What's The Warsh That Could Happen?

By Benjamin Picton, Senior Market Strategist at Rabobank

The DXY is dealing firmer this morning and precious metals continue to be flogged like the family silver after Donald Trump confirmed the nomination of Kevin Warsh as incoming Fed Chair. In defiance of the President’s oft-stated preference, markets are convinced that Warsh is a hawk. Consequently, zero-yield risk is taking a beating (bitcoin, ouch), equities are offered and US 5y5y inflation swaps have fallen by ~2bps since Wednesday of last week.

The Financial Times marked the occasion of Warsh’s nomination by saying ‘Arise, Shadow Fed Chair Stan Druckenmiller’, suggesting that the legendary hedge fund manager who counts both Kevin Warsh and Treasury Secretary Scott Bessent among his proteges is now the most powerful person in the global economy. The FT references ‘people familiar with the matter’ as describing Druck’s relationship with Warsh and Bessent as “akin to father-son relationships”, with Warsh in particular sometimes speaking with Druckenmiller “more than a dozen times a day”. Needless to say, markets will now be hanging off of Druck’s every utterance for direction on monetary policy.

While that will doubtless be the case, it seems absurd that much divination is actually required to determine where monetary policy in the United States is likely to go. The national debt burden is immense – soon to hit $39 trillion in dollar terms and now above 121% of GDP – and more than 3% of GDP is already dedicated to servicing interest expense. That – as Fed Chair Powell pointed out last week – comes at a time of healthy economic expansion with a labor market close to full employment.

With all the understatement of a career central banker, Powell described this cocktail as “unsustainable”. If something is ‘unsustainable’, logically it will not be sustained. So what is likely to change?

It won’t be the spending, as the largely futile efforts of DOGE and the fact that ‘mandatory spending’ (social programs, farm subsidies, student loan subsidies etc) plus interest expense plus defence spending accounts for almost 87% of US fiscal outlays. Interest expense will go up, not down, Trump wants to increase the defence budget by 50% and cutting entitlements is a practical impossibility that often gets talked about but never seems to happen. Besides, Trump campaigned on opposing cuts to programs like social security and Medicare.

What about the income side of the ledger? The Trump administration has already taken steps to increase taxes by introducing sweeping import tariffs, but if those tariffs prove effective over time in driving import substitution for domestically-produced alternatives it stands to reason that tariffs will become less and less effective as a revenue tool. Outright rises in direct taxation also seems unlikely given that Trump permanently extended his 2017 tax cuts that had been due to expire via the One Big Beautiful Bill in May of this year.

That leaves interest rates and growth as the only remaining levers to right the fiscal ship. Politicians always think that they are going to grow their way out of trouble, but in Trump’s case it seems likely that an inflationary boom is genuinely part of the fiscal strategy. All of the signs so far point to a willingness to ‘run it hot’ when it comes to the economy.

We have written previously about the strategy of driving adoption of US dollar stablecoins as a means to lower borrowing costs at the front end of the yield curve. Coupled with a sympathetic Fed Governor who is likely to reflect the President’s wish for a lower Fed Funds rate, this might be the best shot of the administration to move the fiscal needle. Indeed, in an era of fiscal dominance, the incoming Fed Chair may have little choice but to keep short rates low.

Along with moves to pressure mortgage relates lower through MBS purchases, threats of price caps (on credit card interest, for instance) and attempts to use tariffs as leverage to extract investment pledges from other countries, these sorts of measures veer into the realm of financial repression, where real interest rates are held negative and private savers carry the can for the government largesse.

Of course, some of these policy options are only available to the United States due to its status as the issuer of the global reserve currency. Abusing the “exorbitant privilege” of being the reserve currency issuer through erratic trade practices, financial repression and strategic currency devaluation is a high stakes gamble that could backfire spectacularly.

Xi Jinping is evidently well aware of the contradictions faced by the United States in attempting to leverage its position as reserve currency issuer without losing it. The FT yesterday reported on comments from Xi calling for the Chinese renminbi to become a global reserve currency by creating a “powerful (read: politicized) central bank” that would ensure a “strong currency” used widely in international trade, investment and foreign exchange markets.

The renminbi has been steadily strengthening against the dollar since Liberation Day last year, and the PBOC has accelerated its run stronger daily fixings from late November onwards. Xi was clear at the Shanghai Cooperation Organization summit last year that he wished to internationalize the role of the CNY and China has begun using its monopsony market power in commodities like iron ore to drive wider acceptance of its currency for trade settlement. Expect more of this in markets where China is the only buyer, or the only buyer of scale.

CNY is starting from a low base and still faces the Triffin Dilemma of not meeting the requirements of a reserve currency so long as China insists on running trade surpluses (there’s no sign of a change of heart on that score), but by boosting its adoption Xi could chip away at the reserve currency status of the dollar right at the moment when many other players in financial markets and the world economy are openly questioning whether the dollar’s writ still runs.

Though it still seems unlikely at this stage, if the reserve status of the dollar was genuinely threatened it would dramatically reduce the freedom to manoeuvre of US policy makers grappling with that “unsustainable” fiscal trajectory.

For the public finances of the United States, that might be the Warsh that could happen.

Tyler Durden Mon, 02/02/2026 - 13:05

Trump Slashes India Tariffs After Modi Agrees To Drop Russian Oil, Go Full 'BUY AMERICAN'

In a huge Monday development, President Trump has announced the US will trim its punitive 25% tariff on Indian imports to 18% after striking what he hailed as a new "trade deal” with Indian Prime Minister Narendra Modi. Crucially it hinges on New Delhi having reportedly ended its purchases of Russian crude and swapping them for massive US energy and goods buys.

