Editor’s Note: A version of this story appeared in CNN Business’ Nightcap newsletter. To get it in your inbox, sign up for free, here.
Tonight: GameStop stock is all fired up — again. Plus, the US Postal Service’s new vans look like ducks, and somehow Michael Bolton gets a financial news headline in 2021 … Let’s get into it.
The housing market is hot, and maybe a bit of a hot mess.
As the country locked down and home became home/office/gym/padded confinement cell, a lot of folks started buying houses or renovating.
And nearly a year later, the house party is still raging:
- DIY holy sites Home Depot and Lowes both had better-than-expected earnings this week.
- Zillow fantasy scrolling is practically the national pastime.
- Lumber supply has tightened, pushing up prices. That’s also thanks to all those shacks restaurants have built to make “outdoor” dining areas.
- Mortgage rates remain near record lows after falling below 3% for the first time ever this past summer, and mortgage applications are still up from where they were a year ago.
But… * record scratch *
There are two big reasons why some investors are growing concerned about the housing market:
- Mortgage rates are still low, but they’re ticking back up. Mortgage rates are closely tied to 10-year Treasury bond yields, which are beginning to spike. When borrowing is more expensive, that can discourage buyers.
- In an ominous sign, Home Depot declined to give any profit guidance for 2021 when it reported earnings Tuesday, sending shares down 3%. That lack of guidance signals uncertainty. And being uncertain right now makes sense. The pandemic has upended everything, and it’s not clear what the new normal will be as vaccinations roll out and the pandemic continues to shape consumer behavior.
NUMBER OF THE DAY
GameStop shares more than doubled in the final moments of trading Wednesday. The stock ended the day at $91.71, up nearly 104% from the previous day, and trading was halted several times for volatility. Having déjà vu yet?
Just take a look at this adorable duck-billed mail truck.
On Tuesday, the Postal Service announced its very cute next-generation vehicles will start hitting the road in 2023. The new vans have a low engine compartment and hood and a very high windshield. Some will be electric. All will have long-overdue safety upgrades. USPS didn’t say whether the vehicle is amphibious or not, but it sure does look like a duck, right?
WHY THE NEW RIDE?
Few things have changed less during the course of this century than America’s fleet of postal delivery vehicles, CNN Business’ Chris Isidore writes.
The current ubiquitous fleet of 200,000 squat, boxy vans has been around longer than iPhones. Many of them were born in the ’80s. They don’t have airbags or air-conditioning, so, yeah, I think it’s safe to say most of us would never last one summer day as a mail carrier.
USPS said the contract for the new vans, which will have airbags and air-conditioning, was awarded to Oshkosh Defense, a unit of Oshkosh Corp, which will build between 50,000 and 165,000 vehicles over a period of 10 years.
QUOTE OF THE DAY
“Tell me how am I supposed to trade without you?”
Michael Bolton, yes that Michael Bolton, wants you to break up with Robinhood. In the strangest twist yet in the already bizarre saga, Bolton is singing about payment for order flow to the tune of his 1989 breakup ballad “How Am I Supposed to Live Without You.” Because nothing screams “relevant cultural touchstone” like Michael Bolton.
Fry’s, the wacky West Coast electronics store and monument to nerd culture, abruptly shut down Wednesday after nearly four decades. The company’s website said it decided to close permanently because of changing consumer shopping habits and the Covid-19 pandemic.
The business’ kitschy themed stores and oddball inventory gained it a cult following.
In 1998, the Wall Street Journal summed up the superstore’s offerings as “everything tech-related you can think of, as well as about a billion vaguely tech-related things you can’t.” You could stop in for a new modem, and grab a handful of CDs, acid-rain testing kits, Leatherman tools and phonograph needles (because one should always have a supply of phonograph needles).
Fry’s, like other electronics chains (RIP RadioShack), struggled to adapt to the shift to online shopping. And like so many other retailers, the pandemic became a final blow to the bottom line.
WHAT ELSE IS GOING ON
- The Fed suffered a widespread disruption in multiple payment services Wednesday, including a system that banks and businesses rely on to zip trillions of dollars around the financial system each day.
- The New York Times acknowledged problems with its own workplace culture, particularly around the treatment of Black and Latino employees, in a new report following an eight-month investigation.
- Dunkin’ introduced avocado toast to its menu because, millennials?
- A Newsmax anchor derided Champ Biden as a “junkyard” dog and that simply will not stand here at Nightcap. CNN’s Jeanne Moos on the internet’s resounding defense of the First Good Boi.