To view this email as a web page, click here.

By Kristin Myers, Editor-in-Chief

What's Happening Today

Retail sales remained essentially unchanged in July from June as people kept shopping, but falling gas prices and fewer car sales held retailers back from making bigger profits. Economists were forecasting a drastic slowdown in consumer spending in July—expecting just a slight gain of 0.1%—after June's revised gain of 0.8%, but today's figures came in even lower than what they thought as inflation continues to weigh on our wallets.

People in the U.S. are still spending much more than last year, as overall retail sales were 10.3% higher than in July 2021. They bought less gas and cars, which meant more money was freed up to spend on other goods. Shoppers flocked to online stores, which rose 2.7% in July from the month prior, and also spent more at the grocery store—a sign that people are focusing more of their spending on necessities and less on other things, like clothing and department store goods, which dropped in July.

After Walmart beat expectations in its second quarter earnings yesterday, its strength suggested that other retailers also might post surprising numbers. But today, Target didn't follow suit, sharing that its operating income took a big hit, falling 87% from a year ago as the store slashed prices in order to shift excess inventory.

And stocks are falling following the mixed results from retailers and weaker-than-expected retail sales data from July.

- Kristin

Editors' Picks

Cheaper Gas Meant More Money for Shopping Trips in July (The Balance)

Biden Administration Cancels Another $3.9 Billion in Student Loan Debt for Former For-Profit College Students (CNN)

Here's Where Student Loan Borrowers Spent Money With Payments Set To Restart (Bloomberg)

Clogged Ports Put Fall, Holiday Shipments in Doubt (The Wall Street Journal)

Benefits and Drawbacks of Gas Credit Cards (The Balance)

Why Is Estate Planning Important? (The Balance)

Why You Should Review Your 401(k) Beneficiary Designations (The Balance)

Term of the Day

Revocable Living Trust

A revocable living trust is a legal contract that determines how an individual's assets will be handled after they die, and unlike an irrevocable trust, the trustmaker reserves the right to undo or modify a revocable trust. They can reclaim assets they've placed into it, divert the trust's income to themselves or another beneficiary, change beneficiaries, sell the assets, or place more assets into the trust. The trustee retains final control.

However, unlike an irrevocable trust, assets placed in a revocable trust don't avoid estate taxes, because the trustmaker and the trust share the same Social Security number. The trustmaker can reclaim the assets held within the trust anytime they like, so the IRS takes the position that they haven't relinquished ownership as they would with assets placed in an irrevocable trust.

Off the Charts

A drop in gas prices in July led people to spend a bit less at the pump than they did in June, which freed up cash for other things, according to data from the Census Bureau released this morning.