In a Truth Social post, Trump portrayed the agreement as a major geopolitical win, saying that India "agreed to stop buying Russian oil, and to buy much more from the United States and, potentially, Venezuela," and crucially framing the move as helping "END THE WAR in Ukraine."

via AP

Under the newly touted deal, according to breaking details.:

• The United States will cut its "reciprocal tariff" on Indian goods from 25% to 18%, effective immediately.

• India will slash its tariffs and non-tariff barriers on American products to zero.

• Modi has pledged a gargantuan "BUY AMERICAN" commitment, including upwards of $500 billion in U.S. energy, technology, farm, coal, and other exports.

Trump cast the concessions as evidence of deep bilateral "friendship and respect," insisting the deal marks a new chapter in US–India trade and energy ties. This will of course also be a blow to Moscow's oil lifeline.

Bloomberg notes:

The White House did not immediately respond to a request for comment on if Trump was lowering the reciprocal tariff and eliminating the extra penalty over Russian oil purchases, or simply reducing one of the rates. India’s benchmark stock index Nifty 50’s futures traded at the Gujarat International Fin-Tec City surged as much as 3.8% in thin trading, while the US-listed iShares MSCI India ETF hit session highs and rose as much as 2.4%. The rupee rallied in ofshore trading, gaining 1% against the dollar.

The shift represents a dramatic retreat from the brash tariff escalation of 2025, when Washington first slapped India with steep levies, including a 25% penalty linked explicitly to Russian energy imports, in a bid to choke Delhi's crude trade with Moscow. The pressure appears to be working, to say the least.

"Out of friendship and respect for Prime Minister Modi and, as per his request, effective immediately, we agreed to a Trade Deal between the United States and India, whereby the United States will charge a reduced Reciprocal Tariff, lowering it from 25% to 18%," Trump posted. "Our amazing relationship with India will be even stronger going forward."

Tyler Durden Mon, 02/02/2026 - 12:50

The Market Cycles Potentially Driving 2026 Returns

Authored by Lance Roberts via RealInvestmentAdvice.com,

Market cycles are once again at the center of the investment narrative as we head into 2026. The optimism is familiar as earnings held up in 2025, the economy avoided recession, and big tech lifted the indexes. However, those victories are already reflected in the price. As we head into 2026, with valuations extended, the margin for error has narrowed. However, while analysts are very optimistic for this year, the case for another strong year leans heavily on historical patterns.

Let’s start with the Presidential Cycle. Market cycles tied to the presidential calendar suggest the second year of a new administration is often slower. Since 1948, years three and four of a presidential term have yielded the most substantial returns, while year two, or the post-election year, has shown weaker performance, with modest gains and lower win rates. The data is shown below, and while 2025 traded above historical norms, 2026 may not be as fortunate.

Since 1871, markets have gained in 30 of those years, with losses in only 18, resulting in a win rate of approximately 62%. While better than a “coin toss,” it falls well short of the win rate in years three and four. Another potential headwind to the markets in 2026 is the midterm elections, which could potentially result in a change of control in the House or Senate, leading to increased gridlock in Washington.

It is worth noting that since 1948, there have been seven instances of loss during the second year of the presidential cycle. Two of those losses occurred sequentially during the last two administrations, in 2018 and 2022. However, stocks have, on average, performed better during bull market cycles versus bear market cycles. The chart below illustrates the average market return during both bullish and bearish market cycles during the second year of a Presidential term.

With a “win ratio” of 62%, the media has been quick to assume the bull market will continue unabated. However, there is a 38% chance that a bear market will occur, which is not to be taken lightly. Furthermore, given the current duration, magnitude, and valuation issues associated with the market, a “Vegas handicapper” might increase those odds slightly.

Year 6 Of The Decennial Cycle

Then there’s the decennial trend. Market cycles built around decade shifts show the sixth year of each decade tends to underperform. In fact, only the 7th and 10th years have weaker returns. While 2025, the 5th year of the cycle, performed in line with historical averages, years 6 and 7 (2026 and 2027) suggest some caution. Average returns are 4% and -1.2% respectively, with the win/loss ratio barely better than a “coin toss.”

We can further assess the potential risk by examining the average market change by year of the decennial cycle. As noted while 2025 performed near historical norms, the risk of a lower return year in 2026 seems to be elevated.

While the Presidential and Decennial cycles are not guarantees of lower to negative returns in 2026, the analysis suggests that investors should at least exercise caution when it comes to risk management. With valuations elevated, risk-taking and speculation high, and sentiment very bullish, there seems to be a higher risk of disappointment than not.

• A resurgence of interest rates that impact corporate profitability

• Inflation rises, causing the Federal Reserve to halt rate cuts.

• An economic slowdown, or mild recession, that results in a decline in forward earnings.

• A financial or credit-related event that causes a repricing of market valuations.

You get the idea. The current setup reflects that with earnings growth rates slowing, the consumer is leveraged, and while inflation is lower, it remains sticky. The Federal Reserve is caught between weak growth and elevated prices. Betting on another strong year without acknowledging the weight of these market cycles is a dangerous assumption.

Cycles don’t dictate market direction. But they shape investor psychology, and when both primary market cycles suggest caution, it’s not the time to get aggressive.

The “Technical” Risk of Reversion

Market cycles work because they reveal investor behavior. Bull phases are driven by optimism, liquidity, and earnings growth. Bear phases follow when expectations exceed reality. Right now, we’re on the edge of that shift. The Shiller CAPE ratio is trading well above its long-term average, and market prices are outpacing profits by a wide margin. That’s a signal, not noise. Market cycles have always corrected this type of divergence. In 1999, the last time we saw a similar disconnect, the result was a steep and painful correction.

