Initial Public Week in Review
Inflation, sunscreen, & more
SpaceX goes public today with an implied valuation of roughly $1.75 trillion, making it the largest IPO in market history and the 7th largest publicly traded U.S. company.
Of course, $1.75 trillion doesn’t go as far as it used to, not with prices rising the way they have the past few months. That—the ongoing reemergence of inflation—was the biggest economic story during a week that also brought updates on home sales, consumer sentiment, small business optimism, and more.
Monday
Oil Stuff
Both gas and diesel prices fell again during the week ending June 8th. The Strait of Hormuz is still closed, and yet oil prices have fallen below $90/barrel, nearing levels not seen since early March. There are several reasons for the surprisingly low price of oil, perhaps the greatest being a sharp decline in Chinese oil imports that has freed up supply for the rest of the world.
Regarding a deal to reopen the Strait, one could happen “soon, very soon,” which has somehow been true for most of the past three months.
TSA Checkpoint Travel Numbers
Air travel has rebounded and is now trending about 1% above year-ago levels. This slight bounce is at least partially due to the World Cup.
Tuesday
Existing Home Sales
Existing home sales (i.e. not newly built) increased about 3% in May and are up modestly on a year-over-year basis. Median sales prices are up just 1.3% year over year as home prices remain tame even as housing affordability remains a major issue.
NFIB Small Business Optimism Index
Small business owner optimism declined in May as they struggled with “significant and unpredictable hikes in fuel prices, which are more challenging for small businesses to pass on to their customers compared to their larger corporate competitors.” A net 36% of small business owners reported raising their prices in May, well above the historical average of 13%.
FDA Approves Sunscreen with Bemotrizinol
The FDA has finally approved a superior form of sunscreen. If “finally” seems dramatic, consider that the European Union approved this kind of sunscreen 26 years ago, and the FDA has been working on getting it approved for over a decade.
What does this have to do with the economy? Not much, but Zack is extraordinarily pale, so this is worth some celebration.
