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By Staff Reporters

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• American consumers are on track to run out of cash later this year, Bill Gross has warned.
• Consumer spending is a key driver of economic growth. If it drops, a recession might be the result.
• “Bond King” Gross said the government’s aggressive spending during the pandemic is still buoying the economy.

American consumers are propping up the economy by spending their pandemic savings, but they’re likely to run out of cash later this year, Gross warned. 

“It’s fiscal policy not just monetary policy — stupid,” the billionaire investor tweeted. His point was that government spending and tax rates, along with interest rates and money supply, affect economic growth and inflation.

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Used Auto Prices Down

• Used car prices in America saw the largest monthly slump since the height of the pandemic in June. 
• The Manheim Used Vehicle Value Index dropped to 215.1 last month, marking a 10.3% tumble from a year earlier.
• That’s good news on inflation, which could fall below 3% in June, the analyst said. 

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Here is where the major benchmarks ended: yesterday

• The S&P 500^® Index (SPX) was up 29.73 points (0.7%) at 4,439.26; the Dow Jones Industrial Average (DJIA) was up 317.02 points (0.9%) at 34,261.42; the NASDAQ Composite (COMP) was up 75.22 points (0.6%) at 13,760.70.
• The 10-year Treasury note yield (TNX) was down about 3 basis points at 3.978%.
• CBOE’s Volatility Index (VIX) was down 0.23 at 14.84.

Energy companies led sector gainers Tuesday as crude oil futures extended a rally, with the benchmark WTI contract rising more than 2.5% and touching a 2½-month high on signs of lower Russian production.

The Philadelphia Oil Service Index (OSX) jumped more than 3% to a four-month high. Retail and transportation shares were also among the strongest sectors, while the health care and semiconductor sectors slipped.

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Filed under: "Ask-an-Advisor", Alerts Sign-Up, Experts Invited, Funding Basics, iMBA, Inc., Interviews, Investing, LifeStyle | Tagged: Bill Gross, Bond King, CBOE, DJIA, DOW, energy, fed, FOMC, inflation, ManheimUsed Vehicle Value Index, OSX, S&P 500, Use auto prices, used care prices, VIX, Volatility Index, WTI |