🚀 Credit Card Delinquencies Rising

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Market Overview
Read time 1.4 minutes

Year To Date Performances:

1. Consumer financial stress is mounting as a record 10.75% of credit card holders are making only minimum payments, per a Philadelphia Fed report, reflecting the highest rate since data tracking began in 2012. Delinquencies are also on the rise, with over 3.5% of cardholders more than 30 days overdue, more than doubling since mid-2021. Despite these challenges, consumer spending remains a bright spot, growing 2.9% annually in November, though the combination of soaring average credit card rates (21.5%–24.4%), rising balances, and heavy reliance on credit for essentials is creating long-term financial strain. Mortgage activity has also plummeted to a 12-year low, squeezed by 7% interest rates and rising debt-to-income ratios, further exacerbating household pressures.

2. The Trump administration has directed all federal employees in diversity, equity, and inclusion (DEI) roles to be placed on paid leave by Wednesday evening as part of a broader move to dismantle DEI offices and programs across federal agencies. A memo from the Office of Personnel Management calls for these offices' closure, the removal of associated online resources, and plans for dismissing affected employees by the end of January. This follows an executive order signed by Trump on Monday, citing a return to "merit-based" hiring practices. The decision has sparked significant debate, marking a sharp policy shift from the Biden administration's DEI initiatives.

3. On his third day back in office, President Donald Trump issued a direct warning to Russian President Vladimir Putin, threatening "high levels" of sanctions and tariffs if Russia fails to reach a settlement to end its nearly three-year war with Ukraine. Trump's Truth Social post underscored his belief that the war would not have started under his leadership and demanded an immediate resolution, calling the conflict "ridiculous" and urging a deal to prevent further loss of life. While praising Russia's role in World War II, Trump emphasized his readiness to leverage economic measures, echoing his prior tactics with allies like Canada and Mexico. Despite his campaign claims to end the war within 24 hours, his administration now faces the complex reality of achieving a swift resolution to the ongoing crisis.

4. Headlines

   1. Google is investing $1B in Anthropic.

   2. Samsung announced the S25 starting at $799.

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Wall Street loads up on surprising $2.1tn asset class

Bank of America. UBS. JP Morgan. They’re all building (or have already built) massive investments in one $2.1tn asset class—and it’s not what you think. It’s not private equity or real estate, but fine art. Why?

In partnership with Masterworks, data from Citi shows it’s a potent diversifier with low correlation, and certain segments have even outpaced traditional investments. Take blue-chip contemporary art, which has outpaced the S&P 500 by 64% (1995-2023).

Masterworks knows the power of art investing, with their platform giving 900k+ users the opportunity to invest in this asset class as part of their overall portfolio strategy. In fact, from their 23 exits so far, Masterworks investors have realized representative annualized net returns like +17.6%, +17.8%, and +21.5%* (among assets held for longer than one year).

With so many users, Masterworks offerings can sell out quickly.

Our readers can diversify right away by clicking here to skip their waitlist.

Past performance not indicative of future returns. Investing Involves Risk. See Important Disclosures at masterworks.com/cd.

Onwards and Upwards,

Liam Gill