Home Blog

ADP CEO Maria Black says employees who trust their CEO are 41% more likely to be engaged at work



If companies want more engaged workers, ADP CEO Maria Black says CEOs and senior leaders should start by asking themselves if employees trust them. 

Speaking with Fortune executive editorial director Diane Brady at Fortune’s Most Powerful Women Summit in California this week, Black said trust and engagement gang together. Employees who trust the people around then at work with are 60% more likely to be dialed in, she told Brady, 

“Trust is a direct corollary to engagement,” said Black. “So if we want to drive engagement, productivity, and a vibrant world of work that, candidly, I want to be in and I want my children to grow up working, we have to focus there.”

ADP’s finding turns some current thinking about employees being lackadaisical or blasé about work squarely on its head. Engagement is often seen as a metric about sentiment that can be measured and tracked, but is treated as something employees bring—or fail to bring—to their jobs. ADP’s data implies it depends pretty heavily on whether workers actually believe and trust in the people leading them, placing a lot of responsibility for engagement squarely on management and C-suites. 

The company’s research arm previously found that for every 1% drop in full engagement, the likelihood of voluntary attrition increases by 45%. Black said only 30% of employees are overly engaged at work. Meanwhile, if employees trust CEOs and senior leadership, they’re 41% more likely to be engaged and 60% more likely if they trust the people around them that they work with. 

The current moment is jam-packed with reasons not to trust, explained Black. Echo chambers, firehoses of information, discerning what’s real and what’s AI-generated, all accumulate to chip away at trust. At work, driving more focus and engagement comes down to whether people trust those around them and their leaders all the way up to the top. As a leader herself, Black said she gets boots on the ground and holds listening posts, noting that she arrived in California on the heels of a trip to Las Vegas where she spoke with 1,000 company leaders, and a Florida trip to chat with employees over the “universal love language of ice cream.”

“The only way to keep current is to be on the ground and be trusted,” said Black. 

The other issue of the moment for business leaders is the obligation facing companies to upskill and reskill, she continued. ADP oversees payroll and human capital for more than 1 million clients across 140 countries and Black said the new AI era will only play out with human agency in terms of how people actually choose—or don’t choose—to engage with AI tools. 

“We know that, generally speaking, workers in today’s workplace don’t feel as though their employer has prepared them properly,” said Black. 

She joined ADP in 1996, starting as a sales associate and eventually rising to become president and CEO in 2023. She is the seventh CEO in the company’s history and said she has a ground level view from growing up in that business. As AI continues its expansion in new facets of work and life, Black said it can serve people well in terms of expanding their expertise beyond the current domain and, in turn, expanding their ability to increase their income as they take on new tasks and responsibilities. 

“But we have to shepherd them there,” warned Black. “I think that’s the other part that sometimes we don’t spend enough time on.”

What Is Grok Bot? xAI’s AI Agent Explained for Physicians



Imagine handing off a task, closing your laptop, and having the work continue without you.

That is what Grok Bot is built to do. It is an AI agent from xAI (also called SpaceXAI) that launched in beta on August 11, 2026. It is not the same as the Grok chatbot. It is a separate app with its own usage allowance.

This guide covers what it is, how it differs from a regular AI chat, what it can help physicians with, and what to check before trying it.


Disclaimer: While these are general suggestions, it’s important to conduct thorough research and due diligence when selecting AI tools. We do not endorse or promote any specific AI tools mentioned here. This article is for educational and informational purposes only. It is not intended to provide legal, financial, or clinical advice. Always comply with HIPAA and institutional policies. For any decisions that impact patient care or finances, consult a qualified professional.

It’s not just the talks. Or the speakers. Or the strategies.

PIMDCON, the #1 Real Estate & Entrepreneurship Conference for Physicians, works because of what happens between the sessions.

The conversations. The clarity. The shift.

LEARN MORE ABOUT PIMDCON

What Grok Bot is

xAI describes Grok Bot as a team of always-on AI assistants. You create a “Bot” for each job, such as inbox management, expenses, or research. You message it like a coworker. It signs into your tools, does the work, and comes back when it needs your approval.

The basics:

  • Bots can use a cloud computer, connected apps, websites, and files.
  • Work continues in the background, even when your laptop or phone is closed.
  • Apps are available for Mac, Windows, and Linux, with companion apps for iPhone and Android, according to the docs FAQ.
  • It is in beta and updates often. The release notes list version 0.70.2 on October 11.
  • Access comes through a paid Cursor plan or a linked SuperGrok subscription, with weekly usage included. The FAQ points to Cursor’s pricing page for current terms.

How it differs from a regular AI chat

A regular chat answers a question and waits. Grok Bot takes on a job and keeps going. A few things set it apart.

  • It works in real apps. xAI says Bots can sign in and work inside tools and websites, including ones with no clean integration. Some sites may still block automation or show a CAPTCHA.
  • It hands over sensitive steps. For passwords, two-factor codes, CAPTCHAs, and payment confirmations, the Bot is meant to give control back to you.
  • Bots can work as a team. xAI describes a “chief of staff” Bot that passes work to specialist Bots for inbox, expenses, or bug fixes.
  • It can learn your process. A feature called Teach a task lets a Bot watch one browser workflow and turn it into a draft skill that you review and test. The docs say the rollout may be gradual. Routines can then run on a schedule.
  • It asks before it acts. Emails and Slack messages can be drafted for your review. The release notes also describe an approval check before actions that cannot be undone, such as sending, posting, buying, or deleting.

One detail to know: the launch post says each Bot has its own computer, but the docs say all Bots on an account share one cloud computer. That matters for security, covered below.

Why physicians should care

Grok Bot is built to take over repeat admin work, the kind that fills a day outside of patient care. xAI’s examples come from its own teams, but similar tasks show up in a physician’s week, in a practice’s back office, or in a side business.

Here is what it can help with:

  • Inbox and follow-ups. A Bot can handle inbox tasks, draft replies for your approval, and follow up on threads that went quiet.
  • Invoices and bookkeeping. xAI’s example is a Bot that processes invoices arriving in Gmail. The release notes list QuickBooks Online as a connector.
  • Recurring reports. A routine can run on a schedule. xAI’s example is a Bot that keeps its CRM clean and posts a Monday scoreboard. The same idea could fit a weekly summary for a practice or a business.
  • Research and outreach. xAI’s sales Bot researches accounts overnight and prepares personalized drafts to approve. That could apply to vendor research or partner outreach for a physician’s business.
  • Slide decks. The release notes say Bots can build slide decks and deliver them as PowerPoint or Google Slides files.

All of these are business and admin tasks, not clinical ones. Results will vary, since xAI’s examples come from its own teams. Patient information is a separate question, covered next.

