Finance

Economic doom beckoned after President Donald Trump announced his “Liberation Day” tariffs on April 2nd. Stocks crashed; forecasters predicted a recession within the year. Three months on, the mood is rather more relaxed. Prices in shops are not noticeably higher, unemployment is flat and the S&P 500 index is resurgent, back at all-time highs. Mr Trump’s 90-day pause for many of his tariffs, announced a week after Liberation Day to calm markets, will end on July 9th. Although he has threatened to send letters declaring talks over and tariffs back on, nobody seems too worried. More

Long-time market bull Tom Lee is considering two new themes for his Fundstrat Granny Shots US Large Cap ETF. 
On CNBC’s “ETF Edge” this week, he revealed sovereign security could soon make the cut. 

“It’s now evident to me that the mechanisms are in motion for companies to really fix their supply chains within a sovereign border, and that’s a change,” the firm’s chief investment officer said. “That’s not going to just be one or two years.”
He’s also looking at Gen Z. Lee compares the generation to millennials, who he called “the engine” of the market when Fundstrat first began researching themes seven years ago.
“That means we need to be focusing on Gen Z and then Gen Alpha, so we might have to evolve our demographic theme to kind of orient towards the younger cohorts,” he said. “It may not be for a couple years, but I’m kind of sharing our thought process.”
Lee’s Granny Shots ETF was inspired by NBA legend Rick Barry’s awkward free throw style. 
‘If you buy the best stocks in each theme, then you’re hanging your hat on a single idea. So we said, ‘Let’s be like Rick Barry. Let’s do a correct physics basketball throw, underhanded,'” said Lee. “It doesn’t look great, but it makes 90% of the shots.”

According to Lee, the ETF’s strategy starts with seven themes Fundstrat predicts will define the market over the next 10 years — from millennials to energy security. To be considered a granny shot, a stock must fit at least two of the themes.
“We’re not buying junky stocks. We want to make sure that they generate earnings and high ROIC [return on invested capital],” Lee said. “We rebalance every quarter.”
So far, the Granny Shots ETF, which was launched on Nov. 7, is scoring investors. In May, Fundstrat reported the ETF crossed the $1 billion in assets under management milestone. As of last week, Lee said the fund grew to $1.3 billion.
Since its launch, the ETF is up 13% as of Thursday’s close. The fund is beating the S&P 500 so far this year. It’s up almost 15% since Jan. 1 while the index is up about 7%.
As of July 3, Fundstrat reports its top three holdings are Robinhood, Oracle and AMD.
Independent ETF expert Dave Nadig said he’s observed recently that ETFs with active management styles are gaining traction.
“Tom’s very much a part of it,” Nadig said in the same interview. “I think having an active management overlay, both on the stock selection and the thematic part, can make a lot of sense for investors. It’s certainly easier for investors to understand.”

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Legislation championed by President Donald Trump would give the top 1% of U.S. households an average tax cut of about $66,000, according to the Institute on Taxation and Economic Policy.
The highest earners in Wyoming, South Dakota and Texas stand to get a tax cut of more than $100,000 from the bill, formerly called the One Big Beautiful Bill Act.
Overall, lower earners would lose money due to a smaller tax cut and changes to Medicaid and SNAP, analyses have found.

Speaker of the House Mike Johnson, R-La., speaks to reporters as he walks back to his office as the House of Representatives waits to vote on President Trump’s “big beautiful bill” reconciliation package on July 3, 2025.
Bill Clark | CQ-Roll Call, Inc. | Getty Images

A massive package of tax cuts championed by President Trump that Congress passed on Thursday would be a windfall for the wealthiest U.S. households. But the size of that financial benefit depends largely on where high-income taxpayers live, according to a new analysis by the Institute on Taxation and Economic Policy.
The legislation would give the top 1% of U.S. households an average tax cut of about $66,000, or about 2.4% of their income, in 2026, according to ITEP, a left-leaning think tank. (These households have incomes of $917,000 or more per year, averaging about $2.7 million, it said.)

Some households stand to get a much bigger tax benefit.

The wealthiest households in three states — Wyoming, South Dakota and Texas — would see their annual tax bills fall by more than $100,000, ITEP found.
In Wyoming, the top 1% would see their taxes fall most: by an average of about $133,000 (or 3% of income) in 2026, it said. The average income of the top 1% in the state is about $4.5 million.

“The bill is most advantageous to conservative-leaning states that have a lot of very wealthy people living within their borders,” said Carl Davis, ITEP’s research director.
These states also don’t levy personal income taxes, he said.

Wyoming and Texas “are classic examples of states with a lot of wealthy people and which tax those wealthy people incredibly lightly,” Davis said.

Why the wealthy get a large tax cut

Senate Republicans passed the legislation, originally called the One Big Beautiful Bill Act, on Tuesday with the slimmest of margins. House Republicans passed the bill on Thursday, and sent it to the president for his signature.
The legislation offers more than $4 trillion of net tax cuts over a decade, with most benefits accruing to higher-income households, analyses have found. It also slashes the social safety net, cutting billions of dollars from programs like Medicaid and food stamps meant to help lower earners.
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The centerpiece of the bill is an extension of 2017 tax cuts enacted during President Trump’s first term in office.
Overall, the legislation lowers income tax rates, exempts a larger share of wealthy estates from taxation and offers tax breaks to business owners. These are among the core ways the GOP bill benefits high-income households, Davis said.
It also caps the amount of state and local income taxes and property taxes that households can deduct from their taxable income each year, at $40,000.

