US equities reached all-time highs this week amid political turmoil, including tariffs and the Fed's actions. This paradox may arise from a study indicating that high political disagreement correlates with positive stock market returns. The research involved creating virtual investors with varied political views, which suggested that stocks provoking disagreement often yield better returns. Additionally, a separate study revealed that many partisans misinterpret factual economic questions as opinion queries, distorting perceptions of economic conditions based on political affiliations. This reflects a broader trend where even professional forecasters show partisan biases in economic predictions. Furthermore, the narrowing scope of the US stock market raises concerns, with Nvidia representing a significant portion of the S&P 500 at a high P/E ratio. Other highlights include projected declines in international student enrollment in US universities, concerns over government debt servicing, and competitive developments in AI, notably Google's Genie 3 model gaining an edge over OpenAI's GPT-5. Such dynamics suggest that rising political partisanship might lead to lucrative opportunities for investors.

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