US companies continued to add workers at a moderately healthy pace in May, according to yesterday’s update of the ADP Employment Report. Private employment increased 178,000 last month, slightly above the 163,000 gain in April. Meanwhile, the one-year gain held at roughly 1.8% — a pace that’s been endured so far in 2018.
Continue reading →

Secretary of State Pompeo dines with top N. Korean official in NY: CBS
Trump set to impose steel, aluminum tariffs on Europe on Thursday: Reuters
Federal Reserve takes steps to loosen Volcker rule on big banks: The Hill
US Q1 GDP growth revised down to 2.2% from 2.3%: MarketWatch
Higher energy prices trigger sharp rise in Eurozone inflation in May: AP
Fed’s Beige Book: US economy grew moderately as manufacturing picks up: WSJ
Economists raise expectations for US Q2 GDP growth: Bloomberg
US trade deficit narrowed in April to six-month low: Bloomberg
ADP: US private-sector job growth picks up to 178,000 gain in May: USA Today

Italy’s political crisis triggered a risk-off event yesterday that sharply cut US Treasury yields. The 2-year rate fell to 2.32%, the lowest in more than a month as the benchmark 10-year yield fell to a two-month low of 2.77%.
Continue reading →

Italy’s political crisis poses risks for the global economy: NY Times
Asian stocks extend losses after sharp drop in US equities: Reuters
Trump announces US moving ahead with trade tariffs on China: New York Mag
China says it will respond to ‘reckless’ US trade threats: Reuters
US home prices rose a solid 6.8% in March from year-earlier level: USA Today
Texas factory activity increased in May, reaching a 12-year high: Bond Buyer
US Consumer Confidence Index up in May, close to 18-year high: MarketWatch

The US stock market has been on a roller coaster for much of 2018, but the surge in volatility hasn’t derailed momentum’s leadership for US equity factors, based on a set of proxy ETFs.
Continue reading →

N. Korea sends top aide to US for pre-summit talks: Bloomberg
Trump presses aides to move ahead with US-N. Korea summit: CNN
Russia says reports of US troops in Poland could bring “counteraction”: Newsweek
Italy’s political crisis triggers heavy selling in European markets: Reuters
OECD chief: global growth still needs fiscal-policy support: CNBC
NY Fed’s nowcast for Q2 GDP growth ticks down to still-solid 3.01% rise: NY Fed
Oil prices set for longest run of losses since February: Bloomberg
German 10-year government bond yield falls to new 2018 low:

It’s Memorial Day in the US — a day to honor the men and women in the military who paid the ultimate price to serve and defend their country. It’s also the perfect day for Americans to honor the wounded vets who made it home. Please consider a donation to your favorite charity that supports veterans or:

Disabled American Veterans
Paralyzed Veterans of America

To all the American Vets… thank you for your service!

Real estate investment trusts (REITs) posted the strongest gain for the major asset classes last week, based on a set of exchange-traded products.
Continue reading →

S. Korea calls for more talks with North; US planning Trump-Kim meeting: Reuters
Political crisis erupts in Italy amid calls for impeaching president: BBC
Italy names former IMF official as interim prime minister: Reuters
China sends ships to confront US Navy near disputed islands in S. China Sea: Time
China-Iran summit planned to avoid disruption amid nuclear deal doubt: Reuters
US durable goods orders fell in Apr, mainly due to drop in aircraft orders: MW
US consumer sentiment holds steady in May at elevated level: WSJ
Oil prices tumble on concerns of rising supply: MW
World trade volume: sharp slowdown in annual growth to 2.1% in March: CPB

● Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State
By Paul Tucker
Review via Reuters Breakingviews
How much influence should central bankers wield in a democracy? That’s the question Paul Tucker ponders in “Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State”… Central bankers are being sucked into deeply political decisions over how the government is financed, and how income is distributed. Yet these “overmighty citizens” have no electoral legitimacy. At the same time, frustrated voters in the West have turned to demagogues. As a result, central bank independence is under threat.
Continue reading →