December Retail Sales Show Signs of Slowing

 December retail sales had a disappointing ending compared to what was predicted for consumer spending. According to the Commerce Department, retail sales were flat for the month, following a 0.6% increase in November and fell short of economists expectations for a 0.4% gain. Even when excluding purchases related to vehicles, sales showed no growth, reinforcing concerns that holiday spending lost momentum. 

On a yearly basis, retail sales rose 2.4% which was slower than November's 3.3% pace and below December's inflation rate of 2.7%. Therefore, consumer spending failed to keep up with rising prices which is not good as consumer spending accounts for more than two-thirds of the U.S. economic activity.

This slowdown was uneven with furniture, clothing, electronics, and miscellaneous retailers all posted declines and online sales barely increased. Building materials and garden centers had a stronger gain which could mean consumer spending priorities could be shifting. Economists also stated factors such as harsh weather, tariffs, and high prices affected the holiday shopping season.  

Despite the weak December report 2025 was not a poor year for retail. The pattern of spending showed a "k-shaped" economy. Looking ahead consumer spending in early 2026 could slow down more with the growing uncertainty with the labor market and wage growth. This shows the growing pressure on households as inflation and higher costs limit discretionary spending. 

https://www.cnbc.com/2026/02/10/december-retail-sales-were-flat-missing-expectations.html

Falling Inflation Expectations Signal Shifts in the U.S. Business Cycle

 Recent data released by the New York Federal Reserve Survey of Consumer Expectations showed that expectations for inflation over the coming year are falling. This is a clear indication that prices are favorable over time. Americans also seem to have more confidence in their labor market, as few are concerned about losing their jobs. Despite this, many are concerned about their financial well-being.

This has important implications for national income and business cycles. Lower inflation predictions would help encourage consumer spending, which would assist in the expansion of GDP. Additionally, an optimistic job market would help keep the economy as stable as the current income levels. Overall, it seems that the economy may be stabilizing, but mixed consumer sentiment indicates that risks persist.

https://www.reuters.com/business/ny-fed-survey-january-near-term-expected-inflation-lower-amid-better-job-market-2026-02-09/

Labor Market is increasing unemployment

 Layoffs this past January reached their highest level for any January since 2009. U.S. employers announced 108,435 layoffs, which is up 118% from the same month a year ago and 205% from December 2025. Hiring numbers were not encouraging either, with only 5,306 new hires reported—the lowest January total since 2009. The article suggests that layoffs may continue to rise, as the first months of the year are typically the most severe for job losses.

Several large companies have already announced major cuts. Amazon, for example, recently reduced a significant portion of its workforce, shedding about 16,000 mostly corporate jobs. Transportation and technology were the two sectors with the largest losses, largely due to UPS plans to cut more than 30,000 workers and Amazon’s reductions. While it is somewhat expected in transportation—given the surge in delivery drivers in recent years and improvements in automation—it is still striking to see losses of this scale.

With rapid technological growth, fewer workers are needed, and hiring new employees requires time-consuming training. As a result, many companies are combining roles to reduce labor costs. Adding to concerns, job openings fell sharply in December to 6.54 million, the lowest level since September 2020, and are down more than 900,000 since October. Overall, the data point to a weakening labor market, with employers appearing less optimistic about economic conditions heading into 2026.

https://www.cnbc.com/2026/02/05/layoff-and-hiring-announcements-hit-their-worst-january-levels-since-2009-challenger-says.html

Layoffs in January were the highest to start a year since 2009, Challenger says

 In January 2026, we have seen a surge in layoffs and a sharp drop in hiring plans from U.S. companies. We have not seen levels like this since the 2008-09 financial crisis. Employers have announced over 108,000 layoffs, which is more than double last year's January total. Planned hiring has fallen to just over 5,300 jobs, which is the lowest number in January we have seen on record. According to Challenger, Gray & Christmas, these numbers show that employers are anticipating the worst about the economic outlook for 2026. There is a large decline in job opportunities, weak private payroll growth, along with high profile layoffs from companies like UPS and Amazon. There are significant concerns that the labor market may be starting to weaken after a long period of stability.

https://www.cnbc.com/2026/02/05/layoff-and-hiring-announcements-hit-their-worst-january-levels-since-2009-challenger-says.html

Big Tech Stocks Dive as Wall Street Chokes on Massive AI Spending Plans

 Major U.S. technology stocks, including names like Amazon and Oracle, dropped sharply after investors reacted poorly to a wave of earnings reports and spending forecasts that revealed unprecedented capital expenditures on artificial intelligence infrastructure. Amazon’s announcement that it plans to spend roughly $200 billion on capital expenditures in 2026, far above Wall Street expectations, triggered a significant sell-off as shareholders grew concerned about the impact of such large outlays on near-term profitability and cash flow. At the same time, other tech giants — part of a broader trend of planned AI infrastructure investments totaling hundreds of billions of dollars across the industry — saw their stock prices weaken as markets questioned whether these massive expenditures will generate returns soon enough to justify the risk. The sell-off wiped out over $1 trillion in market value across major tech companies as investors rotated away from high-growth, capital-intensive firms toward more stable or cheaper assets, highlighting a shift in sentiment in which the excitement about AI’s long-term potential is now tempered by concerns about the cost and timing of realizing profits.

https://www.cnbc.com/2026/02/06/ai-sell-off-stocks-amazon-oracle.html

Economy Layoffs in January were the highest to start a year since 2009

 The article reports that U.S. job-cut announcements surged in January 2026, reaching their highest January level since the 2009 financial crisis, according to the outplacement firm Challenger, Gray & Christmas. Employers announced more than 108,000 layoffs during the month, a sharp increase compared with both the previous year and the previous month. At the same time, companies announced only about 5,300 planned hires, the lowest January hiring total since the firm began tracking the data, signaling growing caution among employers about the economic outlook.

Major corporations across sectors such as transportation, technology, and finance contributed to the job cuts, suggesting the slowdown is not limited to one industry. Overall, the data indicates that the labor market may be weakening, with employers becoming less optimistic about growth in 2026 and scaling back hiring plans while reducing staff.

Citation: https://www.cnbc.com/2026/02/05/layoff-and-hiring-announcements-hit-their-worst-january-levels-since-2009-challenger-says.html

Budget 2026 Customs changes explained: what gets cheaper, protected, or simplified.

The customs duty reforms in India’s 2026–27 Union Budget, as explained by Vivek Chaturvedi of the Central Board of Indirect Taxes and Customs, show that trade policy is being used as a tool to support economic growth rather than just raise government revenue. By cutting or exempting duties on key inputs such as solar materials, critical minerals, defense repair equipment, healthcare drugs, and export-oriented goods, the government is lowering production costs and improving the global competitiveness of Indian manufacturers, especially in sectors tied to Make in India and export growth. At the same time, higher duties on certain finished products, like imported umbrellas, are meant to protect domestic MSMEs from being undercut by cheaper foreign imports. Beyond tariff changes, procedural updates—including faster customs clearance, expanded digital systems, longer validity for advance rulings, and greater flexibility for exporters through courier limits and duty deferment—reduce delays and uncertainty, which is particularly beneficial for small businesses. Changes to baggage rules and duty-free allowances also show how these reforms affect everyday consumers, not just firms. Overall, the reforms aim to strike a balance between protecting domestic industries, boosting exports, integrating India into global supply chains, and making the customs system simpler, more predictable, and more efficient.

https://www.edexlive.com/news/customs-duty-reforms-aim-to-boost-industry-exports-and-ease-of-living-cbic-chairman 

Project Vault: Trump Invests 12 billion in stockpile for critical minerals.

