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It's finances market US stocks higher today after a solid earnings report from Nvidia and following a court ruling that banned the majority of President Trump's tariffs. US dollar paring back earlier gains, the greenback initially rallying on the back of the tariff block. However, analysts on Wall Street have said there are other ways for Trump to impose his tariffs, plus oil giving back earlier gains after data showing the US economy contracted in the first.GDP declined by 20%, slightly better than the previous read for first quarter GDP. Meantime, initial jobless claims ticking higher in the latest rating, all of this, adding to fears that slowing consumer demand will leave the energy industry with the supply glut. That is your Yahoo Finance market minute for this morning. If you want to monitor more of what is trending on the Yahoo Finance platform, you can scan the QR code below to track the best and worst performingstocks.

Welcome to Wealth brought to you by Synchrony. I'm Brad Smith, and this is Yahoo Finance's guide to building your financial footprints. Our community of experts will give you the resources, tools, tips, and the tricks that you need to grow your money. On today's show, portfolio checkup, we're gonna break down the latest market action and dive into Nvidia's earnings results and happy 5/29 day folks. It's that time of year when industry professionals tap the benefits of the education savings.Known as a 529, we'll discuss with an expert during today's show. Plus, are you having trouble deciding whether you want to invest in a CD certificate of deposit or in treasuries? We'll talk about the key differences you need to know. Stay tuned for that conversation and much, much more throughout this hour. But first, we take a look at some of the market action. We are 90 minutes into the trading day. Stocks higher after a US court struck down.President Trump's tariffs declaring them illegal. The Nasdaq also getting a boost after Nvidia topped first quarter results. Revenue soaring 69% in the most recent quarter. Joining me now, we've got Ivana Devska, who is the Spirit Invest founder and CIO. You say that investors have abandoned the AI trade and will have to come back and chase the high quality stocks, uh, and AI stocks like Nvidia. Why is that?

So that's right, Brett, thank you for having me. Basically, as tariffs started getting announced and the economy became a little more uncertain, investors sold what they own and they were really overweight, the AI trade, specifically people that didn't quite understand what they were getting themselves into. So it was a real exodus coming out of names like Nvidia, but even more so in some of the smaller caps. And right now as we approach the second half.We are seeing the black hole ramping really well, and that's going to drive the entire value chain up. So we are very positive on the second half. So we think as we get closer to that, investors will have to come back andchase it.

What type of flows back into Nvidia did we see even leading up into this earnings print from what you were able to assess?

Well, for Nvidia specifically, it was really people coming back to it given the cancellation of the.Fusion rule and a few other positive catalysts like people thought that dipsy was going to be a headwind. It's actually turning out to be a tailwind. So there's been several positives for Nvidia specifically for some of the smaller caps. There's also been a lot of short covering that we've been seeing. So the first leg up, I would say from the bottom was mostly short covering. I think institutions and hedge funds are still quite underweight.And as they come to the market, I think that's when you're going to see the next leg up for these stocks.

What's the most underappreciated portion or sector of the AI trade, if you will?

Well, there are several sectors that are underappreciated. One example is power generation. This space basically came under a lot of pressure, but it's actually not even going to be negatively impacted by tariffs. So as you have more onshoring, there's going to be more build out in the US and there's going to be more.Power power demand. So I would say that one sector is pretty misunderstood. Another area is networking. You're seeing a lot of the networking names sell off today like Arista Networks, like Marvel, and those stocks basically are positively impacted by the AI trade. Some of the comments that Jensen made regarding their entrance into networking is making people nervous about the rest of the networking place, and they are thinking that maybe Nvidia will gain.Market share, but even if they do, the market is growing at such an exponential rate that there is some piece of the pie for everybody here.

You mentioned tariffs, and it's rare to have a day where we're coming off of Nvidia's earnings report and that being one of the major movers of the market, but also the relief perhaps that we're seeing also in today's trade really tied back to how the Trump tariffs are essentially getting blocked by a federal court here now and.The larger implication of OK how much of these tariffs are actually legally going to remain in place what is really taking the cake here in terms of moving the markets during today's activity?

Well, during today's activity, interestingly, we would have expected a little bit of a stronger reaction to the tariff push back. I don't quite know whether it's because people think there's going to be a workaround and they're gonna become still legal or it's because people already kind of expected that there is going to be some sort of.Solution. So we would have expected a little stronger reaction to the tariffs. So I think most of today's action is really centered around around Nvidia and maybe in sectors outside of tech like consumer, you're seeing a little bigger relief because they are actually getting more affected by tariffs directly in the tech space we're not really seeing as big of a relief as we would haveexpected.

