Hello, YieldAlley readers! In this issue:
Vanguard Slashes Fees Again — Check Your Expense Ratios
Jobs Surge and Cooling Inflation Clash With AI-Driven Stock Sell-Off
E*Trade $300–$2,000 Savings Bonus + 3.75% Intro APY
The Pyramid of S&P 500 Returns: 152 Years of Market Performance
And more!
NEWS
Standout Stories
🤖 Tech drags down stocks amid continued AI anxiety (Sherwood)
📊 February 2026 US Stock Market Outlook: Where We See Investing Opportunities
(Morningstar)
🏠 Mortgage rates today: Low rates and new home discounts entice buyers
(Yahoo)
📉 How the character of the AI trade has changed — for the worse — in 2026 (Sherwood)
🏖️ What Has Surprised Us Most About Retirement (WSJ)
MARKET THOUGHTS
Jobs Surge and Cooling Inflation Clash With AI-Driven Stock Sell-Off
ECONOMY
The U.S. labor market showed unexpected strength in January, with employers adding 130,000 jobs, the highest monthly gain in over a year, while the unemployment rate ticked down to 4.3% from 4.4%. Health care, social assistance, and construction led hiring, though federal government employment declined. The BLS also sharply revised 2025's total job creation down to just 181,000 from a previously reported 584,000. On the inflation front, January CPI came in cooler than expected at 2.4% year-over-year, down from December's 2.7%, helped by falling energy prices. Core prices rose 0.3% month-over-month. Retail sales were flat in December, missing expectations, with eight of 13 categories declining.
STOCKS
All major U.S. indexes finished the week in the red as AI disruption fears weighed broadly across sectors. The Nasdaq Composite led losses, falling 2.10%, while the S&P 500 dropped 1.39% and the Dow shed 1.23%. Midcaps held up relatively better but still declined 0.66%. The value-over-growth rotation continued for a seventh straight week, with the Russell 1000 Value Index now leading its growth counterpart by over 1,100 basis points year-to-date. The strong jobs report also dampened rate-cut expectations — the probability of the Fed holding steady through June jumped from 25% to over 40% after the release, per the CME FedWatch tool.
FIXED INCOME
Treasuries posted positive returns as yields declined across most maturities, with the benchmark 10-year yield hitting a fresh year-to-date low amid the tech stock sell-off. Investment-grade corporate bonds also gained but lagged Treasuries as spreads fluctuated, though new issuance was generally oversubscribed. High yield bonds showed resilience despite equity volatility, supported by institutional demand and short covering.
INCOME BUILDING TIP
Vanguard Slashes Fees Again — Check Your Expense Ratios
Vanguard just cut fees on 53 funds across 84 share classes, averaging a 27% reduction per fund and saving investors roughly $250 million this year alone. The cuts span U.S. equity, international, and income-focused funds — including Dividend Appreciation ETF (VIG), High Dividend Yield ETF (VYM), Value ETF (VTV), and the FTSE Emerging Markets ETF (VWO). Over the past two years, Vanguard has returned nearly $600 million to investors through fee reductions, its largest-ever two-year cost cut.
For cash and income investors specifically, the new 0-3 Month Treasury Bill ETF (VBIL) dropped to just 0.06%, undercutting iShares' popular SGOV (0.09%) as the cheapest ultra-short treasury ETF on the market. With Vanguard's average expense ratio across its entire lineup now sitting at 0.06%, the gap between Vanguard and competitors continues to widen — especially in categories where a few basis points of fees can meaningfully eat into yield.
If you hold Vanguard funds, check whether your specific share class benefited from this round of cuts. And if you've been comparing cash alternatives, the fee difference between VBIL and SGOV is now 3 basis points — small in isolation, but it adds up over time on a large cash position.
INCOME BUILDING
Cash Rates
Government Money Market Funds (7-Day Yields)
SNVXX (Schwab Government Money Fund - Investor Shares): 3.40%
SPAXX (Fidelity Government Money Market Fund): 3.31%
TTTXX (BlackRock Liquidity Funds: Treasury Trust - Institutional Class): 3.54%
VMFXX (Federal Money Market Fund): 3.59%
Brokered CD Rates (6-Month Rate)
Charles Schwab: 3.79%
E*Trade: —
Fidelity: 3.75%
Merrill Edge and Merrill Lynch: —
Vanguard: 3.75%
ETFs (30-Day Yields)
SGOV (iShares 0-3 Month Treasury Bond ETF): 3.55%
BIL (SPDR Bloomberg 1-3 Month T-Bill ETF): 3.49%
USFR (WisdomTree Floating Rate Treasury Fund): 3.56%
TFLO (iShares Treasury Floating Rate Bond ETF): 3.58%
DEALS AND BONUSES
E*Trade $300–$2,000 Savings Bonus + 3.75% Intro APY
E*Trade has sweetened their Premium Savings Account offer with higher bonus tiers (now up to $2,000, up from a previous $1,000 max) and a 6-month intro APY of 3.75%. No monthly fees, no direct deposit required — just park cash and collect. Promo code SAVE26 at signup.
Offer Details
Main promotion: Up to $2,000 bonus on a new Premium Savings Account, plus a 6-month intro APY of 3.75% (vs. regular 3.35%)
Promo code: SAVE26 (must be entered at signup)
Valid dates: February 11, 2026 – February 28, 2026 (bonus offer); intro rate valid through March 11, 2026
Bonus tiers:
$20k deposit → $300
$50k deposit → $750
$75k deposit → $1,000
$100k deposit → $1,500
$200k deposit → $2,000
Eligibility:
New Premium Savings Account customers only
U.S. residents only
Existing ETrade/Morgan Stanley customers may qualify if they've never had an ETrade Savings account
Lifetime limit of 2 PSA offers per customer
Funding requirements:
Deposit funds within 30 days of account opening
Maintain balance for 45 additional days after the 30-day funding window
Bonus deposited within 30 days after maintenance period ends
Restrictions:
Not valid for Checking, Max-Rate Checking, line of credit, or brokerage accounts
Account must remain open and in good standing through payout
Bonus reported on 1099
Our Thoughts
At the exact tier thresholds this works out to roughly a 1% bonus on top of a competitive 3.75% intro rate, which makes it one of the stronger savings account offers available right now. The total hold period is about 75 days (30-day funding + 45-day maintenance), so factor that into your liquidity planning. No monthly fees and no direct deposit requirement keep it simple. If you're already considering an E*Trade relationship for the Morgan Stanley Amex Platinum card eligibility, this gives you a reason to open the savings account now rather than later. The $200k/$2,000 tier is new and wasn't available in older versions of this offer. Stack the bonus with the intro APY and you're looking at a solid short-term return on parked cash — just make sure you're hitting a tier exactly rather than landing between tiers with idle funds earning nothing extra.
Picture of the Week