The Trump administration plans to create a stockpile in the U.S. for minerals listed as "critical" by the Interior Department. Necessary minerals like lithium, uranium, and copper will be apart of the stockpile including the 50 minerals deemed as critical. The goal of Project Vault is to reduce U.S dependence on China due to China being dominant in critical minerals and rare earths. The trade war between China and the U.S. is a threat to the U.S. economy and could potentially mean being cut off exports of critical minerals which are a vital material for defense, electronics, and energy industries.

The $12 billion going toward Project Vault has been provided by the U.S Export-Import Bank ($10 billion) and the rest comes from private capital. Additionally, this initiative has taken equity stakes in multiple mining companies including MP Materials, Commerce Department, Lithium Americas, and Trilogy Metals as an effort to strengthen them against competition in China.

https://www.cnbc.com/2026/02/03/trump-stockpile-critical-minerals-reserve-project-vault.html

 US Inflation Expectations Drop Again, New Low For Sixth Straight Month

The University of Michigan survey on year-ahead inflation expectations reported another new low for Feb. 2026 at 3.5%, the lowest reading since Jan. 2025, and a contninuation from the last five months of reported lows. This report of 3.5% is a 0.5% drop from Jan. 2026, a 0.8% drop from Feb. 2025, and a 1.3% drop from the beginning of the initial decline back in Aug. 2025, which reported at 4.8%. 

Feburary's numbers also continue the trend of beating the forecast, as for Feb. 6, they reported 0.5% under the forecast of 4.0%, and the report prior, Jan. 2026 came in at 0.2% under the forecast with 4.0%. With consumer sentiment trending in the right direction, we look to be on track to return to the readings we saw in 2024, ranging from 2.6%-3.2%, and even the pre pandemic lows from 2018-19 which sat almost entirely below 3%.

Source: https://tradingeconomics.com/united-states/michigan-inflation-expectations

Private Sector hiring slumped in January, adding just 22,000 Jobs

 In January 2026,  U.S. private sector hiring was much smaller than what economists originally expected. According to the ADP National Employment Report, private sector businesses only added about 22,000 jobs, instead of the 45,000 jobs that were forecasted for the month. Most of the job gains came from the education and health services fields due to the aging population. The business field saw a significant loss of 57,000 jobs, which is the sharpest decline for that sector since August 2024. 

Economists are seeing this trend as part of a broader labor market slowdown that has been persistent over the last few years, where hiring is moderate and concentrated in just a few sectors. The report also said that the wage growth rate stayed relatively stable despite the slowdown. Elizabeth Renter, the chief economist with NerdWallet wrote in a note that, "weak and highly concentrated growth in the labor market translates to weaker growth across the economy." (Renter). 

https://www.cnn.com/2026/02/04/economy/us-adp-private-sector-jobs-january 

 

How U.S. trade uncertainty is buffeting small business

Small businesses make up about a third of U.S. international trade and employ almost 46% of American workers. Even though they play a key role in the economy, new research from Harvard Business School shows that many small and medium sized companies are struggling to survive as U.S. trade policy becomes more unpredictable.

A survey of over 4,000 small and medium-sized businesses found that quick changes in tariffs, being announced, delayed, withdrawn, and brought back, make it almost impossible for owners to predict costs, set prices, or sign long-term supplier contracts. Researchers say this uncertainty acts like a tax, making businesses delay hiring, put off investments, or rethink expanding.

Small businesses usually don’t have the cash reserves, legal help, or flexible supply chains that big companies do to handle sudden policy changes. Many depend on imported materials and can’t easily switch to domestic options, which are often more costly or hard to find. As a result, trade volatility hits smaller firms harder.

What stands out to me is not just the tariffs themselves, but how unstable they are. Even businesses willing to pay more can’t operate effectively when the rules keep changing. Economic policy does not happen in isolation; consistency is just as important as intent.

This uncertainty also gives bigger companies more power. Businesses with lawyers, consultants, and global supply chain experts can adapt more easily, while smaller firms are left to react rather than plan. Over time, this creates an uneven playing field that helps large corporations and makes it harder for small businesses to compete.

The effects go beyond just financial numbers. Small businesses are closely connected to their communities as employers, service providers, and sources of local stability. When they cut back or close, it leads to job losses, reduced access to goods and services, and fewer opportunities for people to move up economically.

Whether you support or oppose tariffs, the research shows one clear point: a predictable trade policy is important. Without a stable, clear system, uncertainty stunts growth and survival, especially for small businesses, the backbone of the U.S. economy.

https://www.hbs.edu/bigs/us-trade-uncertainty-buffeting-small-business

Trump Responds to EU-India Trade Deal with His Own

 The U.S. and India announced a huge trade overhaul that greatly affects global economic ties. President Trump and PM Modi agreed to cut reciprocal tariffs to 18% which is down from highs of 25 - 50%. This new 18% on tariffs for India is lower than both Vietnam's (20%) and China's which is a lot higher. A reason for this is that the U.S. is trying to move supply chains away from China, so giving India a lower tariff India becomes a very attractive place for companies to build their products. As part of the U.S. - India deal, India is committing to buying $500 billion worth of American products (oil, fam goods, etc.) and will also stop purchasing crude oil from Russia.

This comes right after India signed a similar deal with the European Union (EU). This shows just how much India is attempting to diversify their partners and increase their global economic connections. Overall, this deal is beneficial to both parties with the U.S. moving toward reciprocal trade, while India obtaining more market access to a larger export partner.

Citation: https://www.cnbc.com/2026/02/03/trump-us-india-trade-deal-europe-india-deal-compared.html

US Edu department proposes overhaul of Federal student loans, sets new caps on graduate borrowing

The U.S. Department of Education is proposing major changes to federal student loans, mainly for graduate and professional students. One of the biggest changes is eliminating the Grad PLUS loan program, which currently allows students to borrow almost unlimited amounts. Instead, the government wants to set clear limits on how much students can borrow each year and overall. Graduate students would have lower borrowing caps, while students in professional programs like law or medical school would be allowed higher limits. The goal is to prevent students from taking on overwhelming debt.

These changes are meant to make student loans simpler and more affordable in the long run. By limiting how much students can borrow, the government hopes to slow rising tuition costs and reduce financial stress after graduation. The plan would also simplify repayment by reducing the number of repayment options, making loans easier to understand and manage. The proposal is not final yet and is open for public comment, but if approved, it could significantly change how students pay for higher education.

Citation : https://www.edexlive.com/news/us-edu-department-proposes-overhaul-of-federal-student-loans-sets-new-caps-on-graduate-borrowing?utm

China and the U.K. Resetting Economic Ties

China and the United Kingdom are taking steps to rebuild their relationship after years of tension. The U.K. prime minister’s visit to China, the first in eight years, signals a shift toward renewed economic cooperation. Both sides discussed expanding trade and collaboration in areas such as finance, artificial intelligence, and clean energy.