And so as you're kind of lining up your checklist for what you need to hear from companies, essentially at the end of theEarnings season, dare I say, because it seems like it's the build up to Nvidia and then it's the following action there after this point of hearing from Jensen Huang and the company and there are a few retail companies that are going to trickle out as well that have been trickling out, but from what they're saying around tariff, it it all seems like some of the projections are still up in the air and it places a lot of pressure on the next earnings season to see how companies are revising some of their language around what the guidance looks like as well.

So it's kind of a mixed bag for our sector. A lot of our stocks that are directly impacted by tariffs highlighted what the impact would be and assumed somewhat of a worst case scenario in their margins. So they're really going to see it more on the margin on the margin side, and it was about 100 basis point impact, I would say on average across the board for the more manufacturing type businesses. Now with those tariffs getting maybe less severe than people expected, there could be maybe some upside.To the margins that they projected on the revenue side, that's the real question whether as goods become more expensive, you're still going to want to buy them. It doesn't affect as much B2B, which is what we focus on, so that's our main bread and butter. But I think for some of the consumer stock that's really going to be the question if things are 20-30% more expensive, would you still want to buy them?

Ivana, great to see you. Great to have you here in studio with us. Thanks so much.

Thank you.

Now time for some of today's trending tickers. We're watching Southwest Airlines and Starbucks. Joining me now we've got Yahoo Finance senior reporter Alexandra Kal. Ali, great to have you here. Let's set the stage for this first one. Southwest Airlines, they are catching an upgrade at Deutsche Bank from, uh, hold to buy. The firm sees more upside ahead, citing the airline's ongoing transformation as a result of its deal with activist investor Elliott Investment Management. Shares right now, they are higher by about 2.4%.

Yeah, and Elliott now has about an 11% stake in the company that's led to a new board which Deutsche Bank says has over 200 hours of aviation experience. It's also, you know, something that comes on the heels of improved revenue initiatives for this company like assigned seating, extra legroom, bag fees, which just went into effect on Wednesday. So overall more upside ahead, which is fueling this upgrade and price target raise as well. Deutsche Bank sees the stock going to 40%.Bucks per share. Now there's still some risk ahead. Deutsche Bank cited a few possible headwinds, including fuel price volatility, execution risk on these new initiatives, and then some of those macroeconomic concerns like regulation and labor issues like you said, Brad, we're up about 3% today, but roughly flat on the year. So it's going to be interesting to see how companies like Southwest and really other competitors do in the months and yearsahead.

Absolutely we're also tracking the brand of the green siren here today.Starbucks getting a downgrade to hold from buy at TD Cowan. The firm expects future profits to be lower than Wall Street's estimates, citing labor costs, increasing competition and deteriorating value perceptions. Shares of SBUX, they are taking a hit on the day they're down by about 1.7% right now on this. Yeah,

TD Cowan modeling earnings per share 10% below consensus. The labor story seems to be a big part of this downgrade along with menu pricing. The bank noted.Starbucks appears to be holding back on price hikes and increasing labor hours, and they said that suggested the post-COVID earnings that they were inflated. Now at this point, the company is in the middle of a big turnaround effort led by CEO Brian Nicol. He's also the former CEO of Chipotle, and Nichols seems to be leaning on operations and marketing to return the company to its former glory, but TD Cowan still expects more muted same store sales growth in the months ahead. They did have some proprietary survey data which he.Mentioned Brad that showed weakening value and quality perceptions compared to its peers along with the fact that it's track record in past recessions raises some concerns if the macro continues to weaken from here. So a lot of obstacles at a time when you're seeing shares down about 7% year to date and near the low end of its 52 week range.