That “SALT” policy doesn’t negatively impact wealthy residents in states like Wyoming, South Dakota and Texas, where residents don’t owe state income tax, Davis said. But it has a large impact on states with high state and local income taxes and property taxes.
In other words, high-income residents of Wyoming, South Dakota and Texas generally get most of the tax upside and not much downside, he said.
Conversely, the highest earners in California and New Jersey would see a smaller tax cut in 2026, averaging about $34,000 and $21,000, respectively, ITEP found. That represents about 1% of their income in each state.

Separate analyses have found that the wealthiest households will reap the largest financial benefits from the GOP bill.
The top 20% of U.S. households (earning more than $217,000 a year) would get a tax cut equivalent to 3.4% of their after-tax income in 2026, according to the Tax Policy Center. Meanwhile, the bottom 20% would get a 0.8% tax cut.
Its analysis only examined the tax portions of the legislation.
Overall, more comprehensive analyses that also account for cuts to programs like Medicaid and the Supplemental Nutrition Assistance Program, the lowest earners would be worse off, according to analyses by the Budget Lab at Yale University and the Congressional Budget Office, which modeled similar legislation passed by the House last month. More

Even before the bombs began to fall, Iran’s economy was in a bad way. Six in ten working-age people were unemployed. Prices had risen by 35% in the past year. Some 18% of the population was living below the World Bank’s poverty threshold. Despite exporting gas and oil, Iranian officials had to burn mazut, a low-grade refining byproduct, to keep the lights on. Binyamin Netanyahu, Israel’s leader, then went after economic targets. Amid attacks on military bases and nuclear facilities, Israeli planes bombed at least two gas fields, a few oil fields and a car factory. More

The town of Malvern is a 45-minute drive north-west of Philadelphia. It has a population of 3,400 or so, and was the site of a minor drubbing for George Washington’s continental army in 1777. It is, in many ways, a fairly unremarkable, affluent corner of the American north-east. But Malvern stands out in one way: it is home to $10trn in assets under management. More

Another agreement, another personal triumph. “It is my Great Honor to announce that I have just made a Trade Deal with the Socialist Republic of Vietnam,” President Donald Trump wrote on July 2nd. “Dealing with General Secretary To Lam, which I did personally, was an absolute pleasure.” The deal showed countries were caving in to his threats, he said. More

New tax deduction — on auto loans, tips and overtime pay, and for older Americans — wouldn’t deliver much of a financial benefit for lower earners, experts said.
These policies are part of a massive legislative package championed by President Donald Trump.

Senate Majority Leader John Thune (R-SD), flanked by Sen. John Barrasso (R-Wyoming), Sen. Mike Crapo (R-Idaho) and Sen. Lindsey Graham (R-SC), speaks to reporters after the Senate passed President Trump’s reconciliation package on July 1, 2025.
Bill Clark | Cq-roll Call, Inc. | Getty Images

Tax cuts are the centerpiece of a massive legislative package championed by President Trump and passed Tuesday by Senate Republicans.
Many new tax breaks in the bill — on auto loans, tips and overtime pay, and for older Americans — are structured as tax deductions.

How much money you save with tax deductions, which reduce your taxable income, depends on your bracket. Deductions are more valuable to higher-income households and less beneficial for lower earners, experts said.
“The most modest-income workers can’t use a tax deduction at all,” said Carl Davis, research director of the Institute on Taxation and Economic Policy, a left-leaning policy think tank.
Senate Republicans passed the legislation with the narrowest of margins on Tuesday. It now heads to the House, where its fate is uncertain.

Tax deductions in the ‘big beautiful’ bill

Luis Alvarez | Digitalvision | Getty Images

The Republican bill, originally called the One Big Beautiful Bill Act, has more than $4 trillion of net tax cuts, according to the Committee for a Responsible Federal Budget.
Among them are several new tax deductions:

Car loan interest: Households can deduct up to $10,000 of annual interest on new car loans from their taxable income;
Tips: Workers can deduct up to $25,000 of tips each year from their taxable income.
Overtime pay: Workers can deduct up to $12,500 of annual overtime pay from their taxable income. (Married couples filing a joint tax return can deduct up to $25,000.)
Senior ‘bonus’ deduction: Americans ages 65 and over can deduct up to $6,000 from their taxable income.

If enacted as drafted, these deductions would be temporary, available from 2025 through 2028. They also carry various limitations such as income restrictions.

