holy smokes!

okay oh here oh my God changing non-farm

payrolls comes in at 339 000 that's a

massive beat uh you've got uh we don't

have the wage gain number yet the

unemployment rate what the hell goes It

goes up to 3.7 how do you have I mean

the participation rate must have no

labor force participation rate

oh my God what is it what are these

numbers labor force participation rate

62.6 so that's a match on expectation

it's the same as the prior the average

hourly earnings are 0.3 percent so it's

a match the average hourly earnings year

over year four point three percent which

is weak weaker than expected on the year

over year number

what the heck but you're changing

non-form payroll is a this insane beat

of 339 000 versus 195. that's a 74 B

but the unemployment rate actually goes

up the unemployment rate goes up from

the prior of 3.4 or the expectation of

3.5

to 3.7

with a massive beat in the change in

non-farm payrolls I mean like now it's

just like what data is this even anymore

like what is happening is is this like

who's cooking the books basically oh

this is quite bizarre uh okay so we'll

go through the exact report uh in just a

detail in just a moment but let's let's

see what some of the initial things are

here third Whopper number of the year

at the start of 2023 economists were

expecting the January jobs figure to

come in at 189 000. we got to print to

517 000 instead

here we go wow another big surprise yeah

no kidding but at the same time the jobs

the unemployment rate Rises 0.3 is this

the fed's interpretation of oh the

unemployment rate is going to go up

while massive jobs are being created

what this is this is so weird uh okay so

again this is this is now the uh uh

third crazy beat in a row let's try to

understand what's actually in this

report because this is quite bizarre not

far payroll increased 339 000 in May uh

yeah this is going to be tough for the

FED going to be hard to pause after such

a big gain in payrolls I don't know

though the average hourly earnings came

in that forecast remember I don't know

that the FED needs to cause unemployment

I think people keep thinking that people

keep thinking the FED needs to cause

unemployment

they don't and in a weird way

they kind of just did cause unemployment

by the unemployment rate going up point

three percent this makes absolutely no

sense at all uh okay uh 339 000 jobs in

May the unemployment rate Rose uh Rose

0.3 percentage points to 3.7 I don't

understand uh we'll figure it out though

uh household data Rose uh let's see

unemployment rate increased okay

unemployed persons Rose oh here you go

and the in the households data so in the

households data the number of unemployed

people Rose by 440 000. okay so that's

interesting so in the in the payrolls

data

you had a 330 000 gain and in the

household survey you had a 440 000 job

loss if I had to understand that

correctly like this we will get through

the the charts and they'll show us this

in a little more detail

all right unemployment rate for adult

women 3.3 percent blacks 5.6 percent uh

adult men 3.5 whites three point three

percent Asians 2 9 uh Hispanics four

percent little changed number of job

losses in persons completing temporary

jobs increased a three-point or 318 000

number of persons jobless less than five

weeks edged up by two hundred seventeen

thousand so so if I'm to sort of put

little negatives here that's an increase

right here

that's an increase right here uh that's

an increase right here so you got some

negative numbers and these all seem to

be on our household surveys data which

remember the payrolls data is calling

businesses so this is from the business

point of view which basically can double

count people so if you have multi-jobs