What to check before trying it

  • Shared computer. All Bots on an account share one computer’s files, browser sessions, and logins. xAI’s security docs say not to use separate Bots as a security boundary. Anything you connect is reachable by every Bot.
  • Data storage. The FAQ says Grok Bot requires cloud data storage and does not support Legacy Privacy Mode. It uses Cursor account and data settings, and training opt-out follows those settings.
  • Patient information. xAI’s BAA request page is about its APIs. Nothing reviewed says Grok Bot is covered, so keep patient information out unless your organization confirms coverage in writing with xAI and its compliance team.
  • Approval limits. An approval controls the proposed action. It does not undo work already done. The docs also say Auto Review is model-based and should complement, not replace, a least-privilege setup.

Unlock the Full Power of ChatGPT With This Copy-and-Paste Prompt Formula!

Download the Complete ChatGPT Cheat Sheet! Your go-to guide to writing better, faster prompts in seconds. Whether you’re crafting emails, social posts, or presentations, just follow the formula to get results instantly.

Save time. Get clarity. Create smarter.


How to start

xAI’s own advice is to connect only what a task needs, use limited-access accounts where possible, and start with read-only tasks and drafts. Sending, publishing, buying, and deleting should stay behind approval. Connected apps and routines should be reviewed regularly. A good first task is one where the worst outcome is a bad draft.

Grok Bot is an early look at AI that finishes tasks instead of only answering questions.

For physicians, the appeal is handing off repeat admin work. The tradeoff is giving an agent access to your accounts, so start small and keep patient data out.


Download The Physician’s Starter Guide to AI – a free, easy-to-digest resource that walks you through smart ways to integrate tools like ChatGPT into your professional and personal life. Whether you’re AI-curious or already experimenting, this guide will save you time, stress, and maybe even a little sanity.

Want more tips to sharpen your AI skills? Subscribe to our newsletter for exclusive insights and practical advice. You’ll also get access to our free AI resource page, packed with AI tools and tutorials to help you have more in life outside of medicine. Let’s make life easier, one prompt at a time. Make it happen!


Disclaimer: This article is for general informational and educational purposes only. It does not constitute medical, legal, compliance, or professional advice. The information provided here is based on available public data and may not be entirely accurate or up-to-date. It’s recommended to contact the respective companies/individuals for detailed information on features, pricing, and availability. All screenshots, if any, are used under the principles of fair use for editorial, educational, or commentary purposes. All trademarks and copyrights belong to their respective owners.

If you want more content like this, make sure you subscribe to our newsletter to get updates on the latest trends for AI, tech, and so much more.

Further Reading



Up To 51%-100% Back On eBay Live


Some readers seeing 100% back…

The Offer

Check your Capital One Shopping homepage or their emails for the following deal:

  • Get up to 51% ($1,000 max) back at eBay. 
    • Completed eBay Live Purchase 51%
    • eBay.com Purchase 16.5%

Our Verdict

eBay live is basically a whatnot competitor, people stream and live auction items. At 51% back this can be very profitable for flips on things like collectible cards. 

As always, keep in mind that Capital One Shopping portal does not require having a Capital One card or bank account. Also remember that the rewards are not cash but rather they cash out as gift cards for various brands. And here are are some tips to maximize Capital One Shopping offers.

If you’re new to Capital One Shopping, sign up via referral link to get $80. Here is our referral sharing thread and here is my own referral link (thanks!).

Hat tip to reader sybloc!

What is a Business Management Degree? [Simple Summary]



What is a Business Management degree? And what can it do for you? Find out from Jeri Retzlaff, business program coordinator at Rasmussen University’s Mankato, MN campus.

Ready to take the lead in business? A degree in Business Management from Rasmussen University can give you the perspective you need to plan for the future – while managing your company’s current workflow and human capital.

Now’s your chance to learn the basics and begin to understand what a Business Management degree is – and whether it’s the right fit for you.

Considering a career in business, but feel like people are speaking a different language? Get a start on cracking the code, here, “30 Basic Accounting Terms, Acronyms and Abbreviations Students Should Know”:

–
Connect with us!
School of Business Blog:
Facebook:
Twitter:
Instagram:
LinkedIn:

source

Supermicro hires a new CFO after $2.5 billion Nvidia smuggling case and a 2-year search



Super Micro Computer, the troubled hardware ally of Nvidia and Elon Musk’s SpaceX, has finally hired a new head of finance. The appointment comes nearly two years after a board-level independent investigation led the company to commit to “immediately” begin searching for a replacement for longtime chief financial officer David Weigand.

Mark Long, 59, replaced Weigand as CFO on Wednesday—“effective immediately,” according to Supermicro—and he brings with him a stack of bona fides. He previously served as CFO and chief strategy officer at $130 billion data storage company Western Digital, and he runs an investment and advisory firm, Prime Impact Capital. Long also served a stint as co-CEO and CFO of a SPAC he co-founded that raised $300 million before it merged in 2023 with a Beijing-based auto insurance technology platform, Cheche Technology. 

He joins Supermicro at an incredibly complex moment for the hardware maker with deep ties to Nvidia and its CEO Jensen Huang and Musk’s xAI, which was folded into SpaceX. Long’s record as a veteran executive and tech investor are likely intended to help clear the cloud that has hovered over Supermicro for the past two years and to burnish its credibility with skeptical investors.

In March, the Department of Justice and FBI indicted and arrested Supermicro co-founder Yih-Shyan “Wally” Liaw in a shocking smuggling case allegedly involving $2.5 billion of Supermicro hardware loaded with Nvidia’s export-controlled chips being illegally routed to China. Liaw, along with two others associated with Supermicro, was alleged to have gone to extreme lengths to deceive officials, including using hairdryers to remove and replace sticky labels and staging thousands of dummy servers that were non-working physical replicas of actual Supermicro servers—because the real servers had already been diverted to China. 

Supermicro is not named as a defendant in the case, and has said it is cooperating with law enforcement. Liaw has pleaded not guilty. His March arrest, however, kicked off another board-led internal investigation—separate from the previous probe that led to the CFO search—that Supermicro said in August found no evidence that current members of senior management knew about the smuggling scheme. 

Until he resigned after being arrested and charged in the smuggling case, Liaw had served on the Supermicro board and had a long history with fellow co-founders Charles Liang and Sara Liu. (Liu and Liang are married and both serve on the Supermicro board.) Liaw had previously left Supermicro in the midst of an internal audit committee investigation just before a 2018 SEC probe charged Supermicro and its then-CFO with improper revenue recognition practices. Supermicro settled the SEC’s charges and paid a $17.5 million settlement in 2020. Liaw returned to Supermicro as a consultant in May 2021 and eventually became a full-time employee before rejoining the board in December 2023.