Why tax deductions are less valuable to low earners

A tax deduction reduces the amount of income that’s subject to tax, i.e., taxable income. You can find your taxable income on line 15 of your Form 1040 individual income tax return.
While the proposed tax deductions may sound large, there are a few reasons why low earners may not see much or any benefit, experts said.
1. You need taxable income
Households need some taxable income to benefit from a deduction, said Garrett Watson, director of policy analysis at the Tax Foundation.
Low earners already get a large financial benefit from the standard deduction, Watson said.
The standard deduction is worth up to $15,000 for singles and $30,000 for married couples filing jointly in 2025. (If the bill passes as drafted, it would raise the standard deduction to $15,750 for single filers, and to $31,500 for married filing jointly.)
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To get a financial benefit from the new tax deductions for car loans, seniors, tips and overtime, a household’s taxable income would have to exceed these thresholds, experts said.
More than a third, or 37%, of tipped workers in 2022 had incomes low enough that they didn’t owe federal income tax, according to an analysis last year by the Budget Lab at Yale University.
That means a “meaningful share” of tipped workers wouldn’t benefit from a tax deduction on tips, it said.
2. Value depends on tax bracket
The relative value of tax deductions depends on a household’s tax bracket, experts said.
There are seven federal income-tax brackets: 10%, 12%, 22%, 24%, 32%, 35% and 37%. Higher-income households generally fall in a higher tax bracket — any therefore can get a bigger benefit from reducing their taxable income.

“If you’re in a somewhat higher bracket, every dollar you get to deduct is worth more to you because that dollar would have been taxed at a higher rate,” Davis said.
Let’s say two households — one in the 22% bracket and one in the 10% bracket — each deduct $1 of tipped income. The former gets a tax benefit worth 22 cents, while the latter gets one worth 10 cents, Davis said.

3. Some deductions are limited
There are other reasons why households may not be able to max out certain deductions.
For example, households would need a car loan of roughly $112,000 or more to generate $10,000 of annual interest on a typical six-year loan, Jonathan Smoke, chief economist at Cox Automotive, an auto market research firm, told CNBC last month.
Only about 1% of new auto loans are this big, according to Cox Automotive data.
By comparison, the average new car buyer would be able to deduct $3,000 of interest from their taxable income in the first year of their loan, Smoke said. A deduction of that size would yield an average total tax benefit of about $500 or less in the loan’s first year, he said.

Above-the-line tax deductions

Jgi/jamie Grill | Tetra Images | Getty Images

There are, however, two elements of the tax breaks that seek to better target benefits to low- and middle- income households.
For one, they’re all what’s known as “above-the-line” deductions.
This means households can claim them regardless of whether they use the standard deduction or itemize their deductions.
High-income households may be more likely to itemize, meaning they detail a list of eligible deductions on their tax return.

Taxpayers itemize when the deductions add up to more than the standard deduction. Some deductions are only available to taxpayers who itemize, such as for “SALT” (or, a deduction for state and local income taxes and property taxes) or mortgage interest.
Also, the new deductions have income limits, barring them from the highest-income households.
For example, the overtime deduction’s value starts to decline once an individual’s income exceeds $150,000 ($300,000 for married couples filing jointly). The value of the senior “bonus” falls once income exceeds $75,000 ($150,000 if married and filing jointly).

Tax credits

Tax credits are another mechanism to lower a household’s tax bill.
A tax credit reduces your tax liability dollar-for-dollar. (If you claim a $1,000 credit, it can reduce your tax bill by $1,000.) Credits have the same dollar value regardless of your tax bracket.
Unlike deductions, the “benefits from tax credits are skewed toward lower- and middle-income households,” the Congressional Budget Office wrote in 2021.
Credits can be “refundable” or “nonrefundable”:

Refundable: The credit can reduce your tax bill below zero. In this case, you’d get a tax refund. For example, if your tax liability is $500 and you qualify for a $600 refundable credit, you’d get a $100 refund, according to a CBO example. Some credits are partially refundable, which limits the size of the refund.

Nonrefundable: Other credits are nonrefundable, meaning that they can reduce your tax bill to zero, but no lower. Credits that are nonrefundable or only partially refundable may prevent those with low incomes from getting the full value.

The largest credits for individuals as measured by total government outlay are the child tax credit, earned income tax credit and the premium tax credit for health insurance, CBO said.
The Senate legislation would permanently raise the maximum child tax credit to $2,200 starting in 2025, and would index this figure for inflation starting in 2026. The credit is partially refundable: Low earners can get up to $1,700 as a tax refund.
But currently, 17 million children do not receive the full $2,000 child tax credit because their families don’t earn enough and owe enough taxes, according to the Center on Budget and Policy Priorities. More

Jawaharlal Nehru, India’s first prime minister, and Donald Trump, America’s president, do not share many similarities. Nehru was an erudite product of Harrow School and Trinity College, Cambridge; Donald Trump, for all his expensive education, is ultimately a rough-and-tumble graduate of New York real estate. A freedom fighter before becoming prime minister, Nehru spent nine years in British-run jails having campaigned against imperial rule; Mr Trump’s tangles with the law have involved hush money for a porn star. Nevertheless, Nehru’s Fabian socialism—a patrician distrust of commerce mixed with an intellectual love of scientific progress—means his views on trade are, many years later, mirrored by Mr Trump’s America-first instincts. More