What’s worse is that earnings growth in 2025 leaned on familiar crutches: cost cuts, financial engineering, and suppressed wages. Margins held up, but revenue growth did not. Now, consumer wages are declining, resulting in slower spending, and forward guidance is being revised lower. That’s not a setup that aligns with the optimism baked into current prices. For example, Bank of America’s 2026 outlook clearly sees this. Their analysts project weaker consumer demand and downside risk to earnings. However, BNP Paribas is more bullish, projecting the S&P 500 at 7,500, but even they admit that it depends on strong economic momentum and falling rates.

This is where market cycles come back into focus. Every long-term chart illustrates the same lesson: when valuations outpace fundamentals, reversion is inevitable. It’s not always immediate. It’s rarely obvious. But it’s consistent. And 2026 is shaping up as a test of whether this time is different—or not.

In September 2021, I produced the following chart stating:

“A market melting-up is exciting while it lasts. During melt-ups, investors rationalize why ‘this time is different.’ They start taking on excess leverage to try and capitalize on the rapid advance in prices, and fundamentals take a back seat to price momentum. Market melt-ups are all about ‘psychology.’ Historically, whatever has been the catalyst to spark the disregard of risk is readily witnessed in the corresponding surge in price and valuations. The chart below shows the long-term deviations in relative strength, deviations, and valuations. The previous ‘melt-up’ periods should be easy to spot when compared with the current advance.”

Of course, just three months later, the market began a nine-month correction that clipped roughly 25% off asset prices before bottoming in October 2022.

The chart has been updated through the end of 2025. It is worth noting that prices are again deviating from the long-term mean, valuations are extended, and relative strength is declining. Furthermore, investors are taking on increasing speculative risk and leverage, much like they did in 2021. Expectations for corporate earnings, the lifeblood of market performance, appear overly ambitious, and analysts are projecting another high double-digit increase in earnings for the year, a figure well above historical trends. However, these projections may not align with economic realities, particularly if consumer demand softens, the global economy slows further, or cost pressures persist.

The chart below uses quarterly data, so it is slow to move. It is worth noting that the current market is significantly deviated from its long-term mean, with the second-highest levels of valuation on record. While many claim that “this time is different,” long-term analysis suggests that it likely isn’t.

In 2025, actual earnings growth fell short of the original forecasts but remained decently strong overall. However, much of the market’s performance in 2025 was driven by valuation expansion rather than fundamental earnings growth. If this pattern continues, the risk of a correction increases. With all “experts” currently expecting above-average economic growth and earnings rates in 2026, investors should consider remaining more risk-conscious. As discussed in “Bob Farrell’s 10-Illustrated Rules:”

“Rule #9: When all experts and forecasts agree, something else will happen.”

Such certainly seems a risk to consider as we head into the new year.

Investors would be wise to treat this phase of the market cycle with discipline. The choice is yours.

“Chase returns, and you’ll likely end up paying for it. Manage risk, and you’ll still be around when the next true bull leg begins.“

How to Position for Market Cycles in 2026

I am always reticent to discuss taking a more “risk-averse” approach to the markets. This is because investors typically interpret such commentary as “sell everything and go to cash.”

While 2026 presents its share of challenges, the solution is not to abandon the market altogether. Instead, investors can take practical steps to navigate these uncertainties.

None of this means the next “bear market” is lurking. The data suggest that being overly aggressive, taking excessive risk, and increasing leverage may not yield the desired outcome. Since exceedingly bullish markets are primarily a function of psychology, they can persist longer and extend further than logic predicts. The requirement to “end” such a phase is an exogenous event that changes psychology from bullish to bearish. Such is when the stampede for the exits occurs, and prices can decline very quickly. As such, investors need guidelines to participate in the market advance. However, the real challenge is maintaining those gains when corrections inevitably occur.

Positioning for 2026 means respecting our current market position. This is not a time to lean into high-beta names or speculative stories. This is a time to manage risk, preserve capital, and focus on quality. With both the presidential and decennial market cycles signaling below-average returns, prudence is more valuable than prediction.

1. Tighten up stop-loss levels to current support levels for each position. (Provides identifiable exit points when the market reverses.)

2. Hedge portfolios against significant market declines. (Non-correlated assets, short-market positions, index put options)

3. Take profits in positions that have been big winners. (Rebalancing overbought or extended positions to capture gains but continuing to participate in the advance).

4. Sell laggards and losers. (If something isn’t working in a market melt-up, it most likely won’t work during a broad decline. It is better to eliminate the risk early.)

5. Raise cash and rebalance portfolios to target weightings. (Rebalancing risk regularly keeps hidden risks somewhat mitigated.)

Notice, nothing in there says, “Sell everything and go to cash.”

Investing in 2026 will require a blend of optimism and caution. With slowing economic growth, fiscal policy uncertainties, global challenges, overconfident sentiment, and ambitious earnings expectations, investors have numerous reasons to approach the markets with caution. There will be a time to raise significant cash levels. A good portfolio management strategy will ensure that exposure decreases and cash levels rise when the selling begins.

The most important thing to remember is that market cycles are not about exact timing. They’re about understanding the rhythm of investor psychology, capital flows, and fundamental trends. In 2026, that rhythm suggests caution. Stay liquid. Stay hedged. And don’t forget—every market cycle eventually resets. Your job is to be still standing when it does.

