The granular data, does it display the same kind of negativity that the bond market took notice of yesterday. >> Yeah, it does. This is our best estimate of what hiring was in September, negative 32,000. That is our best estimate. It is our most robust estimate.It's rigorous. It's tied to the QCW. So, no, you don't need to dismiss the number.Now, if you look at the the series, we don't fully rebenchmark the year until February with the January release, but that September number is the number. So what it tel ...

Economic Growth - The U.S. economy expanded at a 3.8% annualized rate in the second quarter, marking the fastest growth in nearly two years, driven by robust consumer spending and solid business investment [1] - The Organisation for Economic Co-operation and Development (OECD) raised its growth expectations for the U.S. to 1.8% in 2025, up from 1.6% in June, but forecasts for 2026 are projected at 1.5%, indicating a notable drop from 2.8% in 2024 [2] Consumer Spending - Consumer spending, which constitutes over two-thirds of economic activity, rose by 2.5% in the second quarter, revised up from a previous estimate of 1.6% [3] - In the last month, consumer spending increased by 0.6%, following a 0.5% gain in July [3] Household Wealth - Household wealth reached a record $176.3 trillion in the second quarter, although lower-income families face challenges from rising import-driven prices [4] Investment Trends - U.S. equity funds experienced a net inflow of $12.06 billion in the week ending September 24, reversing two weeks of outflows, with large-cap equity funds attracting $16.94 billion, the largest weekly inflow since April 9 [5] - Large-cap ETFs are recommended as a balanced investment strategy to capture growth potential while maintaining a defensive stance amid economic uncertainty [6] ETF Recommendations - Suggested large-cap ETFs include Vanguard S&P 500 ETF (VOO), SPDR S&P 500 ETF Trust (SPY), iShares Core S&P 500 ETF (IVV), and Vanguard Total Stock Market ETF (VTI) [7] - Growth ETFs such as Vanguard Growth ETF (VUG), iShares Russell 1000 Growth ETF (IWF), iShares S&P 500 Growth ETF (IVW), SPDR Portfolio S&P 500 Growth ETF (SPYG), and iShares Core S&P U.S. Growth ETF (IUSG) are also recommended for investors seeking higher growth potential [9]

Bond Market Reaction & Fed Policy - The long end of the curve is considered cheap based on valuation metrics, but the front end could also move if economic data weakens due to a prolonged shutdown [2] - The market is pricing in gradual Fed cuts to neutral, but a worsening economy (unemployment rate above 45%) could lead to more aggressive Fed action [2] - An independent Fed is responding to data and aiming to reduce the level of restrictiveness, making bonds attractive [6] - The Fed is expected to cut rates to 3%, which is close to neutral, even without a significant slowdown [8] Auction & Demand - End-user demand for Treasury auctions remains strong, indicating structural positives in the US economy [5] - Structural positives in the US economy, such as AI capex and strong corporate fundamentals, are driving demand for US bonds [6] - People look at 55%-6% in high-quality bonds and they like it [6] Investment Strategy & Risk Hedge - The 5 to 10-year part of the curve is considered a sweet spot, offering a balance between yield and duration risk [3][14][15] - Bonds are still considered a hedge, especially with the Fed likely to cut rates more aggressively [12][13] - Investors may diversify into other assets like gold and cryptocurrency, but US Treasuries remain a safe haven [9][10][11][12] - High-yield market can offer yields higher than 5%-6% without taking on that much duration risk [15]

Nike shares uh up nicely today about 4%. Profit and revenue beat Wall Street expectations signaling turnaround efforts that the company may be taking hold. Uh sales grew about 1% from the same quarter a year ago.Surprising analysts. Nike expects current quarter revenue revenue though to fall by low singledigit uh percentages in line with where the street was. Anyway, on the topic of tariffs, and that's has a lot to do with this, Nike said it expects a hit of $1.5% billion uh and a gross margin impact of 1.2 ...