The U.K. is also trying to diversify its trade partners amid global economic uncertainty and changing U.S. trade policies. While security concerns still exist, the visit shows that economic stability and long term growth are key priorities for both countries.

https://www.cnbc.com/2026/01/29/china-uk-starmer-xi-relations-visit-businesses-.html

U.S.–Europe Trade Tensions Escalate Over Greenland

In January 2026, a serious trade dispute happened between the United States and several European countries after Donald Trump threatened to impose new tariffs tied to the situation in Greenland. Trump said he would begin applying a 10% tariff on imports from eight European nations on February 1, potentially rising to 25% by June. Unless those countries agreed to talks about Greenland, which is a territory of Denmark. This proposal alarmed European leaders, who called the threats “unacceptable” and held emergency meetings in Brussels to coordinate a response. European officials also talked about the idea of using the Anti-Coercion Instrument (ACI) which is a tool designed to allow the European Union to fight back economically when countries use trade threats to force political decisions.

While some European leaders support doing so, others are more cautious about escalating the conflict. France argues the EU must be ready to use the ACI, while countries like Germany are more hesitant because they rely heavily on exports and are concerned about worsening trade relations. Although European leaders hope to use upcoming meetings, such as the World Economic Forum in Davos, to ease tensions through dialogue, economists warn that uncertainty could last for months. This is expected to hurt European economic growth and create continued instability in trade relations.

https://www.cnbc.com/2026/01/19/europe-retaliatory-tariffs-aci-greenland-trump-threat-us.html

How U.S. midterm elections cay affect markets

 This article posted on January 22 explains that even with many dramatic global events happening in 2026, investors should still pay attention to the upcoming U.S. midterm elections. Historically, the president's party usually loses seats in Congress during midterms, but the authors state that the white house is attempting to limit those loses with political message. Another point they make is that election years can cause markets to shift aggressively both up and down. 

The authors make a point to investors to not panic about political noise. The authors emphasize that markets have a long history of becoming calmer and performing better after midterm elections once the results are known. They encourage people to focus on long‑term fundamentals like company earnings and economic trends rather than short‑term headlines or political drama even though these short swings don't tend to change long term trajectories.

https://www.capitalgroup.com/advisor/insights/articles/midterm-elections-markets-5-charts.html 

Major investment in OpenAI from Nvidia

 Nvidia CEO Jensen Huang says that the company plans on making a "huge" investment in OpenAI, the company behind ChatGPT. There were claims going around that Huang was unhappy with OpenAI, which he has denied. The deal is invest up to $100 billion dollars into ChatGPT, allowing them to finance advanced chips. This will allow Chat to remain one of the largest generative AI platforms amidst a very competitive field.

Huang says that he "believe[s] in Open AI", going even further to call their work "incredible." I don't know what Nvidia would get in return for this, but a trade deal as large as this would no doubt launch both company's stocks much higher. It is clear that Nvidia wants to remain a large factor in AI development and they are willing to pay to see the future of AI explode.

Article: https://www.cnbc.com/2026/01/31/nvidia-ceo-huang-denies-hes-unhappy-with-openai.html

Gold and Silver Prices Fall as Investor Expectations Shift

    Gold and silver prices fell sharply following President Trump's nomination of Kevin Warsh for Federal Reserve Chair. According to this article, the fall was caused by a strengthening U.S. dollar and shifting investor expectations. Since precious metals are considered a safe-haven asset, dramatic drops in their prices signals that investors perceive less risk. This highlights how expectations play a major role in business cycles. Investors appear to have taken the nomination as a sign that monetary policy will become more predictable, reducing the need to hold safe assets like gold and silver. 

    When interest rates are expected to rise, investors prefer assets like bonds that pay interest, instead of assets like gold that do not. Because of this, they move money into U.S. investments, that increasing demand strengthens the dollar. A stronger dollar often results in increased imports and decreased exports, which reduces net exports and slow GDP growth. 

ARTICLE: https://www.cnbc.com/2026/01/30/silver-gold-fall-price-usd-dollar-fed-warsh-chair-trump-metals.html

China and the UK are attempting to reset their relationship - Among a handful of other western nations

 The British Prime Minister took a 4 day visit to Beijing recently in hopes to create a strategic partnership with China for the future. It is the first visit to China in 8 years by a British Prime Minister. Other countries have done similar in recent months, Ireland visiting for the first time in 14 years and the Canadian Prime Minister visiting as well. 

In a recent age where the US seems to be geopolitically violent towards China and other nations, the United State's allies are teaming up with China. What could be the reason? Here is a quote from the article

"Nearly 60% of the more than 300 British firms surveyed said doing business in the country was harder than it was a year ago, the body said in a report in December."

British firms in China have been struggling recently and as China continues to grow in economic power it seems Great Britain is trying to get on their good side. 

This moves come after Britain's trade deficit with China ballooned by over 18% year on year to 42 billion pounds ($58.1 billion) in the 12 months ending June 2025, according to the U.K. government data.

With this move Britain is trying to hopefully close the gap from the trade deficits and make it easier for British businesses to sell to China.  

Key takeaways:

Whisky Tariffs: China agreed to cut tariffs on British whisky from 10% to 5%.

Visa-Free Travel: In a surprise move, China announced 30-day visa-free travel for British citizens—a huge win for business travelers trying to "close the gap."

How Mississippi could meet the needs of more than 19,000 families waiting for child care vouchers

    Mississippi is facing a child-care problem that is hitting working families hard. More than 20,000 children are stuck on a waitlist for vouchers that help parents afford childcare. This is a number that has expanded after the pandemic federal funding expired. The state also holds more than $150 million in unspent TANF (Temporary Assistance for Needy Families) welfare funds. This raises a huge question as to why so many families are waiting while so much money is being unused.

    State officials of the Mississippi Department of Human Services are exploring whether or not these dollars can be legally redirected into the childcare support system. Other states have already found ways to do this within federal regulations, and people believe Mississippi can join them. The agency has also brought up the idea of asking lawmakers for $60 million to stabilize the system, but this request didn't make it into the formal budget. This signals growing concerns and recognition that the current system is not working.

    For families, this money could be huge. Childcare consumes about 10% of a married couple's income and about 35% of a single parent's income. These are both considerably higher than the federal affordability benchmark, which is 7%. With the waitlist continuously growing and parents struggling to stay in the workforce, this could help the economy tremendously by strengthening this workforce, supporting families, and investing in its future. If leaders choose to act, Mississippi has a rare opportunity to use existing federal funds to help strengthen its childcare system and economy. 

https://apnews.com/article/government-programs-mark-jones-child-care-mississippi-general-news-00b0690ecc5e87b5d90b9fe908c9d26e

Fed holds key interest rate steady as economic view improves

In the first meeting of 2026 the Federal Reserve voted to keep the interest rate at a steady range of 3.5-3.7% this time around instead cutting it like they've been doing previously. They believe the economy is growing at a steady pace and also want to prioritize the stabilization of the job market while letting inflation drop back to 2%. The Wall street analysts expected this outcome and also expect these rates to hold till June. The Fed also hopes to balance the economy against inflation caused by the tariff policies induced by the Trump Administration. 

This article was released days before the leadership transition to Kevin Warsh. The Fed's decision to steady the economy by allowing the labor market to stabilize is very important. With the AI bubble ever-growing and new tariff policies, massive amounts of layoffs have been taking place all over the U.S, leaving the job market at a low. With this decision, hopefully the job market the catch up before the Fed's next major decision. If our job market continues to decrease we could be on the verge of a recession.

 https://www.cnbc.com/2026/01/28/fed-rate-decision-january-2026.html

For the first time in 50 years, college grads are losing their edge

 There is a significant shift in the U.S. job market where college students are not taking advantage of getting employed with a degree. Students who are getting degrees are now struggling to get employed even compared to people who didn't earn a degree. This is different from past decades where students had much more of an advantage. Recent data has shown that unemployment rates for young college graduates ranging from 22-27 years old. Rates have climbed higher than workers with other education levels. In the past obtaining a bachelor's degree meant lower unemployment rate and an easier way to find jobs.  Currently that advantage has decreased a lot. 

