Jobs Day in 'merica! Consensus is for +185K headline, but the whisper number seems higher. Weather is cited as factor that could detract from the headline number. Average Hourly Earnings are expected to be ~4.1% annualized and will likely be heavily scrutinized.
Jobless claims rose slightly more than expected at 224K, Q4 Productivity beat expectations with unit labor cost coming below estimates at 0.5% vs. 1.3% est.
BoE was on pause and it sounds like they are going to be potentially even more cautious than the Fed as they revised higher growth estimates.
The market liked META and AMZN earnings and the META dividend. The 2Y is ~4.20 and the 10Y ~3.88% as the 2s10s un-inversion watch has hit a pause.....
AND for all the rate cut talks Atlanta Fed GDPnow is now at 4.2% for 1Q2024.
XTOD (Taleb): Explaining the debt/death spiral. Some of my comments were spreading on social media (they was a a discussion in Congress). Debt servicing = 40% of the past deficit. Next year we will pay interest on that. Debt servicing will reach 70% ,80%, displacing other expenditures. On top of the fragility, there is an intergenerational transfer of liability, highly immoral (h/t Spitznagel).
Note/Errata: total deficit north of 30 Trillion is the accumulated deficit. (I mistakenly used the same word to describe current and accumulated).
XTOD (Prof. Steve Keen): Do the accounting Taleb. The deficit creates the funds used to buy government bonds. There's no borrowing involved so long as you're financing bonds in your own currency. You visibly don't get that government bonds aren't competing for "loanable funds", but creating money on the bank liability side, and funds on the asset side that enable banks & primary dealers to buy the bonds. You're falling for an obsolete model of banking.
XTOD (Taleb): What you showed does not deny the presence of a debt spiral and there is no such thing as "obsolete" banking. So you are saying that a debt spiral is good? If what tou are saying is invariant to scaling then let's abolish taxation and just spend like crazy while printing bonds.
XTOD (some random reply): MMT told me everything will be fine, though. Sure, history disagrees with them, but it's a very convenient theory to justify living for today, tomorrow be damned.
XTOD (unrelated to the Taleb thread): Essentially, if the US has moved to a secular growth regime higher than pre-pandemic then the path to 0.5% real-FF will end up being expansionary....So while we are debating whether or not 3 or 4 or 7 cuts this year makes sense, we are in effect implicitly debating what neutral is, due to a general assumption there isn't an upside risk to inflation. This is why i jokingly say the Fed either needs to hike or a recession has to happen soon....This is why I think we continue to see the market trade in a violent range this year, particularly in the first half as we consume incoming data and determine the clearing price not just for bonds, or stocks or whatever you trade, but for the economy itself.
XTOD: A Few Thoughts on Spending Money https://collabfund.com/blog/a-few-thoughts-on-spending-money/
https://x.com/nntaleb/status/1753069897603592351?s=20
https://x.com/ProfSteveKeen/status/1753093381088047157?s=20
https://x.com/nntaleb/status/1753101061592875489?s=20
https://x.com/grych8/status/1753071005470539997?s=20
https://x.com/EffMktHype/status/1752998294228484170?s=20
https://x.com/morganhousel/status/1753050397357514813?s=20
Well that was a blowout jobs report.
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