(Part 5 of 5) My investing muse (23Feb2026) - Iran adds to the volatility
My Investing Muse
Layoffs, closures and Delinquencies
NEW GRADUATES NOW ACCOUNT FOR JUST 7% OF NEW HIRES AT BIG TECH COMPANIES, DOWN FROM 25% IN 2023 AND OVER 50% PRE-PANDEMIC, PER FORBES.
CREDIT CARD DEBT IS BECOMING A GROWING FINANCIAL RISK. MORE THAN 12% OF BALANCES ARE 90+ DAYS DELINQUENT — THE HIGHEST LEVEL IN 15 YEARS — WHILE AVERAGE INTEREST RATES ARE AROUND 21%. - First Squawk
Walgreens to lay off hundreds of employees nationwide - MacroEdge
America’s biggest wine maker shuts down production in Napa Valley in huge blow to wine heartland - California Post
United Parcel Service (UPS) is planning to close dozens of packaging facilities this year, the shipping giant revealed in a court filing this week. - MacroEdge
The 60+ day delinquency rate on US subprime auto loans is up to a record 6.9%. Serious delinquency rates have more than DOUBLED since 2021. This exceeds the 1996 peak by 0.9 percentage points. For context, the 2008 Financial Crisis high was 5.0%. Meanwhile, total auto debt is up +$312 billion over the last 5 years, to a record $1.67 trillion, driven by surging vehicle prices. Subprime financing makes up ~14%, or $234 billion, of all auto loans. Americans are falling behind on their car debt at a record pace. - X user the Kobeissi Letter
UPS announced the closure of 22 package centers eliminating 30,000 jobs as part of restructuring, following ~50k job cuts last year. They also outsourced their pension to Goldman and killed a great team and are now getting hosed on fees - X user The Long View
1 in 4 unemployed people, or 1.8 million Americans, have been job searching for over half a year, per CNBC
Ford's $5.8 billion battery plant in Glendale, Kentucky is sitting idle just four months after opening, with 1,600 workers laid off. The facility was designed to produce EV batteries but Ford is pivoting to energy storage systems for utilities and data centers instead. - X user Hedgie
A record 331,000 men in the US are now working two full-time jobs — double the average seen during 2011–2016. - First Squawk
Los Angeles Unified School District to cut up to 3,200 jobs amid budget crisis - MacroEdge
Over 52% of college graduates are now underemployed -Federal Reserve Bank of St. Louis.
My Final Thoughts
Based on 2025-2026 trends, rising subprime auto delinquencies likely hit Automotive: Lower new car sales, flooded used market from repos, pressure on makers and suppliers. Financial: Losses for banks and auto lenders, tighter credit. Consumer discretionary: Reduced spending by strained borrowers. Broader ripple to jobs and economy. - Grok
Recent reports indicate a rise in delinquencies, contributing to heightened market volatility, particularly in light of the impending military conflict with Iran. There is on-going debate regarding the necessity of U.S. involvement, with greater concerns centred on potential retaliation and broader consequences. Risks extend beyond the immediate conflict zone, posing threats to both domestic and international American businesses and raising the possibility of increased terrorist activity.
Blue Owl currently manages assets totalling $307 billion. It is prudent to closely monitor the private equity, private capital, and venture capital markets, given persistent concerns about delinquencies and leverage, which may result in significant market distress.
Financial Strategy and Outlook
Let us spend within our means, invest only what we can afford to lose, and avoid leverage. Let us review our current holdings with the intention of divesting from businesses that are losing their competitive advantages. Additionally, I will consider adding both hedging strategies and defensive positions to our portfolio to mitigate risk.
As we move forward, it is crucial to conduct thorough due diligence before assuming any new responsibilities.
Wishing everyone a successful week ahead.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
