July 2
S&P Oil FX Gold 10Y BTC CLZ6
Economy added 57K jobs, well below a downwardly revised 129K. Lowest job gain in four months
Total nonfarm payroll employment for April and May was revised down by 74K combined
Unemployment rate dropped to 4.2%
Participation rate fell 0.3 to 61.5%, lowest since 1976 except for pandemic | Forex
Initial jobless claims 215K. Continue To Signal No Labor Market Stress | Zero
Leisure and hospitality lost jobs | MTick
How does leisure and hospitality lose jobs when we have a huge soccer tournament in the US?
Answer: Demand destruction everywhere else was so massive that didn't help.
Leading employment indicators of a slowdown or recession were mixed
KR: This is a good recap of labor report
S&P is up 0.39% | 8:53
Dollar index drops 0.64%
Crude oil is $67.62, down 1.38%. Brent crude trades below prewar level
Gold is up $92
10Y yield down 1.7bp to 4.470%
Fed funds futures price in less than a 50% chance of Sept hike, down from 67% before NFP
AAA gasoline is $3.838 vs $3.918 a week ago
Cleveland Fed sees CPI down in June by -0.06 and up 3.92 y/y
Core CPI forecast is up 0.23 m/m and 2.85 y/y
Debt Rattle
* Justice Thomas Says Birthright Citizenship Ruling ‘Devalues’ US Citizenship
* Here’s a list of major countries who don’t allow birthright citizenship
* Biden’s “heinous” policy of flying Haitians migrants en masse into Springfield and the Midwest
* Canadian dollar is starting to feel the effects of long-term uncertainty. It will get worse.
* How Fauci Can Still Face Prosecution Despite His Pardon
Trump Approval Index Falls to 41% | Ras
Yen Surges As Jittery Traders Expect Imminent Intervention
After Japan Reveals New Strategy To Wipe Out Shorts
The yen carry trade
An investor borrows yen at low interest rates in Japan, converts the proceeds to dollars, and buys higher-yielding US assets, typically stocks or bonds. As we wrote in 2022, putting down $100,000 to borrow $1,000,000 in yen and buying a 3% Treasury note can generate nearly a 30% return, assuming the yen’s value doesn’t change versus the dollar. The success of the trade depends almost entirely on a weak or stable yen.
The risk in a carry trade arises when the currency appreciates against the dollar. Today, the yen is weakening. This keeps the carry trade economically attractive rather than under stress. But Bank of Japan officials are increasingly discussing its weak currency as a source of domestic inflation, since Japan imports nearly 100% of its energy needs. Prolonged weakness sets up the conditions for the next reversal whenever the BOJ decides to stop it.
China’s open source models are going to crush the U.S. AI industry
Nobody will consistently pay for AI inference from U.S. companies when they can receive nearly the exact same level of capability and intelligence from China’s models at either ZERO cost (download the models and run them yourself), or at a tiny fraction of the cost of U.S. models (typically from 1/50th to 1/100th the cost of U.S. models).
Nvidia is betting on a trillion-dollar robotics boom. Here is the hidden way to trade it
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Email: wkidder42@gmail.com
Text: 1 646 257 2130
Voice: Use WhatsApp +1 646 257 2130 at 1:00 AM