The warehouse real estate sector is seeing a rebalance. Here’s what to watch for

 Warehouse real estate is cooling into balance after a wild few years. E-commerce is still strong, but tenants now care more about location, power, and efficiency than raw square footage. New construction has slowed, onshoring is adding steady demand, and rents in some oversupplied markets are slipping a bit before they stabilize. In the big-box segment, vacancies are near cyclical peaks and builders are pulling back, while third-party logistics firms like Ryder and DHL drive fresh leasing. Proximity to ports and population centers matters more as trucking capacity tightens and transportation eats a bigger share of supply-chain costs. Power is now a pricing lever too, as companies want buildings that can support automation and higher energy loads.

Looking to 2026, watch three themes. First, reshoring and defense spending may revive older industrial corridors and lift warehouse absorption, with some estimates pointing to a large boost in demand over the next five years. Second, strategy is shifting from bigger to smarter, as Amazon and others favor newer, taller, well-located facilities over sheer scale. Third, AI and property tech are moving from buzz to utility, helping owners pick sites, manage inventory, and predict maintenance to cut costs. If interest rates ease and policy uncertainty fades, this sector is set up for a slow, healthier climb rather than another boom-bust cycle.

source : https://www.cnbc.com/2025/11/28/warehouse-real-estate-rebalance.html

America is headed for a fiscal cliff. Here’s how to stop it.

 The U.S. is facing a fiscal cliff where there are huge federal debts, an end to tax breaks, and expiration of spending caps. All of this could result in the debt being even higher. This could lead to higher borrowing costs,, higher taxes, a recession, and living standards decreasing for many. Stand Together recommends both parties work together to eliminate programs that are wasteful and stop relying on short-term fixes.  This is concerning to me. My family is already struggling. I keep thinking how Trump keeps saying the economy is better, but it's not and its hurting middle class families. https://standtogether.org/stories/the-economy/america-is-headed-for-a-fiscal-cliff-in-2025-how-to-stop-it?utm_source=google&utm_medium=cpc&utm_campaign=STTOTGR_IN_2025_PRG-PUB_GOOGLE_50SCROLL_STBP-STMAIN-NB-BROAD&utm_content=ARTL_EPICLAUNCH-826229_V1_TXT&utm_term=economic%20growth&gad_source=1&gad_campaignid=22751714065&gbraid=0AAAAAo3bCM6ZZV2p1IIMzwzMM_oDZYXm8&gclid=CjwKCAiA86_JBhAIEiwA4i9Ju9zJ6sF87dSM1idJSQJCMuV2y7LvSJjh33wDU9pL1i8JWU8rV0Sj2hoCkJIQAvD_BwE

Black Friday's Unexpected Slowdown Weighs on Retailers

    What was expected to be one of the busiest shopping days of the year instead delivered a surprising sense of disappointment for many retailers. According to CNBC, Black Friday foot traffic and sales fell short of expectations, leaving stores with weaker-than-hoped results.

    Analysts noted that shoppers showed up later in the day and spent more cautiously, opting for targeted purchases instead of the doorbuster frenzy that once defined the holiday. Retailers had hoped early deals and heavy advertising would boost momentum, but inflation-weary consumers remained selective with their spending.

    The muted turnout became most visible in major malls, where crowds were thinner and lines shorter. While some online sales grew, they weren’t enough to fully offset the slowdown with the in person shopping, creating challenges for stores that rely heavily on Black Friday revenue to close out the year on a high note.

    Industry experts say that changing shopping habits like shifting toward online browsing and more spread-out holiday sales are making traditional Black Friday surges less reliable than in the past. Many consumers now prefer to shop during extended deal periods rather than crowd into stores on a single day.

    As retailers reassess their expectations for the rest of the holiday season, the question becomes whether shoppers will return in December with stronger demand, or whether this year’s Black Friday is the latest sign of a broader shift in how Americans shop during the holidays.

Link to Article: https://www.cnbc.com/2025/11/28/black-friday-shopping-retail-letdown.html 

Economic Weaknesses are Emerging, Wall Street Seems Unconcerned

    In 2025, major U.S. stock indexes including the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average have reached multiple record highs. Their rise has been driven by enthusiasm over artificial intelligence and expectations that the Federal Reserve will continue lowering interest rates. At the same time, several key economic indicators point to growing weakness in the real economy. Commercial mortgage-backed security delinquencies have reached an all-time high, subprime auto loan delinquencies are rising faster than they did during the Great Recession, and severe credit card delinquencies are at their highest level since 2011. These trends suggest that businesses and consumers may be in a more fragile position than the stock market’s performance suggests.

