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Hey there weekday warriors,
One day, I hope to be as bad at my job as the Bureau of Labor Statistics.
Enjoy the next 4 minutes and 30 seconds of blue-chip news and commentary.
Keep on snapping necks and cashing checks,
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“yesterdays newsletter was particularly snarky. thx.” - Matt S., loyal reader since 2023, and not a huge fan of spelling/grammar, apparently
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+ US stocks “climbed after dovish Federal Reserve minutes and a big downward revision of US payrolls reinforced bets policymakers will cut interest rates in September.” (Yahoo! Finance)
+ The 10-year Treasury yield “dipped on Wednesday after the release of minutes from the latest Federal Reserve meeting suggested the central bank was moving closer to a rate cut.” (CNBC)
+ Oil “settled down by $1 a barrel on Wednesday after the U.S. government revised sharply lower a set of employment statistics closely watched by investors.” (Reuters)
+ Bitcoin “slid on Wednesday as Mt Gox appeared to have mobilized about $2 billion worth of tokens, raising concerns over more distributions from the defunct crypto exchange.” (Investing)
+ The three most talked about stocks on WallStreetBets in the past 24 hours were: 1) Nvidia +0.9% 2) Intuitive Machines -5.1% 3) AST SpaceMobile +6.1%
The market moves you need to know about…
– Shares of Snowflake tumbled 8.0% after reporting earnings Wednesday afternoon. Oh, so it missed the Street’s expectations? Nope. In fact, SNOW beat on the top and bottom lines, shared guidance that was in line with expectations… and increased share buybacks. Tough break.
+ B. Riley mooned 45.6% yesterday after reports surfaced that Oaktree Capital planned to bail out the investment bank (kinda) by taking stakes in its appraisal and valuation services arm and its retail, wholesale, and industrial solutions unit.
– Just me or does it feel like Macy’s is the QB who took the team to States back in ‘84 and has refused to take his letterman jacket off for the past 3 decades? The slow-motion car crash that is Macy’s existence just got a little more bleak. Shares of M tumbled 12.9% after the retailer announced a beat… but slashed its top and bottom line outlooks for the year. Stick to parades…
+ Shares of TJX popped 6.1% on news that the company beat on the top and bottom lines. It also hiked its guidance… even though it wasn’t exactly what the Street was hoping for. Which is exactly how most of TJ Maxx’s customers feel when they get home with their haul…
You had one job…
Source: Giphy
The Department of Labor had its annual review and turns out those non-farm payroll numbers it releases every month were off by 818k total jobs over the 12 months that ended March 2024.
The 2.9M jobs “created” between April 2023 and March 2024 were more like 2.1M. Or, put another way, monthly job gainz over the period were closer to 174k (vs. 242k). This is the biggest revision since 2009.
Imagine missing a forecast by 30%… and still having your job.
According to the Quarterly Census of Employment and Wages (as it’s formally known) the biggest rounding error was in professional and business services (you know, high-paying jobs).
It overestimated the category’s growth by approximately the population of Tampa (~358k).
And it still isn’t 100% confident
This is just the preliminary revision, you guys. The BLS is still tinkering with the Excel model (“US non_FARM payroll 2024 V12_FINAL_finalversion.xlsx”) which is undoubtedly #REFed at the moment…
Following yesterday’s report, Goldman economists said they believe this version could still be off by as many as 500k jobs. We’ll have to wait until February (as in 2025) for the final data set… which will probably also be a clusterf*ck.
Hear me out… we give last year’s payroll data the Barry Bonds asterisk treatment…
Glass half full…
Sure, the Bureau of Labor Statistics might be completely full of sh*t and may have lost all credibility with the biggest revision in 15 years, but look on the bright side… if J-Poww didn’t want to cut rates before, he pretty much has no choice now…
The data, if nothing else, indicates that the US economy might be weaker than expected. And a cut is very likely warranted.
+ “F*ck off.” - Target (+11.2%) CEO Brian Cornell clapping back at VP Kamala Harris’ proposed ban on ‘price gouging’ in the retail and grocery biz
Cornell gave the presidential candidate a lesson in capitalism, reminding her that big box stores are ‘a penny business’ (read: margins are already razor thin). And pointed out that if they were indeed price gouging, consumers would take their business elsewhere.
