Good morning and happy Friday! We have a packed edition to close out the week, covering the president’s “demand” for lower rates, the S&P 500’s first record of the year, and the crypto industry’s reaction to Trump’s executive order. First time reading? Join over 190,000 self-directed investors and sign up here.

Investors always react to Trump

It’s no coincidence that President Donald Trump made two of his most market-moving proclamations the same day the stock market secured its first record of the year.  

The S&P 500 gained 0.5% to close at 6,118.71 Thursday, hours after Trump called for lower interest rates in his speech to global elites in Davos and minutes after he signed a highly-anticipated executive order on crypto. 

Let’s start in Davos.

Addressing the World Economic Forum crowd virtually, the president once again challenged the authority and wisdom of the Federal Reserve. 

“I’ll demand that interest rates drop immediately,” Trump said. “They should be dropping all over the world. Interest rates should follow us all over.”  

Those comments — which fueled a midday rally in US equities — come the week before the central bank’s two-day policy meeting. Markets see no shot of a rate cut next Wednesday, and traders instead expect the first one of the year to arrive this summer. 

Later in the day speaking to reporters in Washington, Trump voiced further concern over policymakers’ decisions.

“I think I know interest rates much better than they do,” Trump said before alluding to Fed Chairman Jerome Powell. “I think I know it certainly much better than the one who’s primarily in charge of making that decision.”

Currently, the Fed’s benchmark interest rate hovers in the 4.25-4.5% range. In their December economic report, central bank officials pulled back their rate-cut forecast from four to two. 

The prediction market Kalshi, meanwhile, assigns 25% odds for two rate cuts in 2025.

Now, in any other era a president demanding a say on monetary policy would headline every show and newsletter.

Yet Trump upstaged himself the same day, as he often does, by introducing a Presidential Working Group on Digital Asset Markets via executive order.

“The Working Group,” according to the executive order, “shall evaluate the potential creation and maintenance of a national digital asset stockpile and propose criteria for establishing such a stockpile, potentially derived from cryptocurrencies lawfully seized by the Federal Government through its law enforcement efforts.”

Investor David Sacks, who Trump assigned as the White House crypto and AI “czar,” is set to helm the group.

In the view of the digital asset industry, the move helps Trump keep his word to be the first-ever “crypto president.” 

“Today’s executive order begins to build the framework for crypto in the US,” said Ari Redbord, global head of policy and government affairs for TRM Labs and a former senior advisor at the US Treasury.

“It sets up the processes — a crypto council composed of key regulatory agencies like the SEC, CFTC and Treasury — and the priorities including individual freedom, dollar dominance and the US as a global leader in the age of technology.” 

Bitcoin slipped slightly immediately following the announcement, hovering just above $103,000. 

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Elsewhere:

🇺🇸 Trump plans to follow through on his “America First” agenda. He told the audience at the World Economic Forum that anyone who makes their products in the US would be among those who get “the lowest taxes of any nation on Earth.” Those who do not, however, will face tariffs. (WSJ)

🏢 UnitedHealthcare named its new CEO following fatal shooting of Brian Thompson. Tim Noel, a veteran who previously served as the head of Medicare for the company, will take over the role. UnitedHealthcare continues to reel from the December murder, which unleashed a flood of social media debate surrounding Luigi Mangione, who was charged with the shooting. (CNBC)

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Rapid-fire:

• President Trump accused Bank of America’s CEO of refusing to serve conservative customers (CNBC)

• JPMorgan CEO Jamie Dimon earned a $39 million pay package in 2024, above the $36 million he earned in 2023 (Business Insider)

• Mortgage rates dropped for the first time in six weeks to slide below 7% (Yahoo Finance)

• HP’s chief executive said the company is stockpiling computers ahead of potential Trump tariffs (Yahoo Finance)

• Rivian plans to launch hands-free driving assistance in 2025 (Reuters)

• Boeing forecasts a $4 billion loss for the fourth quarter following a rocky and chaotic year (CNBC)

• Texas and nine other Republican states are asking Wall Street firms to share any DEI-related hiring policies (Bloomberg)

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