‘Tis the season of giving, and the Fed is clearly in the holiday spirit. On Wednesday, the Central Bank gifted us a quarter-point interest rate cut. The cut was widely expected, and marks the third 25 basis point cut of 2025. Markets surged to recent highs following the midweek announcement, though they were down Friday going into close. According to some analysts, this surge can only mean one thing: To some, Wednesday’s market performance raised the prospects of Wall Street’s favorite Christmas tradition – the Santa Clause Rally. The Santa Clause Rally is pretty much what you’d expect. In roughly 80% of years on record, the S&P 500 trends higher on the last 5 trading days of the year and the first two trading days in January – generally driven by holiday spirit, retail spending, tons of sugar, and of course, year-end corporate earnings reports. But Santa’s sleigh will have to navigate some pretty strong headwinds to sustain our three-year market rally. These winds include continued uncertainty around inflation, a weakening labor market, a massive U.S. deficit, higher long-term borrowing costs for households, and the specter of another government shutdown in January. There is reason to wonder if this is all just a bit too heavy even for Santa. President Trump was asked during a recent Politico interview to grade the U.S. economy under his watch. He awarded it an “A+++++.”Of course, that grade depends on a lot of things. For instance…Fed Chair Jerome Powell was a bit more measured in his assessment. In his remarks following Wednesday’s meetings, Powell observed that the Fed remains in a challenging position as it attempts to fulfill its dual mandate.“There is no risk-free path for policy as we navigate this tension between our employment and inflation goals," Powell said.The Fed has largely been focused on blunting the impact of tariffs. As Powell notes, "Our obligation is to make sure that a one-time increase in the price level does not become an ongoing inflation problem.”“But,” said Powell, “with downside risks to employment having risen in recent months, the balance of risks has shifted." In the midst of this tension, Powell acknowledged that the Fed hears the American consumer’s concerns about affordability “loud and clear." But, he also had this to say: American wallets are strained under the weight of both everyday expenses and a housing supply shortage. The Fed doesn’t really have the tools in its kit to fix either of these things.  Of course, we won’t let this get in the way of our holiday spirit. Alternatively, we can cram down any economic anxiety for a few more weeks, spend freely, and just enjoy the holiday season. Obviously, in the New Year, we will continue to reckon with the relationship between AI investment and recent growth in our markets. The jury is still out in the case of Boom v. Bubble. But… Until then, we recommend vigilance. And Urvin has an awesome new way for you to stay on top of things. Let’s call it an early holiday gift. Download our brand new, totally mobile, AI-powered AskUrvin app and get up-to-the-minute, on-demand market insights. For instance, if you were curious why Big Tech suddenly spiraled on Thursday, you could Ask Urvin “What’s up with the Oracle stock right now?”Here’s what it told us: Got follow-up questions? Any other stocks, tokens, or funds you wanna ask about? Go ahead…push the button!

The Big 3Monday, December 8, 2025 A quick look at the top stories we’re following this week.Fed to hold its final meetings of 2025.Though the outlook is uncertain, futures contracts suggest an 87% likelihood of a 25 basis point interest rate cut.All three major U.S. indices stumble into the week. After a two-week win streak, the S&P 500 pulled back on Monday while awaiting news from the Fed. Tesla gets downgraded.Morgan Stanley lowers its rating, citing slow EV adoption and a “choppy 12 month outlook.” This week’s Company Earnings Announcements at a glanceToll Brothers, Inc. (TOL)--Monday, 12/8AutoZone, Inc. (AZO)--Tuesday, 12/9Oracle Corporation (ORCL)--Wednesday, 12/10Adobe Inc. (ADBE)--Wednesday, 12/10Synopsis, Inc. (SNPS)--Wednesday, 12/10Broadcom Inc. (AVGO)--Thursday, 12/11

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