Must Read Research
Also featuring commentary from our economists
November 16, 2025
Candace Browning, Head of BofA Global Research
A penny saved is a penny earned — and this week, savings takes center stage. We quantify how much payment relief a 50-year mortgage could offer, and unpack key questions surrounding the rise of prediction markets. We also highlight why less-expensive stocks will continue to shine, especially beyond U.S. borders.
The FHFA’s headline-grabbing idea of a 50-year mortgage isn’t as crazy as it seems.
Head of U.S. Mortgage and Structured Finance Research Chris Flanagan notes that extending loan terms could improve affordability, cutting monthly payments even if 50-year rates end up 50-75 basis points above 30-year mortgages. We estimate that for a $350k loan, extending the term to 50-year will generate monthly savings of $116 even if the rate is 50bps higher. Longer-term, 50-year mortgages also preserve a key advantage over renting: equity accumulation. While equity builds more slowly, buying would be preferable in metros with favorable purchase costs like Pittsburgh, New Orleans and Columbia, SC. Extended-term products aren’t entirely new — 40-year mortgages already exist in both Agency (as loss-mitigation tools) and Non-Agency markets, albeit at less than 1% share. And in practice, a 50-year mortgage wouldn’t last 50 years; Chris expects an average duration of 8-11 years, modestly longer than 4.6 years on a typical 30-year mortgage. Determining the actual 50-year rate, its eligibility for a government stamp of approval, and market appetite remains uncertain.
Are prediction markets (PMs) legal, and could they face shutdowns under litigation?
Rapid growth in PMs has already shaken up traditional online sports betting markets and may eventually blur the lines between betting and the financial industry. Gaming, Lodging and Leisure Analyst Shaun Kelley addresses six FAQs about this burgeoning industry. As for the sudden interest, Kalshi won an important court victory last year, and usage of these markets has significantly increased since the start of the football season. Shaun estimates that PMs now make up 3-8% of legal online U.S. sports betting but total sports betting volume could ultimately exceed $1 trillion. The total addressable market is bolstered by exemptions from state gaming taxes and immediate national scale. The legal uncertainties revolve around federal vs. state rights and seem destined for the U.S. Supreme Court, which could take two years to resolve. In the future, PMs could become supermarkets of always-on financial trading products available to consumers and retail traders.
Head of the Research Investment Committee Jared Woodard expects U.S. growth stocks to remain supported by strong liquidity, rate cuts, and a weaker dollar, but argues investors should diversify into global value for uncorrelated returns.
While U.S. value has lagged domestic growth by about 2% per year since 2000, value investing has continued to work abroad. Emerging markets (EM) value has averaged +8% annual returns versus just +1.3% in the U.S. With 2025 shaping up to be the strongest year for global vs. U.S. relative performance in more than 30 years and U.S. equity valuations implying near zero 10-year real returns, global diversification is increasingly compelling. Policy pivots in Japan (nuclear restart), Europe (defense capex), and the U.S. (refocus on manufacturing and critical minerals) further strengthen the global bull case in the years ahead. The committee recommends developed ex-U.S. small-cap value, high dividend EM stocks, and EM debt, which historically added roughly +140bps of annual return with only +40bps more volatility.
Claudio Irigoyen, Head of Global Economics, BofA Global Research
As government reopens, all eyes on incoming data flow
The government shutdown came to an end after 43 days. This brought to a close the longest period in U.S. history with a data blackout, where both collection and publication of data were on pause. The absence of timely official numbers left the markets and the Fed operating in a data fog, forced to scour alternate sources to gauge the underlying. With the shutdown resolved, all eyes will now be on the incoming data dump.
On the lookout for the data calendar
The Bureau of Labor Statistics will likely publish a data release calendar this week. But it may only be partial and address the important data first, on a rolling basis. As per a statement last week, the Bureau of Labor Statistics said that "it may take time to fully assess the situation and finalize revised release dates." They added that they will announce release dates "as they become available."
When will we get the jobs data?
We'll get the September jobs report, data for which had already collected before the start of the shutdown, on November 20th at 8:30am ET. Looking ahead to October, National Economic Council Director Kevin Hassett said that the October jobs report will include the payroll print, but not the unemployment rate. November data for both the Establishment and the household survey will also be collected with a slight delay, since the originally scheduled survey week for November ended on November 15th. We'll wait to hear from the Bureau of Labor Statistics on final timing and process.
And how about inflation?
The October CPI (Consumer Price Index) print will likely be entirely skipped, as the data can't be collected retroactively. But November CPI will be released, albeit with a limited sample — which is preferable to no official data on it. This was the case following the October 2013 shutdown. The sample used for October 2013 CPI was 75% of its typical size. We would expect something similar for the November CPI sample.
What does it mean for the Fed?
If the Fed is still operating in a data fog at the December meeting which is likely, they might be hesitant to cut again (in line with our baseline view and what Chairman Powell indicated at the September meeting). However, if they do end up having data at the December meeting, the focus will be on the labor data more than inflation. If the u-rate remains at 4.3% or below, we think they will not cut. If the u-rate goes up to 4.5% very quickly, at least the Dec cut is likely to happen.