Remember, as Larry David might say,

“You don’t have to be a genius—just don’t be a schmuck.”

Tyler Durden Mon, 02/02/2026 - 12:40

This Weeks Jobs, JOLTS Reports To Be Delayed Due To Govt Shutdown

Here we go again.

The government shutdown, which should be lifted in 24-48 hours once the House votes (we reported yesterday that Mike Johnson allegedly has the votes to pass the vote), is again jamming the machinery of government data reporting. 

The BLS has pushed back the January 2026 jobs report, originally set for Feb 6, along with December’s Job Openings and Labor Turnover Survey and Metropolitan Area Employment data.

“The release will be rescheduled upon the resumption of government funding,” Emily Liddel, an associate commissioner at BLS, said in a statement. “Due to the partial federal government shutdown, the Bureau of Labor Statistics will suspend data collection, processing, and dissemination.”

The Bureau of Labor Statistics will announce new release dates once funding is restored.

Tyler Durden Mon, 02/02/2026 - 12:27

World's Nuclear Club Will Grow If US Doesn't Act By Thursday, Medvedev Warns

We reported earlier that the last major nuclear arms control treaty between superpower rivals Russia and the United States is set to expire this week.

Former Russian president Dmitry Medvedev, now deputy chairman of the country's Security Council, has throughout the Ukraine war been the top official issuing the Kremlin's 'unofficial' nuclear warnings and threats. But now the outspoken Russian hawk is urgently offering an olive branch, arguing that the New Strategic Arms Reduction Treaty (New START) must be quickly extended.

Source: Roscongress Photobank

The Kremlin has made clear Russia is willing to extend it for another year, to allow more robust negotiations and for a longer deal to be finalized. Unless it is renewed, the landmark treaty will expire on Thursday, February 5.

But with just days away, the Trump White House has yet to issue anything official. Of course, President Trump is also known for making key decisions at the last moment, building suspense and leverage, based on also on his notorious unpredictable decision-making style.

Medvedev on Monday made clear that Russia's offer to quickly extend "remains on the table, and the treaty has not even expired yet, and if the American side wants to extend it, then this can be done."

He also confirmed that Moscow has received no response on this offer from Washington:

Medvedev told the newspaper Kommersant that Moscow might have to wait until the expiry of the treaty on February 5 for a U.S. response to the Russian initiative.

When contacted for comment, a White House official told Newsweek Monday: "The president will decide the path forward on nuclear arms control, which he will clarify on his own timeline."  

Medvedev explained Russia's point of view, as summarized in Newsweek:

Medvedev said the New START treaty had played a positive role in curbing the nuclear arms race, and that both Russia and the U.S. had stuck to its main restrictions.

However, the most important thing was for ties between the U.S. and Russia to be restored, with relations at their lowest since the Cuban missile crisis of 1962, Medvedev said. He said Trump's "Golden Dome" and statements about resuming nuclear testing complicated any potential strategic dialogue between Russia and the United States.

He further warned that letting the treaty expire would mark the first time since 1972 that there are no legal limitations on strategic weapons between the two rivals, which are both well-armed with atomic warheads.

Medvedev is predicting that more countries will join the nuclear club if New START's safeguards aren't in place by the world's two foremost nuclear powers.

Former President Obama chimes in...

If Congress doesn’t act, the last nuclear arms control treaty between the U.S. and Russia will expire. It would pointlessly wipe out decades of diplomacy, and could spark another arms race that makes the world less safe. This piece is worth the read. https://t.co/NPtKyjYRml

— Barack Obama (@BarackObama) February 2, 2026

According to Monica Duffy Toft, professor of international politics and director of the Center for Strategic Studies at The Fletcher School, "By providing transparency into the world’s two largest nuclear arsenals, New START has lowered the risk that either side will misinterpret normal military activity as preparation for a nuclear strike."

It was signed in 2010 by Presidents Barack Obama and Dmitry Medvedev, and limits the number of deployed strategic warheads to 1,550 per side, and caps deployed delivery systems - including of missiles, bombers, and submarines - at 700. There's also a mutual inspection regimen, allowing each side to monitor the other's sites.

Tyler Durden Mon, 02/02/2026 - 12:20

"100% Preventable": FAA Accepts Its Failures Led To Fatal Midair Collision Near Reagan National Airport

Authored by Tom Ozimek via The Epoch Times,

Federal Aviation Administration (FAA) Administrator Bryan Bedford said on Feb. 1 that the agency accepts the findings of the National Transportation Safety Board (NTSB) that a series of systemic failures by the FAA led to a January 2025 midair collision, the deadliest U.S. aviation disaster in more than two decades.

Speaking to reporters on the sidelines of an aviation conference in Singapore, Bedford said the FAA did not dispute the NTSB’s conclusions on the collision between an American Airlines regional jet and a U.S. Army Black Hawk helicopter near Ronald Reagan Washington National Airport, which killed all 67 people aboard both aircraft.

“We don’t disagree with anything that the NTSB has concluded from their investigations,” Bedford said. “Many of the recommendations have already been put into action. Those that haven’t, we’re going to evaluate.”

The NTSB revealed the probable cause of the crash on Jan. 27, citing the FAA’s decision to allow a helicopter route to operate close to a runway approach path at Reagan National, along with multiple other “systemic failures” at the agency.

“This was 100 percent preventable,” NTSB Chair Jennifer Homendy said during the agency’s nine-hour probable-cause hearing, which capped a year-long investigation.

The NTSB said that the executive branch’s decision to permit helicopter traffic so close to commercial aircraft operations created unacceptable risk.