All right, a lot to continue to keep tabs on there for Starbucks as well. You can scan the QR code below to track the best and worst performing stocks of the session with Yahoo Finance's trending tickers page.Model and businesswoman Hayley Bieber joining the coveted Billionaires' Club.ELF Beauty Elf Beauty announcing a deal to acquire Bieber's skincare brand Rode for $1 billion. The deal includes $800 million in cash and stock, an additional $200 million tied to the brand's performance over the next three years. Still with me, we've got Yahoo Finance senior reporter Alexandra Kal. I mean, what, what does this deal mean for the two entities, uh, especially with a valuation of.a billion dollars

here. Yes, well, investors certainly seem to like it. We've seen shares surge. I think the last I looked it was up around 25% today. And this comes after Rohde has really made a lot of inroads in the beauty industry. It's acquired $212 million in net sales from just 10 products. The CEO of Elf calling this unprecedented. And when I first heard this news, I was a littleSurprise because Elf Beauty, it's known as this affordable beauty brand overall, but this is its first foray into this premium category, so something that investors seem to be liking at this point, and we know that celebrity backed beauty ventures, they've attracted some very high valuations. You have Fenty Beauty by Rihanna that was estimated at a valuation of around $2.8 billion.Forbes, we have Selena Gomez's rare beauty that's estimated at around 1 billion. Kim Kardashian launched a new skin brand after Cody acquired a 20% stake in her previous KKW beauty brand for $200 million. We have Ariana Grande, so there's a lot of celebrity backed brands out there that seem to be doing well, but it's also a category that, you know, it's very tough to break through, especially with trends.Constantly change within the beauty space. Skin care right now seems to be the biggest thing. Hailey Bieber is known as having beautiful skin. I have a lot of friends that use her products. They love them. I have not used any Ro products at this point, but now I'm curious, and maybe it'll be a little cheaper, maybe a little more inexpensive. We'll see how Elf does with this brand. Well,

she'sgoing to stay on as founder and chief creative officer, we do know and head of innovation at Rode. Do you think?The trend of these celebrity founders is here to stay, especially as they're all doing as we discuss on the show all the time and making sure that you've got streams of income

and that seems to be the playbook, right? You build this brand with your name, you sell it direct to consumer, maybe you get into Sephora and then you have a big company like Cody or Elf come in and acquire a.Or maybe even buy out the brand full stop. So yes, I do think this is something that's going to continue and especially in the era of influencing TikTok, Instagram, you can send out these products to folks to try on and do get ready with me videos and it's just taken off. So I definitely think it's going to stay.

The GRWM videos,

yeah, we got to do one, Brad look.I mean, get ready with me to host well.

Iput makeup on every day. Maybe I should start a makeup line.

Yeah, you should. We got to know. I, I would buy it. Let's do it.

Oh,done. Got one buyer. Thanks so much. Appreciate it. Coming up, we're celebrating National 529 Day. I'll talk to an expert about how to save and manage your child's higher education savings plan. Stay tuned. That's next.It is National 529 Day, an annual event to encourage families to save for their children's college education through a 529 savings plan. We've been covering this savings vehicle all week, but as a reminder, 529s are typically state sponsored investment accounts designed for you to save for higher education.And they're powerful because your earnings grow federally tax deferred and qualified withdrawals are tax free, but one key question that we have is how much money should you be aiming to save? My next guest has an answer and joining me now on set, we've got Tricia Scarlatto who is the head.Of uh education savings at JPMorgan Asset Management, a good friend of the show, we've had you here time and time again. Good to see you back here in studio. You say the right amount is relative, which we do know everybody's situation is different, but is there a helpful kind of rule of thumb as a starting point?

Yeah, I mean I think you gotta look at what your savings is and what your capacity is, right? So I think always, always I would say for a safer retirement right? so that no matter what so I think start there at least be saving up to the amount that your company matches because that's free money, right? So that's number one, but.I think it's just starting. No, you don't necessarily need to be where ultimately it is gonna get you to 100% of tuition costs, but just start, even $100 a month from when a child is born can get you two years of covered tuition costs. So, so even just as little as $100 obviously you go up to $500 you can almost cover the whole thing. But when you wait too long, Brad, that's when you gotta be putting in $101,500 and those numbers are.Really hard

and so you sent along some helpful charts as well here and I want to show some folks this charts that show why starting as early as possible is really crucial. Explain the data behind starting saving at your child's birth versus when they're young kids.

Yeah, and most people do wait. Most people delay those 6 years as you'll see in this chart, and when you delay, every 6 years you delay is half the amount that you have in that account. So what you want to do is use time as your friend.Because that just as you mentioned um in the beginning it's that tax free deferred compounding growth over time that's gonna help get you there of course in addition to your investment returns so use time, give yourself the time to be able to save

those small monthly contributions that you were talking about, they, they add up over time but even according to your own data, not every family is taking advantage of 529 savings plans. So where are we seeing people take advantage of.How many do and how much money are folks losing out on by using other savingsaccounts?