The prior probe, which led the company to commit to replacing Weigand with a more experienced CFO, was spurred by the abrupt resignation of auditor EY and investigated export controls and rehiring of employees who had resigned in 2017 after the earlier accounting investigation. As CFO and chief compliance officer, Weigand was held responsible for process lapses the investigation turned up, which included a consulting arrangement with the former CFO that EY wasn’t informed about, the company disclosed in 2024.

Since Liaw’s March 2026 arrest, Supermicro has since disclosed that it got hit with a grand jury subpoena from the U.S. Attorney’s Office for the Southern District of New York related to both Liaw’s indictment and the company’s compliance program and internal controls. It also got subpoenas and inquiries from foreign authorities, the Securities & Exchange Commission, and the Bureau of Industry and Security, the national security and enforcement arms of the U.S. Department of Commerce that polices trade compliance and violations. In Liaw’s case, his lawyer informed the judge the documents Supermicro would give the government could be material to his defense, and his trial was pushed back from November 2026 to March 2027.

Since then, one of the workers who was indicted with Liaw and worked as a contractor for Supermicro, has pleaded guilty, according to court records in the case. Ting-Wei “Willy” Sun pleaded guilty last week to four counts, including conspiracy to smuggle goods and violate export rules and obstruction of justice. 

The last count is new, according to Sun’s superseding information document, and shows that Sun pleaded guilty to a charge that he deleted an encrypted messaging app on his phone on March 19, 2026, the day of the arrests. His sentencing is set for September 2027 and he’s facing a maximum of 20 years for the obstruction and conspiracy charges. Sun is also required to give up any of the proceeds from the export offenses. His lawyers did not immediately respond to a request for comment and it isn’t specified in his court records whether he has a cooperation agreement with the government. 

As the new CFO, Long jumps headfirst into the fray. The board recently added Intel’s former IT CTO, Shesha Krishnapura, and another board member, Judy Lin, retired. Lin was previously vice president at Western Digital from 2007 to September 2012, leaving after Long began consulting for Western Digital in March 2012 before he officially joined the company as chief strategy officer in January 2013.

For the role, Long will get a base salary of $725,000 plus a signing bonus of $500,000 and a guaranteed annual cash bonus of $500,000. He’ll be eligible to get additional cash bonuses and an annual equity grant based on company performance and his individual achievement. As for equity, Long got an initial equity grant valued at about $4.1 million based on Thursday’s stock price, and options on 150,000 shares. 

Supermicro declined to make Long available for interviews. In a statement CEO Charles Liang welcomed Long and thanked Weigand. Liang said Long would have “an immediate positive impact” in strengthening the company’s financial execution. 

Weigand will stay to assist in the CFO transition. A Supermicro spokesperson said further details about his role would be shared at a later date. 

