2023 | August 14

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The Market

Stocks Fall

Fueled by inflation data and credit rating downgrades for several U.S. banks, the indexes saw ups and downs. Markets gained ground to start the week, but the S&P 500 and NASDAQ fell for a second week in a row, by Friday’s market close. The Dow slipped sharply on Tuesday but rebounded to finish slightly higher than last week.

Inflation in the United States, as measured by the Consumer Price Index, came in at 3.2% in July on Thursday, slightly below market expectation. Core inflation, which excludes energy and food, rose 0.2% for the month, the same rate as in June. This suggests that price pressures are moderating, a development that could lead the Fed to consider pausing rate hikes.

Moody’s cut the credit rating of 10 small and midsize U.S. banks on Monday, noting it has several larger lenders under review. The move from the ratings agency reflects the challenges the banking industry still faces, including increased lending costs and dampening profitability.

China’s exports fell by 14.5% in July compared with a year earlier, the biggest decline since February 2020; imports dropped by 12.5% for the same period. The declining imports and exports figures released on Tuesday added to the country’s waning economic woes, which slipped into deflation for the first time in more than two years. 

After reaching a high in July, U.S. consumer sentiment fell slightly in mid-August but remained elevated compared with the same time last year. A preliminary reading of the Consumer Sentiment Index fell from 71.6 in July to 71.2 in August, according to survey data released on Friday by the University of Michigan, noting that consumers saw “few material differences in the economic environment from last month.”

A report on U.S. retail sales scheduled to be released on Tuesday will indicate whether the mixed picture that emerged from June’s report extended into July. In June, sales rose by 0.2% from the previous month, short of most economists’ expectations; however, the previous month’s sales growth figure was revised upward to 0.5%.  

Source: John Hancock Investment Management

Tax Refund Scam

Is It a Scam? Or Isn't It?

You may receive a request asking for contributions to a fund that helps families who’ve been devastated by Hawaiian wildfires, storms and flooding in New York, wind and tornadoes in Oklahoma, or another disaster. Before you send money, make sure it’s not a scam. In 2022, consumers in the United States lost almost $8.8 billion to fraud, according to the Federal Trade Commission (FTC).

Scammers often target people through email, text messages and phone calls. See what you know about protecting yourself from scams by taking this brief quiz.

1. An email arrives with the logo of the U.S. Postal Service. It says your package could not be delivered because of an incomplete address. The email includes a link that you can click on to confirm your address. Which of the following actions can help you determine whether this is a scam? (Choose all that apply.)

a. Look at the email address of the sender to see if matches the company name.

b. Find the company’s phone number online, then call and ask about the package.

c. Get excited about the unexpected gift, click on the link, and see where it takes you.

d. Check the message for misspelled words and grammatical errors.

2. Ding! It’s a text from an unknown number that reads, “Can you please get us in today? Muffers is really sick! She’s been laying on her side panting for four hours.” What do you do?

a. Don’t respond.

b. Respond by texting, “I think you have the wrong number.”

c. Respond by texting, “This isn’t the veterinarian’s office.”

d. Block the number.

3. You’re looking online for off-campus student housing, but you know rental scams are common. What should you do if a listing is just what you’re hoping to find, but seems almost too good to be true?

a. Look up the management company’s phone number/email online and call/send a message to confirm the availability of the listing, the listing agent’s name, and the rental address.

b. Schedule an in-person walk-through (or have a trusted friend walk through for you).

c. Offer to pay the deposit or application fee with a credit card. If the listing agent insists you wire money or pay with cryptocurrency, refuse to do it.

d. All of the above

Fraud comes in all shapes and sizes – from adoption fraud to elder fraud, business fraud to consumer fraud, and imposter fraud to unemployment fraud. You can learn more about scams and ways to avoid them on the FTC.gov and USA.gov websites. 

Answers:

1)   A, B, and D. “…the biggest tell for most people is that they aren’t expecting any package at all. These scams prey on the rush that getting an unexpected delivery brings. Maybe it’s a gift! (It’s never a gift.),” reported Heather Kelly of The Washington Post.

2)   A or D are acceptable answers. This is known as a “wrong number scam”. It creates an opportunity for cybercriminals to build a relationship with, gather personal information from, and attempt to defraud a victim. Patrick J. Kiger in AARP Magazine reported, “…what seems like an innocent mistake by the sender actually is the first move in a long con...Once the scammer gets a person to respond, more messages usually follow.”

3)   D. “Some scammers hijack real rental listings — changing the contact information and reposting them on different rental sites. Then they charge you for fees, deposits, or even rent for homes that aren’t actually up for rent,” reported Royal Rose on the FTC website.

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