    Even with these warning signs, history provides reassurance for long-term investors. Economic downturns are inevitable, but they tend to be short compared with expansion periods. Since World War II, recessions have typically lasted less than a year while expansions have often continued for many years. Stock market data shows a similar pattern, with bear markets tending to be brief and bull markets lasting far longer. Over long periods, investors who stay focused on the long term have historically been rewarded.

https://finance.yahoo.com/news/foundation-u-economy-appears-breaking-144400992.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAHDw8WXhyt3gFCGYrc862oXfMbUHmcLNGL395ZOOwOa7x_SrD19kCCSsD--d3BVL27eLc7SHVlwJshYHhZCjXyoPNdt0MSdwJc2KaNS8xkr3HMRtqGHZnOmrPo5iOedGa-YUAiCR_RNkJTQTwuLBDfVdkdQIEhmKtu_nW1Hj5JdR

The U.S. Sees A Great Decline in International Students and Billions in Economic Losses

New international student enrollment at U.S. colleges dropped by 17% in the fall of 2025, according to a report from the U.S. Department of State and the Institute of International Education. This drop is largely due to stricter visa restrictions and other policy changes under the Trump administration. 

Over the 2024-2025 academic year, international students at U.S. colleges and universities contributed nearly $55 billion to the U.S. economy including tuition revenue as well as student spending. The drop in enrollment this year is projected to cost the economy about $1.1 billion, according to NAFSA. A separate analysis by Implan found that the drop in enrollment amounts to a nearly $1 billion loss to GDP.

Economists note that international students support local businesses, create jobs, and generate tax revenue, and that before the visa restrictions nearly 1.2 million international students studied in the U.S. However, international student enrollment has been declining for two years now beginning in 2024. Changing attitudes abroad about studying in the U.S. and the more restrictive visa policies have accelerated the decline.

The article notes that while international student enrollment has broader economic effects, colleges and universities and the students they serve are the hardest hit. Because many international students pay full tuition, their enrollment helps fund academic programs, faculty positions, and financial aid for U.S. students. Ted Mitchell, president of the American Council on Education notes that full-paying international students often enable scholarships for domestic students, meaning the decline strains student support and institutional budgets.

I think besides the economic consequences, there's a significant soft power cost because U.S. universities have been one of the nation's strongest tools of global influence. With the decline in international students, other countries like Canada and Australia can gain ground in attracting global talent, and that could shift diplomatic and cultural influence in the future away from the U.S.

https://www.cnbc.com/2025/11/30/international-student-enrollment-decline.html

Inflation, Policy Shifts, and the Uncertain Path Ahead

 The global economy is entering a period of slower growth, and many of the pressures driving this shift are becoming harder to ignore. Rising tariffs, ongoing supply-chain complications, and geopolitical tensions have kept production costs elevated, which in turn has sustained higher-than-expected inflation across many countries. Even though major economies avoided recession recently, underlying structural weaknesses are becoming more visible. This combination of slowing momentum and persistent price pressures has created an environment where central banks must tread carefully, balancing inflation control with the risk of tightening financial conditions too much.

In the United States, the situation reflects this broader uncertainty. The recent government shutdown delivered a noticeable hit to output, and while consumer spending has stayed resilient, business investment is starting to cool as firms wait for clearer direction on interest rates and fiscal policy. The Federal Reserve is expected to begin lowering rates to support borrowing and investment, but this comes with its own risks if inflation hasn’t fully stabilized. As a result, the U.S. economy now sits at a crossroads, still expanding, but increasingly vulnerable. How policymakers respond in the coming months will determine whether 2026 brings renewed growth or a more pronounced economic slowdown.

Source: 

https://www.oecd.org/en/publications/oecd-economic-outlook-interim-report-september-2025_67b10c01-en.html?

Private payroll losses accelerated in the past four weeks

 There is a lot of concern about the current health of the U.S. labor market.  The market itself has been showing signs of weakening, even with the lack of data being released as a result of the government shutdown.  In the past couple of weeks, ADP has been the source of data regarding the labor market.  They have reported that there was a loss of 13,500 jobs a week in the private company sector over the span of the last four weeks.  As a frame of reference, there was a loss of 2,500 per week in the previous update that was given.  As a result of the government shutdown, there will again not be a lot of data to use for the FED when it meets again in December.  Advocation for a cut has shifted the market to expect a cut to rates in the next month, and there is little data that will be released to alter that expectation.  The Goldman team has said that they believe that there will be two more cuts following the December rate cut, come the new year.

https://www.cnbc.com/2025/11/25/private-payroll-losses-accelerated-in-the-past-four-weeks-adp-reports-.html

The Debate Over Minnesota Welfare Fraud and Somalia

A recent City Journal report claims that money stolen in several large Minnesota welfare fraud schemes may have indirectly reached the Somalia-based terror group Al-Shabaab. Citing unnamed federal counterterrorism sources, the article argues that fraudulently obtained U.S. funds, particularly from Minnesota’s Somali community, are sometimes sent overseas through informal “hawala” money-transfer networks, where Al-Shabaab allegedly takes a cut. The report links this claim to major fraud scandals such as the “Feeding Our Future” case, which has resulted in more than 50 convictions tied to an alleged $300 million pandemic-era scam, along with newer fraud cases involving Medicaid Housing Stabilization Services and autism services. Some former investigators and political figures quoted in the article say the issue has been under-addressed due to political sensitivities around Minnesota’s large Somali population.