A Housing Market “Recovery” Is Further Away Than We Thought


Dave:
The housing market is not going back to normal anytime soon. And today I’m going to prove it to you with real math and real data. Everyone wants to know when the housing market gets better, when it becomes easier to buy a home. I hear this question from buyers. I hear it from sellers. I go on the news frequently and I hear this question all the time. My friends who are renting ask me this question all the time. Everyone wants to know. And there actually is a sort of simple answer to this question. The answer is the housing market gets better when housing affordability improves. That’s the single thing that is causing the sluggish market that we’re in. And once affordability gets better, so will the housing market. But how does it actually get better? When most people hear the word affordability, they think mortgage rates, and that is an important piece.
But how far do mortgage rates have to fall to restore affordability? And what about the other pieces of affordability? Because it’s not just mortgage rates. It also comes down to home prices and wage growth. Those are the three components of affordability. And you have to look at all three if you truly want to understand why affordability is so bad, where it’s going, and what to do about it. So today on the show, we’re going to do the math and we’re going to figure this out. We’re going to figure out how and when we’ll actually get back to a normal housing market with normal affordability. And I’ll give you a spoiler. The answers here are uncomfortable, but knowing them will help you. They’ll help you set realistic expectations for your buying, for your selling, if you’re investing for years to come. This is on the market.
Let’s get to it.
Hey everyone. Welcome to On the Market. I’m Dave Meyer, investor, housing analyst and chief investment officer at BiggerPockets. Today we’re talking about one of my favorite topics, which is housing affordability. I said back in 2022 and every year and every week basically since that affordability was going to dictate what’s happens in the housing market, which markets, regional markets are going to grow, which ones are going to contract. And so far that has been true. The good news for a while, for a couple years was that affordability was actually improving. After 2022, we saw this huge spike in interest rates where affordability deteriorated, but we were sort of slowly going in the right direction. Wage growth were going up, real home prices were sort of flat and mortgage rates were trending down and that was improving affordability. But now the opposite is happening. Rates just went above 7.5% as of this recording.
And right now there’s not really a clear line of sight on things getting better. And so the question becomes, and the question everyone asks and I try to answer as much as possible is when is this going to get better? What is it going to take for the housing market to get back to normal? And I know everyone on social media has a take about this, but as you all know, I’m an analyst and I decided to solve this question with math. So rather than just feeling this out on vibes or some random person’s opinion, I am putting real numbers to what it is going to take to get back to a housing market that looks something like normal. And for the purposes of this episode, I’m going to use two different definitions of normal. So I calculated the long-term affordability average. So this is going back decades, what is a normal housing market affordability?
And then I’m also going to use 2019 as a different yardstick because that was kind of the last quote unquote normal market we had. If you were investing then or just paying attention to the housing market in 2019, it felt pretty normal. It wasn’t growing like crazy. Rents were going up a little bit. Affordability was a little bit constrained, but it was fine. And so those are the two benchmarks we’re going to look at and we’re going to figure out what is it going to take from where we are here towards the end of 2026 to get back to something that feels normal. Let’s jump into it. First up, just want to address what affordability actually means because some people hear affordability, they think price, they think mortgage rates. It’s not. It’s actually three different things. It’s a combination of home prices, so how much you’re paying, two, mortgage rates, what it costs to borrow.
And I guess if you’re buying cash, that part is not in there, but most people are using leverage and are using a loan, so we’re going to talk about mortgage rates. And the third is real wages, how much people are actually earning. So those are the three elements of affordability and there are different ways to measure this. People do it differently. NAR has their own version. New home builders have their own version. Wells Fargo has their own version. They’re all fine. I like NARs because it basically uses something called the payment to income ratio. This is basically comparing your monthly mortgage payment to your income. Makes sense, right? Super easy, right? What percentage of your take home pay is going to your mortgage payment? That to me is a very good way to measure affordability. So that’s what we’re going to use for our analysis today.
So knowing that, let’s talk about the benchmarks and what “normal affordability” is in the housing market. And I told you before, I’m going to do two different benchmarks. The first one is the long-term average. And so basically what we’re looking at for a long-term average payment to income ratio is 18.5%. In other words, on average, going back to 1989, so almost 40 years, you could say that the average gross income before taxes, gross income, about 18.5% of it goes towards your mortgage. And that average includes great times in the economy. It also includes terrible times in the economy, and it averaged out at 18.5%. Now, I do think it’s important to mention that this only goes back to 1989, and so it does omit one of the worst periods. Actually, outside of right now, the worst period of housing affordability that we’ve had in this country in the early 1980s.
Prices weren’t high, but mortgage rates were in the double digits. Some people were paying 15, even up to 18% mortgage rates. And at that time, we don’t have a data series for that, but you can actually calculate points in time. I’m getting nerdy about this, sorry, but 36% of your income back in the early 1980s. So I just want to call out that if you went back further, like another 10 years, then you’d probably have something closer to 20 or 21%, but I don’t have consistent data during that time, so I’m going to use this 1989 starting point. That said, I still think this is a good benchmark. If you look at the last 40 years, that’s a long time. We’re in a new economy. The last 40 or so years, 18.5%. Then let’s talk about benchmark number two, which is what I call the last normal market, 2019.
So again, I’m just choosing this year because it was the last year before COVID. You were guests in the low interest rate environment, but interest rates were starting to crawl back up. It was like a normal, healthy, functioning market. And back then in 2019, the payment to income ratio was 15.6, let’s call it 15 and a half. So long-term average, 18 and a half. Then we had 15 and a half in 2019, so better than the long-term average. Those are our benchmarks, 18.5 and 15 and a half. Now let’s talk about where we are today. Let’s compare to these benchmarks. Well, the last time NAR broke this down, this is like the data series I based this off of, our percentage is 24.6%. Again, we’ll call it 24.5%. So now we can see significantly more of everyone’s take home pay is going to their mortgage payments.
This is 6% of people’s income more than the long-term average going to their mortgage, and it is 10% higher than in 2019. So if you’re wondering why it feels so bad right now, it’s because we had abnormally good affordability in the years going up to COVID and now we have abnormally bad affordability. And I should mention that this 24.6 number, that came from June before mortgage rates went up. I just think they haven’t published this yet, but I just extrapolated how they do this with today’s interest rates in the middle of October. And what you can see is that it goes up to 27%. That’s serious stuff, right? That is significantly worse affordability than we were. You want to know why the housing market is sluggish and slow and difficult? This is it, right? It all comes down to affordability. The whole story here is that since 2019, when we had abnormally good affordability, home prices are up 63% on average.
Meanwhile, family income is up only 37% on average. And with mortgage rates going up significantly, not just over where they were in COVID, but were higher than they were in 2019 and much of the 2010s and really much of this century so far, monthly payments are up 116% since 2019. They have more than doubled. Meanwhile, income has only grown by a third. So you want to know why the housing market is slow, you got it right there. But you all probably know this, right? You know that the housing market is slow and affordability is bad, but today why we’re here is to talk about how it gets better. And so I did three different analyses here and I’m going to go through each of them, but basically what I’m going to do in this next segment is talk about what has to happen to each element of affordability to get better.
So we’re going to hold two of the levers of affordability constant and we’re going to change the other one. So just for an example, we’re going to say if mortgage rates stay the same and prices stay the same, how much do wages have to go up for affordability to improve? So we’re going to go through each of these scenarios and then we’ll talk about how some combination of these things can happen. Spoiler, that’s probably what’s going to happen, but I think going through each of these will help you understand exactly where we are in the housing market. We got to take a quick break before we do that though. Stick with us. We’ll be right back.
Welcome back to On the Market. I’m Dave Meyer. Today we’re going through our affordability analysis and I’m going to walk through the ways that affordability can get better. Remember, we have three levers. There are three legs to the affordability stool. They are wages, mortgage rates, and they are prices. And we’re going to look at each one individually. We’re going to start with wages. In my opinion, this would be the best way for affordability to get improved, right? Mortgage rates can stay the same. Prices can stay the same. I don’t care. If everyone’s wages just went up a lot, that sounds great, right? That would be better. Is that realistic? Could it happen? Well, in order to get to our long-term affordability of 18.5% of your income going to your mortgage rate, we would need wages to rise 33%. Real wages, that’s inflation adjusted wages, would need to go up 33%.
