This is The Takeaway from today’s Morning Brief, which you can sign up to receive in your inbox every morning along with:
And just like that, everyone is a recession expert.
Two weeks ago, most self-proclaimed finance experts hadn’t uttered the word recession since it was fashionable in late 2022/early 2023.
From late July to early August, the prevailing sentiment of those seemingly in the know was 1) Nvidia (NVDA) shares were due for another 50% move after earnings on Aug. 28; 2) a 10% year-end rally for the S&P 500; and 3) a 100% move in Nvidia’s stock price in 2025.
Yet here we are, with the pros scaring the heck out of everyone the past week on the potential for a recession after a “bad” jobs report last Friday. Two top Wall Street banks raised their recession probabilities this week, for example.
Advertisement
These pros have voiced their concerns on TV, social media, and in research reports, but they also conveyed them to global trading desks. Markets were pushed into choppy seas as crowded AI trades such as AMD (AMD) have been dumped, with no nod to their underlying fundamentals.
All this recession talk feels like BS to me, an excuse to shake out the average investor so institutional players could get back into high-flying names at cheaper prices. Everyone does know that a recession often means negative economic growth, right? Or a significant slowdown in the economy that lasts quarters or even years?
So the US economy is going to go from 2.8% second quarter GDP growth and a long period of steady expansion to slightly negative growth or worse sometime within the next six months? An economy still creating a good clip of jobs each month is going to begin producing job losses in the near future?
Where is the evidence to support this? What’s the trigger for it? Don’t hit me up on X, formerly Twitter, and say it’s interest rates because the economy has been doing just fine during this high rate period.
Lost in recession BS this week was an ISM services report, which includes data on business activity, new orders, employment, and supplier deliveries. The index clocked in at 51.4%, up from 48.8% in June.
Advertisement
Numbers over 50% are seen as positive for the economy. Most companies in the report said business was either flat or expanding gradually.
Then, initial jobless claims totaled a seasonally adjusted 233,000 for the week — a drop of 17,000. The Street was looking for a print of around 240,000.
Corporate earnings season has gone quite well too. The majority of well-known public companies are easily beating sales and profit forecasts, not shocking the masses with giant misses. Outlooks have been solid.
That’s recessionary? Come on!
Advertisement
Now, I am not going to sit here and blow smoke and say everything is peachy. Many households are struggling to make ends meet because of sticky inflation, something I was reminded of when chatting with P&G’s (PG) CEO Jon Moeller a week ago.
I think the interview by Yahoo Finance’s Brooke DiPalma at the NYSE with Dine Brands (DIN) CEO John Peyton was also eye-opening on this front.
“It’s a value war. It’s a fight for share of wallet. … At a time when our target guest is dining out less, we have to make sure that when they do choose to dine out — IHOP or Applebee’s or Fuzzy’s are their first choice,” Peyton said.
The same goes for DiPalma’s exclusive interview with Molson Coors (TAP) CEO Gavin Hattersley.
“Consumers [are] making different pack sizes choices,” Hattersley said. He said this behavior has been going on “for a while” and is “pretty consistent through through Q2.”
Advertisement
Conversations I had this past week with top leaders further shed light on these macro challenges.
Disney (DIS) CFO Hugh Johnston told me demand at its theme parks tailed off in the final few weeks of the quarter. The company sees this slowdown persisting for the next few quarters.
“We certainly see consumers behaving in a way — I wouldn’t call it recessionary necessarily — they’re watching their pennies a little bit more,” Johnston said. Lost in the sauce, though, was a strong quarter for Disney’s streaming businesses. In a recession, people usually cut unnecessary expenses.
Ralph Lauren (RL) CEO Patrice Louvet told me (video above) this when I asked him if the consumer is behaving recessionary: “I think it’s pretty clear wherever you look that the overall consumer is being pressured by the cumulative effect of inflationary pressures and interest rates. As far as our core consumer is concerned, we actually find them to be very resilient.”
The company still notched sales growth in its North American stores.
