The “Amazon economy” was booming as consumers only had so many options for purchases – namely online stores. That boom has waned, and the demand for seasonal labor does not appear to be as robust as the past couple years. However, it remains similar to pre-Covid levels.
While the housing market turmoil is interesting to parse, the question of “why does this matter?” is somewhat less intuitive. There are some spillovers from the wealth effect, but those are difficult to pinpoint and accurately measure. What is less difficult to understand is the decrease in worker mobility, and the flow-through to the labor market.
The amount of oil available to those enforcing the price cap is much lower now. That will cause further supply issues regardless of the lack of an output cut from OPEC+, and places upward pressure on the pricing of the non-sanctioned supplies. In the course of a few days, energy market dynamics became much more complex and volatile in an already energy constrained world.
As inflation begins to moderate and the FOMC finds its terminal rate, CAT bonds could become an attractive opportunity again. Currently, there are hidden reasons to avoid the space, and wait for the opportunity to emerge.