Market Update | May 19th - May 23rd

A Look at Our Favorite Indexes

This week was an interesting one, as the market saw a modest decline. Let's start by looking at our favorite index funds, assets, and crypto! The S&P 500, Nasdaq, and Dow Jones all dropped around 2.5% this week. Gold continued its impressive rise in 2025, peaking with a 4% increase this week alone. On the other hand, crypto had a fantastic week! Bitcoin and Solana each rose by over 2%, while Ethereum led the pack with an impressive 8% increase.

Trump Administration Escalates Trade Tensions

After pausing or easing many tariffs, President Trump announced new threats: a 25% tariff on iPhones manufactured outside the U.S., and a 50% tariff on all European Union goods. As you might expect, this sent the market into a downward spiral. Apple’s stock dropped more than 3% following the announcement.

The Big Beautiful Bill

The "Big Beautiful Bill" is a sweeping legislative package that passed narrowly on Thursday in a 215–214 vote. Here are some of its major components:

• Tax Reforms:

  • The bill extends tax cuts from Trump’s 2017 legislation, which were set to expire later this year.

  • It introduces an expanded child tax credit, benefiting over 40 million families.

  • The SALT (State and Local Tax) deduction cap will increase from $40,000 to $500,000.

    
    

• Spending Cuts:

  • The bill proposes deep cuts to Medicaid, potentially affecting millions of beneficiaries.

  • Funding for clean energy initiatives and key portions of the Inflation Reduction Act will be reduced.

    
    

• Border Security:

  • An additional $150 billion will be directed to defense, much of it for border security.

  • New technologies, including drones and even potential underwater systems, are expected to be developed.

  • An extra $70 billion will also be allocated specifically to border security improvements.

    
    

Fiscal Impact

Over the next decade, experts estimate this bill will add over $3.8 trillion to the national debt. While Elon Musk, a key figure in Trump’s administration, has criticized the bill for worsening the debt, some Republican lawmakers have also raised concerns. Meanwhile, most Democrats have condemned the bill for cutting vital social programs while extending tax cuts that disproportionately benefit the wealthy.