you could get double counted in this

survey whereas over here you don't get

double counted

two-year treasury yield by the way

serving now oh great and April gets

revised up hold on a sec let me look at

this this is oh yep of course it does oh

wow this is very fascinating okay so

change in non-form payrolls for the last

month goes from 253 000 to 294 000. so

you get a revision up of how many jobs

you had the last time

but then wait for this you ready for

this the average hourly earnings of the

last report actually went down from

point five percent to point four percent

so in other words in May and April we

had weaker wage growth than expected we

just had more jobs than expected that's

that's quite literally your Goldilocks

scenario it's quite literally going to

make Jerome Powell very excited drone

pile is gonna be like Oh I'm getting

inflation down while people are getting

more jobs

I mean come on if you were the

chairperson of the Federal Reserve you'd

be feeling the same way you'd be like

I'm about to get a statue at Mount

Rushmore uh okay labor for the force

participation rate didn't change 62.6

number uh of a person's employed

part-time at 3.7 uh little change number

of persons not in the labor force 5.5

million little different uh not attached

was a little changed fine establishment

survey so here's your establishment

survey total non-farm payroll increased

339 000 in May that was the headline

number we read off whereas we had those

losses over in uh in the household what

we have here you've got in May

professional business services added 64

000 jobs similar in April government

employment fifty six thousand Healthcare

52 000 Leisure and Hospitality 48 000

construction 25 000. transportation and

warehousing twenty four thousand uh

that's actually surprising uh let's see

couriers and Messengers up Air transport

up Social Services uh employment little

change that other Industries like mining

oil gas manufacturing wholesale trade

retail trade no I see no losses here at

least in the establishment survey

average hourly earnings here you go

point three percent that's actually

really good but both of these numbers uh

I mean the point three percent add

expectations the four point three

percent slightly lower than expected

uh most beneficials crucially Powell

have been saying that they're ready to

pause perhaps skipping a rate hike the

whole skip is such BS if they pause they

put I I really don't believe this skip

narrative it doesn't make sense you go

back to the Arthur Burns reputation of

start stop start stop start stop it's

not what they're going to want to do

yeah Wild

this is a 14 straight months by the way

that payroll gains have beaten

the median estimate

wow 14 straight months uh and it's not

the first time in a period that the

number is beaten every single forecast

the highest forecast this cycle was 250

000 and 339 000 handily beat that

especially since the prior two months in

total so last month was revised up like

40 000 jobs or whatever and the month

before that was also revised in total

those two months revised up 93

000 jobs

this is nutty

this is very very wild uh well it's it's

good but it's wild it's not what you

would expect uh let's get one of some of

these tables up here so we could get a

little bit detail but oh my God this is

insane okay so let's look at

let's look at the household status

um

I mean it's good it should be good the

market should be seeing this is a good

thing uh but we'll we'll look at just a

moment so here you have the household

survey household data

and you have

uh let's see here employed

wow look at this this is why the

unemployment rate went up

so in the household survey

employed minus three under ten thousand

unemployed up

440 000.