AI has made it harder for college graduates to get entry level jobs. Entry level jobs used to be the first thing college graduates would get hired for. Entry level jobs used to be set people up to advance their careers and help get them experience. Now it is much harder for graduates to start their careers because they aren't able to get experience right after college to leverage their resume to kickstart their career. Another factor is industries are slowing down in employing people. Many industries like finance and tech are slowing down in employing. This is making it much harder for college graduates to get jobs because the market is trending down. Getting jobs without experience is very hard in today's market and companies aren't looking to hire graduates because people without degrees have work experience.

https://www.washingtonpost.com/business/2026/01/31/labor-market-gap-trade-workers-white-collar

Record ETF Investment Show Growing Demand for Safe Assets

We have seen that investors have poured a record breaking $1.5 trillion into exchange-traded funds also known as ETFs in 2025, which surpassed the previous record set in 2024 of $1.15 trillion. According to data from State Street Investment Management, the total assets invested into ETFs have now reached $13.4 trillion. One thing to note is we saw bond ETFs bringing in a record $448 billion, and gold ETFs saw an increase of $48 billion as investors are looking for protection from inflation and geopolitical uncertainty. With a strong demand for gold, this raises an important question about uncertainty in the economy and if people will continue to invest money into gold and bond ETFs. 

Relatively speaking, gold and bonds are often considered safe investments so demand for these ETFs suggests that investors are seeking ways to preserve their money while staying invested. This basically allows people to manage their risk without completely moving their money out of the market.

Another reason for the record high inflows of ETFs is due to their convenience compared to mutual funds. They allow investors to broaden their portfolios, trade easier and become more tax efficient as stated in the article. Investors can additionally find ETFs that track almost any type of asset making it much simpler to diversify. Having a combination of flexibility and safeness seems to be the biggest driver for popularity in ETFs.

Taking these into consideration, it will be interesting to see whether this trend continues. If uncertainty in the economy persists, investors may keep favoring gold and bond ETFs as a safer option. Conversely, if the economy stabilizes or grows stronger, money may be put into more riskier investments like stock ETFs. Either way, the record inflows from 2025 make it certain that the growing role of ETFs is apparent in the economy and will continue to respond to changing market conditions.

Article Link: https://www.msn.com/en-us/money/savingandinvesting/investors-pour-record-amount-of-money-into-etfs-here-s-where-they-invested/ar-AA1TGs31?ocid=socialshare

D-Wave Quantum Inc. Finds new home

     Florida has been pushing to become a technological hub of the USA for a few years now. In a big addition to D-Wave Quantum Inc., there is definitely progress happening. Moving from the famous Silicon Valley to Boca Raton, Florida, was a calculated move by the company.     

    D-Wave plans to create upwards of 25,000 jobs for the Florida economy, based in the same place that IMB made their first personal computer. D-Wave says that the loosened tax restrictions fueled a large part of their departure from California. Demand for their products keeps rising from government agencies and multiple Fortune 500 companies. 

    Local institutions have embraced the move. Florida Atlantic University has already pledged a $20 million partnership with the company to improve research and development tactics. D-Wave has already agreed to implement at least 1 quantum computer on the college campus. All in all this move should be equally good for both the company and the state of Florida. 

 https://www.foxbusiness.com/technology/florida-wins-again-quantum-computing-company-joins-exodus-from-high-tax-california

Who's really paying for the Trump administration Tariffs?

 Trump declared the increase in tariffs would generate trillions of dollars to reduce taxes and pay debt. Research done by Gita Gopinath (Harvard professor) and Brent Neiman (University of Chicago professor) studied the actual effects of these tariffs on the economy. They found that the majority of the costs are being paid for by the US when the original point of the tariffs was to increase cost for foreign countries.

Trump has always advocated for increase in tariffs. He increased the tariff rates during his first term too. His actions during this term have been on a much larger scope, affecting 88 countries and 77 products. The average statutory tariff rate is at the highest level that it has been in over a century.

Again, most of this cost has come back to the US. The researchers found that 94% of tariffs were passed to US buyers in 2025. This is hurting the US's relationship with foreign countries. For example, China's share of US imports dropped during the past years. 

Tariffs could also affect domestically produced goods. Price increases on intermediate goods may affect companies ability to produce. This would increase the producer price inflation.

Tariffs have brought in new revenue, but it is not directly improving the lives of the American consumers as originally promised by Trump. Without direct results, it is hard to see the real motivations behind the decisions for such large changes on foreign relationships.

https://news.uchicago.edu/story/whos-really-paying-trump-administration-tariffs 

Leading Economic Index Signals Cooling Momentum in the U.S. Economy

Economists and investors are increasingly paying attention to recent movements in the U.S. Leading Economic Index (LEI) as signs emerge that economic momentum may be slowing. The LEI, published monthly by the Conference Board, is designed to forecast future economic activity by tracking forward looking indicators such as manufacturing orders, stock market performance, building permits, and unemployment claims. While the U.S. economy has continued to grow, recent declines in the LEI suggest that this growth may be losing steam as the country moves further into 2026.

The Conference Board reported that the LEI declined again in its most recent release, continuing a broader downward trend seen over the past several months. Historically, long drops in the index have often preceded periods of slower economic growth, as businesses and consumers begin to pull back on investment and spending. Although a recession is not guaranteed, the weakening LEI suggests the U.S. economy may be transitioning from rapid expansion to a more moderate pace of growth, highlighting the importance of monitoring leading indicators rather than relying solely on data from the past such as GDP.

https://www.conference-board.org/topics/us-leading-indicators

Senate passes funding deal but government will still partially shutdown at midnight

    On Friday evening, the Senate passed a deal to fund federal agencies and allow lawmakers time to address issues that arose with the Department of Homeland Security. A 71-29 vote was passed by lawmakers including a package of five bills, and a two-week stopgap measure for the DHS funding. However, a partial shutdown will still take place over the weekend as the House of Representatives must still approve the final version, which is expected to return to Washington, D.C on Monday. Meanwhile, House Speaker Mike Johnson held a conference call for GOP lawmakers, and indicated that he would back the Senate-passed funding deal amid Donald Trump's support for the deal. Johnson expressed hope that the House would pass the bill Monday evening, though uncertainty remains over how much support the package will receive. Under the agreement, DHS will be provided with temporary stopgap funding even though it has faced intense Democratic backlash over its aggressive immigration enforcement in Minnesota; long-term funding will be revisited later. 