“Number one, this helicopter route shouldn’t have been there in the first place. This was terrible design of the airspace,” Homendy said toward the end of the Jan. 27 hearing.

Data and Procedural Lapses

Investigators also faulted the FAA for failing to adequately review its own data indicating elevated midair-collision risk around the Potomac airspace and for allowing controllers to rely heavily on “visual separation”—a practice in which pilots are responsible for seeing and avoiding other aircraft—to maintain traffic flow.

“The question is, should the FAA have known there was a problem, and should something have been done? Absolutely, the data was there. The data was in their own systems,” Homendy said, adding that the NTSB had worked with the FAA to flag more than 15,000 close-proximity events over several years, including 85 classified as serious.

Salvage crews work on recovering wreckage near the site in the Potomac River of a midair collision between an American Airlines jet and a Black Hawk helicopter at Ronald Reagan Washington National Airport, in Arlington, Va., on Feb. 6, 2025. Jose Luis Magana/AP Photo

The NTSB also cited staffing and human factor issues at the Reagan National control tower, noting that a single controller was handling both helicopter and airplane frequencies on the night of the crash. While the board concluded that staffing levels technically met FAA requirements, it said extended shifts likely reduced alertness and vigilance, increasing operational risk.

The safety board also criticized what it described as the FAA’s long-standing resistance to safety recommendations under previous administrations.

A visitor walks toward flowers and a letter left in memorial to the victims of a midair collision of an American Airlines jet and a Black Hawk helicopter near the Potomac River at the base of the Titanic Memorial in Washington, on Feb. 1, 2025. Carolyn Kaster/AP Photo

The U.S. Army was also cited for failing to fully implement a safety management system that could have addressed altitude risks on Washington helicopter routes. Investigators said the Black Hawk’s altimeter likely misreported altitude by about 100 feet, contributing to the crew’s belief that they were flying within authorized limits.

Federal Response

The FAA said in a Jan. 27 statement that it “values and appreciates the NTSB’s expertise and input” and that it has acted on urgent safety recommendations issued in March 2025, adding it would carefully consider additional measures outlined in last week’s findings.

Amid the fallout from the 2025 crash, U.S. Transportation Secretary Sean P. Duffy recently announced that the FAA had formalized permanent restrictions on helicopters operating near Reagan National unless they are carrying out essential operations.

The rules move helicopter routes farther away from Reagan National and require all military aircraft to broadcast their locations during flight, and prevent air traffic controllers from relying on visual separation.

“After that horrific night in January, this Administration made a promise to do whatever it takes to secure the skies over our nation’s capital and ensure such a tragedy would never happen again. Today’s announcement reaffirms that commitment,” Duffy said in a Jan. 22 statement. “The safety of the American people will always be our top priority. I look forward to continuing to collaborate with the NTSB on any additional actions.”

The Trump administration on Jan. 26 unveiled a major overhaul of the FAA to bolster modernization efforts and enhance safety, including the installation of a new air traffic control system and advanced aviation technologies.

Tyler Durden Mon, 02/02/2026 - 12:05

ICE Drops $70 Million On Massive Arizona Warehouse To Detain And Deport Illegals

Authored by Steve Watson via Modernity.news,

Arizona is ground zero in the fight to reclaim U.S. borders, with ICE shelling out a whopping $70 million for a 418,000-square-foot warehouse in Surprise—the size of seven football fields—to process and detain illegal aliens targeted for deportation. The acquisition under the Trump administration marks a long-overdue shift from the chaos of unchecked migration that flooded communities under previous Democrat-led policies.

The Department of Homeland Security snapped up the sprawling industrial site near Dysart and Cactus roads in a cash deal completed January 23, as property records confirm. ICE plans to convert it into a 1,500-bed processing center, part of a broader push to expand detention capacity amid renewed focus on mass deportations.

Local officials in Surprise distanced themselves, stating they “do not participate in ICE operations” but can’t block federal authority. Yet the move has ignited fury from Arizona Democrats, who see it as a direct threat to their sanctuary-state dreams.

ICE just purchased a massive 418,000 sq ft warehouse in Arizona and the Democrats are LOSING THEIR MINDS

Cry harder, Libs.

ICE is here to stay! pic.twitter.com/hKlZhcYscG

— Libs of TikTok (@libsoftiktok) January 30, 2026

State Senator Analise Ortiz slammed the purchase as “abhorrent,” adding “It really should chill all of us because ICE is violating the US Constitution, which means none of us are safe, including United States citizens.”

The warehouse buy comes hot on the heels of Arizona Attorney General Kris Mayes’ inflammatory warnings to ICE agents, where she suggested citizens could legally shoot masked feds under the state’s Stand Your Ground law.

In a brazen display of anti-enforcement bias, Mayes told local media: “You have these masked Federal officers with very little identification, sometimes no identification, wearing plain clothes and masks. And we have a stand your ground law that says that if you reasonably believe that your life is in danger, and you’re in your house or your car or on your property, that you can defend yourself with lethal force.”

She doubled down, questioning how people would know if masked intruders are legitimate officers: “But how do you know they’re a peace officer? It becomes, did they reasonably know that they were a peace officer?” Mayes even boasted of her own gun ownership, implying she’d react the same way.

Republicans blasted her comments as dangerously irresponsible, with calls for resignation pouring in. Senate Majority Leader John Kavanagh demanded she retract and step down, while Congressman Abe Hamadeh accused her of justifying murder against federal agents. It’s classic leftist hypocrisy: championing gun rights only when it suits their agenda to sabotage border security.