Advertisement
All in all, you don’t get the sense the economy has already jumped over a cliff and is falling to the ground. As a result, it’s hard to justify some of these severe down days we have witnessed in markets this week.
What appears to be unfolding is a gradual cooling in the economy that could prove short-lived, especially if the Fed cuts rates, as Cognizant (CTSH) CEO Ravi Kumar told me on my Opening Bid podcast this week.
Labor market developments of late “seem more consistent with post-reopening normalization and gradual rates drag than any current shock or accelerating weakness but the risk is present,” said 22V Research strategist Peter Williams in a note this week.
I think that’s a fair assessment. What’s not fair is all this recession hysteria talk.
Three times each week, I field insight-filled conversations with the biggest names in business and markets on my Opening Bid podcast. Find more episodes on our video hub. Watch on your preferred streaming service. Or listen and subscribe on Apple Podcasts, Spotify, or wherever you find your favorite podcasts.
Advertisement
In the below Opening Bid episode, Trump’s former nominee to the Federal Reserve Judy Shelton shares why the Fed should be focused on 0% inflation.
This embedded content is not available in your region.
Click here for in-depth analysis of the latest stock market news and events moving stock prices
Read the latest financial and business news from Yahoo Finance
My spreadsheet reviewed a WalletHub ranking of financial distress for the residents of 100 U.S. cities, including 17 in California. The analysis compared local credit scores, late bill payments, bankruptcy filings and online searches for debt or loans to quantify where individuals had the largest money challenges.
When California cities were divided into three geographic regions – Southern California, the Bay Area, and anything inland – the most challenges were often found far from the coast.
The average national ranking of the six inland cities was 39th worst for distress, the most troubled grade among the state’s slices.
Bakersfield received the inland region’s worst score, ranking No. 24 highest nationally for financial distress. That was followed by Sacramento (30th), San Bernardino (39th), Stockton (43rd), Fresno (45th), and Riverside (52nd).
Advertisement
Southern California’s seven cities overall fared better, with an average national ranking of 56th largest financial problems.
However, Los Angeles had the state’s ugliest grade, ranking fifth-worst nationally for monetary distress. Then came San Diego at 22nd-worst, then Long Beach (48th), Irvine (70th), Anaheim (71st), Santa Ana (85th), and Chula Vista (89th).
Monetary challenges were limited in the Bay Area. Its four cities average rank was 69th worst nationally.
San Jose had the region’s most distressed finances, with a No. 50 worst ranking. That was followed by Oakland (69th), San Francisco (72nd), and Fremont (83rd).
The results remind us that inland California’s affordability – it’s home to the state’s cheapest housing, for example – doesn’t fully compensate for wages that typically decline the farther one works from the Pacific Ocean.
Advertisement
A peek inside the scorecard’s grades shows where trouble exists within California.
Credit scores were the lowest inland, with little difference elsewhere. Late payments were also more common inland. Tardy bills were most difficult to find in Northern California.
Bankruptcy problems also were bubbling inland, but grew the slowest in Southern California. And worrisome online searches were more frequent inland, while varying only slightly closer to the Pacific.
Note: Across the state’s 17 cities in the study, the No. 53 average rank is a middle-of-the-pack grade on the 100-city national scale for monetary woes.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
The up-and-coming fintech scored a pair of fourth-quarter beats.
Diversified fintech Chime Financial(CHYM +12.88%) was playing a satisfying tune to investors on Thursday. The company’s stock flew almost 14% higher that trading session, thanks mostly to a fourth quarter that featured notably higher-than-expected revenue guidance.
Sweet music
Chime published its fourth-quarter and full-year 2025 results just after market close on Wednesday. For the former period, the company’s revenue was $596 million, bettering the same quarter of 2024 by 25%. The company’s strongest revenue stream, payments, rose 17% to $396 million. Its take from platform-related activity rose more precipitously, advancing 47% to $200 million.
Image source: Getty Images.