    Republican Sen. Lindsey Graham of South Carolina refused to lift the hold he placed on the measures, unless otherwise guaranteed a vote on his bill to criminalize sanctuary city policies on Friday. Specifically, he wanted to impose criminal penalties on officials who interfere with the enforcement of immigration laws. Also, Graham showed interest in an amendment to address the Arctic Frost investigation, which is a federal probe into efforts by Trump allies to overturn the 2020 election, which focused on the fake electors scheme. The amendment would require officials to notify senators if their phone records are obtained. In addition, the House just last week included measures to repeal a law that would have allowed senators to sue up to $500,000 in compensation if their phone records were obtained. 

https://www.cnbc.com/2026/01/30/government-shutdown-senate-vote-dhs.html

The "Stuck" Labor Market Paradox

     Our current labor market is behaving a way that goes against traditional expectations. According to the Wall Street Journal, we are in a "Low-Hire, Low-Fire" environment. While job creation has slowed and hiring rates for new graduates have stalled, layoffs remain remarkably low because firms are engaging in "Labor Hoarding. Labor hoarding is the practice of keeping workers even when current demand doesn't fully justify their payroll costs. Firms that struggled to find workers during the 2022-2023 labor shortage are now reluctant to let them go, mostly in fear that they wont be able to re-hire quickly if the economy rebounds. 

    This dynamic provides a real world challenge to the Neoclassical Theory of Distribution, specifically when a firm maximizes profit by hiring labor until the marginal product of labor equals the real wage under standard competitive assumptions. In contrast, labor hoarding suggests that firms are currently operating at a point where the MPL may actually be lower than the real wage. With this scenario, firms are accepting short-term inefficiencies, effectively overpaying for the current marginal output of their staff. 

Article: https://www.wsj.com/economy/jobs/layoffs-labor-market-92a069c6?gaa_at=eafs&gaa_n=AWEtsqc_ZqKx1aUGYjIoKLe8B1Af-LJFQg3O2zKFTKWv12PCeyHzJIJtPEJeAIdg7g%3D%3D&gaa_ts=697d55e0&gaa_sig=jdfJr4pf4G6Q1CaUPMMYMb4osJGbO18cXgrxnlV_h9p_z1B5RVBYXozvyw_DBfHLAyF99EGJaPPKF_yetMYLWw%3D%3D

Wealth inequality and the ‘K-shaped’ economy are more striking than ever, data shows

                The U.S. economy is increasingly divided into a “K-shaped” structure in which wealthy Americans continue to gain while lower-income households fall further behind—a trend economists now view as permanent rather than temporary. High earners benefit from rising stock markets, home values, and stronger recent wage growth, allowing them to spend more on travel and luxury goods. Meanwhile, most Americans struggle with the lasting effects of inflation, stagnant real wages, and rising costs for essentials.

                The gap is not going to stop anytime soon, as the net worth of the top 1% of Americans reached a record share of nearly 32% in the third quarter of 2025. The bottom 50% of Americans is at 2.5% of the overall net wealth. This spread in the economy is evident in the recovery from the pandemic, but economists say it can be traced back decades. From the Reagan administration and the Global Financial Crisis of the late 2000s.

                Looking ahead, experts warn inequality is likely to worsen due to policy choices that reduce social support, the growing impact of automation and AI on jobs, and a fragile economy reliant on a narrow set of strengths, such as high-income consumer spending and healthcare employment. Many economists caution that this “winner-take-all” economy is ultimately unsustainable and leaves overall growth vulnerable to shocks.

https://www.cnbc.com/2026/01/30/wealth-inequality-k-shaped-economy-united-states-consumer-spending-trump.html

Trump Threatens Harsher Military Action Against Iran Over Nuclear Deal

President Trump warned Iran that the U.S. could launch an attack “far worse” than its June strikes if Tehran refuses to negotiate a nuclear agreement. He announced that a major U.S. naval force, led by the aircraft carrier USS Abraham Lincoln, is moving toward the Middle East, tying the deployment to stalled nuclear talks and urging Iran to agree to a deal banning nuclear weapons.

Iran responded by rejecting negotiations under pressure and warning it would defend itself against any attack. Iranian officials also cautioned that new military action could destabilize the Middle East, while criticizing past U.S. wars in the region. Since the U.S. withdrew from the 2015 JCPOA nuclear deal, Iran has expanded its nuclear program, heightening international concern.

Looking ahead, this escalation could lead to an increased risk of military conflict if neither side compromises. The situation may shape future U.S.–Iran relations, impact regional stability, and influence global nuclear security depending on whether leaders choose negotiation or confrontation.

Article: https://www.cbsnews.com/news/trump-threat-iran-attack-if-no-nuclear-deal/

Trump finally makes his Fed chair pick — what Kevin Warsh means for investors

 On Friday January 30th, President Trump announced Kevin Warsh as his next pick for the Fed Chair. In the wake of this announcement, the financial markets took this appointment largely in stride. Treasury yields stayed relatively the same immediately following the announcement, demonstrating that investors saw little risk to inflation and the Federal Reserve's independence. The US dollar saw a gain against competition major currencies while stock losses were contained. Both Gold and Silver prices plunged due to the appointment being seen to help ease the concerns about US currency "debasement" Overall, these market events signal confidence from investors in the credibility of Warsh to steward monetary policy.

Warsh's nomination is seen as boosting the independence of the Fed, which had been previously been weighing on stocks and driving interest rates higher. Due to this risk decreasing, investors are able to focus on economic fundamentals rather than political interference, benefitting the market as a whole. 

Article: https://www.cnbc.com/2026/01/30/trump-finally-makes-his-fed-chair-pick-what-kevin-warsh-means-for-investors.html

China’s new plan to get consumers spending again

https://www.cnbc.com/2026/01/30/china-services-consumption-plan-domestic-demand-reform.html China is trying to increase consumer spending by shifting its focus to experiences and services, unlike the traditional big drivers such as cars and popular household items. Chinese households are not making big purchases regularly due to the uncertain job market affecting income. Therefore, the city of Beijing is focusing on popular sporting events and everyday services that people mainly use. The Chinese government has presented its 5-year plan to have people consume more services by strengthening their buildings that are popular for tourism, enlarging visa-free travel, and encouraging banks to give more funding specifically to businesses that provide services. The economic data has shown that China's growth in retail has fallen behind their inductrial production. By focusing on the service-based market and attractions that cause people to interact with employees, China believes this will help with the unemployed youth. 

Why has gold price fallen 5%?

Prices for 4 precious metals have fallen recently in the global market after reaching record highs. Gold’s 5% decline can be partly attributed to how rapidly its price increased over a short period of time. In addition, U.S. interest rates, geopolitical tensions with Iran, and global demand trends are all influencing the market. The future of gold remains uncertain and will depend on factors such as who becomes the new Federal Reserve Chair and whether investor demand remains strong. Silver, copper, and nickel have also recorded sharp declines. According to the head of market analytics at Marex, these price drops are linked to the flow of physical demand, which has left prices more vulnerable. Silver, in particular, fell by more than 8%, partly because its market is much smaller than gold’s. Meanwhile, the CEO of Tether announced plans to allocate 10–15% of the company’s investment portfolio to physical gold, citing uncertainty during this period. The SPDR Gold Trust also performed well, reaching its highest level in four years for its gold-backed ETF. Looking ahead, the key question remains whether silver and gold prices will continue to fall, or if changes in interest rates, investor demand, and geopolitical risks will push metal prices higher in the next period.

