Choppy morning trade sent the major averages into the final hour about even on little real news, other than the bizarre. Elon Musk tweeted that he would take Tesla private at $420 a share is going to go down in history as the largest torching of the shorts ever. Or, the beginning of the end for Elon Musk. If he actually has financing, or has made an earnest effort to obtain it, he’s off the hook. If not, charges of share price manipulation and worse wait in the wings. I doubt this is the last we will hear on this subject. Crypto currencies after a brief rally that saw Bitcoin break above $8,000 momentarily has failed with the premier crypto currency looking to re-test $6,000. If the hype breaks, and you don’t really have anything else, watch out, ala 2000 or the Dot-Com crash.
Consumer credit came out after the close yesterday. It missed expectations substantially after consumers went back to their penny-pinching ways, gaining just 10.2 billion in June. Credit card or revolving debt fell for a second time in 5-years, down .2%, total revolving debt stands at 1.038 trillion. Non-revolving debt, essentially student and auto loans carried the day gaining 10.4 billion to reach 2.868 trillion Dollars. Nothing screams success like eye popping debt levels and a weak employment and wage market.
Mortgage activity continues to slip compliments of higher interest rates falling 3% last week as per the Mortgage Bankers Association or MBA. Refi’s fell 4.5%, while purchase apps slipped 2%. The 30-year contract rate for a jumbo loan decreased 2 basis points to 4.74%
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