Sure, I mean, I think right now the stat is, you know, that 63% are not using 529 plans and about half of that 63% is just sitting in cash. So they actually are saving for college, but what I'm telling them to do now or what I'm telling everybody online to do is.To not just save but plan and a plan is understanding the cost, knowing the reality around financial aid and not just putting money in a checking or savings account, it's investing that money and leveraging the benefits of a 529 plan. There's a there's $1.5 trillion earmarked for college, not in a 529 account. So and, and then you got about another 50% that are just looking to leverage their retirement money and we don't want people.To do that if you plan early enough and give yourself the time as we talked to earlier, you won't be in that situation where you feel desperate where you're borrowing against your retirement and every $10,000 you take from your retirement account is $30,000 plus less at retirement and we find a lot of families are doing that.

So let's compare the return on investment for a tax-free account versus a taxable account. You sent a great chart as well that we want to show page this one actually.Looks at a $10,000 initial investment with monthly contributions here. Break this one down forus.

So all things being equal, you have a $10,000 initial contribution into an account and then $500 subsequently on a monthly basis starting at zero, you give yourself 18 years simply based on taxes, assuming the same 6% return, you have almost $42,000 more in a tax-free account such as a 529 account.This is my favorite page in our college planning essentials guide because everyone that says I'm just gonna pay out of pocket. I'm gonna pay as I come as it comes this is the page. Why would you give up that money? That's almost 2 years of in-state public tuition. It's a lot of money to leave. Yeah

and so some Americans might be worried about what happens to all this money if their child doesn't go to college. How can the money be used if it doesn't go to the original beneficiary?

Sure, I mean, first of all, we, we get a lot of families say I'm not sure what my child's going to do and the statistic from last year is just about 70% of graduates high school graduates last year went to a 2 or 4 year institution. So don't let that be your excuse number one. But if you've done the right thing and for whatever reason your child isn't going the traditional route, so it's 2 and 4 year institutions, it's obviously books expenses.Room and board off campus housing, but you can also use it for K through 12 tuition. Um, there's special needs you can use it for if you have a child has special needs, you could certainly apply it to that. There's also student loan you can use it to pay um for student loan up to $10,000 and also you can now roll over to a Roth IRA, which is tremendous. So now you have the ability to fund and a college education.And then if you are, you know, someone that's planned really well and there's excess, you can roll over up to $35,000 into a Roth IRA and potentially set your child up with a retirement account for the future.

Really interesting. Great advice as always, Trisha, thanks so much for taking the time.

Pleasure. Good to

see you.The Trump-backed tax bill being considered in the Senate right now contains investment accounts for newborns. So how does this stack up against the more traditional 529 savings plan? Here to break it down, we've got our personal finance new senior editor Molly Moorhead. Molly, give us some more details around this Trump account.

Hey Brad, uh, so the Trump accounts as described in the House bill.are also a a mechanism for funding a child's education, not exactly like a 529, but kind of some of the same bones, but they also have the flexibility of, uh, you can use the money for a first home purchase or for startup money for a new business. Uh, so, you know, the talk about, I'm not sure if my child's going to go to college, these accounts have a few more uses that 529s don't.However, uh, they are limited to $5000 a year in contributions. Um, the $1000 in the bill would apply for newborns, but born, uh, between this year and 2028, and that's seed money from the government. Uh, for everyone else though, uh, you can put in $5000 a year. It grows tax deferred, uh, and then when you take it out, you'll pay, uh, the capital gains rate.So they, they're a kind of a companion to 529s.

So how does that compare to a 529 savings plan then?

Right, well, 529s, as you all just discussed, are limited to education expenses, uh, although there is that, that, uh, Roth IRA rollover, as well as um student loans and K-12. So they really have a lot of flexibility within the realm of education costs, but the biggest difference is that the contribution limit to a 529 is, is.At a at a rate most of us will never hit, states set limits on them based on the cost of a higher education in the state, but it's, it's over 6 figures. So you're not going to hit a ceiling, more than likely on how much money you can put in. It also grows tax deferred and then.The big key difference is that it comes out tax free when you spend it on education costs. So again, the Trump account has a preferred rate of the capital gains rate, but a 529 tax free when you withdraw it and spend it on education.

Molly, thanks so much for breaking this down.

Sure thing.

