The AI stocks are spent.
We’ll see how long US-China trade negotiations materialize.
Government Shutdown consequences get real next week
UnEmployment statistics unveiled….. Spooky….
AI Decimating the Work force.
November – Vietnam month
Category: Uncategorized
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Unemployment Statistics?
With the recent US Government shutdown the public has not received the unemployment statistics. Do we really expect the unemployment stats to improve with AI decimating the labor market more and more every month? How does the impact of laying off and furloughing government employees impact the unemployment statistics?
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“We’ll never yield”
As we embark on the upcoming US-China trade war negotiations its important to understand China’s mindset entering a war of any kind.
China will not back down on the negotiations points, specifically export controls on rare earth minerals and resulting tariffs China plans to inherit as a result.
China is adopting the foreign direct product rule, to restrict China’s access to US software. Recently China published their export controls in a WPS format making it impossible for anyone outside China to open the document.
While the US has been very optimisitic about making a fair trade deal to the media, there are some undercurrents to suggest otherwise:
-Make a deal with Australia for rare earth materials as a backup if the China deal does not workout.
-Laying out the terms of the deal in public media as opposed to behind closed doors. Maybe China is not interested in having behind closed doors meeting.
-China did not seem overly thrilled about their perception of time hacking backed by irrefutable evidence.
-China re-opening discussions about invading Taiwan for their rare-earth minerals. Interesting fact, the head of Nvidia is from Taiwan and China has banned use of all Nvidia chips sold in China.
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US-China Trade War: Critical 4 weeks ahead!
Much of the future of this years stock and bond market outlook, as well as next years (2026) trajectory is dependent on the trade negotiations with China.
Scott Bessent is meeting with the Chinese government to soften the recent tone ahead of next week’s critical meeting with the US and China top leaders.
If things go well, the stock market will surge. If things don’t go well, the triple digit tariffs go into effect, and the stock market will tank (see 10/10/25 results). Very simple.
The real question is: How does the recent allegations coming from the China government impact the sentiment of the negotiations?
We will know by mid November.
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Federal Government employees to be laid off
With the birth of AI bots taking over the private sector and more federal government employees being laid off the Unemployment rate will rise.
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Goldman CEO gets it wrong!
Last week the CEO of Goldman Sachs stated the economy is “still in pretty good shape” and appears poised to accelerate into 2026.
Let’s revisit these numbers at the end of 2025 on 12/31/2025 to understand how David Solomon got it wrong.
GDP- 3.8%
Unemployment Rate-4.3%
****Watch the impact of machines replacing humans will have on the Unemployment rate****
Stock Indexes:
DOW- 46,758
Nasdaq – 22,780
S&P – 6,715
The real question is: Why did David Solomon get it wrong?
He knows the truth, specifically where the economy is heading as can be seen with this comment:
“I wouldn’t be surprised if in the next 12 to 24 months, we see a drawdown with respect to equity markets … I think that there will be a lot of capital that’s deployed that will turn out to not deliver returns, and when that happens, people won’t feel good.”
So why did David Solomon get it wrong?
Answer: The hedge funds are lining up their own funds to take short positions in the market and make a pile of cash.
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Bottom of the 9th Inning
Leon Coopermann stated we are in the bottom of the 9th inning of this AI bull market. Citing a quote from Warren Buffet in the late 90’s before the first tech crash:
““Once a bull market gets under way, and once you reach the point where everybody has made money no matter what system he or she followed, a crowd is attracted into the game that is responding not to interest rates and profits but simply to the fact that it seems a mistake to be out of stocks,”
The Buffet indicator – ratio of US stock market to GDP has far exceeded its overvalued threshold of 217%.
Hope you got your shorts in this summer!
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Blue Moon: Tariffs Confusion and Uncertainty.
As evidenced by the 2008 crash, the number 1 reason the markets start to crash is an financial risk uncertainty. The recent 7-4 decision by a Federal Appellate court to reverse the tariffs instituted in the 2nd quarter fused with the decision to lift de minimis exemption is going to introduce a tremendous amount of confusion and spiraling uncertainty after the Labor day weekend.
In the Federal Appellate Court rule, the US Court of International Trade (CIT) on Friday, 8/29/25 stated:
“We affirm the CIT’s holding that the trafficking and reciprocal tariffs imposed by the challenged executive orders exceed the authority delegated to the President,” the majority held in the ruling. “We also affirm the CIT’s grant of declaratory relief that the orders are ‘invalid as contrary to law.’”
The words Congress commonly uses when giving the President tariff authority (“duty,” “tariff,” etc.) are not in IEEPA and that Congress typically requires the President to adhere to various procedural and substantive requirements in tariff statutes.
IEEPA is a very broadly-worded statute empowering the president to “deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States, if the president declares a national emergency with respect to such threat.” Often invoked by presidents in levying economic sanctions against foreign states and actors, IEEPA also empowers the president to “regulate … importation.”
Similar to a 1975 court looking at tariffs Nixon imposed under IEEPA’s predecessor statute in 1971, the Federal Circuit suggested that any IEEPA tariffs would need to be far more bounded than what Trump has in fact done.
Fe-fi-fo-fum, I smell the blood of summer 25 skyrocketing stock market momentum!
The end is here. the werewolf ignites the Bear; Bad moon on the rise!
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Bad Moon Rising predicts Goldman Sachs
Goldman Sach’s CEO and chief economist predicted the economy was going to start to turn due to the high tariffs.
Goldman Sach’s throws caution to the recent stock market rally over the past 4 months stating: “If the most recent tariffs, like the April tariff, follow the same pattern that we’ve seen with those earliest February tariffs, then eventually, by the fall, we estimate that consumers would bear about two-thirds of the cost.”
The combination of a very soft job reports 2 weeks ago and the increasing cost of all consumer goods is a highly unstable concoction that will slowly wreak havoc on the stock market for months and potentially years to come.
“I don’t think this will matter a whole lot to the Fed, because now they have a labor market to worry about, and I think that’s going to be the dominant concern.”
The Feds can drop their rates in September, but that’s not going to produce the massive consumer mortgage loans and corporate business borrowing that is anticipated.
Goldman predicts that the Bad Moon is Rising in the upcoming months:
Creedence Clearwater: 1969.
I see the bad moon rising
I see trouble’s on the way
I see earthquakes and lightnin’
I see bad times todayAh, don’t go ’round tonight
Well, it’s bound to take your life
There’s a bad moon on the riseI hear hurricane’s a-blowin’
I know the end is comin’ soon
I feel a river’s overflowin’
I hear the voice of rage and ruin -
Q3 is Here! The bill is BIG, but not beautiful!
Q3 2025 is here: This is the tipping point of the market entering a long-term depression. The banality of cruelty of the Big Beautiful bill will eat away at the stock market gains of May and June like a cancer. This bill is big, but far from beautiful as it will increase the national debt by $3 billion dollars.
The financial impact this bill will have on those who rely on healthcare will have an catastrophic impact to the HealthCare systems who are forced to take in uninsured medicare patients.
NoFluffBizRants 