Federal prosecutors, however, have not charged anyone in these cases with terrorism-related offenses, focusing instead on large-scale financial theft. Still, former law enforcement officials say that even unintentional remittances can benefit Al-Shabaab because the group taxes economic activity inside Somalia. Critics argue that this creates a risk that stolen U.S. welfare funds could indirectly support terrorism. Others note that the claims rely heavily on anecdotal sources rather than confirmed evidence, showing the need for careful investigation rather than broad assumptions about Minnesota’s Somali community.

https://www.msn.com/en-us/news/us/somali-terror-group-al-shabaab-taking-a-cut-of-millions-in-stolen-minnesota-taxpayer-money-from-welfare-fraud-scheme-report/ar-AA1QR7SD?ocid=BingNewsVerp

End of the "Rip Off" Economy

 This article is focused on how AI is beginning to rapidly reduce the information advantages which was allowing companies to overcharge consumers. AI gives people price comparisons, diagnostic help, and is able to weaken the normal imbalance between customer and consumer. This article reveals that AI is going to help people with identifying quality, make better/more informed choices, avoid hidden issues. Markets are improving but industries such as home repairs, law, or real estate still have a large information gap that costs consumers millions to billions of dollars every year.

AI is already prevalent and working in some apps used to compare prices, report issues, etc. But the article also highlights that business will implement AI which creates a competitive environment for both sides. The "Rip Off Economy" is not gone but is definitely declining as of late. 

https://www.economist.com/finance-and-economics/2025/10/27/the-end-of-the-rip-off-economy

AI Takes Over Holiday Shopping

This holiday shopping season is different because AI has adopted new features to make it easier for people to find and buy perfect gifts. Big stores like Amazon, Target, and Walmart now have smart chatbots acting like personal shopping assistants, helping shoppers sort through gifts, read reviews, and even buy things without leaving the chat. For example, in September, OpenAI launched an instant checkout feature in ChatGPT, letting people buy items from stores such as Etsy without leaving the chat. Amazon also rolled out a tool that tracks price drops and can automatically buy items if they fit someone’s budget, and Google announced an AI assistant that calls stores to check prices or product stock.​

Because these companies invest so much in AI, they are likely to keep pulling ahead of smaller stores. Their technology helps people shop faster, with more choices and confidence, making it hard for small businesses without the same tools to keep up. What kinds of jobs do you think will be most needed as more stores start using AI shopping assistants?

Read the article here: https://www.nytimes.com/2025/11/25/technology/chatgpt-holiday-shopping.html

Delayed September Jobs Report Expected to Show Continued Weak Growth

Website: https://www.morningstar.com/economy/delayed-september-jobs-report-expected-show-continued-weak-growth

The September jobs report was delayed because of the government shutdown, but economists forecast it will show only about 50,000 new jobs added and the unemployment rate holding steady at around 4.2%. A majority of these jobs were in the healthcare sector. This data suggests that although the labour market is not collapsing, its strength is clearly diminishing and growth remains weak.

Using the IS-LM framework, this weaker job growth and stable unemployment rate imply a leftward shift of the IS curve. Lower job creation means less income and consumption, reducing aggregate demand. Meanwhile, if the central bank reacts by easing monetary policy, the LM curve shifts right. This puts the new equilibrium at lower output. This framework aligns with the article's predictions. 

Why the Fed May Pause Rate Cuts: Hammack Warns Inflation Is Still Too High

This week, Cleveland Federal Reserve President Beth Hammack suggested that the Fed may slow or pause its plans to cut interest rates because inflation is still too high. In a recent report from Reuters, she said that current interest rates are only “barely restrictive,” meaning they may not be high enough to keep inflation moving toward the Fed’s two percent goal.

Hammack warned that lowering rates too quickly could undo the progress made so far. Her comments go against what many in the financial markets were expecting, since some investors thought the Fed might cut rates again soon, possibly in December. Her message suggests the Fed wants to be more careful and avoid making inflation rise again.

If the Fed decides to wait before cutting rates further, borrowing costs like mortgage rates, car loans, and credit-card interest may stay high for a bit longer. Inflation is still a major concern, and the Fed wants to make sure prices continue to cool down before taking big steps.

Hammack’s comments do not guarantee that the Fed will pause rate cuts, but they show that future decisions will depend on stronger proof that inflation is easing. For now, the path toward lower interest rates remains uncertain.