Consumer Credit Concerns - Credit scores are falling at the fastest pace since the global financial crisis [2] - 90-day plus delinquency rates for credit cards are north of 12%, the highest in 14 years, with an average rate of about 215% and $12 trillion [2] - CarMax reported increased loan loss reserves due to subprime customers (FICO scores under 550) having the most trouble [9] - A significant portion of thericcolor bankruptcy borrowers had no credit scores or scores around 600, highlighting concerns about lower-quality consumers [10] Market and Bank Performance - Despite consumer credit concerns, the market (HYG) has remained resilient [3] - Banks experienced pressure, possibly due to rebalancing or concerns about access to credit [4] - American Express, expected to perform well due to its higher-end demographic, was surprisingly hard hit [13][14] - Mastercard and Visa held up relatively well [14] - JP Morgan and Capital One earnings will provide insights into different customer segments [12][15] Buy Now Pay Later (BNPL) - BNPL options are prevalent for online purchases, potentially unique to this cycle [5] - Affirm (a firm) experienced a post-IPO pop but quickly broke price, indicating potential investor concerns [5][6] - The lower-end consumer is particularly relevant to the BNPL sector [8][9] Economic Outlook - The push and pull between the Fed's dual mandate (full employment and stable prices) continues [7] - PCE data was "sticky," and the upcoming jobs number may shift focus to the lower-end consumer [7][8] - The economy is perceived as "doing okay," with a good employment picture, though a government shutdown could cause disruption [12]

Consumer Spending Trends - Overall consumer spending is pulling back, with less money spent this year compared to last year [2] - The top 10-20% of household earners in the US are expected to spend more, while the bottom 50-70% are holding back [3] - Only 50% of US households are actively participating in the market, impacting their spending behavior [3] - Consumers are prioritizing needs over wants due to global stress factors like wars [9] Retailer Strategies and Outlook - Retailers are making real estate decisions for openings in 2027 and 2028, focusing on the long-term consumer outlook [6] - Retailers are generally bullish on the consumer in the long haul, not focusing on short-term market fluctuations [7] - Concerns about a soft job market and constant talk of tariffs are scaring consumers from spending [7][8] - Most retailers believe the US consumer will not shift heavily to online-only shopping, with roughly 84% preferring brick-and-mortar stores [10][11] Real Estate Market Dynamics - There is a historical supply shortage in retail real estate space, a problem not seen in about 40 years [11] - Current real estate space delivery is less than 40 million square feet per year, significantly lower than the 200 million plus square feet per year during the 2000s [12] - From 2010 to 2023, less than 1 billion square feet of real estate space was delivered, compared to 1 billion between 2002 and 2007 [12] - Retailers are primarily looking at second-generation space due to the lack of new development, with significant development mainly in Florida, Georgia, and Texas [13]

Consumer spending is a crucial part of the US economy, accounting for about twothirds of its growth. But with inflation still running sticky, can spending power hold up. The latest data appears to be yet another testament to the sheer resilience of the US consumer.However, the solid gains are masking a deepening inequality among US households where a small share of high-wealth Americans is seeing continued gains while a larger share of the middle and lower income households is experiencing increased strain. ...

Consumer Behavior - Cost-conscious Americans are carefully spending on groceries [1] - Splurging on fancier, fattier butter is an exception to the careful spending habits [1]

Welcome back. As we continue to monitor uncertainty around tariffs, inflation, the labor market, how's the consumer holding up. Here to discuss is Mastercard Economic Institute's chief economist, Michelle Meyer.Recently releasing a forecast for the holiday season, expecting retail sales to grow by 3.6%. Welcome. It's good to have you.>> Thank you. Good to be here. >> So, how does that compare 3.6%.What does it say about where we are in consumer spending. >> It's pretty a solid growth rate. Um, and actually ...

Consumer Spending Outlook - The Mastercard Economic Institute forecasts a 3.6% growth in retail sales for the holiday season, which is consistent with spending trends observed over the summer months [1][2] - Last year's holiday spending growth was 4.1%, driven by high volumes and disinflation in many categories, while this year presents more pricing challenges for consumers [3][5] E-commerce vs. In-store Spending - E-commerce retail spending is expected to grow by 7.9%, significantly outpacing the just over 2% growth for in-store shopping, indicating a shift in consumer behavior towards online shopping [6][7] Consumer Demographics and Spending Power - Spending is increasingly driven by high-end consumers, supported by wealth gains in markets and real estate, which have created a positive wealth effect for upper-income households [8][9] - The overall household balance sheets are in good shape, with serious delinquency rates trending slightly lower, suggesting consumers are well-equipped to manage spending this season [12] Labor Market Dynamics - Job creation has slowed, but the labor market remains balanced with low firing rates, contributing to a steady unemployment rate [14] - The impact of technological advancements, particularly AI, on the job market is a topic of debate, with potential structural changes expected rather than cyclical dynamics [15][16]