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• The Trump administration has talked a lot about the yield on the 10-year Treasury, the benchmark for rates on mortgages and other common types of loans, as the president pledges to bring down borrowing costs for Americans. Data suggests more households are exposed to changes in interest rates than swings in the stock market, but the effect of tariffs on inflation might ultimately be the most impactful economic issue for voters. 

Donald Trump loved to brag about the stock market at the start of his first stint in the Oval Office. But as share prices tumble amid his on-again, off-again tariff threats and mounting recession fears, the president has indicated he’s no longer using the S&P 500, which closed in correction territory on Thursday after the index dropped 10% from its high in mid-February, as a yardstick during his second term. 

Instead, the new administration, including Treasury Secretary Scott Bessent, has been much more vocal about the bond market and Trump’s pledge to lower borrowing costs for Americans. Bessent has said the president’s focus is on seeing a decline in the yield on the 10-year Treasury note, the benchmark for rates in the country’s nearly $12.6 trillion mortgage market, many corporate bonds, and the government’s own interest payments.

“We’re focused on the real economy. Can we create an environment where there are long-term gains in the market and long-term gains for the American people?” Bessent told CNBC Thursday. “I’m not concerned about a little bit of volatility over three weeks.”

Regardless of Trump’s true feelings, the data suggests Americans are more exposed to changes in interest rates than swings in the stock market. While just about six in 10 Americans report owning stock, according to a 2023 Gallup poll, nearly 80% of American households have some type of debt, according to the Federal Reserve. The 10-year yield has fallen roughly 50 basis points since the week before Trump’s inauguration, though it ticked up to 4.30% Friday morning.

“More voters are impacted by interest rates than the S&P,” political strategist and venture investor Bradley Tusk told Fortune. “But inflation dwarfs both of them.”

It’s clear markets are no fan of tariff uncertainty, though stocks bounced back a bit Friday morning. It remains to be seen whether more protectionist measures will result in slower growth, higher prices, both (the worst-case scenario), or neither. Even as many Americans have presumably seen the value of their 401k and other retirement plans drop in recent weeks, there are signs the decline in yields is already having an impact.

Mortgage rates fell for a month-and-a-half before Freddie Mac’s weekly estimate ticked slightly higher Thursday, though the agency said the average rate on a 30-year mortgage has fallen to 6.65% after surpassing the 7% threshold in early January.

“Despite this minor bump, rates are still at their lowest levels of the year and if they continue to fall, could provide a welcome boost as the spring housing market kicks off,” Lisa Sturtevant, chief economist of multiple listing service Bright MLS, wrote in a note Thursday.

Lower mortgage payments may not address the nation’s structural housing deficit, but they could prod homeowners who have felt “locked in” to rates they obtained before borrowing costs spiked in 2022. Mortgage loan application volume increased 11% last week, according to an index calculated by the Mortgage Bankers Association.

Why Trump is eyeing the 10-year Treasury

Long-term yields are highly correlated with the Federal Reserve’s overnight lending rate for banks, which allows the central bank’s decisions to be transmitted throughout the economy. The relationship isn’t perfect, however, because the market for free-floating assets like the 10-year Treasury is also based on other factors, explained Matt Sheridan, lead portfolio manager for income strategies at AllianceBernstein. Expectations for economic growth, inflation, and fiscal policy also play a role, he said.

Yields, which represent an investor’s annual return, fall as bond prices rise—and vice versa. That tends to happen if investors believe the Fed will be forced to cut rates, which makes the higher payments on existing bonds more attractive relative to new debt.

Conversely, if concern about the government’s debt burden increases, investors might demand a higher return. Over the last few months, Sheridan said, fixed-income investors have worried less about the federal deficit and are now more anxious about the economy. Initially, many traders believed Trump would be focused on pro-growth aspects of his agenda like tax cuts and deregulation.

“I think investors were a little bit surprised the new administration is prioritizing tariffs,” he said.

A White House spokesperson said the bond market’s minor rally reflected the new administration’s efforts to restore “fiscal stability and confidence.”

“President Trump has been committed to restoring our nation’s fiscal credibility, which was undermined by the previous administration’s reckless spending,” Harrison Fields, deputy press secretary and special assistant to the president, said in a statement.

Marko Papic, chief strategist at BCA Research, said it’s wrong to suggest Trump wasn’t willing to look past equity volatility during his first term. After all, despite the president citing the stock market’s performance roughly once roughly every 35 hours throughout January 2018, per Politico, the S&P 500 eventually declined 6% that year as Trump launched a first trade war with China.

“President Trump tweets about the stock prices when they go up,” Papic said, “and he doesn’t when they go down.”

