“It is not the strongest or the most intelligent who will survive but those who can best manage change.” – Charles Darwin

1. Biden Signs Bill Aimed at Lowering Drug Costs, Boosting Renewable Energy — President Biden signed into law sweeping legislation to lower prescription drug prices, boost the renewable energy sector and impose new taxes on large corporations. The package includes hundreds of billions of dollars in subsidies for investing in renewable-energy projects and producing energy from renewable sources—and includes credits to help factories retool to turn out electric vehicles or other products needed in a low-carbon economy. It also includes tax credits to help homeowners upgrade their homes with more energy-efficient products. It gives a $7,500 tax credit for purchasing electric vehicles, although with conditions that could make it hard to qualify. The law creates a new 15% corporate minimum tax and a 1% excise tax on companies’ stock buybacks and sets aside roughly $300 billion for reducing the deficit. And it spends $80 billion over a decade on new workers and technology at the Internal Revenue Service.
2. Fed Minutes Show Fed Sees Interest Rate Hikes Continuing Until Inflation Eases Substantially — Federal Reserve officials at their July meeting indicated they likely would not consider pulling back on interest rate hikes until inflation came down substantially, according to minutes from the session released last week. They did not provide specific guidance for future increases and said they would be watching data closely before making that decision. Market pricing is for a half-point rate hike at the September meeting, though that remains a close call.
Meeting participants noted that the 2.25%-2.50% range for the federal funds rate was around the “neutral” level that is neither supportive nor restrictive on activity. Some officials said a restrictive stance likely will be appropriate, indicating more rate hikes to come.
3. U.S. Home Sales Dropped in July for Sixth Straight Month — U.S. existing home sales fell in July for the sixth straight month, the longest streak of declines in more than eight years, as higher mortgage rates and a shortage of homes for sale are cooling this once red-hot market.
Sales of previously owned homes dipped 5.9% in July from the previous month to a seasonally adjusted annual rate of 4.81 million, the National Association of Realtors said Thursday. That was the weakest pace of sales since November 2015, excluding the three-month pandemic-related drop in the spring of 2020. July sales tumbled 20.2% from a year ago. sales are slowing and the relentless rise in home prices is showing some signs of easing after repeated new highs. The median sales price of an existing home fell to $403,800 from a record $413,800 in June, the first decline since January, according to NAR.
4. U.S. Plans to Shift Bill for Covid Shots and Treatments to Insurers, Patients — The Biden administration is planning for an end to its practice of paying for Covid-19 shots and treatments, shifting more control of pricing and coverage to the healthcare industry in ways that could generate sales for companies—and costs for consumers—for years to come.
The Department of Health and Human Services intends to hold a planning session on Aug. 30 that would bring together representatives from drugmakers, pharmacies and state health departments with a stake in a Covid-19 treatment industry. Shifting payments for Covid-19 drugs and vaccines to the commercial market is expected to take months, an HHS spokesman said. At the meeting this month, officials and company representatives are expected to discuss reimbursement and coverage, regulatory issues and access to vaccines and treatment for the uninsured.

The week ahead — Economic data from Econoday.com: