For a man who once said bitcoin was “based on thin air,” President Trump is turning out to love digital assets as much as he loves regular old assets.

We’re just one week into his second term in office, and he’s already unleashed a whole slew of policy actions boosting the crypto industry.

• Yesterday, Trump signed a new executive order to create a crypto working group. The group will be led by VC David Sacks, who has been appointed “AI and crypto czar” by Trump, and include the treasury secretary, attorney general, and head of the SEC. Their mission? Boost the crypto industry, and develop a regulatory framework to expand access to digital assets.
• The executive order also set the US on a path toward developing a national digital asset stockpile—a move industry bulls have been adamantly pushing for. However, the order didn’t establish a national bitcoin stockpile.
• The SEC announced the formation of a new “crypto task force” earlier this week. The task force will be led by SEC Commissioner Hester Pierce, who has been a longtime advocate of a more clear regulatory framework for crypto.
• The SEC also rolled back previous accounting guidance that, among other things, limited banks from accepting crypto funds.

Zooming out: Why did Trump pivot so hard that he launched his own token? Beyond the fact he’s always loved to put his name and face on things, crypto industry companies and executives accounted for nearly half of all corporate donations during the 2024 election cycle.

How to invest in crypto safely

While crypto bulls are more confident than ever that cryptocurrencies are going to keep hitting new highs, remember: Digital assets are way more volatile than stocks. That said, there are some smart ways to approach crypto investing.

Exchange-traded funds that track crypto are one way to get in on the crypto boom while still making sure the SEC is keeping an eye on your money. That’s partially why spot bitcoin ETFs, including the iShares Bitcoin Trust (IBIT), have become so popular. Given the SEC’s sudden embrace of all things digital, we’ll most likely soon get ETFs for other tokens, such as solana and XRP—which means more ways for investors to get in on the action.—LB

🟢 What’s up

• Burberry is back in fashion, after posting a surprisingly strong quarter that included lower-than-expected losses for the struggling luxury brand. Shares rose 10.55%.
• Novo Nordisk surged 8.31% on the news that the Danish pharma giant’s latest obesity drug saw strong results in early-stage trials.
• Twilio soared 20.13% after the cloud communications company not only posted positive operating income for the first time ever, but also predicted strong growth all the way through 2027.
• Grindr ground out gains of 8.07% after the dating app announced it expects full-year 2024 revenue to rise 32% to 33%.

What’s down

• American Express sank 1.39% following a strong quarter for the credit card titan, but in spite of double-digit growth forecasts, shareholders were disappointed by management’s projections for fiscal 2025.
• Texas Instruments fell 7.52% after announcing so-so earnings results. More importantly, the semiconductor company warned that earnings will be lower than Wall Street predicted next year.
• Intuitive Surgical beat analyst expectations on both the top and bottom lines last quarter, but the robotic surgery tech manufacturer still slipped 7.52% after forecasting lower margins next year.
• Ericsson plunged 14.38% after the Swedish telecom company missed analyst estimates thanks to weakness in its cloud and enterprise businesses.
• Fannie Mae and Freddie Mac are in a government conservatorship, but Wall Street’s anticipation that President Trump will keep a campaign promise and make them both private helped push shares down 11.15% and 7.92%, respectively.

Earlier this week, Nvidia reclaimed its position as the world’s most valuable company, marking yet another milestone in the tech titan’s meteoric rise.

But how exactly did we get here? And more importantly, why does CEO Jensen Huang dress like a masochistic Top Gun cosplayer?

Our own Dan Toomey dove deep into Nvidia’s climb to the top of the S&P 500, how Jensen Huang evolved into a “Tier-1 capitalism maniac,” and why the company is perfectly positioned to “dom the economic universe for the rest of time.”

Check out this deeply reported “Nvidia Nvestigation” from the Good Work gang right here.

You may have heard the B-word thrown around to describe how concentrated the market has become in a few key AI stocks. But how do we know if we’re actually in a highly-feared stock market bubble?

According to UBS Global Equity Strategist Andrew Garthwaite, the market meets six out of the seven preconditions for a bubble—not exactly reassuring math.

