Karl Schamotta

US Li Keqiang index composed of;
- Dunkin donut’s volumes in Boston,
- McRib’s selling status,
- number of Waffle Houses currently open,
- frequency of Arby’s specials,
- Costco toilet paper shortages

From @cullenroche.bsky.social on the other site:

No other way to slice it: this is incredibly fucked up.

Bad sign. Very very bad sign.
The @darioperkins.bsky.social “moron risk premium” embedded in US assets needs to go up.

“economic growth right now is basically a Friday church service: just old people + trying to summon god”
(health + AI)

@dkthomp.bsky.social on the other site.

The correct take:

The Wile E. USD is a having a good one.

Unsurprisingly to anyone observing the corporate operational paralysis that tariff uncertainty has imposed in recent months, private sector job creation slipped into negative territory in the latest non-farm payrolls report:

Annotated summary of this evening's move in the Canadian dollar (given that the average effective rate on imports from Canada is likely now just above 5%):

Opinion | The Tariffs Kicked In. The Sky Didn’t Fall. Were the Economists Wrong?

Discussions about why the US economy hasn't fallen apart because of tariffs remind me of those around Brexit expecting imminent collapse or that this not happening meant all the forecasts were wrong. Nope, just that impacts take time, and there are other factors. www.nytimes.com/2025/07/31/o...

Not sure, but we know we can rely on him to switch sides at least once.

In a weird coincidence, dissents tend to soar when the Fed is engaged in a long (and politically-unpopular) battle against inflation:

How long until we get the "AI cycle IS the business cycle" takes?

Omair Sharif of Inflation Insights warns of higher price pressures: "I think it’s highly likely that we’ll see the April and May core PCE readings revised higher...The revisions also suggest that the June YoY core PCE will come in higher than my 2.70% estimate and could print 2.81%."

Ahead of today's Fed decision, remember that chair Powell wears an earpiece that tells him to jawbone currency markets in the exact opposite direction whenever traders think they understand what the official statement is saying:

Financial conditions are tight

@nicktimiraos.bsky.social caputured the definitive Powell quote in his book, and today’s action gave weight to his words:

It’s like a home renovation show written by morons.

Fun* anecdote, raised by Bloomberg's Cameron Crise: this morning, the euro briefly hit the same level it opened at when trading began on January 4, 1999: 1.1736

*Your mileage may vary

Fun* anecdote, raised by Bloomberg's Cameron Crise: this morning, the euro briefly hit the same level it opened at when trading began on January 4, 1999: 1.1736

*Your mileage may vary

The yen and dollar are trading at levels last seen … checks notes … at noon today:

A certain Commodore Perry might dispute this claim.

If this is anything like what's in it, Ishiba is so done.

It boggles my mind that folks look to a small pool of gamblers to get clues about political stuff. Seems at best a measure of overall sentiment but beyond that, I don't know what it represents.

Government debt in the UK is near levels last seen in the sixties, but appears to be stabilising, unlike what's happening in the US:

Options markets are turning more neutral on the dollar and euro, although—unusually from a historical perspective—the euro is still seen having slightly more upside:

Import price indices measure the prices paid by US firms bringing goods into the US. If their foreign suppliers were taking "haircuts" to compensate for tariff-related costs on the US side, we would be seeing these fall. There isn't much sign of that happening (perhaps modestly in China's case).

Correlations between the dollar and 2-year yields have climbed back to near-perfect levels:

This is exactly how being an FX analyst feels right now.