3 “Must Know” Headlines for May
Headlines for May 25th, 2022 — Possible Recession in our Near Future, Gen Z & Millennials’ Career Progression, and Rising Air Travel Prices
The U.S Treasury Yield Curve inverted for the first time since 2019 primarily due to interest rate hikes by the Federal Reserve in an attempt to control and reduce inflation. An inverted curve means that the yield went negative, which indicates that the return on a short-term investment (2-year bond) is greater than a long-term investment (10-year bond). Generally in an efficient market, the longer the period to maturity, the higher the expected return should be. Investors monitor the curve for this type of activity and it is a precursor indicator of a possible recessionary period approaching. History has shown that the Treasury Yield Curve inverts roughly 6 to 24 months before a recessionary period occurs. Although the indicators show that a recessionary period is approaching, the yield curve is not an indicator of magnitude — meaning there is not a need to be overly concerned or panic.
According to Bain & Company, about 61% of respondents are significantly concerned with job security, finances, and failing to meet their career goals within the next decade. The respondents’ demographic were Gen Zers and Millennials. Furthermore, the respondents were from a diverse range of nationalities such as China, Japan, Nigeria, the United States, India, and Brazil. Young professionals today are coping with “slowing economic growth, rising inequality, and declining housing affordability across the West”, said Bain’s report.
After more than two years into the pandemic, traveling is on everybody’s mind. However, with increased demand, supply/labor shortages, and rising fuel costs due to the Ukraine War, expect to pay more to travel and for prices to continue rising. According to the Consumer Price Index (CPI), airline fares are up 12.7% compared to last year and are expected to continue rising into the Summer months. On average, a round-trip domestic airline fare is $330 and an international fare is $810. These fares are up 40% and 26% respectively from last year.
Budget Advice:
- Consider new low-cost airlines such as Breeze Airways or Avelo Airlines
- Opt for low-cost international destinations such as Mexico or Central America over Europe
- Save and plan ahead for the best experience
