Oil & Gold Soar On Week, But 'Good Jobs Data' Wrecks Rate-Cut Hopes, Slamming US Stocks & Bonds


ASX200 Futs are pointing up 38 pts.

Also, Australian Daylight saving concluded over the weekend so in QLD the mkts are now back to opening at 10am and officially closing at 415pm

Last week was a 'good' week for macro data...

Source: Bloomberg

...but 'soft' survey data remains mired in depression as the 'aggregate' hard data holds strong...

Source: Bloomberg

Of course, good news is bad news for the doves and rate-cut expectations for 2024 are down (particularly after today's big payrolls headline beat) well below three cuts expected by the 'median' Fed dot and the odds of a cut in June have tumbled back to a coin-toss!

Source: Bloomberg

On Friday the March US jobs report came in hot.  the relentless influx of (illegal) immigrants would lead to a hotter than expected payrolls number.

Sure enough, the illegals won again when moments ago the BLS reported that in March, the US added a whopping 303K jobs, tied for the highest since Jan 2023!

Source: Bloomberg

And all the job gains were part time jobs!

Here is exhibit A: in March, the number of part-time jobs soared by 691K to 28.632 million, up from 27.941 million while full-time jobs dropped by 6,000, to 132.940 million from 132.946 million.

This number only gets scarier when we extend the period to the past year: as shown in the next chart, since March 2023, the number of full-time workers has collapsed by 1.347 million while the number of part-time workers exploded by 1.888 million!

Regular readers are aware that all the job gains since 2018 have gone to immigrants, mostly illegal immigrants.

So what happened in March? It will come as no surprise that there was more of the same, and after the collapse in native-born workers in the last three months when nearly 2.5 million native-born workers lost their jobs, March saw some pick up, and 929K native-born workers were added. Meanwhile, after last month's record increase in foreign-born workers, in March illegal immigrants added another 112K jobs, pushing the total number of foreign-born workers to a new record high of 31.114 million.

Said otherwise, not only has all job creation in the past 6 years has been exclusively for foreign-born workers...

Source: Bloomberg

... but there has been zero job-creation for native born workers since July 2018!

This, as we have been saying for months now, is a huge issue - especially at a time of an illegal alien flood at the southwest border...

Source: Bloomberg

and is about to become a huge political scandal, because once the inevitable recession finally hits, there will be millions of furious unemployed Americans demanding a more accurate explanation for what happened - i.e., the illegal immigration floodgates that were opened by the Biden admin.

All that job growth has gone to illegals...

And the punchline, or how the establishment is trying to spin the flood of illegals into a positive feature for the US economy: apparently all these illegals are little gifts from god, keeping wages low and taking jobs that nobody else would ever want.

Data from the 2023 Current Population Survey suggest that recent adult immigrants are more likely to be young or prime age (90%) than the native-born adult population (62%) or adult immigrants who arrived earlier (64%). Recent immigrants have a higher labor force participation rate than the native-born population but a lower rate than immigrants who have been in the US for longer, have a higher unemployment rate than either group, are more likely to work in construction and food services and accommodations, and earn significantly lower wages on average.

This is hardly a surprise: none other than Fed Chair Powell fired the starting gun one month ago when in his 60 Minutes interview he effectively said Americans are lazy and that it was the illegals that have been critical in keep wages lower even as jobs have grown substantially in the past year (at least according to the Establishment survey). Recall this exchange from the interview:

PELLEY: Why was immigration important?

POWELL: Because, you know, immigrants come in, and they tend to work at a rate that is at or above that for non-immigrants. Immigrants who come to the country tend to be in the workforce at a slightly higher level than native Americans do. But that's largely because of the age difference. They tend to skew younger.

PELLEY: Why is immigration so important to the economy?

POWELL: Well, first of all, immigration policy is not the Fed's job. The immigration policy of the United States is really important and really much under discussion right now, and that's none of our business. We don't set immigration policy. We don't comment on it.

I will say, over time, though, the U.S. economy has benefited from immigration. And, frankly, just in the last, year a big part of the story of the labor market coming back into better balance is immigration returning to levels that were more typical of the pre-pandemic era.

: The country needed the workers.

POWELL: It did. And so, that's what's been happening.

But that's not all: just in case praising illegal immigration wasn't enough to keeping wage growth low (completely ignoring that all these millions in illegals will require trillions in additional welfare spending, and are the primary beneficiaries of the latest explosion in US debt), there has been a second angle this time courtesy of the CBO which recently hilarious "calculated" that illegal immigrants will boost US GDP by USD$7 trillion in the next decade.

This is how CBO Director summarized it: "as a result of those changes in the labor force, we estimate that from 2023 to 2034, GDP will be greater by about $7 trillion and revenue will be greater by about $1 trillion than they would have been otherwise."

And there you have it: yes, the US hasn't added any jobs to native-born Americans in six years, as instead all jobs have gone to immigrants, mostly the illegal variety, but that's good news you see, because if it wasn't for these lovely creatures flooding into the US, wages would be higher (that's a bad thing according to the Fed), and the US economy would not grow by $9 trillion. Just please ignore that that $9 trillion in "growth" will come only thanks to $20 trillion in debt, almost all of it soaked up by these same illegals, and of course, a handful of corrupt, embezzling politicians.

Source: Bloomberg

And so the Trap has been set: if and when Trump or Republicans finally get their act together and halt the flood of illegals, then and only then, will the Bureau of Labor Statistics and the Bureau of Economic Analysis admit just how ugly the US economy, the labor market and inflation truly are... and then they will blame Trump for pushing the US into a stagflationary recession because he halted the record inflow of immigrants without which the US is - drumroll - doomed!

And people ask me why they should own some Bitcoin and Gold?

Finally, with all the macro and geopolitical headlines, everyone seems to have forgotten about the whole premise for this rally was AI and wunderstock NVDA which is down 11% from its record highs one-month ago...

And some say History never repeats...

Happy Monday!

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