Article: https://economictimes.indiatimes.com/news/international/us/why-has-gold-price-fallen-5-and-will-it-continue-to-dip-now-or-make-a-comeback-gold-price-dream-run-ends-after-record-highs-heres-what-should-investors-do-now/articleshow/127782571.cms#google_vignette

Wealth inequality and the ‘K-shaped’ economy are more striking than ever, data shows

         The U.S. economy has become increasingly "K-shaped", meaning that economic growth benefits higher-income households far more than lower-income ones. Wealth inequality in the U.S. has reached historic levels, with the top 1% holding nearly one-third of the total net worth while the bottom 50% only owns a small share. This is concerning as lower-income households are struggling with the rising costs of essential needs like housing, food, and energy. The higher-income households are still continuing to spend freely on luxury goods and experiences, due to rising stock and housing values. Economists argue that this isn't just a temporary divide, but a structural feature in the modern U.S. economy. 

    This economic divide shapes spending patterns, politics, and future growth. Businesses have to cater to different needs with both luxury and budget consumers at the same time. The purchasing power in the modern U.S. economy is in an uneven distribution state. Politically, the affordability crisis in lower-income households helps explain why candidates are emphasizing cost-of-living issues. Looking ahead, economists warn that this inequality can deepen as job losses driven by A.I. and cuts to social programs are taking place. 

Wealth inequality and the ‘K-shaped’ economy are more striking than ever, data shows

India bets on up to 7.2% growth next year, outpacing most major economies

 "India economy is expected to grow between 6.8% to 7.2% in the fiscal year of 2027" 

India is expected to be the fastest growing economy in the world; growing faster than Germany, United Kingdom, and Japan. India's economy was expected to suffer after the U.S enacted a 50% tariff on exports for the U.S. But, even with this ginormous tariff India's economy is still growing. India 's market has found other consumers to sell their products to. 

India lowered it rates on good and services to help boost consumption which seems to be benefiting the country but, even with all this growth and prosperity India still has weak points. India's currency is the weakest currency out of all the Asian countries. India runs on a trade deficit so it depends on foreign capital flow to help keep the currency strong. When there is not enough capital flow coming to India the currency weakens. Due to this international investors are avoiding investing in India due to this risk. Why invest in India when you can invest in a country with a much safer currency and less "risk". If you were an international investor would you take the risk with investing in India? And is there any ideas you have that could help strengthen the rupee? 

https://www.cnbc.com/2026/01/29/india-economy-growth-7-point-2-percent.html  

 

Cuba, reliant on Venezuelan oil and support, faces uncertain future after U.S. removes Maduro

    There are questions surrounding how the Cuban economy will fare after U.S. interference with its closest ally, Venezuela. The fragile Cuban economy has been supported by Venezuelan petroleum for years, forming a relationship between the two countries that went even deeper than economics. It is said that Cuban security agents and soldiers were part of President Maduro's security force prior to his removal by the United States. Prior to the interruption, Venezuela was sending an average of 35,000 barrels of oil to Cuba daily, consisting of 1/4 of total demand. 

President Trump has publically predicted that the Cuban economy will suffer from the loss of Venezuela, and expressed that such events would benefit the U.S. goal of threatening the Cuban government. Although the effect on the Cuban governent remains to be seen, it is certain that everyday Cubans will be affected by increased blackouts and declining access to food. Some have speculated that Russia may step in to supplement the Cuban economy and oil supply, but doubts have arisen due to thier ongoing conflict in Urkaine. 

Source: https://www.pbs.org/newshour/world/cuba-reliant-on-venezuelan-oil-and-support-faces-uncertain-future-after-u-s-removes-maduro

Trump's refugee cuts affect a small town economy

Often in discussions around immigration, the lack of jobs for native residents is brought up. However, often left out is the labor shortage some small towns face, as the populations age and birth rates decline. Trump suspended the U.S. Refugee program (except Afrikaners) at the beginning of this last term, and towns that once depended on the program for workers. One such town is Twin Falls, Idaho, which has accepted refugees since the 90s, and citizens express being the better for it. In the wake of these cuts, the town faces a labor shortage. The head of economic development for the town said that the population was important for the town's prosperity. In 2016, far-right groups in the town alleged that teenage girls had been raped at knifepoint by a Syrian Refugee. This was proven false, but the story was used as a lightning rod for anti-immigrant policy. It remains to be seen how this kind of policy will lead to a decline in economic activity long-term. 

 Source: https://www.nytimes.com/2026/01/19/us/politics/twin-falls-idaho-afrikaners-trump.html 

Investors bet on ‘hot’ US economy heading into midterm elections

     Economists and investors alike are looking at the current state of the U.S. economy as one with high growth and anticipated inflation heading into the November midterm elections. President Donald Trump’s deregulation efforts, tax cutting initiatives, and stimulus spending associated with his “One Big Beautiful Bill” have allowed the U.S. economy and stock market to grow, seeing a 4.4% increase in GDP in the third quarter of 2025 and an forecasted 5.4% increase the fourth quarter of 2025. This increase is expected to coincide with a heated up job market, which has been a known weak spot in Trump’s economy. 

    While growth is expected and has happened, there is also the potential for an inflationary cycle within the U.S. economy. President Trump has been very adamant that the Fed cut interest rates, which would most certainly cause an increase in inflation. With President Trump set to replace Fed Chairman Jerome Powell in 2026, investors have braced themselves for the inflation that would coincide with cutting interest rates, especially since the new Fed Chairman would most likely support the President’s viewpoint on interest rates. The issue of whether or not to cut interest rates remains contentious, but investors are of the opinion that the inevitable cutting of them would lead to an increase in the inflation rate. 

https://www.ft.com/content/8cbb2664-7795-4286-a795-99181df151fc 

Economy AI spending wasn’t the biggest engine of U.S. economic growth in 2025, despite popular assumptions

       In recent analysis, the idea that artificial intelligence is the main force propping up the U.S. economy is challenged. While AI investment did boost market valuations and capital spending. The primary driver of the GDP growth in the U.S. was consumer spending. While AI investment did rank second, it is most likely believed that without this investment, the economy would have stalled. However, given how strong consumption was, it would have most likely kept growth solid. 

    It is said that many overstate the impact AI has on the nation's GDP, as most of the equipment is imported, which does not contribute to domestic production. The 40% that was cited for AI's contribution is actually closer to 20-25% of GDP growth. The investments that held the most weight were in software and computer investments. These investments are the heaviest weight because they are produced domestically, which contributes to the GDP. Overall, growth remained resilient due to consumer strength and AI investment. If consumer strength, moderate investment in AI, and supportive fiscal and monetary conditions continue, the economy is expected to sustain in 2026. 

https://www.cnbc.com/2026/01/26/ai-wasnt-the-biggest-engine-of-us-gdp-growth-in-2025.html

Why the Federal Reserve Is Keeping Interest Rates Unchanged and What It Means for the Economy

The Federal Reserve is expected to keep interest rates unchanged as Chair Jerome Powell shifts the focus back to economic conditions rather than political pressure, according to a recent AP News article. After a period of aggressive rate increases aimed at controlling inflation, the Fed is now taking a more cautious approach. Powell emphasized that future decisions will depend on incoming economic data, such as inflation trends and labor market conditions. This signals that while inflation has slowed, the Fed is not yet confident enough to begin cutting rates.

One key detail from the article is that maintaining current interest rates reflects uncertainty about the economy’s direction. Although inflation has eased compared to previous years, it remains above the Fed’s long-term target. At the same time, consumer spending and job growth are showing signs of slowing. Keeping rates steady allows the Fed to avoid reigniting inflation while also preventing excessive damage to economic growth. However, higher borrowing costs continue to affect consumers, making loans for cars, homes, and credit cards more expensive.

