What’s going on here?

Meta released better-than-expected third-quarter results late on Wednesday, and Zuckerberg won’t be the only one smiling.

What does this mean?

After many extravagant years, Meta’s cost-cutting was always going to be more drastic than your average American’s budgeting session. But by announcing that this year’s expenses will land between $87 and $89 billion, the tech giant trimmed a couple of billion off its previous projections. That was impressive by itself, but then Meta announced that it made 23% more revenue last quarter than the same time last year – better than analysts expected. A quick mental math equation tells you that profit, then, flew past expectations too, a very welcome relief for investors nursing nerves that’ve been frayed by sagging tech stocks recently.

Why should I care?

Zooming out: Head in the clouds, feet on the ground.

Big Tech investors tend to have their heads in the clouds. Literally: they’re drawn to major companies with successful cloud divisions. But advertising sectors are worth an eyeball or two, as well. Ads still dominate Meta and Alphabet’s revenue streams, plus the amount of money funneling into online ads is a reflection of the overall economy’s health. So with Meta more than doubling Alphabet's 11% bump in advertising revenue, those heady results could be a strong sign that the economy’s gaining strength.

For markets: Time to test the mettle.

Tech stocks used to follow the market’s movements to extremes, often outperforming others during better days and sinking more than most when the tide turned. But the explosion of software products and services brought along reliable subscription-style revenue streams, which along with bulletproof balance sheets, means investors now view Big Tech as a shelter during even the roughest storms. Major tech companies have yet to test this theory against an all-out recession, of course, but they may get the chance very soon.

What’s going on here?

China’s government announced a package designed to excite its economy on Wednesday, but it’s little – very little indeed.

What does this mean?

The Chinese president recently paid a rare visit to the country’s central bank – the knee-shaking equivalent of your boss scheduling an impromptu one-on-one meeting without warning. That’s a sign that the country’s leader is far from content with the state of the economy, and it may well have spurred on the government’s decision to increase its spending. Now that decision’s been made, China’s borrowing – the gap between what the country makes in taxes and spends – could tick above the 3% limit that the thrifty government has historically hovered around.

Why should I care?

For markets: Slow and steady might win the race.

That fresh stimulus spending doesn’t even match 1% of the Chinese economy. But China’s a dab hand at making the most of small steps: rather than bringing out a big bazooka, the country’s stuck to a little-and-often approach to tackle its economic slowdown. And with the country picking up more than expected last quarter, this tortoise may be inching ahead in the marathon – even if it fell short on the sprint.

The bigger picture: China needs to watch its credit score.

China’s careful approach to budgeting is clear in its books: the country's debt is worth around 80% of its economy. That’s not insignificant, but compared to Japan’s 260% and the US’s 120% it’s pretty paltry. And in Europe, big spenders Italy, Greece, and Portugal have racked up debt piles worth between 120% and 170% of their economies, while some Scandinavian and Eastern European countries have kept theirs below 40%. That matters: a country’s debt levels can lead to higher interest rates, which can lead to higher debt, and so the pattern repeats.