To get back to 2019 affordability, they would need to go up 57%. Do you think that’s realistic? Well, take this stat. Why don’t you just ponder this one for a minute? Real median wage growth did grow 56%, which we need 57. It grew 56%, but it took from 1967 to 2025, 58 years, right? So if you calculate that, that means that on average real wage growth, that’s inflation adjusted wage growth, so you’re actually earning more even after inflation is accounting for, amounts to just 0.8% a year since 1968. I’ve done other episodes on this in the past. I’ll do more on the future because it’s a huge problem in our economy that real wages really don’t grow, but I think you can see that wage growth is really not the solution here. If you were just calculating this, how do we get back to 2019 affordability?
We would need 59 years of wage growth at existing rates. And right now I should mention that real wage growth is negative. It turned negative this year because inflation is higher than the average pay raise right now, and so it’s going negative. But even using the historical average, 59 years to get back to 2019 affordability to get back to our long-term affordability, it would only take a mere 40 years. So I think it’s safe to say that wages aren’t going to get us out of this problem. Now, this isn’t part of the analysis, but I will just say the one good thing is that if you look at wages, they are growing faster right now than home price appreciation. So that has helped affordability a little bit, but just look at the big picture here. You can all see that unless something really big changes in the economy, wages are not going to solve this problem for us in the housing market.
And like I said, wage growth negative right now. If you look at some of the trends in AI, it’s hard to imagine wage growth picking up in an environment where AI is replacing a lot of high paying jobs. I just don’t see it. So can wage growth contribute to better affordability? Yes. But right now it’s going in the wrong direction. It’s actually detracting from affordability. And even if we get back to the long-term 60-year average of wage growth, it’s going to take two generations for the housing market to get back to normal. So I think it’s fair to say don’t count on wage growth. Let’s move on though to lever number two, which is mortgage rates, right? This is the one that everyone keeps talking about because it is the most volatile, especially in the last couple of years. It’s not always volatile, but in the last couple of years, we’ve seen mortgage rates go up, they go down, they go up, they go down.
And so people are thinking with all this volatility, rates are going to go down and that’s going to improve the housing market, right? Well, that is true. That is a very reasonable piece of logic there, right? You co say, yeah, mortgage rates go down, affordability to get back. But how low do mortgage rates actually need to be? To get back to 2019 levels of affordability, the last normal market that we have that everyone wants to get back to, you know what mortgage rates are going to need to be? 2.7%. 2.7%, pretty low. I’ve heard a few people, some mythical creatures out there who have mortgage rates at 2.7%. Pretty rare though, even in 2021, the best mortgage market we’ve ever had and we’ll ever see in our lifetimes, in my opinion, I do not think we’ll ever see that again. The average rate was 3%.
So are we going to get back to 2019 affordability with mortgage rates? I don’t think so. I don’t think we’re getting to 2.7%. I think we’d all be super stoked if we got to 5.7% in the next couple of years. So we’re not getting to 2.7%, not to 2019 affordability. Even to get to the long-term average of long-term affordability, mortgage rates would need to drop to 4%. Might happen again in our lifetimes, but maybe not. Before the financial crisis, 4% mortgage was absolutely unheard of and maybe they’ll come back. That’s possible. I don’t think 2.7 will ever come back, but 4% is possible, but it would take a lot of unusual things, bad things in the economy to happen for us to hit 4%. So again, mortgage rates probably not going to happen. And I’ve talked about this at length, so I’m not going to go into super detail on this.
You’ve probably heard me talk about mortgage rates all the time. I’m not even going to talk about 2.7% because it’s just not going to happen. But let’s just talk about 4% because I see people on social media being like, rates are going to be 4% next year. I’ve been spending four years telling people that’s not going to happen. And I’m just going to explain why it’s not, because it doesn’t matter what the Fed does. They can cut interest rates back down to zero again and we won’t get 4% mortgage rates. I’m just telling you that right now, not while inflation is high. We need to win the battle on inflation. That is how mortgage rates come down and it’s just heading in the wrong direction. It’s not like going out of control. I know there’s a lot of talk of inflation. It’s not like it was in 2021 when there was 9% inflation.
It’s not like that, but 3.4% inflation matters because mortgage rates are based off of this number, right? Again, I’m not going to go into all the mechanics of this, but inflation really dictates what happens in the bond market and what happens in the bond market impacts mortgage rates. And when inflation is up, it pushes all of these things up. And so unless we start to see inflation come down to below, even below the Fed’s target of 2%, we would probably need to see inflation at 1% maybe to get 4% mortgage rate. So that’s possible. It is definitely possible, but it doesn’t look likely. We’ve spent five years above that target, well above that target. And if you’re thinking the difference between 1% inflation and 3% inflation doesn’t matter, that’s incorrect. It does matter. It’s incredibly important for the bond market. And so it’s not going to happen.
Just look at the bond market, just Google 10-year US treasuries. I know no one’s going to do this, but you could. You could just see it’s going in the complete opposite direction. So if you’re searching for hope in the mortgage market, could they come down next year? Yeah, I hope so. I hope that there’s a resolution to the conflict in Iran and maybe mortgage rates go back to 6.5%. Maybe they get to 6%. That’s my most optimistic case for 2027 is like 6%. That would be great, but we’re not getting a 4% anytime soon. I’m sorry, that’s going to be at least several years and maybe never. We might never get to that point. We have all gotten used to mortgage rates that are much lower than our normal. We’ve had zero interest rate policies for a lot of the last 15 years, 17 years.
And I think the Fed’s learned its lesson with the inflation that we’re having to not do that unless there’s an extreme emergency. And so another reason I wouldn’t count on mortgage rates bringing back affordability anytime soon. Will mortgage rates trend down over the next 10 years? I don’t know. I hope so, but I wouldn’t necessarily count on big moves down. Could they get into the 5%s? Yeah, I hope so. I think that would be a great place for us to land. Personally, if we could see mortgage rates at 5%, 5.5%, I think that would be good, but it’s not getting us back to old affordability. So again, don’t count on mortgage rates. That brings us to our third lever. We’ve talked about wages, we’ve talked about mortgage rates, both of which I think are going to be a challenge to help us in the next year, two years at least.
We need to win the battle on inflation. I’m not counting on wage growth. That brings us though to home prices. How do we get back to average affordability with home prices? Well, in order to get back to 2019 levels, we would need home prices to crash, like truly crash 36%. That’s huge. To get back to that long-term average, we would need them to go down 25%. So just for some context, to get back to the long-term, back to 1989 average, we need the average home price to go down to about $335,000. Right now, it’s 446. That is a huge, huge crash. To get back to 2019 levels, we would need prices to go down to 284. That is an even bigger crash. And just for context on this, the biggest price crash in modern history, as far back as we have reliable data for, was the great financial crisis in 2007, 2008.
And prices went down during that time, about 20%, 22%, depending on who you ask, but neither this big. And I just want to stress that that was a real estate created crisis, and there was bad debt, and there was all sorts of situations that contributed to that, that do not exist right now. A 25 to 35% national crash is unlikely, in my opinion. I’ve said it many times on the show for four straight years while everyone’s calling for a crash. I’ve said that this is unlikely. If you look at what’s going on with the lock-in effect, that is going to provide a lot of padding for the housing market. About 80% of mortgages are below 6%, 50% are below 4%, and 20% are below 3%. That’s unbelievable, right? It just causes people not to sell. They don’t have to, and they won’t because moving will be more expensive.
That’s the difference between 2008 and today. People did not have equity in their homes back then. They had adjustable rate mortgages that was making it progressively more expensive for them to stay in their homes. They were underwater on their mortgages and they were forced to sell. Right now, as mortgage rates go up, what happens? The lock-in effect is only getting stronger, right? There’s not going to be as many homes going on the market. That is my number one prediction. I did this on social media the other day.People say, “What’s going to happen?” Fewer people are going to sell homes right now. That doesn’t mean inventory is not going to go up. They are going to go up because the ones that go on the market are going to sit longer, but fewer new listings, that is going to happen. The lock-in effect is only getting stronger.
The second thing is inventory is not growing that much, right? In order for a crash to happen, we need to see a flood of inventory. It’s not happening. We are seeing, yes, increased inventory, but from a year ago, it’s up five or 6%. It would need to go up a lot more than that. For a crash to go 25, 35% crash, we’d probably need to see at least 50% inventory growth, if not more, so that’s not happening. And the third reason a crash is unlikely is there’s just not a lot of distress. I know there’s all these media posts about foreclosures going up, and that’s true because they’re going up off this artificial low during COVID. But if you look at actual numbers, if you truly care to take the time and study this, which I do, you look at the distress in the housing market and it’s really not bad.
Delinquency rates are lower than they were in 2019, and they’re actually going down. They’ve gone down the last several months. So yes, foreclosures are going up because it’s people who fell behind during COVID and they’re working their way through the system. This takes years, and so now some of them are getting foreclosed on. But if you look at early level distress, people are entering the foreclosure funnel now, it’s gone down. And so there is very little distress. Now, of course, regional corrections are real and possible. You look at parts in the Sunbelt, Austin, you can argue that that’s a crash. They’re down more than 10% in nominal terms in Florida, Texas, places like that. Markets I invest in, in Denver, it’s not down that much yet, but I think they will go down more than 10% in Denver. In Seattle where I live, I think there’s real danger there.
