“Always play the hand you have, not the one you wish you had.”
-Garry Tan
Here’s what you need to know this week:
- Markets rise then fall as geopolitical tensions flare
- President Trump introduces new measures aimed at improving housing affordability
Frozen Fracas
Stocks swung in both directions last week due to escalating tensions between the US and Europe. The Dow Jones and S&P 500 both reached new all-time highs on Tuesday and the NASDAQ was within striking distance of its own high water mark before President Trump renewed his campaign to annex Greenland. Trump first floated the idea of annexing Greenland back in 2019 but appears more serious about the plan this time around.
Greenland is currently part of the Kingdom of Denmark although Greenland enjoys autonomy in most of its affairs.Denmark and Greenlanders themselves are strongly opposed to a potential annexation and immediately rejected President Trump’s opening bid to purchase the large island. Multiple European nations have also vocally opposed the idea and released a joint statement vowing to stand with Denmark over the issue. President Trump responded by threatening a 10% blanket tariffs on every country who signed the statement, and those countries are viewing targeted tariffs on more than $93 billion of US products as a response[1].
Markets famously despise uncertainty and have consistently moved lower since this all started. It is unclear whether President Trump truly wants to acquire Greenland or is attempting to use this as another bargaining chip in international trade, but this will likely be a market mover until we come closer to a resolution.
Real Estate Relief
In other news, the Trump administration has announced new measures to attempt to improve housing affordability. President Trump directed the Federal National Mortgage Association (FNMA) and the Federal Home Loan Mortgage Corporation (FHLMC) to purchase $200 billion of mortgage-backed securities (MBS). FNMA and FHLMC (more commonly known as “Fannie Mae” and “Freddie Mac”, respectively) were created by Congress to bundle mortgages into large packages and sell them to investors, making it easier for banks to underwrite mortgages to American families. The rationale behind this plan is that bidding up the price of MBS’s will drive down their rates similar to bonds, and then new mortgages will be set using the lower interest rate.
Early evidence shows this plan working:
As you can see, mortgage rates have moved slightly but steadily lower in 2026 and the 30-year fixed-rate mortgage (30Y FRM) is closing in on dipping below 6%. Rates are still elevated relative to the last twenty years but lower rates still means lower monthly payments. Many real estate experts believe that lower rates will increase demand for new home sales which may drive prices higher down the road and that the only sustainable way to make home prices more affordable is to increase the supply by building more housing; however, they also say that lower rates and more home sales will incentivize home builders to build more homes[2]. For now, it seems like a step in the right direction for affordability.
What Else
- Venezuelan opposition leader Maria Corina Machado gifted her Nobel Peace Prize to President Trump in an attempt to placate US advances in Venezuela
- The Trump administration paused a plan that was about to garnish wages of delinquent student loan borrowers in a bid to appeal to voters on affordability issues
- Israeli leaders pushed back on President Trump’s “Board of Peace” intended to oversee the ceasefire between Israel and Hamas
- Ukrainian drone strikes took out key power plants in Russia, causing more than 200,000 Russian homes to lose power
- Iranian protesters have reported dozens of deaths as the Ayatollah cracks down on dissidents around the country
- The Indiana Hoosiers defeated the Miami Hurricanes 27-21 in the College Football National Championship
What We’re Reading
NASA’s Artemis II mission is slated to launch in less than three weeks and preparations are heating up. On Sunday NASA moved an eleven-million-pound rocket to their launchpad at the Kennedy Space Center in Florida. The space agency will be running tests and dress rehearsals up until the launch window of February 6-11, and if all goes well then they will launch the US’s first manned mission to the moon in more than fifty years. Click below to learn more about the mission and crew:
What’s Happening Downtown
The Myriad Gardens is hosting their annual orchid exhibition now through March 1st. This year’s theme is Love Takes Root: An Orchid Engagement; tickets are $10.50 for adults, $9 for seniors and veterans, $5.50 for children, and free for children under the age of 5. This event is open seven days a week, click below to learn more:
To read more from our blog, click here
Written by: Kane Ogle, CFP®
Steve Beck, Kane Ogle, CFP®, Amber Eduvigen, CFP®, Cale Olbert, CFP®, Brett Valentine, CFP®, Brandon Ingerson, Bill Daniel, Sam Postich, Jenni Hess
Sources: [1] Washington Post [2] Yahoo! Finance