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HEADLINES
What You Need To Know
Mortgage rates are rising sharply as investors sell off U.S. Treasurys, likely in reaction to President Trump’s sweeping tariffs. But a bigger concern is growing. China, one of the largest holders of U.S. mortgage-backed securities, may respond by selling its MBS holdings, which could send rates even higher. Foreign nations hold 15 percent of U.S. MBS, and if China, Japan, or others unload their portfolios, it could severely impact the spring housing market. With the Fed also letting MBS roll off its balance sheet, investors worry that rising spreads could spook buyers already facing high prices and economic uncertainty.
JPMorgan posted strong Q1 results, with profit up 9% to $14.64 billion, or $5.07 per share. Excluding a one-time First Republic gain, earnings came in at $4.91—well above estimates. Revenue rose 8% to $46.01 billion, driven by a 48% surge in equities trading and solid asset management and investment banking fees. Shares rose 4%. CEO Jamie Dimon warned of “considerable turbulence” ahead, citing tariffs, inflation, and market volatility following President Trump’s recent trade moves. While the uncertain environment may slow deals, it’s proving lucrative for trading desks across Wall Street.
Delta Air Lines will pause expansion plans for the second half of 2025, citing weaker bookings tied to shifting trade policies under President Trump. CEO Ed Bastian called the policy direction “the wrong approach” and noted a sharp drop in consumer and corporate confidence since mid-February. The airline still expects to remain profitable this year, reporting Q1 adjusted earnings of 46 cents per share on $12.98 billion in revenue—both slightly above expectations. Delta shares rallied after Trump temporarily eased some tariffs, but they remain down nearly 27 percent this year as travel demand slows and economic uncertainty builds.
Walmart may have found a buffer against Trump’s new tariffs: its fast-growing Walmart+ membership program. Members now account for nearly half of U.S. online spending, shopping twice as often and spending nearly three times more than non-members. The program’s growth comes as Walmart braces for a rocky economy and possible global recession. Tariffs targeting key supply chain hubs like China and Vietnam are set to expand this week. While Walmart is not immune, its scale, grocery dominance, and loyalty-building tools like Walmart+ could help it weather the storm and keep profits growing.
TIP
Cash Flow Matters
When the market is shaky, companies with predictable cash flow tend to hold up better. That steady stream of income gives them flexibility—to pay expenses, invest in growth, or return money to shareholders—even when the economy slows down.
Look for businesses with recurring revenue models, like subscription services or essential products. These companies often have more stable cash flow and are less vulnerable to sudden drops in demand. In volatile markets, predictable cash flow becomes a safety net. It helps companies weather downturns and gives investors peace of mind that the business can keep moving forward, no matter what the market is doing.
CHART
90 Years Of The Stock Market
Source: @bean_wealth
TERM
Working Capital
Working capital is the difference between a company’s current assets and current liabilities. It shows how much short-term liquidity a business has to cover day-to-day operations. For example, if a company has $500 million in current assets and $400 million in current liabilities, its working capital is $100 million. Positive working capital means the company can easily pay its bills. Negative working capital might signal cash flow problems—unless it’s part of an efficient business model (like some retailers). Investors use working capital to assess a company’s operational health and ability to manage short-term financial obligations.
Actions
Steps to Level Up
Source: @bean_wealth
BUDGET: Personalized Budget In Just A Few Clicks
READ: The Truth About US Tariffs
LISTEN: Designing The Future
WATCH: Nissan Is Fighting To Survive
RESEARCH: The Short Case For Nvidia
EXPLORE: Top 3 AI Stocks To Invest In
See you on Wednesday!
Cheers,
Matt Allen
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