Mayes also launched a webpage urging citizens to report and film alleged ICE misconduct, vowing to prosecute agents for “assault, murder, unlawful imprisonment” if they step out of line. She warned ICE to “keep your hands off of our tribal members,” positioning herself as a defender against federal overreach while ignoring the real victims—American communities ravaged by illegal immigration.

The new Arizona facility is just one piece of ICE’s aggressive warehouse-buying spree across the U.S., with the agency acquiring sites in at least eight states to ramp up detention networks. Recent purchases include a $102 million warehouse in Maryland and plans for an 8,500-bed mega-jail in El Paso, Texas, as part of a $45 billion effort to enforce immigration laws long ignored by deep-state bureaucrats.

While open-borders advocates howl in protest, this facility promises to bolster enforcement efforts, ensuring criminals and overstays are swiftly removed to protect American families and sovereignty.

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Tyler Durden Mon, 02/02/2026 - 11:25

The 'Full Of Wind'-y City: Chicago Mayor Johnson Puts "ICE On Notice"... Of Meaningless Gesture

Authored by Jonathan Turley,

I have long been a critic of Chicago Mayor Brandon Johnson, who has been a disaster for my home city.

From moronic proposed taxes to racist comments, Johnson has brought some of the greatest devastation to the city since the Great Fire.

Deeply unpopular, he often uses race-baiting commentary or gimmicks to distract voters. The latest is his chest-pounding press conference where he declared “we are putting ICE on notice in our city.” 

The threat was that he was ordering the Chicago Police Department to move against ICE in the city.

However, even a cursory examination reveals that, as before, there is less than meets the eye in Johnson’s theatrics.

Democratic leaders have jumped the shark on ICE and are now trying to outdo each other with increasingly reckless rhetoric.

Gov. Tim Walz declared last week that this was now a “Fort Sumter” moment, alluding to a new civil war.

Philadelphia District Attorney Larry Krasner promised to “hunt down” ICE officers like “Nazis.”

Rep. Eric Swalwell has promised, if elected governor, he will take away the driver’s licenses of ICE officers and bar them from employment in the state.

It is hard to see what else he can promise to take away other than cable and WiFi.

Johnson is not to be out-yelled on this or any other subject.

He signed an executive order Saturday laying the groundwork for the city to investigate and seek prosecution of federal law enforcement officers.

The order, titled “ICE On Notice,” directs members of the Chicago Police Department (CPD) to document alleged illegal activity by federal immigration agents and refer evidence of felony violations to the Cook County State’s Attorney’s Office for possible prosecution.

He declared that “with today’s order, we are putting ICE on notice in our city. Chicago will not sit idly by while Trump floods federal agents into our communities and terrorizes our residents.”

While it is true that officers do not have absolute immunity, it is highly unlikely that they could be liable for the increased enforcement of immigration laws. Just a day ago, a federal judge and Biden appointee in Minnesota rejected Attorney General Keith Ellison’s demand that federal operations be enjoined in his state. He could not come up with a single claim that the expanded operations were unlawful to sustain the burden for an injunction.

A close examination of the Johnson order shows that it is little more than a directive to the CPD to document any alleged violations. While suggesting that CPD would arrest federal officers, it merely states that they should take statements and preserve any videotapes of alleged violations.

Johnson said the order makes Chicago the first city in the nation to pursue legal accountability for alleged misconduct by federal immigration agents.

That included the alleged game-changing order that police should file “incident reports.” Actual incident reports! ICE officers are presumably fleeing en masse at the very threat of such CPD reports.

The term “windy city” is not, as commonly believed, a reference to the wind off the lake. In the Nineteenth Century, it was a reference to how Chicago politicians were full of wind in their bragging and exaggerations. In that sense, Johnson is the very personification of the Windy City, but this order will not even rustle the leaves in Lincoln Park.

Tyler Durden Mon, 02/02/2026 - 10:50

On-Chain Activity Soars As Crypto Crumbles, 'Mega-Whales' Buying The Bitcoin Dip As Retail Runs For Exits

Crypto prices are rebounding this morning, after further weakness over the weekend to its lowest since Trump's election victory. 

“From a technical perspective, the recent drawdown is bringing price closer to attractive levels,” said Joel Kruger, a markets strategist at LMAX Group.

Bitcoin is likely to find “strong support” should it drop to around $70,000, he said.

Other cryptocurrencies like Ether and Solana also staged modest rebounds after slipping earlier Monday.

“For crypto specifically, ETF flow stabilization is the key signal to monitor,” said Timothy Misir, head of research at digital asset analytics firm BRN.

“Without it, rallies are likely to fade.”

Interestingly, Goldman points out that in contrast to the declining price performance, on-chain activity painted a different picture, especially for the Ethereum and Solana networks.

Activity across the Bitcoin network was down over the month, suggested by decreased average daily transaction count (-14.9% MoM), average daily new addresses (-3.6% MoM) and average active addresses (-2.7% MoM) (Figure 2).

However, for Ethereum, average daily active addresses, new addresses, and transaction counts were up by +27.5%, +26.8% and +36.0% MoM respectively.

For Solana, average daily active addresses and transaction counts were up by +24.3% and +8.2% MoM respectively (Figure 10).

Looking at Ethereum specifically, we are seeing an ATH in daily new addresses.

On average, Jan saw 427k new addresses – if we compare this to the 2020 ‘DeFi summer’, the average daily new addresses back then were 162k.

In terms of activity, we have registered 1.2m daily active Ethereum addresses – another ATH from a 7-d moving avg basis 

Separately for Ethereum, Goldman notes that the market cap is now below its realized market cap (which values each coin at the last time they moved on the network - representing the aggregate cost basis), signifying that most ETH holders are now sitting on a loss...