His comments came after the company reported a top and a bottom line beat for the most recent quarter. Did I mention it returned to same-store sales growth for the first time in 5 quarters?
‘Walmart for people who buy after-market accessories for their Stanley Cup’ hiked its profit guidance but left its sales forecast unchanged. Investors appeared to give zero f*cks about the cautious outlook, though. Shares jumped more than 11% on the day.
+ Wednesday’s Fed minutes were basically mommy p*rn for investors. But, instead of knockoff Glen Powell with a throbbing member, the main character is a 71-year-old Fed chair with a 12-member committee…
Yesterday’s Fed minutes were the stuff of investors’ wet dreams. According to the cliff notes, during the July FOMC meeting, “The vast majority observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policy at the next meeting.”
Given that economic data has cooperated over the past few weeks, it probably shouldn’t come as a shock that markets are pricing in a 25 basis point cut at the upcoming Fed meeting.
The only real question is if there is enough evidence to convince the FOMC that they should pull the Band-Aid and go 50 basis points.
Oh, and…
+ Crocs gains after inking Sydney Sweeney to be the global spokesperson for the HEYDUDE brand. Bullish.
+ Microsoft will release controversial Windows Recall AI search feature to testers in October. “What’s the worst that could happen?” - Satya Nadella, probably
+ Former FTX exec Ryan Salame seeks to void guilty plea, says feds reneged on deal to end probe of his partner. It’s a bold strategy, Cotton… let’s see if it pays off for him…
+ 'Self-Run' Car Wash Sells For 140K, New Owner Profits $5K A Month, Only Stops By To Mix Soap And Collect Cash. “Have an A1 day!”
+ Does the President Have An Impact on Housing? Here’s What 30 Years of Data Says. Yes, but also no…
+ Investors are quietly scooping up 1 in every 6 single-family homes in these cities. “Investors? Possibly you”
🔥 7 Types of Homes Expected To Soar in Value by the End of 2025. Bad news tiny home owners…
FYI, TWC might be compensated if you click on the links above. So, what are you waiting for? Start clicking.
⏪ Yesterday, we were keeping an eye on earnings from TJX Companies, Analog Devices, Target, and Macy's before the bell. Snowflake and Zoom reported after the close.
We also got the Quarterly Census of Employment and Wages and Fed minutes.
⏩ Today we’re keeping an eye on…
+ TD Bank, Baidu, Williams-Sonoma, Bilibili, and Peloton report before the bell
+ Intuit, Workday, Cava, and Bill.com release earnings after the close
+ Global manufacturing and services PMI data drops
+ Monthly existing home sales data
Yesterday, I asked, “What is the best kinda free sample?”
Costco won easily with 51.9% of the vote. Followed by orange chicken from Panda Express at the mall and SiriusXM.
Here’s what some of you guys had to say (and my thoughts in italics)…
Write in: "Trying 10 different flavors at the ice cream shop, then leaving because you've got your fix of ice cream"
Write in: "Booze at Total Wine"
Write in: "Honestly, Gillette mailing me a Mach 3 when I turned 18 was the best marketing plan I’ve ever seen. Still buying their razors 25 years later."
Write in: "Aesop having fancy lotion outside their stores. The homeless deserve to smell like geranium extract." This man needs to be mayor of SF…
Write in: "I go to the mall before I travel to get samples of cologne."
Here’s today’s question…
The “So, where do you see yourself in 5 years?” question got me thinking…
Would you want someone to tell you exactly what you'll be doing in 5 years if you couldn't do anything about it?
+ This explanation of inflation is so perfect.
Oh, and one more thing…
What did you think about today's newsletter?
Does this look like the face of a guy you should take financial advice from?
No, it’s the face of an individual who is financially irresponsible/dumb enough to be talked into spending money on a family photo shoot that he could have just done with his iPhone. So, act accordingly...
This is not financial advice. Nothing in this newsletter is an investment recommendation. All content is created for entertainment, educational, or informational purposes only. Do your own research, or do yourself a favor and hire a professional.