The U.S. housing market is showing signs of cooling, with J.P. Morgan Research projecting a modest 3% rise in house prices for 2025.

This subdued growth reflects persistent challenges in the market, including affordability issues and tight inventory. While single-family existing homes for sale have increased by about 20% year-over-year, inventory still remains near record lows.

Adding to this economic uncertainty is the aggressive cost-cutting campaign led by DOGE, headed by Elon Musk. The federal workforce, comprising approximately 2.4 million individuals, is facing significant disruption.

President Trump has signed an executive order implementing DOGE's workforce optimization initiative, which aims to drastically reduce the size of the federal government.

The impact of these cuts is already being felt across various departments…

Your Rundown for Friday, February 21, 2025...

Ripple Effects of DOGE’s Workforce Cuts

The Pentagon, for instance, is facing an 8% reduction from its $800 billion-plus budget for the upcoming year, including workforce cuts.

The Department of Housing and Urban Development (HUD) is reportedly aiming to reduce its workforce by 50%, with some divisions potentially facing cuts of up to 75%.

In total, more than 200,000 federal workers at more than a dozen agencies have had their roles eliminated in recent weeks. Additionally, 75,000 federal workers have accepted buyouts.

These widespread job cuts in the federal sector could have rippling effects on the broader economy. Government spending and employment play a significant role in overall economic activity, and large-scale layoffs could lead to reduced consumer spending and economic growth.

The housing market may feel the impact of these cuts as well. With potentially fewer government employees able to afford homes and uncertainty in the job market, demand for housing could decrease.

This, combined with already softening market conditions, may lead to further cooling in home prices and sales.

As we move through 2025, the interplay between the housing market and government workforce reductions will be crucial. The full impact of DOGE's cuts on the economy remains to be seen.

Market Rundown for Friday, Feb. 21, 2025

S&P 500 futures are up just a whisker at 6,139.

Oil’s at $71.96.

Gold’s down $7.80 at $2,948.

And Bitcoin, at $99,376, is knocking on the door of $100k again.