Meanwhile, as James Van Starten reports below for CoinDesk.com, very large investors, or whales, holding 10,000 bitcoin or more are currently the only ones that are buying the largest cryptocurrency as prices plummet.

All other holder groups are hitting the sell button, according to onchain data.

This divergence is highlighted by Glassnode’s Accumulation Trend Score by wallet cohort, which measures the relative behavior of different entity sizes based on both balance and the amount of bitcoin acquired over the past 15 days. Scores closer to 1 indicate buying, while values near 0 signal selling.

Bitcoin accumulation trend (Glassnode)

According to Glassnode data, the largest whales are in a "light accumulation" phase and have maintained a neutral-to-slightly-positive balance trend since bitcoin fell to $80,000 in late November. During this period, price has largely consolidated, trading within a $80,000 to $97,000 range through the end of January.

Bitcoin is now trading near $78,000, according to CoinDesk data.

In contrast, all smaller cohorts are net sellers, particularly retail holders with less than 10 BTC.

This group has been in persistent selling for over a month, reflecting continued downside and risk aversion among smaller participants.

At the same time, the number of unique entities holding at least 1,000 BTC has increased from 1,207 in October to 1,303.

Number of Entities with balance 1k BTC (Glassnode)

Since bitcoin’s October all-time high, growth in this cohort suggests that larger holders have been buying into the correction.

Whales holding at least 1,000 BTC are now back at December 2024 highs, reinforcing the view that large players are absorbing supply while smaller holders continue to exit.

Tyler Durden Mon, 02/02/2026 - 10:35

EU Faces Hard Choices After LNG 'Wake-Up Call'

Authored by Irina Slav, via OilPrice.com,

• Europe is growing uneasy over its heavy reliance on U.S. LNG, with EU officials warning that energy security risks are shifting rather than disappearing.

• Diversification options are limited: sanctions on Russian gas and strict EU methane regulations effectively rule out major suppliers like Russia, Qatar, and much of U.S. LNG.

• Gas costs and policy contradictions are rising, as Europe pushes for diversification while remaining locked into record U.S. LNG imports

The European Union needs to diversify its natural gas sources, Brussels’ energy commissioner said this week, expressing a growing unease in European capitals that the EU has become too dependent on liquefied natural gas from the United States. Yet succeeding in that diversification drive will be tricky because of the bloc’s emissions-focused energy policies – and the sanctions on Russia.

“We are speaking to countries around the world that are able to deliver LNG to us,” Energy Commissioner Dan Jorgensen told media in Brussels this week, as quoted by Bloomberg.

“I definitely hear this when speaking to energy ministers and heads of state from all over Europe that there is a growing concern.”

The situation represents an interesting reversal of sentiment from just four years ago. Back in 2022, the European Union declared it would switch from Russian pipeline gas as punishment for the invasion of eastern Ukraine and start buying U.S. liquefied gas instead. EU officials hailed the decision as a big step towards energy independence and praised U.S. LNG producers—and the U.S. federal government—as a reliable business partner and energy supplier.

Now, the European Union is the biggest regional buyer of U.S. liquefied gas, which seems to have been the plan all along—but that gas is coming at a steep cost, and with the federal government very different from the one of four years ago, the image of the reliable business partner and energy supplier has changed quite radically.

It was the Greenland affair that played the role of the alarm clock that woke Brussels and national capitals up. Until that point, the European leaders had apparently assumed that Trump would keep doing business with their countries—and the EU—as Biden had before him, namely by continuing the security guarantees and preferential trade arrangements that had been the hallmark of trans-Atlantic relations for decades. Only Trump did not feel like that. Trump demonstrated early on that he was coming to collect—higher NATO spending, import tariffs, and, finally, Greenland.

The myth of the friendly American LNG that could replace all Russian gas and ensure energy security for a continent was, however, dispelled even before Greenland, by Trump’s top energy man. Secretary Chris Wright stated plainly that U.S. producers of liquefied gas have no intention of complying with the EU’s new methane regulation. The regulation requires constant monitoring, tracking, and reporting of methane leaks along the LNG supply chain—and U.S. LNG producers are not investing in that. Incidentally, neither is QatarEnergy.

During his talk with reporters, Commissioner Jorgensen said that European gas buyers were eyeing Qatar, Canada, and Algeria as potential avenues for gas supply diversification. But Qatar, for one, has made it as clear as the U.S. that it will not be doing methane tracking and reporting. And it has done so repeatedly. And with the world’s two biggest LNG exporters out of the methane-reporting experiment, the EU is really short on options—especially now that the top brass in Brussels approved the total ban on any and all Russian gas imports, beginning next year. Of course, it’s still January 2026, and a lot of things could change over the next 12 months, with some observers of the EU arguing that it will soon change its tune on Russian gas. Until this argument finds factual backing, however, the EU is off Russian gas—and unless it drops the methane regulation, it is also out of Qatari and most U.S. gas, too. Alternatively, U.S. gas will simply become even more expensive, raising the question of just how long the EU would be able to afford it.

The bigger question is what the realistic alternatives to U.S. LNG are. The answer, alas, is unpleasant. There is no large enough LNG supplier to step in and take the place of the United States, not economically, at least. This means gas buyers in Europe would be scouring the world for LNG from now on in a bid to advance the new diversification vision of the Brussels political establishment.