There’s regional places. In the Midwest, prices are still going up, right? So on a national level, a crash remains unlikely. And so this is why I started the show saying that the realities here are tough to swallow. If you look at these realities, no one lever can fix it all by itself. Wages aren’t going to grow out of it, mortgage rates aren’t going to come down enough, and prices are not going to come down enough. So the only realistic path here is that it has to be some combination of these things. Again, this is something I’ve been saying for a long time, that this is the most likely path for the housing market, but today I’ve actually brought you some numbers on how long it could actually take. And we’re going to get into that, but we got to take one more quick break. We’ll be right back.
Welcome back to On the Market. Today, we’re talking about housing affordability and the paths that it could take to get back to normal. And as we talked about before the break, no one lever or pillar of affordability is going to fix this problem. Wages aren’t really growing, so that’s not going to help. Mortgage rates would have to fall to really low levels to get back to 2019 affordability, and we’d have to see a price crash bigger than the financial crisis to get us back to normal affordability. So you can’t just look at one of these things altogether. You have to look at them in combination. And I did. I actually did the math on all of this stuff to look at some of the most likely outcomes. So first up, I’m going to call this the base case. This is not my opinion. So just be clear, this is what I would say is what the average real estate person thinks is going to happen.
This is the base case. They would say rates are going to come down to about 6%, prices are going to stay flat, and income’s going to outpace inflation a little bit. It’s a totally reasonable scenario. This is not pie in the sky stuff saying that rates are going to go to 6%, home prices are going to stay flat, income is going to go three and a half percent per year. If all those things happen, how long do you think it would take for the housing market to get back to normal? It’s not one year. It’s not three years. It’s not five years. It would take seven years for that to happen. So that’s what people are thinking, right? This could be a long time. We could talk about some other scenarios. I’m just going to name a couple I ran because I was curious about them.
So I came up with a scenario where rates stay a little bit higher, right? So if rates stay at 6.6%, home prices stay flat, income is at 3.5%, just that little difference, that little difference from six to 6.6% in rates, that would take our years to go to normality from seven years to 20 years. 20 years it would take for that to happen. That’s crazy. Actually, you want to know something that’s really crazy? If you want to get back to 2019 levels of affordability, even if rates go down to 6% and home prices don’t even grow, and you just assume good wage growth, it’s going to take 12 years. That is not good. This is not a scenario that I think is realistic because the housing market is going to get strained before that happens. And so when I look at these numbers and I say all these assumptions people have out there that rates are going to come down, that prices are going to stay somewhat flat, that wages are going to keep growing, I don’t think the housing market can stay in this stall, the great stall that we’re in for another seven years.
To me, the most likely scenario is rates come down 6%. Wage growth I think is going to be muted, right? AI, all of these things, it’s negative right now, but hopefully inflation comes down and real wage growth goes back up. Let’s just call it 2% real wage growth. That’s optimistic. But even if it is, prices, if they come down 2% per year, so a correction, a prolonged correction, it’s still going to take about five years for the housing market to get back to normal levels of affordability. I know that’s a sobering analysis for real estate investors and for people who are in this industry, but I want to be honest with you. The math is tough here. It is really hard to figure out and to model out a way for the housing market to get back to normal. Like I said, even if rates go down, a full one and a half percentage points, even if wage growth goes from negative to positive 2%, and even if home price is just correct, 2% per year for the next couple years, it’s still going to take five and a half years for the housing market to reach its long-term affordability.
Now, the thing here I want to call out here is that a lot of influencers and people who call for crashes say that we need to get back to historic affordability. And I would hope for that because I think that’s good for our society, but I don’t think that’s true. I just straight up think that’s wrong actually. I think we are in an era where housing is going to take up a higher percentage of people’s income than it has in the past. There’s a lot of reasons for this. We can go into it another time, but I just believe that trying to get back to that 18.5% rate is unrealistic. Could we get to 20%? That would be good. 22%, not as good, but I think the market could start functioning again if we’re in 20%. So could that happen? Yeah, I think that would take three to four years.
But again, that requires prices coming down two or 3%. That requires mortgage rates coming down from seven and a half back down to six. That requires wage growth to happen again. And I think if the wage growth doesn’t come, if the mortgage rates don’t come, prices are going to come down more. And again, I am not saying a crash, right? We saw double digit declines in one year in the great financial crisis. But when I look at this math, after doing this analysis and looking at this stuff for years, I don’t see how prices don’t go down in the next couple of years. And I’ve been saying this for years. It’s not different from what I’ve been saying. I predicted this year, we do predictions on the show that prices are going to go down and I’m sticking with it. Again, if you look at nominal home prices, they’re up modestly, but real home prices, like inflation adjustment home prices have been down or flat for four straight years, and I think that’s just what’s going to happen.
And I know that might sound like it stinks and people don’t like that. I think it’s the worst for people who work in this industry an agent or a loan officer who rely on transaction volume, that’s the tough pill to swallow because transaction volume will not go up until affordability improves. I feel pretty strongly about that, that they are very closely correlated. And so that’s tough. As an investor though, this is an opportunity to buy. It just is, but you need to take into account that this could be a prolonged period where appreciation is low. And it goes back to the things we say all the time on the show, but I always say you need to buy below current market comps. You can’t just say, “Okay, this house is worth 200 grand, I’m going to buy 200 grand.” If you’re holding onto it for a long time, you got to buy that for 170.
You need a 15, 20% discount off current market comps to feel good about it. It depends on your market, of course. If you’re in a super hot market, that probably doesn’t apply. But if I think about buying in Denver, I think it would have to be 20% off current market comps and cash flowing. That’s the only way I would buy that because when I look at this, we’re not going to get appreciation for a while. So you have to make it yourself. There’s only two ways to make appreciation. One is on the buy, you buy below market comps, or you do value add. Both of those still work. So that is the positive news for real estate investors or homeowners who want to do this as well. It works for homeowners as well. But man, do not listen to those people on social media who say, “We’re a year or two away from the housing market recovering.” It’s really not.
The only scenario I can see where the housing market becomes affordable again in the short term is a big recession, a big one, a massive recession where it causes inflation to drop and money pours into bonds, so mortgage rates come down. But mortgage rates would probably sit in the four or 5%. And we’re going to have the lock-in effect. So we’re not going to see this huge flood of inventory. And in that case, maybe home prices go down five or six or 7% a year instead of 2% a year. And then maybe in two to three years we are back at affordability levels. But that’s not a good scenario. No one wants that scenario. So there’s no good way out of this. Either we wait or there’s a really bad economic outcome. I don’t see a way we grow out of this. I know people say AI is deflationary.
That really hasn’t proven to be true. I don’t really buy that line of thinking. I don’t think we’ve ever really seen service deflation in the United States as far back as I’ve seen data for. And so yeah, it’s optimistic, maybe it’ll happen. I hope it happens. That would be great. But service deflation may bring down the inflation number, but it also might bring down wage growth. So all these things are just so optimistic. I don’t like being pessimistic. I don’t think I normally am, but in the last couple of years, I just try to let the math do the talking. And the math is kind of clear to me here. It is very unlikely we’re going to get affordability back in the next couple of years, and I really think it makes sense for you to plan accordingly. I am not one of these people out there who’s going to go tell you to buy real estate at all costs.
I still believe real estate is the best path to financial freedom. I still think you can and should buy right now, but it’s not because there’s going to be appreciation in the next few years. There will be appreciation again, that will happen, but it’s going to take some time. And so you need to position yourself. You need to buy so low that you’re not losing money in the next couple of years. And then when appreciation does pick up, you got in at such a good basis that your returns are going to be huge when it picks back up. That’s what happened in the financial crisis. People who did well bought super low back then. A lot of times they bought in 2008, 2009, 2010 before the market recovered. The market didn’t bottom until 2013. They bought then at a low enough price that when the market did recover and those returns came, they were able to benefit from that.
And it’s the same playbook here. It’s very different from 2008, a lot of the fundamentals, but the playbook is the same. You have to do value add, you have to buy really low to outlast this scenario. And in this scenario, there will be more motivated sellers and that means you have more leverage. So use it. That’s the play. That’s what you do in today’s market. But go into this with clear eyes and sober about what’s likely to happen in the housing market over the next couple of years. I hope this analysis helps you do just that. If you have any questions, let me know in the comments. I am happy to answer them. Thank you all so much for watching this episode of On the Market. I’m Dave Meyer, and I’ll see you next time.

