Hey friends - happy Friday. We’re in an all-out sprint here at Scoops, building out something really cool for financial advisors to help them educate and help people at scale, like we’ve been doing. Really pumped. Really exhausted. Can’t wait to release it next month.

🌎 The Big Picture

To say it was a relatively uneventful week feels relatively right and absolutely wrong. But here’s what I was paying attention to for you.

Investors are worried about the rising energy costs of the Middle East conflict.

Stocks have been sliding around for weeks without a meaningful decline, but each day, policymakers have left more questions about the proposed tariffs, taxes, and government spending. Oil prices, which feed into everything from gas to shipping to manufacturing to food, have soared to their highest level since June 2022 this past week. Stock market investors are searching for clarity on policies, especially after the Federal Reserve left the future of interest rates up in the air at Wednesday's policy meeting.

Despite all of the swings of the past few weeks, the broad S&P 500 stock market index is down less than 6% from its record highs. Investors haven’t found a reason to hit the panic button yet.

It’s not getting cheaper to borrow money yet, but savings accounts will keep paying well.

The Federal Reserve decided not to continue lowering baseline interest rates at its January meeting, keeping the federal funds rate at 3.50-3.75%, after cutting rates by 0.75% over the second half of 2025. Most other lending rates, from credit cards to car leases, are derived from this benchmark. The Fed initially raised borrowing costs to slow spending and get inflation under control, but now that prices aren’t rising as quickly anymore, policymakers have been inching rates lower to find a more neutral level that doesn’t restrict business too much.  

The Federal Reserve believes the economy started the year in decent shape, but it’s not sure what policy moves it will make this year. The Fed is tasked with keeping unemployment low and prices stable, but shifting tariff policies and war-driven oil price shocks have the potential to drive up living costs and strain the economy. Meanwhile, unemployment is low, but hiring has stalled. So the Fed isn't eager to make any moves to stimulate or restrict the economy until things play out. For businesses and households, this means interest rates may stay higher for longer, and relief on loan payments could take time.

Wealthy Americans drove a pickup in spending last month.

The Bank of America Institute reported that credit and debit card spending for their millions of customers was 3.2% higher in February than a year earlier, the strongest growth in more than three years. Spending also climbed 0.9% from January on a seasonally adjusted basis. Part of that rebound came after winter storms earlier in the year kept people home and temporarily slowed spending. People spent a lot more on services like travel, dining, and lodging, though regular retail store purchases picked up as well.

But not everyone is spending the same. Higher-income households continue to drive the spending in America as their wages rise far faster than those of lower-income workers. Bank of America’s data shows wages for higher-income households grew about 4.2% over the past twelve months, roughly 3.5x faster than the middle-income group and 7x faster than lower-income households, the widest gap in the bank’s data going back over a decade. For the first time since early 2022, lower-income households are spending faster than their paychecks are growing. Larger tax refunds this year are helping cushion budgets and boost purchases on non-essentials like electronics and travel. Still, businesses may see that boost fade if wages don’t start growing faster for everyone. Businesses may need to reshape their customer profiles to adapt to spending trends.

AI isn’t driving widespread improvements in productivity yet, but American workers are getting paid better. 

The Bureau of Labor Statistics reported that nonfarm business labor productivity grew at a 2.8% annualized rate in the fourth quarter, showing that workers were more productive than economists expected. But the improvements in output per hour were a notable step down from the 5.2% pace set in the third quarter. The full-year average landed at 2.2%, which is right in line with the long-run historical norm.

Employers paid workers more per hour over the holidays, helping to gain ground on the higher cost of living. American paychecks ended 2025 with 1.3% more purchasing power than the year before. Unit labor costs (what businesses pay per unit of goods or services produced) rose 2.8%, reversing two straight quarters of declines, meaning companies are spending more to get each unit out the door.

The manufacturing sector is struggling with worker efficiency. Factory productivity fell 1.9% in the quarter, while manufacturing unit labor costs jumped 8.3%, the steepest increase since Q3 2022.

Overall, workers keep getting more productive, but not dramatically so, and are earning better paychecks from it. That means businesses’ costs are rising, but their customers have more spending money.

🏭 The Companies Everyone’s Talking About

❔ The Big Question of the Week

Scoops app users: We have taken the beta app offline for a short period for some major updates. Can’t wait to show you all what we’ve been working on! Reach out if you have any questions.

We’re going to switch up the content in this spotlight for a bit to make sure you all have the info you need to master your week.