Market update: Mega banks grilled by Congress

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This week in the markets

  • On Wednesday, big bank CEOs testified 10 years after the 2009 bailout on topics that ranged from business practices to social issues.
  • This week, Uber’s rumored initial public offering (IPO) drove Lyft shares down 10%.
  • At the EU summit on Wednesday, the United Kingdom’s “Brexit” from the EU was delayed through Halloween.

Bank CEOs testify a decade after financial crisis

CEOs from seven of the largest US banks met this week to testify before Congress for the first time since the massive taxpayer-funded bailout in 2009. Most experts blame the 2008 Global Financial Crisis, and the massive bailout that resulted from it, on deregulation in the financial industry and poor judgment by bank executives. . Since then, large banks like Chase, Bank of America, and CitiGroup, have raked in over $780 billion in profits, which is nearly five times the amount they paid in fines over the last 10 years. Lawmakers grilled bank CEOs on topics that ranged from business practices to social issues (like the wage gap and financing gun manufacturers). Needless to say, this 10-year reunion was even more tense than most high school reunions.

Markets were mixed this week

Markets were mixed at Thursday’s close. The Nasdaq decreased 0.21%, the S&P 500 rose 0.0038%, and the Dow Jones Industrial Average (DJIA) fell 0.054%. For the week, however, all three major market indexes were up.

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Uber IPO rumors drive Lyft down 10%

On Wednesday, Lyft shares tumbled 10% to a new low upon rumors its larger rival Uber would file to go public. Lyft has had a tough first couple of weeks on the public market. The stock’s IPO price was $72/share but has now decreased more than 14% to $60.12/share. On Thursday, Uber filed to go public, but it still has a few more steps to complete before it can officially ring the bell at the New York Stock Exchange. Uber’s valuation is expected to be between $90 – $100 billion, which would put its stock price between $48 – $55/share.

Brexit gets delayed through Halloween

Leaders of the European Union have granted the United Kingdom a six-month extension, through October 31, to leave the EU. “Brexit” was originally supposed to happen on March 29, but the departure has been extended numerous times because a withdrawal deal cannot be agreed upon. The withdrawal agreement needs to lay out what the UK and EU’s future relationship would be, and would need to include all of the economic guidelines for that relationship. The UK’s Prime Minister Theresa May said the UK would still aim to leave the EU as soon as possible.

And now for your weekly Lionomics wrap-up. ?

Lionomics: Finance made easy

This week in Lionomics, we discussed the trade-off between short-term income and long-term portfolio growth. Learn how you may be able to generate both. ?

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