Fed's Hammack leans against more rate cuts because of high inflation

Stock investors are buoying the economy. A labor market breakdown could end that

Elevated stock market returns have helped lift sentiment among wealthy Americans, who now feel more confident about their finances and the economy. However, economists are warning that this confidence is fragile because the labor market is showing signs of weakening. While equity prices remain strong, a drop in hiring, slower wage growth, or higher unemployment could quickly shake investor and consumer confidence. The piece also notes that if stock-driven optimism is not backed by a healthy jobs market, the risk of a broader economic or market correction increases. Stocks are buoying wealthy sentiment for now, but the underpinning labor-market strength is at risk and could pull that confidence away.

https://www.cnbc.com/2025/11/11/stocks-are-buoying-wealthy-sentiment-a-labor-market-break-could-end-that.html

European Markets – “Waves of Trade & Sentiment in the EU”

 

The markets across Europe have recently been showing a cautious optimism. Stock indices like the Euro Stoxx 50 and the major national markets are up around 1%, helped by hopes that global tensions might ease and by better investor mood. At the same time, the economic backdrop remains tricky: the European Central Bank (ECB) has flagged that future decisions will depend heavily on incoming data because growth is weak and uncertainty is high. 

What this means is even though markets are zooming up a bit, many European companies are still dealing with slower exports, rising costs (especially energy), and trade shifts. So, while it’s a better mood, the economy hasn’t fully recovered and markets remain on alert for anything unexpected.

https://www.investing.com/markets/europe?utm_source=chatgpt.com

https://www.theguardian.com/business/live/2025/jul/24/lloyds-uk-economy-deterioration-elon-musk-tesla-european-central-bank-ecb-lagarde-manufacturing-pmi-business-live?utm_source=chatgpt.com

Government Shutdown Takes Off-Flights Don't

Last Saturday alone, more than 2,200 flights were cancelled as the ongoing U.S. government shutdown continues to disrupt air travel nationwide. The Trump administration recently announced a 4% reduction in domestic flights at 40 major airports due to severe staffing shortages. If the shutdown continues past this Friday, that number is expected to increase to 10%

Fortunately, the disruption occurs during the year's slower travel period, but that relief will be short-lived. Thanksgiving and Christmas are right around the corner, and the strain on the airline industry will only continue to rise as the holiday season comes upon us. 

Secretary of Transportation Sean Duffy warned that commercial air travel in the United States could soon be reduced to "a trickle" as the number of air traffic controllers continues to fall. According to Airlines for America, which represents the largest U.S. airline industry, 71% of recent flight delays are due to staffing shortages among air traffic controllers. 

Despite the shutdown, air traffic controllers and airport security are expected to continue showing up to work, without pay. Many have been forced to take on a second job just to make ends meet. 

As the country navigates what has become the largest government shutdown in U.S. history, the outlook for travelers remains unknown. With the holiday season fast approaching, it's unclear how many Americans will actually make it home to spend time with their loved ones. 

42,000 Jobs added

    The ADP reported that there were 42,000 jobs added by employers in October, which was higher than Economist were expecting. The government is still in a shut down, so we are not sure if the government's job report will release on Friday. It will most likely be a delay. Although ADP shows this increase in jobs, there are other private surveys of the job market showing that there is a weakening in replacing workers who quit or retire, and some big-name firms such as IBM and Amazon have announced layoffs (Smart). Large employers (500 employees+) drove the gains in the ADP report, with 74,000 jobs added, while industry sector, trade, transportation and utilities added 47,000 jobs, and education and health care tide in added 25,000 workers. 
    
    Studies have shown that employers cut jobs in professional business services are down by 15,000, while information, and leisure and hospitality, were also cut by 17,000 and 5,000 (Smart). There was a recent survey done by Paychex's that shows that hiring among small businesses with fewer than 50 employees, which causes some caution, however, in September, there were 29,000 jobs lost, which means that we are doing a little better. 

    The article I read also talked about how there were two dissents at the Fed’s October meeting. At the meeting, one member of the central bank’s monetary policy committee wanted a bigger cut of a half point and the other preferred no cut, which means that nobody knows what they are going to do and that will depend on what incoming data, assuming the Fed has enough to make a decision (Smart). 

Smart, T. (2025). ADP: Employers Add 42,000 Jobs in October. US News & World Report; U.S. News &

    World Report. https://money.usnews.com/money/personal-finance/articles/adp-employers-add-42-000-        jobs-in-october

Russia tries to re-stake its claim to China after Trump’s meeting with Xi

Russia is moving to reaffirm its strategic relationship with China following Donald Trump’s meeting with Xi Jinping. Moscow has described Mikhail Mishustin’s visit to China as “very important,” and aims to deepen cooperation in trade, technology, energy and agriculture. Despite China-Russia ties strengthening since 2022, recent data show Chinese exports to Russia are down, while Russian exports to China are rising modestly, underscoring Moscow’s desire to stabilize the partnership amid wider geopolitical shifts.

