Wednesday's Scoop: Clarity☀️

Hey friend - welcome back to your scoops.

Here’s what you need to know today to inform your work, spending, and investments:

1. The economy faces sweeping changes under newly-elected President Donald Trump.

2. Mortgage costs keep climbing.

3. Bitcoin is more valuable than ever.

Inflation Rate: +2.4% (YoY), +0.2% (MoM)
^{Policymakers aim for 2% YoY inflation. (September CPI)}

The economy faces sweeping changes under newly-elected President Donald Trump. President Trump’s victory marks a pivotal shift, reflecting widespread voter concerns over the economy and immigration. Trump’s economic agenda hints at broad changes ahead, with plans to reduce corporate taxes, decrease regulation, and enforce taxes on imported goods. Lower corporate taxes and deregulation help companies earn more profit, which should fuel more growth in the stock market and potentially more hiring while possibly putting worker protections and the environment at risk.

President Trump has also widely promoted the implementation of up to 60% tariffs on imports from countries like China, which could drive revenue for the government while inflating costs for businesses and consumers.

The future president has pledged to ramp up spending to deport undocumented immigrants, which could cost both the taxpayer and the economy by spending resources to deport people who are currently working, spending, and paying taxes in the US. As with most political agendas, many of these policies risk increasing the national debt. As President Trump’s second term begins, he will face the challenge of balancing bold promises with the realities of managing a delicate economy still recovering from an unprecedented crisis.

30yr Mortgage Rate: 6.8%
^{That’s down from 7.6% a year ago. (MBA)}
Median Home Price: $404,500
^{That’s up from $393K a year ago. (Existing Homes, NAR)}

Mortgage applications took a sharp dive last week as interest rates climbed higher. According to the Mortgage Bankers Association, total mortgage application volume dropped by 11% compared to the previous week. The average interest rate for a 30-year fixed-rate mortgage increased to 6.81% from 6.73%, making borrowing money for a home more expensive. Interest rates have climbed even further this week following the US election results. Applications to purchase a home decreased by 5% for the week and were only 2% higher than a year ago. While more homes have become available and prices have fallen slightly, rising mortgage costs discourage potential homebuyers and those looking to refinance. Homes aren’t getting more affordable as quickly as buyers would like.

The Market: ⬆️ +2.5%
S&P 500: 5,929.04
1Mo: +4% | 1Yr: +36% | 5Yr: +92%

The market surged to a new all-time high on Wednesday following the US election results naming Donald Trump as the winner of the presidential election, with Republicans gaining control of the Senate and the House still undecided. Relief from uncertainty and the potential for lower taxes and regulations outweighed any concerns about tariffs or ballooning national debt and fueled investment across stocks, crypto, and other major assets.

Bitcoin hit a new record high following Donald Trump's presidential election win, which has renewed investor confidence in a more crypto-friendly regulatory environment. The cryptocurrency rose past $75,000, with investors betting that Trump’s policies favor looser regulations in the crypto space and more potential investment. Other major cryptocurrencies followed suit, with Ether and Solana surging by 10% and 12%, respectively. As part of his agenda, Trump has proposed creating a crypto advisory council, promoting US-based bitcoin mining, and establishing a national stockpile of the cryptocurrency. Trump has promised to replace the head of the Securities and Exchange Commission, Gary Gensler, whose enforcement actions have frustrated the crypto sector. With a crypto-friendly president and hundreds of new crypto-friendly lawmakers in Congress, America looks like a new frontier for digital asset investment growth.