Good Afternoon on this best day of the week, Wednesday,

Apologies for the late start. Not much in the way of news today. We did have a 10-yr Treasury auction which I don’t normally comment on, but it is worth mentioning today as the yield on the 10-yr note dropped substantially. Where it looked like we were pushing our way to 3.75 and higher, today’s auction showed solid demand and brought the 10-yr down to 3.62%. It may not sound much but it is a big move for one day and brings us back below a line of resistance. Mortgage bonds did well too. All in all, a good day for bonds now that we are back above the 50-day moving average. Most other asset classes (equities and crypto and gold) were unchanged to down.

I am still shaking my head on last Friday’s jobs report and have been doing a lot of reading on it as it doesn’t make much (or any) sense. All data is pointing the other direction so how could so many more jobs have been filled? I came across a few pieces in the WSJ that are starting to make some sense. The next stone to turn will be how do we revise our accounting methods to accurately reflect the number of workers in America. Think about that for a moment, if we revise the number of workers, it revises the number of available jobs per worker and revises the unemployment rate. Those are the items keeping the Fed in tightening mode. 

Migrants who come to the U.S. to find work are now being hired more quickly, at higher pay and under better working conditions than at any time in recent memory. In many cases, employers and economists say, migrant workers are being paid as well as their American counterparts, Santiago Pérez and Michelle Hackman report.

Job vacancies in the U.S. increased to 11 million at the end of December and the unemployment rate fell to a 53-year low in January, according to the Labor Department. Employers say finding hourly wage workers is a challenge, and many are paying a premium for migrant workers. It’s another aspect of the hot labor market that is pushing up wages and prices for consumers, keeping pressure on the Federal Reserve to continue raising interest rates to fight inflation.

The pool of migrants seeking employment in the U.S. includes those with and without valid work permits. While no official statistics track the wages of immigrants in the country without authorization, economists say pay appears to be growing based on remittances to Latin America from the U.S. The World Bank estimates remittances to Latin America grew more than 9% in 2022 to $142 billion.

Leaving it here for today.

Please remain safe and stay healthy, make today great!