This topic stood out to me because it highlights how monetary policy decisions directly affect everyday economic behavior. When interest rates remain high, consumers tend to delay large purchases and become more cautious with spending. Since consumer spending is a major driver of the U.S. economy, prolonged hesitation could slow economic growth in the coming months. The Fed’s decision to pause shows how delicate the balance is between controlling inflation and maintaining a healthy economy.

Source:

https://apnews.com/article/federal-reserve-trump-powell-inflation-c1e2c5222795bda4a1d294f6406f66fc

Will BlackRock’s Rick Rieder Replace Jerome Powell as the Next Federal Reserve Chair?

Rick Rieder, BlackRock’s fixed income chief, appears to be the top candidate for the Federal Reserve chair held by Jerome Powell, whose term is ending in May 2026. According to Kalshi, he holds a 48% chance, which is well ahead of his competitors. It seems like the seat will either go to Rick Rieder or former Governor Kevin Warsh, with a smaller chance of it going to the NEC director Kevin Hassett. Sentiments are mixed on who the markets believe will take the seat, but these three candidates are the front runners for this position. 

Rick Rieder is an interesting choice for many reasons. He seems to align with President Trump's views in many ways such as pushing for lower interest rates and is willing to use the Fed’s balance sheet to guide the economy. However, some critics have noted that Rieder represents a firm that is more focused on a globalist finance view, while President Trump has a more nationalist view. Rieder would be replacing Powell, who Trump has repeatedly stated his dislike for. Some wonder if this change will result in any kind of shift because Rieder, like Powell, does not have a PhD in Economics, but instead has a market-rich background.

As the nomination process is coming to an end Rick Rieder seems to be the top choice due to his views aligning so closely with Trump’s agenda.

Market thinks BlackRock's Rieder will next chair the Fed. What's at stake

The Reasons Behind the Recent 12-year Low in U.S. Consumer Confidence and the Implications for the Economy

The economy is causing Americans to feel more and more pessimistic. Consumer confidence dropped precipitously in January to its lowest level since 2014, according to a recent AP News report. The Conference Board's Consumer Confidence Index fell to 84.5, indicating that a large number of people are concerned about the future of the economy. A big reason for this decline is ongoing concern about high prices and inflation. Even though inflation has decreased from prior years, many consumers are still burdened by the high cost of housing, groceries, and daily necessities. According to the article, more employees are beginning to worry about job security, and fewer people think there are plenty of jobs. The decline in the expectations index, which indicates how people feel toward the economy over the next six months, is one particularly alarming detail that stands out. This dropped significantly below the level that frequently indicates economic difficulties. People tend to save more and spend less when they are worried about the future, which can slow down economic growth. This article caught my attention because it shows how people may not feel financially secure even in times of economic expansion. Spending decisions are heavily influenced by consumer confidence, and if pessimism persists, it may have a significant effect on businesses and the economy as a whole in the coming months.

Source: 

 https://apnews.com/article/consumer-confidence-economy-spending-inflation-conference-board-f36b997dc46ac9c3577d05db52166846

Winter Storm Fern Could Cause a $100 Billion Hit on the U.S. Economy.

     Winter storm "Fern" is proving to be more than just a major weather event, it has become a significant economic disruptor. According to Newsweek, the storm is estimated to cause a $100 billion downturn in the U.S economy, making it one of the costliest winter storms. The affects nearly 200 million Americans, causing power outages, school and business closures, and massive travel problems. All of these directly affect consumer spending, causing a downturn in the economy.

    Financial Institutions have estimated that this storm affects growth of GDP by reducing it around 0.5% to 1.5%. Although we will likely bounce back after the storm, it highlights the vulnerability of the U.S economy regarding extreme weather. Property damage is a large concern for the American public, enforcing the importance of strong infrastructure, highlighting the strength of investing in reliable and resilient buildings and emergency preparedness.

https://www.newsweek.com/winter-storm-fern-hit-us-economy-11417665

Personal Finance Therapists say they see more workers anxious about AI: It’s ‘a fear of becoming obsolete’

 Since AI becomes more and more common in the workspace many workers are starting to fear about their futures in the workforce. Therapist across the U.S. have been saying more clients than ever have been talking about their jobs getting overtaken by AI. This anxiety that is being formed within workers is closely tied to real economic changes happening in the labor market. According to American Psychological Association, 38% of workers worry that AI will slowly take over their skills and then their job. These fears come from 55,000 people being laid off in 2025 alone just from AI.  Studies have show that right now AI is capable of replacing 11% of US jobs. This is a clear representation of how technology can disrupt labor markets. While AI is able to increase productivity and lower cost for companies, it is also creating uncertainty and job insecurity for workers. I found this article to be very interesting because it just shows how our economy is always changing. In the next few year we are going to see big changes when it comes to AI in the workforce. 

https://www.cnbc.com/2026/01/24/ai-artificial-intelligence-worries-therapy.html

Natural Gas Prices Surge Past $6 as Winter Demand Exposes Energy Market Constraints

 U.S. natural gas prices surged above $6 per million BTU (British thermal units) for the first time since 2022, showing a drastic increase in supply-demand imbalance triggered by extreme winter conditions. The spike illustrates the high price elasticity of demand in the short run, as heating needs increase rapidly during severe cold, while production and transportation remain relatively the same in the cold temperatures and winter weather. With natural gas inventories being used more and drawn down faster than expected, they quickly repriced to account for an unexpected potential shortage. 

The price surge also highlights a broader structural pressure in the U.S. energy market. Increasing liquefied natural gas exports have further linked domestic prices to global demand, reducing excess supply during peak consumption. At the same time, power grid constraints and regional travel bottlenecks increase economic costs due to extreme weather. With these factors, it shows that weather-driven price shocks may become more frequent, reinforcing the role of natural gas. 

Core CPI rose, less than expected

 The core Consumer Price Index (CPI), which excludes volatile food and energy costs, rose 0.2% in December and 2.6% over the past year, slightly below expectations and marking one of the lowest annual readings in several years. Meanwhile, headline inflation held steady at 2.6% annually, in line with forecasts and suggesting that price pressures are gradually easing but still above the Federal Reserve’s 2% target. 

The latest CPI report reflected mixed forces across the economy. Shelter costs, the single largest component of overall inflation, rose 0.4% in December, while food prices climbed about 0.7% for the month. Energy prices edged higher, although gasoline prices slipped, and some durable goods like used cars and trucks saw price declines. Other areas, including airfares, recreation, and medical care, recorded notable increases, highlighting that inflation remains uneven across sectors.

Investors responded calmly to the data, with stock futures moving up slightly and Treasury yields dipping, as markets priced in the likelihood that the Federal Reserve will keep interest rates unchanged in the near term. The softness in core inflation adds to the view that price growth is moderating, though persistent costs in key categories may keep the Fed cautious about cutting rates too soon. 

https://www.cnbc.com/2026/01/13/cpi-inflation-report-december-2026.html

The Predicted Effects of AI on the Job Market

There have been many predictions on how AI will affect job markets, but before making wild predictions, it is useful to look back at past technological advancements. In the past, new innovations like steam power, electricity, and personal computers all took 20 to 40 years for their impact on the labor markets to be seen. The Internet and digital spreadsheets took 10 to 20 years. These delayed effects allowed the economy and job market to prepare. However, AI integration has been and is expected to be far faster than that of these other technologies. 

