US ratings hit

It was a torrid week for the bond market, a lackluster week for Apple and a mostly positive week for global economic data. China’s central bank said it will step up efforts to bolster the nation’s faltering recovery while the European Central Bank said core inflation has likely peaked. US payroll data showed job growth moderating in July but wages holding firm, adding to arguments the Federal Reserve has gotten the upper hand on inflation without triggering a recession or major job losses. The figures also bolster arguments the US central bank could be close to the end of its historic interest-rate hiking cycle. Then there’s the bond market, where the discussion over the past few days has turned from the economy to global public finances that deteriorated during the Covid-19 pandemic. Fitch this week stripped US government debt of its pristine, top-tier rating (something it warned of two months ago when Republicans were refusing to raise the debt limit, almost triggering an historic default). Despite criticism from Wall Street and Washington, the rating agency’s reasons weren’t a surprise: ballooning US deficits and political dysfunction. But there’s more to assessing US creditworthiness, Jonathan Levin writes in Bloomberg Opinion. “Some attention should also be paid to the role of inflation, a phenomenon that returned after a long hibernation, piercing naive notions of the nation’s inherent absence of risk.”

“Not guilty,” Donald Trump said again, this time in a Washington, DC courtroom as he faced the most serious charges leveled against him yet. The Republican was indicted by a federal grand jury for allegedly conspiring to defraud the US by interfering with the counting of votes in 2020, obstructing and conspiring to obstruct Congress’ certification of the election results and conspiring against the right to vote. Trump now faces 78 charges in three criminal cases that may reach trial just as the 2024 race heats up. And a fourth potential indictment looms in Georgia. Nevertheless, the twice-impeached former president wasted no time showing that those felony prosecutions will be a pillar of his campaign. “This is a persecution of a political opponent,” Trump proclaimed after his arraignment. The claim may appeal to his most fervent followers (and many of their donations are going to his legal defense), but Bloomberg Opinion editors contend “any sane voter should now see that he has no business returning to the White House.”

A new month, a new round of extreme weather from Texas to Japan. China is bracing for typhoons and stifling heat as it reels from deadly floods after the heaviest rains to hit Beijing in more than a century. After a brief reprieve, temperatures are due to soar again across Portugal and southern Spain. Fire warnings have popped up from Oregon to the US Southwest. The extreme heat has also prompted a new wave of personal cooling devices for everyone from infants to outdoor workers.

Farmers in Ukraine are curbing winter crop plantings as Russia continues to attack export routes and storage options shrink. Poland, a NATO member, said it will sendmore troops to protect its border with Russia-ally Belarus and summoned that country’s envoy in Warsaw to protest the alleged violation of its airspace by Belarusian helicopters. Tensions have grown since Russian mercenaries arrived in Belarus last month after cutting short their mutiny against the Kremlin. Meantime, in Asia, a series of scandals is putting Singapore’s image for clean governance to the test.

Anyone looking to buy or sell a home in the US right now will not find the following statement shocking: It’s never been more challenging to find an affordable home. Locked into cheaper borrowing costs and unable to find a new place that fits their budgets, countless people are opting to remain in their current homes, adding to an acute shortage of available properties. Mortgage rates falling to 5% (from their current rate of around 7%) seem to be the key to unlocking supply. And while builders are rushing to get new homes and apartments on the market, “the picture in 2024 should be better, or at least ‘less bad,’” Conor Sen writes in Bloomberg Opinion.

Living in New York City has never exactly been affordable. But this month, it’s getting even less so thanks to the rising price of public transportation and electricity. Couple that with near-record rents and inflation-driven price increases, and perhaps that move to Miami might make sense. The Florida city wants to attract more out-of-state workers and wealthy residents—but there’s a rub: Miami’s landfills are running out of space. And the city is highly dependent on septic tanks (not a sewer system), which overflow when it rains.

Before they were strangled to death six years ago, Barry and Honey Sherman were one of Canada’s wealthiest and best-known couples. Police still haven’t identified the killers, but along the way, they’ve turned up no shortage of potential suspects—and a bareknuckled family drama.

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