Russia tries to re-stake its claim to China after Trump’s meeting with Xi

Open AIs Big Stock Market Debut soon

OpenAI is preparing to go public, with plans for an IPO that could value the company at up to $ 1 trillion. The firm may launch the IPO as early as the second half of 2026, though the timing could shift depending on market conditions. The move from private to public has significant implications for the markets. It could unlock a new pathway for raising capital, bringing in billions of dollars to fund acquisitions, hire thousands of new employees, and expand AI infrastructure. The IPO signals strong investor confidence in artificial intelligence as a significant growth sector, with global spending on AI projected to reach over $ 500 billion by 2030. At the same time, it will put pressure on OpenAI to demonstrate consistent revenue growth and profitability once it is accountable to public shareholders. The listing may also create ripple effects across the tech industry, boosting investor interest in hundreds of AI startups, chip makers, and cloud infrastructure companies.

https://www.reuters.com/business/openai-lays-groundwork-juggernaut-ipo-up-1-trillion-valuation-2025-10-29/ 

Here’s where the economy is starting to show ‘K-shaped’ bifurcation

 Americans are splitting into two groups when it comes to spending. Higher-income shoppers are still buying, while many lower-income families are cutting back. You can see it in food and drink, cars, and even airline seats. Coke says premium items like Topo Chico and Fairlife are selling well, and McDonald’s is pushing value menus because traffic from lower-income diners is down. Chipotle says some customers feel squeezed, and Procter & Gamble sees wealthier shoppers buying big packs while others stretch what they have at home. The same split shows up in big purchases. The average new car now costs over $50,000, defaults are rising for buyers with weaker credit, and airlines say premium seats are outpacing coach. A cooler inflation report came out after a shutdown delay, showing prices up 0.3% on the month and 3% over the year, and Social Security’s cost-of-living adjustment for 2026 will be 2.8%.

Hotels also show a mixed picture. Hilton’s budget brands saw softer revenue, but luxury did great. Their CEO thinks the gap may narrow if inflation and rates ease, with the middle and low end improving rather than the high end falling. To me, this “K-shaped” economy is simple to read on the ground. Households paying more for groceries and gas are trimming meals out and skipping upgrades, while wealthier households keep spending on premium drinks, bigger cars, and roomier seats. If the Fed cuts rates next week and inflation keeps cooling, we will see whether that helps the lower and middle tiers catch up.

source : https://www.cnbc.com/2025/10/23/k-shaped-spending-sectors-showing-bifurcation.html

Politics Trump administration must pay SNAP benefits despite government shutdown, judge rules

 During the ongoing U.S. government shutdown, a federal judge in Rhode Island temporarily blocked the Trump administration from halting Supplemental Nutrition Assistance Program (SNAP) benefits that feed 42 million Americans. Judge Jack McConnell ruled that the administration must use emergency contingency funds to continue providing food aid, calling the potential harm to families “irreparable.” The decision followed a similar ruling by Judge Indira Talwani in Boston, who said the suspension of SNAP was likely unlawful. In response, former President Trump said his administration was seeking legal clarification on how to fund the program. Senate Minority Leader Chuck Schumer accused him of using hunger as political leverage. The ruling argued that no administration should use food access as a bargaining chip during political disputes.

Trump admin must pay SNAP benefits despite shutdown: judge

Race to the Top: AI Spending

Consumer spending and hiring may be in a slow period in the broad economy, but the big US tech companies are going the opposite way, due to their large investment spending in artificial intelligence. In the latest earnings reports from large tech companies, namely Microsoft, Amazon, Alphabet, and Meta all showed massive increases in capital expenditures mostly toward AI spending. Most of this AI spending is aimed at new data centers, advanced chips and cloud capacity for larger models. Microsoft spent almost $35 billion last quarter, more than 70% from a year ago, while Amazon spent almost $34 billion. Alphabet clocks its full year spending in at roughly $90 billion, and Meta enlarged its spending over $70 billion, showing no sign in this AI spending race. 

Even with good revenue and solid earnings growth, investors aren't jumping for joy quite yet. Shares of Meta and Microsoft dropped after their reports came out due to worrying that the AI investment would squeeze the profit margins for these companies. Even though these companies are ensuring these investors that this spending is necessary to meet the large demand for AI development to secure the top spot in the race, the investors still aren't fully convinced if, or when the investment will start to pay off. 

The difference between investor skepticism and corporate optimism is shared in its likeness in Silicon Valley. Where executives of tech companies are rather optimistic about the surge of Ai and all of the demand that comes with it. They believe in the transformation that AI will bring upon the economy. Markets however do not reflect that; they are more so reflecting the billions in spending on infrastructure and massive energy costs that may not pay near term. As of now it is just a game of risk, although the future seems to be in AI the question seems to be how soon that future will be.

How much Google, Meta, Amazon and Microsoft are spending on AI

Mortgage rates jump 20 basis points following Fed cut

This week the Fed cut the interest rate which caused mortgage rates to go up. The 30 year mortgage rate jumped 20 points to 6.3% after Jerome Powell spoke. The bond market had already expected the rate to cut, but didn’t like Powell’s comments, which caused rates to rise. The same thing happened after the last cut in September when mortgage rates also jumped.