This leaves us with two different possibilities concerning the future of AI and the Job Market. Some people believe that AI will displace workers more quickly than jobs can adapt. This may create something similar to the Rust Belt, but in cities across the world. Some think that if AI integration is slower, it will allow the workforce to adapt. If the job market had time to adapt to the use of AI, then it is predicted that fewer jobs would be lost and AI would be more effectively used to assist workers. The World Economic Forum has expressed optimism that, in the short term, job creation will outpace job loss. 

Another factor that impacts the speed at which AI invades the job market is the availability of labor. In countries with immigration control and aging populations, some companies are facing difficulties in obtaining labor. This has led to an increase in the use of AI. Japan, where there are tight immigration controls and an aging population, has started uing AI for jobs such as the care of the elderly (robot assistance). The presence of a skilled workforce may, in fact, slow the integration of AI in the workforce.

It is unclear exactly how AI will affect job markets, and difficult to account for all the factors that play into this issue. However, it is clear that it will be essential for the workforce to learn how to integrate and work with AI. 

https://apple.news/Ayta1fi4fTiavD1pjCRrf_g

Gold just hit a record high. What is causing this surge?

 

In early 2026, the price of gold had climbed to record highs, surpassing $5,000 per ounce for the first time. This latest surge builds on an extraordinary rally: in 2025, gold prices soared about 65%, the largest annual increase since 1979, and over the first 26 days of 2026 alone, gold has risen roughly 15% — pushing spot prices near $5,058  troy ounce.

Gold is widely seen as both a safe-haven asset and a barometer of market anxiety, drawing investors when global and domestic uncertainty intensifies. The most recent jump in gold prices has been fueled by a series of market-destabilizing events and policy shifts associated with President Donald Trump. These include the now-revoked tariff threats against NATO allies over Greenland, the U.S. military operation to capture Venezuelan President Nicolás Maduro, and the opening of a criminal investigation into Federal Reserve Chair Jerome Powell — developments that have heightened concerns about geopolitical risk and the independence of U.S. economic institutions.

Additional factors driving demand for the precious metal include a weaker U.S. dollar, higher-than-expected inflation, and market expectations that the Federal Reserve will cut interest rates later this year. Investors, unsettled by ongoing policy uncertainty and economic volatility, have increasingly turned to gold as a hedge against instability, helping push prices to historic levels.

Gold just hit a record $5,000. What’s driving the surge? 

USA Rare Earth shares jump 20% as Commerce Department takes equity stake

 USA Rare Earth shares surged more than 20% after the company announced that the U.S. Department of Commerce plans to take an equity stake in the critical minerals startup. This proposed deal includes a $1.3 billion loan and $277 million in federal funding in exchange for common stock and warrants. Giving the U.S. government an 8% to 16% ownership stake. USA Rare Earth also raised $1.5 billion form private investors, though the agreement is still subject to final approvals and conditions.

This funding will help USA Rare Earth build a magnet manufacturing plant in Stillwater, Oklahoma, which is expected to be commissioned in early 2026. The funding will also go to develop the Round Top rare earth mine in Texas, with commercial mining planned for late 2028. The company estimates it will need $4.1 billion to execute its full plan and still must raise about $600 million more. 

The investment is part if a broader effort by the Trump administration to strengthen a domestic rare earth and critical minerals supply chain. In turn, reducing U.S. dependence on China. This became a concern when Beijing tried to cut off rare earth exports last year during trade disputed with the Trump administration.

USA Rare Earth shares jump 20% as Commerce Department takes equity stake

Canada Backs Away From China Trade Deal

     Prime Minister Mark Carney, makes it clear Canada does not want to chase a free trade deal with China anytime soon. Carney emphasized that Canada will honor its commitments under the Canada-U.S.-Mexico (CUSMA) Agreement. This news came out after, President Trump threatened to impose a steep 100% tariff on Canadian exports if Canada made a larger deal with Beijing. 

    The comments come as tensions rise between the two neighbors. Trump argued that Canada could become a gateway for Chinese goods into the U.S., but Carney pushed back, saying Canada's recent agreement with China was focused only on fixing tariff issues that had built up over the years. The agreement lowers tariffs on a small number of products, including Chinese electric vehicles entering Canada and Canadian agricultural exports heading to China and follows CUSMA rules.

    The situation highlights how Canada is trying to balance trading with other countries while also keeping a strong relationship with the U.S.  With tough language and tariff threats coming from Washington, Canada seems more focused on avoiding conflict and protecting its economy than on making bold new trade deal with China right now.

https://www.cnbc.com/2026/01/26/canada-china-trade-deal-tariffs-trump.html

AI honeymoon is over?

 Artificial intelligence single-handly boosted the economy in 2025. AI stocks including Google, Nvidia, and CoreWeave were just a few stocks that ended up booming in 2025 due to AI. As 2026 comes around people are looking for the next stock to make them rich and the Deutsche Bank warns the public that the AI honeymoon will be coming to an end in. 

A big reason why is due to the fact that AI has not proved to be effectivly cheaper than human workers in many work settings. This is leading to a lack of ROI and cause stockholders to be cautious where they are putting their money. It is still very possible that AI will take over some jobs in the future but the rapid change that was expected has not happened yet leading people to believe it still needs some time. 

Next, AI data centers are already at capacity and some companies are scrambling just to find the money to support spending that is over 15 billion. Investors are also seeing the lack of infastutcure to support the growth of AI currently which could send some companies back to square one. 

Finally, if a pullback of investment in AI occurs some analysts warn that it could trigger financial market correction that would drop global growth. If this happens it opens that door for competitors like China to get ahead of the United States in the AI race which would prove detrimental to the U.S. in the future. 

https://www.investing.com/news/stock-market-news/why-deutsche-bank-says-the-ai-honeymoon-is-over-4455029

Trump Walks Back Tariffs on European Countries

In an interview with CNBC at the World Economic Forum in Davos, Switzerland, President Trump said he'd walked back tariffs on eight European countries. He's been threatening tariffs recently on countries that opposed his pursuit of Greenland, but has backtracked on some of those because he says he has the concept of a deal. 

This caused the markets to rise tremendously in response to the news from Switzerland. The Dow Jones, NASDAQ, and S&P 500 all rallied big on Thursday, recovering from dips earlier in the week. The circumstance is still very volatile, and we'll have to wait and see what happens with Greenland and the effects it will have on the economy.

https://www.cnbc.com/2026/01/22/trump-tariffs-greenland-europe-deal-taco-trade-sell-america.html 

AI’s Productivity Paradox

Artificial intelligence is often praised for making work faster, easier and better. However, at the task level, this is partly true. Recent studies show that AI can help people complete certain tasks much more quickly. However, when economists look at productivity across companies or the economy as a whole, the gains are surprisingly small. This gap is known as the AI productivity paradox.

One reason is that AI helps less experienced workers more than experts. While beginners benefit from the AI's guidance and structure, experienced workers often spend extra time checking and fixing AI output. Also faster individual task, do not always improve overall results.

AI adoption is another limitation. Most firms are still experimenting, and the time savings per worker are relatively small. As a result, AI’s impact has not yet shown up in broader productivity data.

Overall, AI is changing how people work, but real productivity growth will depend on how well organizations adapt their processes around it.

https://www.forbes.com/sites/guneyyildiz/2026/01/20/ai-productivitys-4-trillion-question-hype-hope-and-hard-data/