so we have to think about this at the

same time as wages aren't going up so

really uh that much what's Happening

Here

is you're probably seeing let's take a

look here household data which again

reports on individuals

individuals nobody really cares how you

spell it Kevin just get to the point

minus 339

000. do I have that correct

minus oh 310 000. okay fine minus 310

000 jobs

that's the household data the payroll or

the establishment

survey reports on businesses that's kind

of like yo business how many how many

people you got on payroll that actually

shot up

by three hundred thirty nine thousand

and then the number of unemployed

shot up by four hundred and forty

thousand so this is soft

uh right so fed working

this is soft fed working

this is stupid

and and then the point three percent

uh wage gain month over month is good

the point four or the sorry the four

point three percent year over year is

lower than expected

and last month

months month over month went down from

point five to point four percent and

like

I don't suppose I would argue that the

data is rigged but I suppose if I were

going to rig the data it would look

something just like this

uh okay yeah wow very interesting uh so

uh let's see here

job gains have averaged 314 000 this

year

470 000 cents 2020. in the 10 years

before the pandemic employers added

about a hundred and eighty seven

thousand on average so this is the 14th

straight beat on average

since what what is this on average since

uh

pandemic or all right 10 years since

pandemic 10 years prior to pandemic 187k

average wow this is remarkable now I'm

curious to see what gear what effect

this actually has on on some of our

markets so well let's look at exactly

that we have here's your NASDAQ look at

that volume first of all coming in right

here uh as the data comes out at first

you get this massive dump

and then you get a recovery and then you

get a dump again so you're at about

point three percent you're down about 15

basis points from where you were before

the report on the NASDAQ if you look at

the spotlight you're at 422 you're at a

fibi level the Spy is basically like oh

my God this is terribly great the Spy is

actually up like eight basis points uh

Tesla's off 1.3 you've got uh uh OCTA

you know up 1.3 after that like minus 20

day it had uh yesterday yeah okay minus

17.8 C3 AI is up 13 Point uh or down 13

yesterday down another two percent today

what's this carvana we were crazy like

22 yesterday Redfin six percent

yesterday Nvidia five percent yesterday

up 8.8 here in pre-market uh Embry air

was up four percent yesterday

wow okay so what about uh DJI every time

I type DJI for Dow Jones Industrial I'm

like drones uh okay fascinating so uh

let's let's now let me see what else

Wall Street is saying here uh other than

Kevin still needs to raise the prices on

the courses so you still have a few

hours left of checking out on any of

those programs or send us an email uh

we've already caught up on all the

emails but if so if you wanted to fill

the team up again you could do that

email us at staffmbecue.com but I will

get it taken care of uh after I after I

get my work done uh this morning so

anyway

Bureau of Labor Statistics notes that

employment gains in May came in these

sectors Business Services government

Health Care construction we already went

through that uh okay what is this here's

an industry breakdown of I don't really

care about that that's what we already

went through that's stupid I don't care

uh okay oh treasuries so what's going on

with treasuries and then we need to see

in a moment what's going on with a

five-year break even the five-year Break

Even lags a little bit so we'll go to

that in in probably a few minutes but

it's just it's just this is just insane

um okay so treasure yields technically

up a little bit I mean like the 10-year

treasury is up like four bips

who cares it's that 3.64 the treasure

yields in a weird way are actually

popping they were trying to pop off a

little bit we don't know if that'll

actually hold but I can't say that like

a 4-bip rise on the 10-year treasury is

that big of a deal it looks like a big

deal

but that's because I'm looking at a day

chart and I'm literally looking at a

chart going from 3.61 to 3.64 like who

cares

so so that's not a big deal

that's so weird this is quite bizarre

what are they saying here I mean I

wonder if they're just equally oh oh the

second I go to them they go to

commercial your blastard

okay let's try Bloomberg then weird

economy in terms of hiring that's a

little bit of worrisome for the fed and

the inflation because all the

disinflations coming from the goods and

so if Goods prices are stabilizing and

goods hiring is increasing which is what

we see in this report then you know you

may have the consensus outlook here

which is focused on these napum surveys

the pmis we got it earlier the isms you

know collapsing into recession levels

that may just be a nominal effect yeah

well and that's also true that's the big

thing is like this is not a recessionary

level Igor Igor

zagalowski says he has the answer okay

you ready for Igor zekulowski uh his

answer he's in is this Russian

disinformation

okay Igor says people who work from home

are getting two jobs on paycheck and

productivity is zero that's why we have

this nonsense payroll up

unemployment up hilarious I mean you're

not wrong in fact there are there are

some people who will get a remote job

and then they'll get another remote job

and they basically get another remote

job and they make it their job to get as

many remote jobs as possible

and they'll sit there and have four or

five remote shops this happened a lot

during the pandemic and they basically

won't even work they'll just wait to get