Experts say the market was too confident that the Fed would make more rate cuts in 2025 and Powell’s comments made investors less sure. Even though lower rates had led to a surge in refinance applications, they haven’t encouraged more people to buy homes. The housing market is still slow as high prices and borrowing costs make it difficult for home buyers.

https://www.cnbc.com/2025/10/30/mortgage-rates-fed-cut.html 

Is Gen Z Screwed?

 A recent article by Futurism discusses a Goldman Sachs report warning that Generation Z could face a future shaped by automation and artificial intelligence. The report suggests that while AI will likely boost productivity and economic growth, it may also replace many entry-level jobs, the very positions younger workers depend on to start their careers.

This creates a major challenge for both workers and policymakers. If the economy grows because of AI but doesn’t create enough jobs, we could experience what economists call “jobless growth.” In theory, output rises, but employment stagnates. That disconnect has serious implications for income distribution, consumer demand, and long-term stability.

From a macroeconomic perspective, this situation highlights the tension between technological progress and labor market adjustment. Innovation boosts efficiency, but it can also make certain skills or roles obsolete faster than new ones appear. It also connects to structural change, where economies shift toward sectors that rely more on capital and technology than on human labor.

For students and young professionals, this raises real questions about how to prepare for a future shaped by automation. Should we focus on developing technical skills to work with AI, or on creative and interpersonal skills that machines can’t replace? And for policymakers, how do you support growth while also protecting opportunities for new workers?

https://futurism.com/artificial-intelligence/goldman-sachs-genz-automation

The Long-Term Sustainability of AI Investment

    The ongoing debate over artificial intelligence (AI) investment focuses on whether current spending represents a lasting technological shift or an unsustainable bubble. Major tech firms such as Microsoft, Amazon, Alphabet, and Meta Platforms are leading the charge, supported by strong, profitable businesses outside of AI. Their established revenue streams make their AI investments more secure and less speculative than past technology booms that were fueled by hype rather than real economic strength.

    At the center of this surge is Nvidia, whose graphics processing units (GPUs) power the vast majority of AI systems. The company projects that global spending on AI data centers will reach $600 billion this year and could climb to as much as $4 trillion by 2030. While some view these numbers as overly ambitious, Nvidia’s insight into future demand is unmatched. Because AI hyperscalers plan their hardware purchases years in advance, Nvidia has a clearer understanding of where the market is heading, suggesting that AI expansion may have far more room to grow than many investors assume.

    Concerns about an AI bubble largely stem from the financing structure surrounding OpenAI, the creator of ChatGPT. Some analysts warn that companies may be funding each other’s purchases in a way reminiscent of the dot-com bubble. However, unlike that era, the current leaders in AI, such as Meta, Alphabet, Microsoft, and Amazon, generate substantial cash flow from other successful ventures, reducing the risk of circular financing. The key indicator to watch will be whether these firms begin scaling back their AI investments. For now, all four are planning record capital expenditures through at least 2026, signaling that AI growth remains strong and likely sustainable in the years ahead. 

https://finance.yahoo.com/news/ai-rally-sustainable-just-another-103000211.html

Too much money in the bank could cost you big — here’s how to tell

Too much money in the bank could cost you big — here’s how to tell

 You might think having a lot of cash in your bank account is the safest thing you can do. After all, cash is secure, easy to access, and gives you peace of mind. But right now, with inflation running and bank account interest rates tiny, keeping too much money in your checking or savings account could quietly drain your wealth.

Here’s what we’re seeing: According to a recent report, the average American family holds around $62,410 in their checking account. That sounds solid, but consider this, as of September 2025, checking accounts are paying about 0.08% interest, while inflation is around 2.9%. That means your money is growing slower than prices are rising, so its purchasing power is shrinking. Over time, that means less value in your money than you expect.

From an economist's perspective, this is the classic "opportunity cost" problem. Money that sits idle is money not working for you-money which could have been invested to earn more money, help you keep up with inflation, or grow your future income. Accordingly, holding a large cash balance under these conditions is considered by economists to be a potential drag on the accumulation of wealth.

Of course, this doesn’t mean you should put all your cash into risky assets. You do need liquidity, money you can access when you need it, for emergencies, unexpected costs, or just peace of mind. But the key is balance, enough cash for safety, not so much that it becomes a drag on your long-term financial goals.

For your macroeconomics framework, this situation relates to a number of different themes. One is inflation versus savings, for your real return on savings to beat inflation, you must earn enough from your savings to preserve value. Another is investment, if people hold excess cash instead of investing, then aggregate investment can be lower, and that can slow economic growth. And finally, there's resource allocation: even though cash is safe, it's not the most efficient use of your financial resources in this environment.

