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The Fed could slash interest rates in half next year, says UBS

The Fed may be compelled to slash interest rates in half next year to stave off a looming recession, according to a recent report by Swiss multinational investment bank UBS. In its 2024-2026 outlook report published on Nov. 20, UBS said the U.S. economy is in for a shocker next year as consumers are running through the last shreds of post-pandemic savings.

World News RealWarrenBuffett • Now • 66%

Why the death of remote work isn’t making suburbs cheap again

Work-from-home made living in the suburbs a lot more expensive, and that’s unlikely to change even as more people return to the office.

World News RealWarrenBuffett • Now • 93%

More than one-third of millennials believe they won’t get a dime of Social Security when they retire, so they’re taking matters into their own hands

Of all generational cohorts, older millennials are most likely to generate enough income to retire comfortably, according to the latest Vanguard Retirement Readiness report. Specifically, millennials aged 37-41 have the greatest chance of landing a comfortable retirement.

News RealWarrenBuffett • Now • 27%

Some traders bet on a cataclysmic stock sell-off in December

Some traders are betting that the stock market will go into a cataclysmic selloff that could make the Covid crash look like a picnic. According to Bloomberg, a trader recently placed a $30,000 bet that the CBOE Volatility Index, or VIX—known as Wall Street’s “fear index”—will shatter new highs. The VIX typically trades on a scale of 10-80, with 20 representing the historic average. Anything above 20 implies that the S&P 500 will experience unusually high volatility—which is a precursor to a selloff. This trader expects the VIX to clock in at 180 by Feb. 14; that’s a 1,100% increase from current levels. VIX has never traded above 100, and it hasn’t even been above 35 (extreme volatility) this year. While it’s easy to dismiss this trade as ludicrous—after all, investors make crazy trades all the time—it’s not an isolated bet. As Bloomberg reports, traders have opened more than 20,000 contracts for VIX December options with the same target price. Just last week, 5,000 of those contracts traded hands. Clearly, some corners of the financial market are taking this bet seriously—or using it as part of a bigger strategy.

News RealWarrenBuffett • Now • 92%

Can natural disasters set off a full-fledged banking crisis?

The wildfires in Hawaii this summer, Colorado in 2021, and Oregon in 2020 are bringing home to even die-hard climate change deniers the investment consequences of global warming. The utilities serving the areas in each case are being sued for not shutting down their power grids during heat waves, contributing to some of the worst blazes in U.S. history. PacifiCorp alone potentially faces $1 billion in class-action fines for the Oregon fires. Hawaiian Electric Industries’ shares plunged 40% during the fires in Maui. But there is a sector that’s potentially on the hook for many times the size of those losses. And it’s not on anyone’s sell list—yet. Banks.