We've got all your markets actions straight ahead. Stay tuned. You're watching Yahoo Finance.We're excited to partner with Synchrony Bank, our premier sponsor for Wealth. Synchrony Bank is working with Yahoo Finance and Wealth to bring you the insights for your personal finance playbook and help you make your money work for you. Let's get a check of the markets here as we are just about 2 hours into today's trading session. The Dow Jones Industrial Average holding on to gains right now of about 0.1%. I'll put this on an intraday view just so you could see exactly how we've been moving around here and ultimately did.Touch negative territory at a few points during today's trading session. We've bounced off of that and for the majority of today's activity been in positive territory here. We'll keep a close eye on the Dow Jones Industrial Average, the Nasdaq Composite that's been positive throughout the day here. That's up by about 90% right now, likely boosted by results from Nvidia out after the close of yesterday here. We'll dive into that in a second and get a check in on shares of NVDA.The AI poster child, but the S&P 500, let's take a look at that. That's up by about 0.5% as of right now. Also want to take a look at the S&P 500 11 sectors here. We've got them loaded up here for you on the screen, pulling up the caboost communication Services, it's down by about 60%. I believe that did start off the day in positive territory though, and real estate, you're seeing that lead the pack here. We've got more gainers than laggards here, just two of them staples flat, just barely.Downside by hair a chinny chin chin and taking a look at the Nasdaq 100 here you've got a steady mix here on the day. It looks like more gainers than laggards here were being pulled lower by Atlassian right now actually. Atlassian is one of the largest decliners, Starbucks as well, but Nvidia, you're seeing that pull the broader Nasdaq 100 higher here on the day. That's up by about 0.5%.The Department of Labor removed guidance that discouraged employers against offering crypto in worker 401k plans. The Labor secretary saying, quote, We're rolling back this overreach and making it clear that investment decisions should be made by fiduciaries, not by DC bureaucrats. So what are the implications for the retirement.Industry joining me now on this we've got Tyrone Ross who's the founder of 401 Financial. Great to have you here back in studio with us. So just wanna get your reaction to what this could mean for crypto and retirement portfolios to the extent that it's not already a part of some folks' retirement portfolios.

Yes, so to that point, if you go back to 2022, um, there's been crypto available in specific employer sponsored plans.So I think what we're gonna see now is now that it's loosening up you're gonna see more folks move in obviously crypto and retirement accounts can get a little tricky, um, but I think what they want is just leave it up to the employers, leave it up to the plan sponsors and the 338 advisors if you're out there, update those risk disclosures

with crypto in your retirement account, how.Do you safeguard against some of the known volatility when it's a risk asset with the profile like a cryptocurrency Bitcoin? Yeah,

that's thething I think one, I would limit it, right? I think you start with Bitcoin in my opinion you end there. I think also you look at your, you know, how long do you have until retirement if you're 10 years or more, maybe you wanna have a little bit more exposure.Um, if you're retiring in the next year or so, don't think that Bitcoin is gonna get you to close that gap that you have, and I think that's really what it is, and I tell people this, why do you want to invest in crypto if you think that it's gonna make you rich or you're gonna close this funding gap that you have a retirement that's probably a bad place tostart,

you know, it's really interesting. I, I tend to track this gauge on CoinMarket Cap.com, which is really just this fear and greed index here to try and figure out, OK.Where are we at extreme greed points and what's almost to the tune of the Warren Buffett investment thesis and his thinking when people are extremely greedy, that's when you should be fearful when they're fearful, that's when you should be greedy. Where are we sitting at right now, even as we've gotten back above these 100K levels and been able to kind of sustain at these heights as of this juncture.

So I like thatyou, you mentioned a fair and green index at my other company, uh, Turnkey.Labs we use the fair and green index as a as a monitor of when there's really you know a lot of buying and when they're selling so when it gets in the twenties is usually a good time to buy because again the fear is immense. So I think what you're seeing now is retail is still slow to come back. I think what you're seeing is corporates buying you're seeing a lot of the ETF flows still being strong, but I think if you're a crypto hippie, as you always hear me mention like we are and you're in the space 24/7 365.The underlying fundamentals, the building, the infrastructure is being built, it's hard not to be excited of what the future looks like and I think you see that with us cracking all time highs here last week, and I think we're, you know, we're poised to go higher where no one knows, right? We shouldn't pretend, but I think the industry is very robust from the ground up.