fired and as they wait to get fired

they're collecting the paycheck and then

it takes the companies like four or five

months to realize that remote worker

isn't actually performing

their duties and then they get fired but

in the meantime they just got paid five

jobs like for five months and then they

just kind of keep adding a new job at

the end

so yeah to some extent remote work uh

has has some catching up to do with with

how we count it uh so so you're not

wrong uh Igor uh so uh but Igor says

this is very bearish

uh so and then Gary Roberts says Igor is

a bot and not Steve says Igor is Polish

not Russian okay whatever

I I guess the the point is yeah we gotta

look at the five five year break even a

let's pull that up really quick uh but

the point is

however you measure it uh as as weird

and as rigged it feels

it's very hard to look at it and say

with certainty it's a hundred percent

bearish like even if people are working

two jobs uh

fine then then uh but then again

it you know like I say either way you

look at it it's like if you take out the

multi-counting then the fed's job is

working right if you take out the

multi-counting by looking at the

household survey well then the FED just

destroyed 330 000 jobs

or 310 000 or 310 000 jobs so if you

want to look at no multi-counting the

FED just destroyed 310 000 jobs so if

that's doing a good job if you want to

look at the FED avoiding a recession

well then then you could cite the

payrolls reporting go the FED just

created 333 9 30 339 000 jobs

and then if you want to look at

inflation which is the important one

you look and go inflation for wages are

right at expectations and actually came

in softer for the year over year

and the month over month last month you

had a revision

The Five-Year Break Even is like

I don't know what to think of this

here's the five year Break Even which

just ticked up from 2.08

but dude

look at the trend like

yeah really do we really care that the

five-year break even just ticked up four

basis points no it is volatile it has

its little you know five to twenty Point

moves all the time you just want to pay

attention to it to make sure it doesn't

unanchor scene that's that's the big

thing that regularly I would argue that

everybody misses when it comes to okay

Igor wants you to know he's Macedonian

not polish or Russian

it's exactly what a Russian would say

sorry but anyway so the the big thing

that the that that essentially people

are missing about the FED is this idea

that oh well well the FED has to get

inflation down faster that's still above

two percent Kevin

no

what is the historical precedent of the

FED getting inflation down well the

historical precedent of the FED getting

inflation down is let's wait 20 years to

get inflation down

that's what they did after we got Paul

volckert they waited 20 freaking years

to get inflation down

so in that case

as long as inflation expectations are

stable the fed's in no rush and Jerome

Powell could be like

I will have my tea and crumpets and be

happy because I'm getting a building or

a Mount Rushmore or something dedicated

to me

um

this by the way is a massive Batman cup

uh what's kind of cool about it is it's

got this really like badass handle right

here the only downside is when I hold

that badass handle you can't see it

anymore

then again you know it's there so

yeah look

I know people say they're like oh Kevin

you just you just always have a busy

space

no I don't

it certainly wasn't bullish about

rivienne or the market

um but

this isn't that bad from the biggest the

most important thing that came out of

this report in my opinion was the wage

growth because we do not want to see an

inflation or wage price spiral remember

what got me to flip-flop in the first

place if you go all the way back to the

first flip-flop Jan 2022 it was a wage

price spiral nobody's talking about a

wage price spiral anymore literally

nobody is talking about a wage price

spiral why is nobody talking about a

wage price spiral because there is no

wage price spiral if anything there's

like a deflationary wage price spiral

potentially going to happen because of

AI

like if you're not learning AI you're

getting left behind that's why we're

releasing all the AI lectures

on June 6th at 6 pm

Macy's this was entertaining

I tweeted this part yesterday but I want

to point it out

uh yesterday we we were going through uh

some of retails earnings calls in the

course member live stream just to check

what inflation is doing that's what we

do we looked at Nordstrom we looked at

Macy's you look at their earnings you

look at their earnings calls we do this

every day we try to do fundamental

analysis every single day the market is

open and Macy's listen to what I wrote

on the tweeters

you ready for this you can look at my

beautiful little yellow check mark isn't

that nice it's for a team it's beautiful

it's shiny it doesn't matter okay so

here Macy's is literally trying to

convince investors the markdowns and

massive price

reductions happening in stores are just

following quote you ready for this

here's here's Macy's explanation for

markdowns and massive price reductions

quote

We are following our enhanced pricing

algorithms

We are following our pricing science

tools

we are conducting promotions with

precision and we are simply updating our

marketing messaging

in other words our pricing is very

robust

no it's not

these are all euphemisms for

we suck and prices are going down but

this is exactly what you would tell an

investor in your earnings call because

Macy's thinks you're stupid

and thinks you're gonna go oh oh yeah

you're dropping prices because you have

enhanced pricing algorithms why don't

you just come out and say you have ai to

