Uriel Cohen

My latest Substack post analyzes $XOM once again catching $TSLA in terms of market cap. Last 5 qtrs: $XOM returned ~$40bb to shareholders via divvies, buybacks. $TSLA: $0.00 That is what really matters. But the key to investing is the second derivative, and as EV sales slow (good for demand for oil, obvs, and for $XOM) I fail to see the Silver Bullet for $TSLA. Why? Because Elon let his product line get old. No amount of robotaxi/FSD necromancy is going to change that. Trade accordingly. Excelsior! --Jim

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An excellent take from The FT on NFP yearly revisions post the ZH story. This obviously caused front running sellers of USD. I made it free to the first 10 people as a FREE gift. BAML nicely added: Are these figures final? No. "This is a preliminary estimate of the annual benchmark revision. The actual revision might be different, based on revisions to the QCEW data. Last year’s preliminary estimate was -306k, but the final revision was just -266k." What does this mean for the unemployment rate? Nothing. "The unemployment rate is calculated from the household survey. The QCEW impacts the establishment survey. What are the broader labor market implications? Even after these large downward revisions, the labor market looks to have been on solid footing last year and in 1Q 2024. That is consistent with the resilience in consumer spending." By contrast, employment growth in the household survey looks too weak relative to the rest of the macro data (54k on average from April 2023 to March 2024). That said, the revisions do help close the gap between the two surveys. My 3 key considerations: 1. USD sold on the ZH story rumour and bought the "fact" but we need the doves to come out AKA Dec 2023 for EURUSD to crack 1.1276 which is the 50% fib on the DAILY CHART. 2. Forget the yearly revisions and focus on lead indicators like LMCI (Kansas City FED) which looks smelly to say the least. NAIRU getting hit on my radar too. 3. Labor Costs nose diving which should drag Core PCE lower (dare I say it below 2% Happy Friday!

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NYU Prof. Emeritus Roubini says that the effect of the US Treasury borrowing tilt towards bills from notes and bonds has an equivalence of a 100bps reduction in the Fed Funds rate. He accuses the US Treasury of manipulation of financial conditions for political gain, which Yellen denies with vehemence. The engineered stimulus keeps the Fed from cutting rates, keeps financial conditions loose, and, according to Roubini, a major reason for the US economy not being anywhere near recession, and stock markets roaring. He also suggests that UST10s are trading 25bps below their normal level in the absence of the Treasury "manipulation" of market rates. We are tempted to go with Roubini on the estimates of the scale of net stimulus provided, which would tend to shift our forecasts, for now by an untested scale. Roubini is part of the team launching a new ETF for hedging future risks, and the pitch discredits US Treasuries in favor of other safe havens and investment strategies. For this reason, we take some of the story with a pinch of salt. #fed #UST #hedging #manipulation #treasury #financialconditions #realrates #policyconflicts

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Quick thoughts on JPY intervention… i.) There’s a common misconception that the MoF/BoJ sell UST to intervene in FX and support the JPY. Actually, they’re most likely already using USD liquidity parked at Fed reserve banks (foreign RRP cash deposits). ii.) This isn’t about “defending a particular level”. It’s all about shocking speculators that have become too complacent, and using the lack of liquidity as leverage. iii.) This isn’t a currency crisis. The BoJ/MoF have plenty of ammo. #BoJ #JPY #FX #intervention #Japan

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