Business Frame Weekly – Banks tightened lending standards for businesses and households / Tennessee, Texas, Florida, and the Carolinas are popular relocation spots because these states don’t tax income

Banks tightened lending standards for businesses and households during the first quarter and expect to keep tightening for the rest of 2023, according to the Federal Reserve's quarterly survey of senior loan officers.

Tennessee, Texas, Florida, and the Carolinas are popular relocation spots because these states don’t tax income.

The market is being buffeted by conflicting headwinds, making the pundits’ job harder. While inflation appears to be moderating, with the annualized rate down to 5% in March.

In this newsletter:

• Fed: Bank officers expect lending to tighten through rest of 2023
• California and New York Are Losing More Residents to Low-Tax States, IRS Says
• Seeking at Least 9% Dividend Yield? Analysts Suggest 2 Dividend Stocks to Buy
• Worst Isn’t Over for US Stock Market, JPMorgan’s Kolanovic Warns
• A.I. trade is leaving investors vulnerable to painful losses: Evercore
• Nintendo Switch sales plunge 22% and the gaming giant expects further declines

May 09, 2023

Fed: Bank officers expect lending to tighten through rest of 2023

Banks tightened lending standards for businesses and households during the first quarter and expect to keep tightening for the rest of 2023, according to the Federal Reserve's quarterly survey of senior loan officers. The widely-followed survey is the latest sign of how challenges in the banking industry could pose a threat to US economic growth.

California and New York Are Losing More Residents to Low-Tax States, IRS Says

Tennessee, Texas, Florida, and the Carolinas are popular relocation spots because these states don’t tax income. Given the economy, many people are looking to save money where they can. Reducing taxes is one way to cut costs, and sometimes moving from a high-tax state to a low-tax state can eliminate thousands of dollars in expenses year after year. After all, if $3,729 of your annual salary goes to state income tax, moving to a state that doesn’t tax income could potentially save you nearly $75,000 over 20 years. That idea is supported by migration data, recently released by the IRS, showing that taxpayers are leaving notoriously high-tax states like California and New York and choosing to live instead in low-tax states.

Seeking at Least 9% Dividend Yield? Analysts Suggest 2 Dividend Stocks to Buy

The market is being buffeted by conflicting headwinds, making the pundits’ job harder. While inflation appears to be moderating, with the annualized rate down to 5% in March – the lowest since the summer of 2021 – the job market remains surprisingly robust. Last month, the BLS reported 253,000 new jobs, exceeding the predicted 180K, and an unemployment rate of just 3.4% compared to a forecast of 3.6%.

Worst Isn’t Over for US Stock Market, JPMorgan’s Kolanovic Warns

Expectations among US stock investors that the worst of pressures may have passed will likely be proven wrong as recession risk still looms, according to JPMorgan Chase & Co.’s Marko Kolanovic. The strategist reiterated Monday that equities are set to weaken for the remainder of the year as the full impact of interest-rate hikes catches up to the economy and some factors supporting growth — such as strong corporate margins — wane.

A.I. trade is leaving investors vulnerable to painful losses: Evercore

The artificial intelligence trade may be leaving investors vulnerable to significant losses. Evercore ISI’s Julian Emanuel warns Big Tech concentration in the S&P 500 is at extreme levels. “The AI revolution is likely quite real, quite significant. But ... these things unfold in waves. And, you get a little too much enthusiasm and the stocks sell off,” the firm’s senior managing director told CNBC’s “Fast Money” on Monday. In a research note out this week, Emanuel listed Microsoft, Apple, Amazon, Nvidia and Google parent Alphabet as concerns due to clustering in the names.

Nintendo Switch sales plunge 22% and the gaming giant expects further declines

Nintendo reported a fall in profit and revenue in its fiscal year driven by a drop in sales of its flagship Switch console. The Japanese gaming giant sold 17.97 million units of its flagship Nintendo Switch console series, roughly in line with its own forecast of 18 million units for the fiscal year. For the fiscal year ended March 2024, Nintendo forecast sales of 15 million units of the Switch.

Random Ramblings

• Why first-time business owners shouldn’t do their own taxes?
• 'An Anvil, Not A Shoe': Elon Musk warns of a crushing blow to commercial real estate — here are the companies set to benefit from the market collapse.
• 2 ways to earn billions: Warren Buffett and Charlie Munger talk Elon Musk.
• The IIA shares new legislative proposal with congress to strengthen corporate governance of cryptocurrency.
• AI and COVID job disruptions risk hurting women more than men.
• Insiders pour millions into these 2 ‘strong buy’ stocks — here’s why you might want steer toward them too.