Help us reach new listeners on iTunes by leaving us a rating and review! It takes just 30 seconds and instructions can be found here. Thanks! We really appreciate it!

Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email [email protected].

Mortgage Rates Plummet Despite Hot Wholesale Inflation Report


Now it’s a party.

A day after the mortgage rate rally seemed to end, then pulled off a miracle same-day turnaround, they’ve moved even lower still.

The 10-year bond yield nearly slipped back below 5% today as bonds all of a sudden look attractive and tech stocks feel risky.

There was always going to be a point when this happened, especially with sky-high equity valuations, and mortgage rates love it.

All this despite a hot wholesale inflation report, illustrating that bond traders are finally interested in yields at these levels.

Bond Yields Collapse While Economic Data Comes in Hot

Mortgage rates continue to rally and are sharply lower today, building on yesterday’s CPI-fueled turnaround.

At last glance, the 10-year bond yield was down over 10 basis points and at one point as low as 5.03.

Depending on if this move holds, the 30-year fixed mortgage could fall to around 7.375% today.

Rates are still elevated, but given we were closer to 7.625% a week ago, it’s certainly welcome news.

Normally, a wholesale inflation report like the one we got this morning would send bond yields and mortgage rates soaring.

The producer price index (PPI) jumped 1.3% in September, the biggest monthly increase since early 2022, and well above the 0.6% economists were expecting.

Retail sales were also stronger than expected, which like hot inflation isn’t a recipe for lower interest rates either.

Yet the 10-year yield shook it off and fell to its lowest level in about a month.

And that’s after spiking as high as 5.33% following Wednesday’s CPI report, before quickly going the other way.

In other words, the bond market is looking past the hot inflation data for now, and that’s something to pay close attention to.

Is the AI Trade Finally Cracking and Making Mortgage Rates Better in the Process?

I mentioned Tuesday that at a certain point bonds would start to look attractive, and perhaps tech stocks would start to look risky.

With yields above 5% and tech valuations seemingly pricing in perfection, you could see investors look toward bonds and mortgage-backed securities (MBS), as a safer, alternative investment.

Well, it looks like we’re there.

AI-related stocks have been getting hammered, with CoreWeave and chip companies like AMD and Micron moving a lot lower.

There are fears that high interest rates could slow the AI spending boom that’s been propelling the stock market higher and higher.

So money flows out of stocks and into the safety of bonds, which pushes bond yields lower and mortgage rates along with them.

It’s a less-than-ideal path to lower mortgage rates (if your stock portfolio gets crushed), but perhaps better than all the alternatives like higher unemployment.

[Compare different mortgage rates fast with my mortgage rate calculator.]

Mortgage Rates Are Winning, But Home Buyers Might Not Bite

Lower mortgage rates are obviously good news for prospective home buyers.

But a stock market selloff cuts both ways.

When people feel less wealthy because their portfolios are sinking, they tend to hold off on big purchases like a new home.

Especially when mortgage rates remain well above 7% (it’s not like they’re back to 5.99%).

And if the selloff spills over into the job market and wider economy, that’s a different story altogether.

For now, it seems to be mostly just a technical rotation out of expensive tech names and into bonds, which is a pretty normal thing to see after a long run higher.

How Low Can Mortgage Rates Go?

As noted, today we might get back to 7.375% if this holds.

That’d be about 0.25% lower than levels seen just about a week ago.

If the 10-year yield does slip below 5%, mortgage rates could head closer to 7.25%, and perhaps even lower if the rally continues.

It would be huge if somehow rates could get back to a 6-handle before the midterms.

President Trump could highlight that and take a victory lap, despite rates being well above the 3% rates he promised to bring back while campaigning.

But as I always say, nothing moves in a straight line. And lenders always take more time to lower rates than raise them.

In addition, inflation is clearly still a problem. And while the Fed is still expected to hold rates in two weeks’ time, that could change quickly if the data keeps coming in hot.

The bond market is looking past hot inflation for now, which is great news for mortgage rates.

Whether it keeps doing that is the biggest question mark and will be the answer to if we keep moving lower or go higher again.