In plain terms, if your bank account is filled with money that isn't serving a clear purpose-an emergency fund plus maybe a cushion for the short term-then you're probably losing out on potential growth. On the other hand, over-investing or having no cash buffer is not good either. The best action is one which provides security and at the same time lets your money work. Having cash in the bank is safe, but in today's economic climate, this could silently cost you money. Think about how much one really needs for near-term security; then consider moving the rest into options that may offer higher returns and better keep pace with inflation. That will keep you away from the hidden cost of doing "nothing" with your money.

Read more at:
https://economictimes.indiatimes.com/news/international/us/best-way-to-grow-your-money-in-2025-too-much-money-in-the-bank-could-cost-you-big-heres-how-to-tell/articleshow/124969548.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Wall Street’s Mood Swings — What the Mixed Market Says About the U.S. Economy

Wall Street’s Mood Swings — What the Mixed Market Says About the U.S. Economy

Today, the U.S. stock market presented a confusing yet interesting picture, the Dow Jones rose about 264 points, by strong performances in stocks such as Goldman Sachs, Disney, and Salesforce, while both the S&P 500 and Nasdaq retreated on the back of declines in major technology stocks like Microsoft and Nvidia. It's not too often that the Dow climbs while tech stocks are declining, and this indicates that investors are still divided over which direction the economy will take. Some are placing their bets in stable, more traditional companies, while others are pulling away from riskier technology bets.

There are a few reasons for this mixed reaction. Strong earnings from companies such as Salesforce and Disney saw confidence in sectors other than technology, while slowing growth and questions about future profitability caused investors to retreat from technology. The Federal Reserve's recent rate cut added to the uncertainty, cheaper borrowing usually helps businesses, but many worry it could also push inflation higher. All of this has made investors cautious, trying to figure out which parts of the economy can withstand slower growth and which might be strained if conditions deteriorate further.

From a macroeconomic perspective, this reflects the tension between growth and stability. While the Dow's rise indicates confidence in old-economy mainstays like finance and manufacturing, the decline in the Nasdaq shows growing doubt about future innovation and consumer spending. This mix of optimism and hesitation often characterizes the economy at a juncture when it is growing, but with potential risks coming from inflation, jobs losses, and trade issues. It is indicative that people think the U.S. economy as a whole remains strong but the path forward will be bumpy.

The stock market is not all about the numbers, it's also about sentiment. And for now, Wall Street seems cautious. Investors are moving toward conservative and away from riskier companies that tend to see bigger swings when the economy accelerates or slows. If that trend holds, it could mean slower investment and hiring in fast-growing parts of the economy, such as technology, and reduced innovation over time. On the other hand, traditional industries' steadiness will help balance the economy and probably help it avoid a severe downturn.

Overall, today's market action feels like a snapshot of the U.S. economy itself-strong in some areas, fragile in others. The Dow's rise shows resilience and confidence in parts of the market, while the decline in tech is a signal of concern about the future. A reminder that the economy rarely moves in one clear direction. And to quote Jerome Powell's description of "driving in the fog," investors and policymakers alike have limited visibility. For now, Wall Street's mixed day captures a bigger truth, the economy is still growing, but confidence remains fragile.

https://economictimes.indiatimes.com/news/international/us/u-s-stock-market-shocks-wall-street-today-dow-jones-climbs-as-sp-500-and-nasdaq-fall-salesforce-goldman-sachs-and-disney-rally-while-microsoft-and-nvidia-drag-tech-lower-in-mixed-u-s-market/articleshow/124960368.cms?utm_source=chatgpt.com&from=mdr

Government Shutdown's Impact on Contractors and Small Businesses

    Over the past month, the impact of the ongoing government shutdown has begun to weigh heavily on businesses that work with the federal government. According to a new report released Thursday by the U.S. Chamber of Commerce, government contractors have collectively lost around $12 billion since the shutdown began on October 1.

    The report, which is being sent to members of Congress, highlights that 65,500 small businesses across the country are losing roughly $3 billion each week. These companies provide a range of services — from high-tech manufacturing and office supplies to landscaping — and many rely on government contracts for a large portion of their income.

    Neil Bradley, executive vice president of the Chamber of Commerce, said in a letter that while federal employees are guaranteed back pay once the government reopens, contractors have no such protection. “When the government reopens, rarely are contractors made whole,” Bradley wrote, noting that many purchases are permanently lost during shutdowns.

    In order for the shutdown to end, there needs to be a "bipartisan" short-term spending bill which is all but bipartisan as of now. The Democratic party is pushing for the inclusion of ACA tax credit extensions before they agree on a deal. 

    With pressure continuing to build on getting a deal done, it will be interesting to see how the contractors continue to deal with this with no promise that they will get the pay they once agreed upon with another party. 

