Gold still surging - kinda concerning. Maybe someone is preparing for a big geopolitical move as they know they'll lose their dollars and euros after the fact.

US 10-year Treasuries are having their worst day since May 2023, with yields surging after the one-two punch of a hot CPI and a bad auction. Peter Boockvar: '10 yr auction was bad...Dealers were left with 24% of the auction, which is the most since Nov. 2022.'

.Federal Reserve is in a serious but it can’t cut rates with high and rising #inflation rate so the only way the yield curve can normalize is if term premium surges which it could given record large budget deficits. Soaring long term interest rates would depress risk assets

As we look ahead to the all important CPI figure out tomorrow, I wanted to shed some light on this very interesting breakdown of the composition of the CPI indexes which looks at the % of components which are above 2% and above 4%.

Various Fed members in recent weeks have…

The biggest reason to expect rate cuts is “Jay told us he would cut.”

Otherwise, it would be very difficult to make the case given recent data, which argues that cuts are not necessary.

BTW, Jay says lots of things.
I'm old enough to remember “transitory.”
——
From the story:…

5 year returns…

Gold: +83%
S&P 500: +80%

500 of America’s best and largest companies that drive profits and innovation vs. a yellow rock that produces nothing.

This is what happens when US growth is fueled by deficit spending and dollars are being printed by the Trillion.

The job market is strong, right…

That’s why we have the least amount of voluntary quits since 2017.

In a strong labor market people quit to get paid better elsewhere, they don’t stick to their job as they have no valid alternative!

Current situation:

1. Stocks are rising like the Fed is about to cut rates

2. Bonds are falling like rate hikes are coming back

3. Gold prices are rising like we are entering a recession

4. Oil prices are rising like the economy is perfectly fine

5. #Crypto is at all time…

BLS response rates collapsed during the pandemic and have meaningfully failed to rebound

It just doesn't stop. A 'blow out' employment number with falling full-time employment? Last 10 months, full-time down 2MM, part-time up 1.8MM.

Hard to argue this wasn't a 'better' report, but data quality remains garbage.

March Madness: A booming labor market that sees +303k on headline nonfarm payrolls while full-time employment from the rival Household survey drops -6k and is down -1.8 million since last November — which has only in the past happened in recessions. A real head scratcher.

MARCH JOBS

+300k sounds hot, BUT more than 50% government + education/health.

This continues the trend of government jobs growing much faster than private sector.

Nothing about this chart suggests we have a 'strong' labor market. Far from it. FT jobs down -1.3% yy...PT jobs up 7.5%y/y

Two Fed Headlines today 11 minutes apart.

Can anyone explain?
---
* FED'S GOOLSBEE: IF HOUSING INFLATION DOES NOT COME DOWN, WOULD BE VERY DIFFICULT TO RETURN INFLATION TO 2%.

* FED'S BARKIN: IT IS CONCEIVABLE THAT 2% TARGET IS MET WITHOUT SHELTER INFLATION RETURNING TO WHAT…

The hiring rate has tumbled. Remember, firms usually stop hiring before they start firing.

Looking at yesterday’s JOLTS data, one can legitimately ask what it means for the consumer outlook when retailers reduce their job openings to a level that last occurred during the peak of the pandemic/lockdown recession.

Feels to me like things are about to turn... and turn HARD! 1/3

Why the unemployment rate can go up even if jobless claims remain low, in BLS own words: “The unemployment data derived from the household survey in no way depend upon the eligibility for or receipt of unemployment insurance benefits.”

If you also believe that immigration drive…

BLS has a very clear exposition of the household vs establishment survey now: bls.gov/web/empsit/ces…

There is a simple chart there that is very striking. No need to say more. It is amazing that markets are pricing in a no landing given this.

We may be hitting an air pocket folks