Colin Robertson
Latest posts by Colin Robertson (see all)

Rotting meat smell sparks protest at Mexico’s screwworm sterile-fly plant




Rotting meat smell sparks protest at Mexico’s screwworm sterile-fly plant

OCC Debanking Report Shows That Financial Services Firms Denied Services During Biden Administration


Debanking, or denying access to financial services, is a nefarious activity that was far too prevalent during the prior administration. Numerous reports indicated that individuals and entities were denied services because of their political leanings or business operations deemed unsavory. Crypto or digital asset firms were frequent targets.

This week, the Office of the Comptroller of the Currency has issued its final report on debanking after months of research. According to the report, it reviewed nine of the largest banks under OCC supervision. In total, the OCC reviewed almost 100,000 complaints between 2020 and September 2025 about restricted access to banking services.

The findings uncovered countless abuses by the firms under review. To quote the report:

The OCC found that, in response to general reputation risk policies, bank employees escalated customers or prospective customers that held potentially contested viewpoints outside the perceived “mainstream” and that those views were often equated with higher potential reputation risk. The OCC found that decisions related to such escalations were not universally consistent across transactions the OCC sampled, illustrating the subjective nature of the banks’ ambiguous and open-ended reputation risk policies and the risks those policies present in denying Americans fair access to financial services. This report highlights several, non-exhaustive examples of Americans that had accounts closed or that were otherwise denied financial services seemingly because of the perceived reputation risks associated with their constitutionally or statutorily protected beliefs, affiliations, or political views. For example, one bank’s payments subsidiary, working with bank reputation risk employees, closed the account of a customer that employees characterized as a “[r]ight wing religious conservative non profit with strong anti LGBTQ rhetoric.” A reputation risk employee later removed references in the internal bank tracking system to the nonprofit organization being “right wing” and “religious.”

Debanking examples provided in the report include:

  • One bank closed the account of a merchant that sold merchandise promoting President Trump and the Make America Great Again (MAGA) brand
  • One bank declined to provide financial services to a public education organization because of its partisan leanings—specifically, its political arm’s endorsement of only Democratic candidates.

  • One bank implemented an environmental and social risk management policy that restricted it from entering into business relationships with customers whose policies did not align with the bank’s responsible firearm standards.

The OCC said that mere allegations could compel a bank to decline services to “average Americans.”

Comptroller of the Currency, Jonathan Gould, commented on the report:

“What began as decisions made by executives to debank disfavored industries became institutionalized and opaque bureaucracies that empowered bank employees to cut off industries and persons from financial services or created procedural frictions that achieved the same result as a practical matter.”

In the end, the regulator said more work is needed to address politicized or unlawful debanking in the federal banking system.

The OCC noted that it continues to review AML/CFT rules that may push banks to err on the side of caution even when a firm is operating legally. Federal agencies are no longer able to point to “reputation risk” as the reason for a bank to deny services.

During the Biden adminstration, which was explicitly anti-digital assets, Operation Choke Point 2.0 was described as using regulatory pressure to shut down crypto firms and cut off access to the banking system. In January 2023, regulators issued a statement warning banks about operational and reputational risks of providing services to digital asset entities. The FDIC issued non-public letters telling banks to stop providing services to these undesirable operations. Today, it appears that blocking financial services due to your business or affiliation, as long as it is not criminal, is no longer the case.

Abuse of federal power is always a risk, especially when the government seeks to expand its authority and control without restraint from the electorate and policymakers.



Stock Split Watch: Is Eli Lilly Next?


Eli Lilly (LLY +4.72%), as a pharmaceutical stock, may be seen as a source of safety for investors — patients need their medicines, and this provides a certain level of revenue stability regardless of the economic backdrop. But in recent times, this company has also become a growth player thanks to its leadership in a space generating high demand: the weight loss drug market.

Lilly, the seller of blockbuster GLP-1 drugs, has seen revenue take off, and that has prompted both cautious and more aggressive investors to pile into the stock. The company has seen its stock advance more than 300% over five years, and in recent months, it reached record levels, trading above $1,200.

Today, with a stock price of more than $1,160, could a stock split be next on the company’s agenda? Let’s find out.

Image source: Getty Images.

What are stock splits?

So, first, let’s talk about stock splits. What are they, and why are they done? Companies generally launch stock splits after their shares have had a really good run — or while the stock is soaring. These operations involve offering current holders additional shares, and this mechanically brings down the price of each individual share.

The final price is determined by the ratio of the split, so, for example, in a 10-for-1 split, a stock that was originally $1,000 would be $100 post-split. And an investor who originally held one share valued at $1,000 would then hold 10 shares with the same total value.

The logic behind such an operation is simple: A stock split makes it easier for a broader range of investors to get in on the stock. Some investors don’t have access to fractional shares, which allow the purchase of part of a stock. In other cases, investors may not want to invest $1,000 in a company but are happy to invest a couple of hundred dollars. Finally, for some investors, the level of $1,000 represents a psychological barrier, and they see the stock as expensive even if valuation suggests otherwise. A stock split opens the investment opportunity up to all of these investors.

LLY Eli Lilly

$1,265.81+$57.07 (+4.72%)

NYSE · As of 1:19 PM ET 10/15/26

Now, let’s consider Eli Lilly. The company sells a wide variety of drugs across treatment areas, but its star products in recent years have been in the area of GLP-1. These drugs act on hormonal pathways involved in digestion and have safely helped many worldwide shed pounds. Demand is high, and this has translated into billions of dollars in revenue for the company’s Mounjaro and Zepbound.

Lilly competes with Novo Nordisk, the maker of Ozempic and Wegovy, in the space, but is the market leader with 60% share in the U.S.

Addressing a growing, billion-dollar market

All of this has generated a lot of excitement around Lilly stock, particularly considering that the GLP-1 story may continue to drive growth well into the future. The market is expected to reach nearly $100 billion by the end of the decade.

So, it’s not surprising that Lilly shares have advanced. Now, the question is: Will Lilly launch a stock split around today’s levels?

The company completed four stock splits in the past, which could show that it favors such moves. But the most recent one was nearly 30 years ago, so the company’s stock split history isn’t relevant to its strategy today.

Lilly stock has climbed in recent years, but early this year it declined, and if that had continued, I would have said a split wasn’t likely. Over the past six months, though, momentum has returned, with the stock advancing 25% over that period. This coincides with Lilly’s launch of a new weight loss drug, GLP-1 pill Foundayo, and could usher in a new period of gains.

Against this backdrop, it’s very possible that Lilly may be one of the next market giants to announce a stock split.

It’s important to keep in mind that splits don’t change anything fundamental about a stock, so they aren’t a reason to buy or sell. This means, unless the price tag is holding you back for the reasons I mentioned above, you don’t have to wait for such an operation to get in on this exciting pharmaceutical stock.