Link to Article: https://www.cnbc.com/2025/10/30/government-shutdown-business-chamber.html 

Fed Chair Powell Says Don't Count on a December Rate Cut

 On October 29th, the Fed cut rates by a quarter of a basis point to combat unemployment from surging.  This cut dropped the benchmark lending rate to a range of 3.75% - 4%.  This is the first time that there has been a "dueling dissent" in the decision of what to do with the Fed rates.  There were two opposing views on opposite policies.  One to cut rates by half a basis point and one to leave the rates as they are.  Along with these dueling perspectives, the decisions for the Fed rates are also occurring when there has been no government employment data as a result of the shutdown.  Employment is struggling, and the addition of jobs is at its lowest it has been since 2010.  Powell has said that the decisions are currently being made during a time of blindness for the Fed.  He has made it very clear that it is hard to make decisions about the conditions of the U.S. economy.  Data trends and private sector data that have been released by ADP are incite into the economy but are nothing compared to the government data that is typically used and considered the "gold standard".

Along with concerns about the economy's status and the lack of information due to the government shutdown, there are concerns about inflation rates.  Powell has said that, as of now, we are not seeing significant inflation, but this is mainly due to the tariffs and that businesses are doing a good job in not passing the increased expenses from tariffs onto customers.  He says, though, that because of the time it takes for tariffs to reach consumers, some inflation is going to occur.  Although we aren't seeing high inflation right now, tariff inflation is expected.  The September CPI showed unexpectedly reasonable values; however, this is likely to change as price pressures are apparent with the new tariffs.  With all this being said, the short-term inflation is hoped to be stopped by the tariffs, and this is what drove the most recent Fed rate cut.  The Fed will be in a tricky position if crucial government data is still not released in the near future as a result of the government shutdown.

https://www.cnn.com/2025/10/29/economy/fed-october-rate-decision

Global Commodity Prices Hit Six-Year Low, Easing Inflation but Raising New Concerns

 Global commodity prices have dropped to their lowest level in six years, according to a new World Bank report released this week. Prices for energy, metals, and food have all been falling as demand slows and supply improves around the world.

Energy prices, including oil and natural gas, are expected to fall by about 12% next year, while food prices could drop around 6%. This is helping cool inflation in many countries, giving consumers and businesses a bit of relief after years of high costs. Economists say that lower commodity prices are one reason inflation might finally return closer to normal levels by next year.

However, the report also warns that this drop reflects a slowdown in the global economy. Countries that depend on exporting oil, metals, or crops are being hit hard by lower prices, which could lead to weaker job growth and less government spending in those regions.

There’s still a lot of uncertainty ahead. If interest rates keep falling, demand could pick back up, but ongoing trade tensions and tariffs could make things unpredictable. Some analysts also point out that while inflation is easing, the slowdown in demand isn’t necessarily good news for long-term growth.

Overall, the decline in commodity prices is a mixed signal. It’s helping to ease inflation, but it also shows that the global economy may be losing some strength heading into 2026.

Source: https://www.worldbank.org/en/research/commodity-markets

Federal Reserve cuts key interest rate in bid to boost job market

The Federal Reserve today (Wednesday 29th October 2025) cut its benchmark interest rate by 0.25%, which is its second rate cut this year, in order to stimulate economic activity in the country and to boost investment. This decision was made despite concerns about persistent inflation and fairly low unemployment rates because job hiring is low and firms seem to be laying off workers indicating that the labor market is sluggish.

There isn't really a clear way forward because the US economy is very uncertain. The Chair of the Fed, Jerome Powell compared the current economic uncertainty to driving in the fog and emphasized slowing down. The rate cut aims to make borrowing cheaper for consumers and businesses but it also risks further fueling inflation, which recently rose to 3%, above the Fed’s 2% goal. It's going to be interesting to see how the economy progresses and what the Fed will do on December 10th when it makes its next rate decision.

This rate cut comes as the US economy faces a dilemma with the labor market cooling while prices are still high. Hiring rates have collapsed to levels last seen in the years following the 2008 global financial crisis, and the ongoing government shutdown has also made it harder to assess the economy, as key data releases are delayed. And economists say lower interest rates can sometimes worsen inflation by increasing economic activity. Jerome Powell acknowledges this risk especially looking at the effects of President Trump's tariffs that suggest that inflation could continue to increase.

The issue also is that, the economy is showing mixed signals with strong GDP growth driven by an AI investment boom. Powell described the rate cut as a risk management step to balance the conflicting trends in the economy.

There is disagreement within the Fed about what to do next. Powell stressed that another rate cut at the December meeting is not guaranteed. Some policymakers urge caution, warning that lowering rates too quickly could worsen inflation, which is also being driven by tariffs. And some analysts believe that the tension between elevated inflation and the labor market cooling is easing, but not for reasons that look good for the broader economy. 

Ultimately, the Fed is navigating a complex situation because inflation remains stubborn, the labor market is fragile, and government shutdown has made economic data incomplete. Fed governor, Christopher Waller made a really good point here, "either economic growth softens to match a soft labor market, or the labor market rebounds."

Source: https://www.nbcnews.com/business/economy/federal-reserve-interest-rate-decision-rcna240337