Here’s UBS’ checklist for a stock market bubble:

End of a structural bull market: “Bubbles happen at the end of a structural bull market (when equities outperform bonds over a 10-year period by at least 5% per annum),” he wrote in the note.

25 years since last bubble: It’s been a long time since the dot-com bubble burst, and many of today’s investors have never experienced the growth and subsequent implosion of a market bubble. “This allows a new generation to believe 'It really is different,'” Garthwaite wrote.

“This time is different” narrative: New technology or a trendy new way of investing can dominate the market during a given period of time, so much so that investors forget that even newer tech or trends will eventually replace the old. “And now we have both with the 'Magnificent 7,'” he wrote. “The bubble risk has been reinforced by the narrative of Trump deregulation and 'MAGA'.”

Pressure on corporate profits: “Happens when overall profits come under pressure (often when margins peak) – this was certainty the case in Japan in the late 1980s (when stock prices were driven by real estate values, not earnings),” Garthwaite explained.

Narrowing breadth: A few key tech stocks have driven much of the S&P 500’s growth over the past year, to the point that the top 10 stocks by market cap now account for about 37% of the S&P 500. Compare that to a decade ago, when the top ten accounted for 14% of the index.

Retail investors getting in on the fun: Retail investing has surged since 2020, accounting for a larger percentage of market volume over the last few years than it has throughout history. “Both anecdotal and ETF flows data show this to be the case,” he explained.

Loose monetary policy: “What we are missing are benign monetary conditions, but if the Fed reduces rates to 3.2%, then some of the $6.6 trillion in money market funds could easily switch into equities,” he wrote.

Keep your eyes peeled: We’re not in a bubble yet, but Garthwaite says that if the 10-year Treasury yield rises above 5%, it will signal to investors the equity-risk premium is no longer worth it.

The hedge? “Just in case there is a bubble (35% chance) that we are not yet in, we would favour investing in the areas that are different this time around but where you can justify the valuation without a bubble – namely the Gen AI and electrification names above,” he wrote. A few of those names include TSMC, Meta, Amazon, Microsoft, Nvidia, and Vistra. He also advises underweighting non-financial cyclical stocks, and argues financial stocks are a hedge against rising inflation.—LB

• The AI race goes international: China’s DeepSeek model is already neck-and-neck with the best the US has to offer.
• You can’t invest in Elon Musk’s SpaceX…or can you?
• Major retailers closed 7,325 stores in 2024—and as of Jan. 10, they already plan to close another 1,925 in 2025.
• 5 stock market sectors that will profit from Stargate.
• 7 political trends investors should watch in 2025.

Hold on tight folks, next week is going to be a bumpy ride.

On the data side of the equation, we’ve got a boatload of numbers dropping on just about every aspect of the economy. Monday delivers new home sales, Tuesday we’ve got the consumer confidence index, as well as the S&P Case-Shiller home price index and a look at durable goods orders.

Tuesday also kicks off the Federal Reserve’s two-day FOMC meeting, and we’ll find out if the central bank is lowering interest rates or keeping them steady (or, God forbid, raising them) on Wednesday. Thursday brings us initial jobless claims, pending home sales, and a look at Q1 GDP, while the week wraps on Friday with the latest PCE reading.

And if all that wasn’t enough, next week marks the busiest week of this earnings season: About 41% of the S&P 500 is reporting over the coming days, so be ready for some serious market moves. Here are a few of the announcements you should be keeping an eye out for:

Monday: AT&T, SoFi Technologies, and NuCor

Tuesday: Boeing, Lockheed Martin, Starbucks, General Motors, Royal Caribbean, JetBlue Airways, Kimberly-Clark, and Chubb

Wednesday: Tesla, Microsoft, Meta Platforms, IBM, ASML, Western Digital, Las Vegas Sands, Progressive, Corning, General Dynamics, and Norfolk Southern

Thursday: Apple, Visa, Mastercard, Caterpillar, UPS, Intel, Shell, Altria Group, Thermo Fisher Scientific, Blackstone, Cigna, Southwest Airlines, and Nokia

Friday: Exxon Mobil, Chevron, Colgate-Palmolive, Church & Dwight, Abbvie, Eaton Corporation, and Phillips 66