tell you you need to drop prices because

you know what that would just make us

really happy you're dropping prices

15 patients going away it's crazy it's

crazy

so uh somebody here writes uh Business

Insider blamed AI for the people laid

off uh maybe

uh

uh then uh yeah there's there's no

inflation going to the Moon why is the

bond market moving higher so why would

the bond market move higher on this the

bond market would move higher on this

because the initial impression is that

oh well

this means the Fed

is going to have to keep rates higher

for longer maybe not necessarily higher

but at least for longer and the longer

rates are up the more uh people end up

uh

you know the more you end up seeing

bonds get dumped and then when bonds get

dumped the price of those bonds go down

and the yields go up in other words what

you have to be compensated to stick your

money into stupid bonds has to go up the

only reason you should put your money

into bonds is if you really need the

cash for something like you're gonna go

shopping for Real Estate there's no way

in hell if you're going to go shopping

for Real Estate you should really

probably be speculating

on you know your locals is the stock

markets just don't know uh or you know

but otherwise your opportunity cost is

massive to sit there and oh I'm making

five percent fine

uh but uh in addition to to this

explanation for why yields are going up

if you look at now the uh Futures rate

monitor yesterday

after the FED leak that we were going to

see a pause you got this

yesterday we were at a 77 chance of a

pause

after today's data you're actually at a

66.9 chance of a pause

fascinating

Steve says Macy says AI so it must be

good

uh yeah yeah oh that's a really

interesting idea take these phrases

enhance pricing algorithms and such put

them into chat GPT and see what it

thinks

hey chatgpt if a company used the

following phrases to discuss price

reductions and markdowns are they trying

to make investors feel good or uh uh uh

while while actually facing

uh a lack of pricing power or how should

I

interpret these phrases from Macy's in

an investor earnings call

paste okay let's just see what it says

together

these phrases are certainly trying to

cast the company's pricing strategies in

a positive light as they tend to do in

earnings calls

each of them indicates a different

aspect of their pricing and marketing

strategies enhanced pricing algorithms

this implies the company is using

advanced technology or data driven

methods to determine optimal pricing and

deter oh look at that it suggests

they're using AI

to adjust prices okay uh it could be

about increasing prices where the market

will pair it oh oh you're saying there's

hope pricing science tools is another

way of saying they're using analytical

methods to determine pricing promotions

and precisions suggest their sales and

promotions are targeted based on the

data of consumer behaviors yeah but all

of this should be the default anyway

updating marketing messages seems to

indicate they're changing the way they

communicate about their prices and

promotions to customers they may be

trying to emphasize value well that's

exactly what everyone does when pricing

is going down well these phrases do

suggest the company is using more

sophisticated about this is that prices

they do not necessarily mean the company

is facing a lack comparison power you

know I disagree but okay it could be

that they're trying to use these methods

to maximize profits in a competitive

market however if these praise phrases

are being used in conjunction with the

news of lower than expected profits or

Revenue yes Macy's just dumped or if the

company is generally strugging

struggling the company just dumped it

could indeed be an attempt to make a bad

situation seem better

oh that's actually kind of hilarious

I'll this is what I like about the chat

GPT I feel like you're almost kind of

getting like you're you're it's like an

unbiased friend you say well it could be

this it could be that the only downside

is is like

where which is it

anyway very cool so

um there's the jobs data for you very

fascinating

and uh now let's uh let's go chat about

I don't know something else uh we could

listen to CNBC for a second we're gonna

I want to jump into a a very interesting

piece about uh talking about the history

of artificial intelligence from but but

or innovation from a way of what does it

do to the economy and what does it do to

jobs it's actually a really fascinating

piece so we'll go into that in just a

moment uh do keep in mind after we get

our work done this morning uh we got to

raise those prices on the programs on

building your wealth uh or the uh

increasing your income course uh whether

you're an employee or you're working for

yourself you're an entrepreneur you want

to see how to use AI actually

productively in your business you don't

want to just get inundated with a stupid

list of tools but you actually want to

see how can a real entrepreneur who

faces real entrepreneurial challenges

actually use artificial intelligence in

their daily lives to be a better

entrepreneur or employee that's what the

how to make more money and get sh9t done

faster courses for and then of course

all of these come with lifetime access

to the course member live streams and

the updates that we do to them in the

future so check those out link down

below we'll get that done we are caught

up on emails but if you want to email us

at one to uh Stafford me kevin.com now I

want you to know this when it comes to

AI

time is what's going to make you money

and if you can prove that value to an

employer you'll always be able to be

employed so this is another way of

making sure that you don't get replaced

but

foreign