15% this year, Kroger’s stock has gained an impressive 14%, and Friday’s solid earnings results proved why. Kroger’s 2Q results featured solid growth in same-store sales despite an overall slowdown in consumer spending. CEO Rodney McMullen highlighted that customers have become more frugal, with coupon usage rising to an all-time high. The company also launched a new grocery brand called SmartWay, which caters to low-budget customers and will continue to propel the company’s sales forward. $KR gained 7.38% on Friday. What's Rotten Bilibili ($BILI) — The video-sharing and gaming company had a rough week in the markets after reporting weak earnings and downcast guidance. Although the company increased the average daily active users, C19-related lockdown measures are hurting Bilibili’s bottom line. Higher costs led to a widening net loss compared to the prior quarter. On top of this, the company guided revenue for the next quarter that failed to meet analysts’ expectations. $BILI ended Friday down 3.74%. National Beverage Corp ($FIZZ) — LaCroix, the one-time favorite drink for millennials and Gen-Z, might be fizzling out. The fizz-maker announced that they have been losing market share as customers seek cheaper alternatives. I guess millennials are willing to cut out sparkling water before the avocado toast. National Beverage Corp dropped 7.36% on the announcement. Thought Banana Economic Impact of Queen Elizabeth’s Death — The passing of Queen Elizabeth II marks the end of a prosperous era for the British Monarchy and is also expected to have a significant impact on the UK economy. According to the Independent, the total cost could be up to $7 Billion as the country faces the brink of recession and inflation levels not seen in over 40 years. The Crown announced a public holiday on the day of the memorial service, during which banks and stock markets will remain closed. In addition to this, some major stores and theme parks closed their doors during the period of mourning, and Premier League Soccer matches were postponed. The lost productivity is anticipated to have a significant economic impact. There will also be changes to British currency, passports, and many other government-issued articles that will now be donned with the stunning face of King Charles III. The Bank of England has an estimated 4.7bn banknotes in circulation, which will all need to be re-minted eventually. Let’s also not forget that there are many countries globally that bear the Queen’s image on their currency. Conservatively, replacing every currency in circulation throughout every country could cost $1bn alone. Wise Investor Says “The market can remain irrational longer than you can remain solvent.” — John Maynard Keynes Happy Investing, Patrick & The Daily Peel Team Was this email forwarded to you? Sign up for the WSO Daily Peel [here](. [ADVERTISE](=) // [WSO ALPHA]() // [COURSES](=) // [LEGAL](=) Don't want The Daily Peel? [Unsubscribe here](=). Click to [Unsubscribe]( from ALL WSO content IB Oasis Corp. (aka "Wall Street Oasis") 20705 Saint Charles St Saratoga, California 95070 United States (617) 337-3353