Daily Brief – US Employment

US Employment

As we wrote on Friday, USD was going into the weekend strong. In fact, it became stronger still on employment data released on Friday afternoon: the expectation from what were known in the 1970’s as chart monkeys, in the 1980’s as teenage scribblers then in the first Bloomberg TV age of the 1990’s as talking heads and are now known less colourfully simply as market analysts was for May US non-farm payrolls to increase by 85,000. Never mind what they are called, they were wrong as payrolls increased by 172,000 and USD strengthened appreciably late in the day on Friday.

EUR/USD 1.1522.

Top 6

By market capitalisation the largest equity markets are in order as follows: USA, China, Japan, Hong Kong, Taiwan, and India. In case you are wondering how Taiwan’s market with a market cap of USD 4.95 trillion can be worth more than India with its population of 1.4 billion and a market cap of USD 4.92 trillion, the answer lies in Taiwanese tech, and in particular in those semi-conductors to which the world ascribes such a high value. And that is why China’s territorial aggrandisement aspirations towards Taiwan command such a degree of the world’s attention.

GBP/USD 1.3342.

Energy 

Conventional wisdom as the US-Iran war dragged on through May was that come June, energy shortages would start with still higher prices and then shortages leading to widespread flight cancellations and supply disruptions everywhere from garage forecourts to domestic fuel supplies. That so far has not happened, and the most credible explanation is a combination of the following: lower overall consumption due to high prices, increased non-Gulf oil production, and lastly the drawing against strategic energy reserves. The last part of the explanation will of course be time constrained and measures to circumvent the Strait of Hormuz, while much smaller than pre March 1 traffic, can only get more significant over time with new land pipelines. Getting in on the act to explain alternative energy sourcing, the EU released a figure on Friday of EUR 136 million per day as the amount that has been saved across the EU for the 3 months since the outbreak of the war due to the implementation of EU solar energy sourcing since March 1 which amounts to EUR 12.8 billion. Suspiciously precise -and therefore unprovable.

EUR/GBP 0.8637.

Rotherham

In the news due to a Year 6 teacher named Joe Wilson being up before a Teaching Panel because 3 years ago in May 2023 he pretended to be ill when in fact, he was fine and took the time to join a stag weekend in Lisbon Portugal. Tagged in a picture holding a pint of beer at the airport, he was outed on social media but compounded the original sin by ripping the pages with the Portugal stamps out of his passport. The decision is due any day and will hinge on whether being banned from the teaching profession is proportionate to his behaviour. Year 6 is the final year of primary school i.e. for 10–11-year-olds and there is more than a case for such inept bunking off by Joe Wilson being fully deserving of a ban – if only to discourage similar cackhanded sickie throwing when those 11 year olds go on to secondary school.

EUR/JPY 184.66.

Brown Sugar

Featured this day in 2008 at number 5 in the Greatest 50 Guitar Songs Ever in Rolling Stone magazine appropriately was this Rolling Stones song. If Chuck Berry’s Johnny B. Goode which incidentally was voted the Greatest in the same poll spawned the artform of the air guitar, then this 1971 number ran it a close second.

Gold Coast slave ship bound for cotton fields
Sold in a market down in New Orleans
Scarred old slaver knows he’s doing alright
Hear him whip the women just around midnight

Brown sugar, how come you taste so good?
Brown sugar, just like a young girl should

Drums beating, cold English blood runs hot
Lady of the house wondering where it’s gonna stop
House boy knows that he’s doing alright
You shoulda heard him just around midnight

Brown sugar, how come you taste so good, now?
Brown sugar, just like a young girl should, now

Brown sugar, how come you taste so good, babe?
Ah, got me feelin’ now
Brown sugar, just like a black girl should, yeah

Now, I bet your mama was a tent show queen
And all her boyfriends were sweet sixteen
I’m no schoolboy, but I know what I like
You shoulda heard me just around midnight

Brown sugar, how come you taste so good, babe?
Ah, brown sugar, just like a young girl should, yeah

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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