I've beengetting takes on this throughout the week and I would love to get your take as well. Why invest.In crypto versus some of the alternatives of investing in a crypto touching or holding ETF or mutual fund versus investing in a company, an equity market company with crypto on its balance sheet, we're hearing that from DJT this week. We heard that from GameStop as well this week. We,

we're here, man, because I was thinking about this yesterday, um, it's a really interesting time in crypto because it.Matured right, not all the way, right? Still a volatile teenager, you do have other options. You don't have to go right in and and hold the underlying asset. You can own a coin base. You can't hold a micro strategy. Circle just, you know, announced their IPO to file so you can own it indirectly right through equities which has PE ratios and all those things that folks care about, um.And you don't have to understand the underlying metrics and things can get a little fuzzy with crypto. So I think that's a good point and I think that's what people are gonna realize is that they're gonna own it anyway, right? Coinbase added.You know, um, to, you know, a bunch of indices now and, and, but part of portfolios folks are gonna own it whether they want to or not, so I think that's a big deal,

you know, just bringing this full circle in our retirement accounts focus here as you're looking at more younger investors and those who are in the workforce and contributing more aggressively to their retirement accounts, do you think that'll change the type of assets that get added into those retirement accounts and that just paves.Even more of the way for Gen Z's millennials who are already a little bit more crypto friendly, yes,

because they want it, right? And I think studies have shown that folks would want access that there was a study done a couple of years ago to show that 30+% of folks wanted access to crypto and retirement account and as you again, the oldest millennials now are in their 40s, right? So

don't remind me, don't remindme.

So you know they got a ways to go as well but again I think that's what's gonna, if you go back to what you said initially when you started this, this piece is.The DOL is basically saying, look, the old guidance is out. They didn't give new guidance they're just saying we're stripping old one away. So now they're putting it on the plan sponsors, the providers to say, all right, it's up to you guys.ERISA rules the roost here as always but be, be a fiduciary what's best for, you know, the folks involved, but I think now we have more research, more data, more insights for a plan provider, um, to make this a part of it with a small allocation available. So I think we're gonna see more of it. And yes, millennials and Gen Z are gonna dive in head first. Tyrone,

good to see you. Thanks so much for joining us. Thanks

for having

me. Absolutely. Coming up, pending home sales fell in April. What that means for the housing market on the other side of the short break.April pending home sales fell 6.3% month over month, the worst monthly drop since 2022. It could be a tough sign for the housing market, especially as spring is typically peak home buying season.Here with more on what this data means for the housing market, we've got Logan Mataswami who is the, uh, who is looking across all of this action here. You are the housing wire lead analyst as well. We wanna make sure that folks know that here. Logan, just wanna get your reaction to the number.

Well, we're not the biggest fans of the NAR's pending home sales data month to month. Last month was a big beat. This month was a big miss. Not much is really going on for some time. However, this year, the positive housing stories inventories grow.Price growth is slowing down. Purchase application data for the NBA is now up 17 straight weeks in a row with year over year growth. The last 4 weeks, double digits, all this with elevated rates. When you're working from record low levels of sales, but record bad affordability, what you're seeing this year is a net positive for the future. Because if mortgage rates just get down to 6%, if President Trump and the set and Paul to get what they want, then existing home sales has the capacity to grow some.Uh, real numbers for growth, uh, uh, from this data line. New home sales just recently had the highest print it's had since 2022 as well.

Despite these numbers, you've seen a few optimistic signs in the data. What, what are those positive signs?

We're about to have like a few months from June to, uh, October. We're very, very low comps. Um, last year, uh, existing home sales were trending under 4 million. We're gonna see some growth on the year over year data. Take it in context. We're working from record low levels.But the fact that this year that purchase application data has been positive every single week for 17 weeks with elevated rates, not 6%. We're 6% rates wouldn't be that big of a story. It just shows that housing has the capacity to grow. We don't have monetary policy right now that is pro housing growth, but if you could just get the 10 year yield down a little bit, spreads getting a little bit better, sales can grow in America. And if you look at existing home sales going back to 1968, this is what traditionally happens, rates go up, sales tend to.Uh, uh, uh, bottom out right before the recession when the recession comes, rates tend to go lower, sales tend to grow. The backdrop is more healthier now because price growth is cooling down and inventory is up. That's the main story for 2025.

And so given that this all comes back to the mortgage rates 15 and 30 year, is there a sweet spot that you're looking for on those levels that would really encourage more activity?