Some demographics that tend to have lower exposure to the stock market have also appeared to gravitate to Trump, who bested Harris and his own 2020 performance in November among voters without a college degree and those making less than $100,000.

“They probably don’t care about the stock market, but they [also may not be] in the market to buy a new home,” said Tusk, who served as campaign manager for former New York City mayor Michael Bloomberg.

“But what they do do is buy groceries,” he added, “or they might want to buy a new truck.”

Auto loans aside, that’s why inflation and potential price increases from tariffs, he said, are the economic issues that loom largest.

Correction: This story was corrected to reflect that the report from Politico found President Donald Trump boasted roughly once every 35 hours during January 2018.

This story was originally featured on Fortune.com

• Employment in New York’s securities industry reached the highest level in three decades at more than 200,000 workers, reported state Comptroller Thomas DiNapoli on Wednesday. And along with sky-high employment, the total estimated 2024 bonus pool among New York Stock Exchange member firms is the largest on record since 1987. But looming uncertainty due to federal policy is muddying the industry outlook for 2025.

Wall Street is back and profits are soaring. And according to a new report, so are bonuses.

New York State Comptroller Thomas P. DiNapoli reported on Wednesday that Wall Street’s annual wealth infusion for employees—its bonus pool—notched a new record at $47.5 billion in 2024, an increase of 34% over the year prior. The bonus pot hasn’t veered even close to this level since 2021, when the total swelled to $42.7 billion, before tumbling back down to $33.9 billion in 2022. 

The comptroller’s office publishes a yearly estimate of bonus payouts for those employed in the securities industry based on personal income tax withholding trends and cash bonuses paid. The average bonus deposit, accounting for those at the entry level all the way up to those with panoramic views in corner offices, was $244,700, DiNapoli found. A year earlier, the average payout was $186,100. The 131 New York Stock Exchange member firms’ profits rose 90% in 2024, the comptroller reported. 

“The record high bonus pool reflects Wall Street’s very strong performance in 2024,” DiNapoli said in a statement. “This financial market strength is good news for New York’s economy and our fiscal position, which relies on the tax revenue it generates. However, increasing uncertainty in the economy amid significant federal policy changes may dampen the outlook for parts of the securities industry in 2025.”

Tariffs have claimed a starring role among the many policy changes implemented by the Trump administration, rocking major market averages with uncertainty and volatility. The S&P 500 is down 3% the past month and 1.5% year to date. One of the cascade effects of those federal policy changes—and the presence of Tesla CEO Elon Musk in Washington, D.C.—has resulted in pressure on DiNapoli. As comptroller, DiNapoli oversees the state’s $270 billion retirement fund, which holds a stake in Tesla valued at more than $800 million. A group of 23 Democratic state senators urged the comptroller this month to divest from the Musk-helmed automaker. 

According to the two dozen state senators who reached out to DiNapoli, the Tesla stake is the fund’s seventh-largest holding, and it is in jeopardy while Musk is the CEO. 

“Musk’s actions leading President Donald Trump’s Department of Government Efficiency (DOGE) have led to a deterioration of the company’s reputation among its most loyal customers,” states the letter, signed by Senator Patricia Fahy (D.-Albany) and 22 other senators. 

Tesla did not immediately respond to a request for comment. 

Meanwhile, the traders, supervisors, analysts, and portfolio managers in New York have a front-row seat to the volatility. The lucrative industry, with an average annual salary of $471,000, helps make up the beating heart of New York City, with 69% of employees residing in one of the five boroughs. More than a quarter of New York City residents who work in securities and finance make more than $250,000 a year. Similarly, more than half of commuters from Westchester County and 41% of commuters from Long Island who work in securities make more than $250,000 a year, according to New York state labor figures.

DiNapoli reported that one in 11 jobs in New York City is somehow linked to the securities industry, and the state derives 19% of its tax collections from it. The 2024 bonus pot will gin up an extra $600 million in income tax this year, and an additional chunk of change valued at $275 million will go into New York City’s coffers in 2024 compared to 2023. Securities industry employment is the highest it’s been in some 30 years with 201,500 workers in contrast to 198,400 the year before. It’s higher than any other state, the comptroller reported.

Still, while New York City boasts the largest number of securities-industry jobs in the U.S., the figure has tumbled consistently since the ’90s, according to labor data. In 1990, a third of all securities jobs were in NYC, compared to 17.4% in 2024. And while New York state added 15,600 securities industry jobs between 2019 and 2023, Texas outpaced it by adding 19,400 jobs of its own. Florida added 13,300 jobs during the same period. 

Also worth noting, major financial firms including Goldman Sachs and Citigroup have announced job cuts and restructurings, which could impact headcount in the state’s securities industry. 

This story was originally featured on Fortune.com