☹️🧾 Your Tax Refunds Are Getting Smaller This Year
Happy Wednesday all,
The next Mega Millions lottery jackpot on Friday the 13th is for $1.3+ billion dollars. That got me thinking… why have lottery jackpots been so outrageously high recently? They never used to get this big - rarely crossing $1 Billion.
After doing some digging, it looks like in 2017 the "numbers matrix” was adjusted so that the chances of winning the jackpot became lower (like they weren’t low enough already). Prior to 2017, you had to get 5 numbers right from 1-75 (the white balls), and the Powerball correctly from 1-15.
This meant your probability of winning was 1 in 258 Million.
After Oct 28, 2017 - you now had to get 5 numbers right from 1-70 (5 fewer balls), but the Powerball correctly from 1-25. This increased the number of combinations available, thus making your odds of winning the jackpot 1 in 302 million. Couple this with the fact that the Mega Millions ticket price increased to $2 that same time, and you have the formula for higher jackpots. That’s nuts.
So you’re probably wondering… do I play the lottery? With such bad statistical probabilities, I usually do not play - however, on big jackpots like over $1 billion, I usually like to go and buy 1 quick pick. If I’m going to be struck by lightning, buying 2 isn’t going to make a huge difference. Statisticians say that these odds are so tiny that it is hard for most people to understand them truly.
$2 does get you some hopium for a little bit though :)
Enjoy this week’s Hump Days!
- Humphrey, Rickie & Tim
Tweet of the Week
The Weekly Brief
Expect Tax Refunds to Be Smaller this Year (WSJ)
Congress chose not to extend the tax breaks put in place at the height of the Covid-19 pandemic and tax preparers expect Americans will get smaller refunds when filing their returns for 2022. Refunds could shrink by a few hundred to a few thousand dollars depending on the taxpayers’ situation. The average individual tax refund last year was $3,176, up 14% from the year prior.
JPMorgan’s Dimon says U.S. Consumer Health in Good Shape (Reuters)
JPMorgan CEO Jamie Dimon said the American consumer was still strong in the face of heightened economic uncertainties. Dimon said in an interview with Fox Business published on Tuesday that consumer balance sheets are in good shape and that they are spending 10% more than pre-Covid, even as economic uncertainties such as the Russian invasion of Ukraine and the Fed’s interest rate hikes continue to arise.
Berkshire Hathaway Sells 1.1M Shares in Chinese EV Manufacturer BYD (Reuters)
The investment company owned by Warren Buffett, Berkshire Hathaway, has sold almost 1.1M shares of electric vehicle maker BYD at an average price of $24.52 (HK$191.44), a filing from the Hong Kong stock exchange showed. Berkshire went from owning 14.06% of the company on Jan. 3rd to 13.97%.
What We’ve Been Reading
Stocks/Crypto
Bed Bath & Beyond Stock Pops 100%+ On No News as Potential Bankruptcy Looms (Yahoo)
Ant-Linked Firms’ Shares Rise After News of Jack Ma Ceding Control; Alibaba Jumps (Reuters)
FTX Says it Has Located More than $5B in Cash, Liquid Assets (WSJ)
Economy
Goldman to Cut About 3,200 Jobs This Week After Cost Review (Bloomberg)
Wells Fargo, Former No.1 in Mortgages, is Stepping Back from the Housing Market (CNBC)
U.S. Adds 223k Jobs in December, Ending 2022 on High Note (The Guardian)
Government
U.S. Public Pension Debt Topped $1T in 2022, Equable Says (Bloomberg)
McCarthy Elected House Speaker After Days of Painstaking Negotiations and Failed Votes (CNN)
World
Goldman Sachs No Longer Expects Recession in Euro Zone in 2023 (Reuters)
Euro Zone Unemployment Rate Unchanged in November, as expected (Reuters)
Restoration of the Ozone Layer is Back on Track, According to a U.N.-Backed Report (NYT)