Part of 2025. Nobody had purchase application data having a positive year with rates near 7%, but what we've seen in our data line, we track housing a little bit different, uh, live fresh weekly contract data. We've always seen housing data get better when rates get down towards 6%. We've never been able to hold that for any kind of duration. You don't need 3, you don't need.4, you don't need 5, but just getting back down there working from very low levels, you can grow sales. But the fact that inventory is up now, especially from the lows of 2022, means that whenever rates do fall, you don't have to worry about home prices escalating out of control or anything in that negative. That was a very unhealthy to a savagely unhealthy housing market.In 2022, now this year it's much better. It's better not just for next year, it's better for the next 10 years for the housing market. I want to

get into some generational statistics. According to a Realtor.com survey, nearly 25% of millennials are still planning to buy a home within the next 6 months here. What do you think needs to take place in order for that to continue to be a reality for millennials?

Perennials have been the highest percentage of home buyers, uh, for the last 13 years outside of 2 years. Whenever rates elevate, they finance more than 90% of their homes. Um, the baby boomers tend to take their spot. Uh, Gen X has been a very solid, uh, home buyer for many years now. Mortgage rates go lower.You get more financing of of of housing that tends to push up the millennials and remember this is the biggest housing demographic patch in history, so the fact that you know rates have been so elevated with prices just shows that they are very sensitive to the rate factor. So again, it doesn't take much.You just get rates down towards 6. You can get a little bit more growth in home sales when you're working from this low levels. It's, it's not shocking to see that kind of development, but again, they are a very, very extreme big demographic patch in America.

Logan Modashami, who is the housing wire lead analyst, great to have you here with us today, Logan.

Pleasure.

We've got much more on wealth after the break. Stay tuned you're watching Yahoo Finance.If you're looking for a low risk asset that offers reliable income, you may come across two common choices CDs, certificates of deposit, and Treasury bonds. They may look similar at face value, both offering predictable returns, but there are some key differences. Here to break those down, we've got Cooper Howard, who is the Schwab Center for Financial Research, fixed income strategist. Good to have you here with us. Cooper, you wrote about 5 factors to decide.Whether you want to invest in a CD or treasuries, and they are security yields, taxes, maturities, and liquidity, I want to start with security. What do you need to watch there?

Well, thank you very much for having me on, Brad. Um, I think that this is a good point to bring up because it kind of goes on one end of the spectrum of what to invest in.And I'd say on one end of the risk spectrum, just like you were talking about in your earlier segment, you kind of have cryptocurrency that tends to be very volatile, very, uh, risky on that side of things. And then on the other side of the spectrum is CDs and treasuries. And the first point about that security, they do tend to be relatively conservative, safe investments, andPart of that conservative safe investment is the security behind it. So CDs, they are FDIC insured, up to $250,000 per bank per depositor, whereas the US Treasury, it is backed by the full faith and credit of the US government. So if you're an investor who's investing beyond that $250,000 limit,Then that's something to consider a treasury. Now, the other thing to consider is that if you are below that $250,000 limit, then you can also consider CDs. Um, however, that doesn't just create the surface of it. You can also buy CDs from multiple different banks, Brad. So if you can, if you do have enough funds to go beyond that $250,000 FDIC insurance limits.Then you may want to consider purchasing CDs from multiple different banks to spread that FDIC insurance limit out. So we generally suggest to be aware of that if you are getting near that threshold.

So we know another major consideration that you listed out is yields. How do the yields on CDs versus treasuries differ?

Yeah, and this is a very good interesting point because the CD market isn't really a homogenous market. So CD markets, there's kind of two major buckets of CDs that I would like to that I'd like to talk about. The first are going to be bank-issued CDs, and that's just like, if I walk into my local bank or I pull it up online, and that's a CD that's directly issued by that bank. The other is going to be a broker.Issued CD. So I'm biased. I work at Charles Schwab. If you open up a Charles Schwab account, then you can buy CDs through Schwab, whether it's through your IRA or your brokerage account. And if we look at where yields are today right now, Brad, right now, a CD, a short-term CD, say maturing in less than one year, it yields a little bit less than a US Treasury. So if you're looking for the highHighest yield, then under 1 year right now where we're looking at, um, that could consider a CD relative to a treasury. Beyond that, it tends to be that you're getting a little bit more of a divergence in yield. So that's another very important factor to consider.

Third in the decision tree here is how taxes between the two differ. How does that exactly influence the decision here?

