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Biden transition begins, Dow hits 30,000: Here’s how the headlines could affect your money

The Dow broke 30,000 for the first time, setting a new intraday high.

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U.S. President-elect Joe Biden announces his national security nominees and appointees at his transition headquarters in Wilmington, Delaware, November 24, 2020.
Joshua Roberts | Reuters

Markets are up as Biden officially starts the transition process, and home prices are soaring. Here's how the headlines could affect your money.

Dow hits 30,000

All three major indexes were up at the closing bell on Monday, as President-elect Joe Biden's transition began and the AstraZeneca and Oxford University vaccine also showed promise. The rally continued Tuesday morning: The Dow broke 30,000 for the first time, setting a new intraday high.

The Biden transition begins

More than two weeks after the presidential election was called by news organizations, General Services Administration Chief Emily Murphy announced that the Trump administration is making resources available to the Biden team. That includes $7 million in federal funding.

Biden has been announcing Cabinet picks, including Janet Yellen, the former Federal Reserve chair, as his Treasury secretary. Economists expect the pragmatic Yellen, who would be the first woman to serve in the position, would focus on helping the economy recover from the pandemic. 

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Home prices spike

Home prices are soaring, thanks to low mortgage rates and increased demand. Prices rose 7% in September compared to last year, according to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index. It's the largest gain since September 2014.

In some cities, over 40% of homes are selling above asking price, according to a recent Grow analysis of Zillow data. But if you're in the market for a home, don't let these reports scare you off: In most cases, the final selling price is still within 10% of the original listing.

Words you've heard: Bubble

In financial terms, a bubble refers to a fast increase in an asset's prices, at a clip that exceeds its intrinsic value. That's often followed by a quick deflation. Although home prices are rising quickly, experts say the U.S. is not currently experiencing a housing bubble. 

Although the daily news can have an impact on your wallet, remember to take a long-term outlook when it comes to decisions on spending, saving, and investing.

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