Meanwhile, Chime’s net loss under generally accepted accounting principles (GAAP) more than doubled. It was $45 million, or $0.12 per share, compared with a fourth-quarter 2024 deficit of $19.6 million.
Advertisement
On average, analysts tracking the stock were modeling revenue below $578 million and a deeper bottom-line loss of $0.20 per share.
In its earnings release, Chime pointed to the take-up of its Chime Card as a particular catalyst for growth. Regarding the product, the company said, “Among new member cohorts, over half are adopting Chime Card, and those members are putting over 70% of their Chime spend on the product, which earns materially higher take rates compared to debit.”
Today’s Change
(12.88%) $2.72
Current Price
$23.83
Advertisement
Key Data Points
Market Cap
$7.9B
Day’s Range
$22.30 – $24.63
52wk Range
Advertisement
$16.17 – $44.94
Volume
562K
Avg Vol
3.3M
Advertisement
Gross Margin
86.34%
Double-digit growth expected
Chime management proffered revenue and non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) guidance for full-year 2026. The company expects to post a top line of $627 million to $637 million, which would represent at least 21% growth over the 2024 result. Adjusted EBITDA should be $380 million to $400 million. No net income forecasts were provided in the earnings release.
It isn’t easy to find a niche in the financial industry, which is crowded with companies offering every imaginable type of service to clients. Yet Chime seems to be achieving that, as the Chime Card is clearly a hit among the company’s target demographic of clientele underserved by mainstream banks. This growth stock is definitely worth considering as a buy.
ROCHESTER, N.Y. — Student athletes are now earning real money thanks to name, image, likeness deals — but with that opportunity comes the need for financial preparation.
Noah Collins Howard and Dayshawn Preston are two high school juniors with Division I offers on the table. Both are chasing their dreams on the field, and both are navigating something brand new off of it — their finances.
“When it comes to NIL, some people just want the money, and they just spend it immediately. Well, you’ve got to know how to take care of your money. And again, you need to know how to grow it because you don’t want to just spend it,” said Collins Howard.
What You Need To Know
High school athletes with Division I prospects are learning to manage NIL money before they even reach college
Glory2Glory Sports Agency and Advantage Federal Credit Union have partnered to give young athletes access to financial literacy tools and credit-building resources
Financial experts warn that starting money habits early is key to long-term stability for student athletes entering the NIL era
Preston said the experience has already been eye-opening.
“It’s very important. Especially my first time having my own card and bank account — so that’s super exciting,” Preston said.
Advertisement
For many young athletes, the money comes before the knowledge. That’s where Glory2Glory Sports Agency in Rochester comes in — helping athletes prepare for life outside of sports.
“College sports is now pro sports. These kids are going from one extreme to the other financially, and it’s important for them to have the tools necessary to navigate that massive shift,” said Antoine Hyman, CEO of Glory2Glory Sports Agency.
Through their Students for Change program, athletes get access to student checking accounts, financial literacy courses and credit-building tools — all through a partnership with Advantage Federal Credit Union.
“It’s never too early to start. We have youth accounts, student checking accounts — they were all designed specifically for students and the youth,” said Diane Miller, VP of marketing and PR at Advantage Federal Credit Union.
The goal goes beyond what’s in their pocket today. It’s about building habits that will protect them for life.
Advertisement
“If you don’t start young, you’re always catching up. The younger you start them, the better off they’re going to be on that financial path,” added Nihada Donohew, executive vice president of Advantage Federal Credit Union.
For these athletes, having the right support system makes all the difference.
“It’s really great to have a support system around you. Help you get local deals with the local shops,” Preston added.
Collins-Howard said the program has given him a broader perspective beyond just the game.
“It gives me a better understanding of how to take care of myself and prepare myself for the future of giving back to the community,” Collins-Howard said.
Advertisement
“These high school kids need someone to legitimately advocate their skills, their character and help them pick the right space. Everything has changed now,” Hyman added.
NIL opened the door. Programs like this one make sure these athletes walk through it — with a plan.