Yeah, so I would say there's also a 3A decision that needs to be factored into. And it's what type of account are you investing in because that is going to influence taxes. So if you're investing in something like a tax sheltered account, like an IRA tends to be that the investments that generate income or capital.gains are sheltered from federal income taxes and state income taxes. So really the taxes question comes down to are you investing in a taxable account like a brokerage account. Now, US Treasury, the interest income that they pay is exempt from federal, from state income taxes, excuse me.So for investors who are in high state taxes, or high state tax um high tax states, excuse me there, say like California, New York, after considering the impact of state taxes, it could tip the scales in favor of one investment relative to the other.So, because CDs are subject to both federal income taxes and state income taxes, that could take a little bit more of a bite out of your after-tax income rather than a treasury, which is exempt from state income taxes. So again, that's another factor that you need to consider, Brad.

And so next up here is maturities. Why does that matter?

You know, it matters because what we like to do is that at the beginning, the starting point of trying to determine why are you investing is to have a plan. So why are you investing in this investment, um, a CD and a treasury, it is a loan to the US government or to that bank itself at the end of the day. So how long are you going to be loaning that money for? How long are you comfortable locking up your.Money for. So if it's something that you need access to the funds in a very short period of time, we generally suggest investing in something that's shorter maturity. If it's something to where you say, I can lock it up for a longer period of time, or it's part of an overall retirement strategy, maybe a longer term CD or a longer term treasury makes sense. Now, what that meansIn investing is that for CDs, they tend to be more short term. So the availability of CDs that are longer term is much less limited, much more limited than say US Treasury. So if you are locking up funds for a longer period of time, tends to be that you're gonna have more options if you look at Treasuries relative to

CDs. Last up, liquidity, what, what are the concerns there?

Yeah, so like I mentioned earlier, we do suggest that if you are looking at it, figure out why are you investing in this, how long are you comfortable locking up your money for. So let's say that I have an investment.That I'm comfortable locking it up for a year. Now, we know that maybe I plan on locking it up for a year, but there are certain circumstances where you might have to break that CD or sell out of that US Treasury or sell the CD prior to maturity. So your situations change, your circumstances might differ than originally what you got into it asAnd in terms of liquidity, the US Treasury market is a much more active liquid market. So it tends to be that if you had to sell that US Treasury prior to maturity, it's a little bit easier to do so than to break a CD. And again, it goes back to the idea of, are you inInvesting in a bank-issued CD or are you buying a brokered issued CD? So for brokered issue CDs tend to be that we'll go out and we'll have to find another buyer through a brokerage firm that will purchase it from you.

Cooper, great to have you here with us. Thanks so much for joining.

Thank you, Brad.

Experiencing a layoff can be difficult to navigate, especially if you don't have a financial safety net to fall back on. And even if you're feeling confident in your job security, it's never a bad idea to be financially prepared. Here with more, Casey Bond, Yahoo Finance, personal finance editor for banking. Casey, good to see you. One way to prepare for a layoff is to have emergency funds. What's a way that you recommend building that fund?

Yes, so the point of an emergency fund is to have this money set aside before the financial emergency happens. Um, financial experts tend to recommend 3 to 6 months' worth of your essential expenses set aside in an emergency fund, though if your income is variable or your job security is shaky, you might want to aim for more.And really getting started now is the best thing you can do if you don't have that emergency fund set aside. Start adding to it, maybe even $25 to $50 a week, anything helps as long as you're consistent.And then putting that money in a FDIC insured bank account that also earns competitive interest will help that fund grow even faster. And

sowhat are the pros and cons pros and cons here of CDs and how can you use them to strategically prepare for the events of an unexpected layoff?

Right, so one of the biggest benefits of a CD is that when you deposit that lump sum of cash into the account, you're guaranteed an interest rate for the entire term, um, whether that's 6 months or 2 years. Um, the downside is that if interest rates are on their way up, you are stuck in that current interest rate until the CD matures. Um, additionally,You know, if you need to access that money before the term is up, you could face an early withdrawal penalty. So it's very important to choose a CD term that isn't too long, um, but long enough that you can get that competitive rate.

Casey, great breakdown as always. Thank you so much.

Thank you.

Let's do a final check of the markets. Taking a look at the major averages here across the board. Uh, well, we were higher across the board. The Dow has slipped back into negative territory to touched that earlier in the session. The S&P 500 and the Nasdaq still positive though right now. That's it for wealth, everyone. I'm Brad Smith. Thank you so much for watching. You can stay tuned for market domination that comes your way 3 p.m. Eastern time. They'll count you down to and through the market close.