Meanwhile, however, there is that trade deal that Commission President Ursula von der Leyen signed with President Trump last year that calls for $250 billion worth of U.S. energy imports into the EU every year until 2027. One could argue whether Trump knew the EU could not physically buy so much U.S. energy, but wanted to make them buy more oil and LNG—which is what he got, by the way. European Union imports of American LNG hit an all-time high last year, though their price was nowhere near $250 billion.

Trump probably knew the Europeans couldn’t buy $250 billion worth of oil and LNG. But if the Europeans get really serious about that diversification, the Greenland deal may be canceled in favor of another, more direct option. If anything, President Trump has proven repeatedly that he follows his own rules.

Tyler Durden Mon, 02/02/2026 - 10:20

Key Events This Week: Payrolls, ISMs, ADP And Many More Earnings

Welcome to February with another big sell-off in Gold (-5%) and Silver (-10%) overnight, and a partial US government shutdown that isn't as severe as the record one before Xmas, and is expected to get resolved soon. Nevertheless, as Jim Reid writes, it's typical of the 2026 constant stream of complicated news flow. This follows a January that managed to both shock and awe in various ways, yet still delivered broad based gains across all global assets in our monthly performance review when measured in USD terms—a genuinely rare occurrence.

It was perhaps fitting then, that the month ended with extraordinary volatility: silver saw its largest daily fall on record (36% at the intraday lows,  26.3% at the close), while Gold recorded its biggest one day decline since 2013 ( 8.95%). With the overnight moves, Silver is now around $5 below its real adjusted level from 1790. Even incorporating the dramatic 1980 boom and bust and the recent surge, Silver has failed to outperform inflation over more than 230 years of data. So while Reid has long been a bit of a gold bug given his strong views on the inflationary consequences of fiat money, the recent run up in precious metals feels to have an enormous speculative element. Friday’s moves, almost certainly driven by positioning and margin dynamics, only reinforced that impression.

Anyway, turning our attention to the coming week, we will get a dense run of US macro releases, with the January jobs report set to dominate attention on Friday. We also have the ISM surveys, consumer sentiment and the latest Treasury’s quarterly refunding details.

Central banks be in focus with decisions due from the ECB, the BoE (both Thursday) and the RBA (tomorrow). Elsewhere we have the latest global PMIs and inflation in Europe. Corporate earnings include Alphabet (Wednesday), Amazon (Thursday) and AMD (Tuesday). Remember that Meta (+6.56%) and Microsoft (-8.50%) saw big moves in either direction last week with both having a 10% plus intra-day rise and decline respectively. 

Looking at more detail into the week ahead, Friday’s employment report is the highlight, with forecasts pointing to another modest payroll gain (consensus at +50k and +37k for headline and private respectively) and no change in either the unemployment rate (4.4%) or the pace of hourly earnings growth. Ahead of that, the JOLTS data tomorrow and the ADP report on Wednesday will give early clues on labor market momentum. The week also brings the manufacturing ISM on Monday and the services ISM mid week, followed by the University of Michigan’s February sentiment survey on Friday. Fixed income investors will also be watching Wednesday’s quarterly refunding announcement and today’s Treasury borrowing estimate closely.

Central banks will remain a major theme as well. The ECB and Bank of England both meet on Thursday, and neither is expected to adjust policy, with the ECB likely extending its on hold stance for a fifth straight meeting and the BoE seen keeping Bank Rate unchanged once again. The Reserve Bank of Australia is also expected to stand pat tomorrow. Additional colour on financial conditions will come from the Fed’s senior loan officer survey today and the ECB’s latest bank lending survey tomorrow.

Across Europe, the flow of flash January inflation reports continues, with France tomorrow and Italy and the broader euro area following on Wednesday. Sweden publishes its CPI on Friday. Several Eurozone economies will also release December retail sales and trade figures, while Germany rounds out the week with its factory orders and industrial production numbers. It'll be interesting to see if they show continued evidence of the fiscal stimulus.

The corporate earnings calendar remains active, with attention in the US turning to two members of the Mag-7, Alphabet on Wednesday and Amazon on Thursday — alongside a range of other tech firms such as Palantir, AMD and Qualcomm. Major healthcare names are also reporting, including Eli Lilly and AbbVie in the US and Novartis and Novo Nordisk in Europe. Broader US earnings include updates from PepsiCo, Walt Disney and Uber. In Europe, several banks are scheduled to report, while in Japan, Toyota, Sony and Tokyo Electron will be among the key companies releasing results.

Here is a day-by-day calendar of events, courtesy of DB:

Monday February 2

• Data: US January ISM index, China January RatingDog manufacturing PMI, Germany December retail sales, Italy January manufacturing PMI, new car registrations, budget balance, Canada January manufacturing PMI
• Central banks: Fed’s SLOOS, BoJ Summary of Opinions from the January meeting, Fed’s Bostic speaks, BoE’s Breeden speaks
• Earnings: Palantir, Walt Disney, Intesa Sanpaolo, NXP Semiconductors, Teradyne
• Auctions: US Treasury quarterly borrowing estimate

Tuesday February 3

• Data: US December JOLTS report, January total vehicle sales, Japan January monetary base, France January CPI, December budget balance, New Zealand labour force survey
• Central banks: RBA decision, ECB’s bank lending survey, Fed’s Bowman and Barkin speak
• Earnings: AMD, Merck, PepsiCo, Amgen, Pfizer, Eaton, Nintendo, Emerson Electric, TransDigm, Mondelez, Chipotle, Electronic Arts, PayPal, Corteva, Take-Two, Super Micro Computer

Wednesday February 4

• Data: US January ADP report, ISM services, China January RatingDog services PMI, UK January official reserves changes, Italy January CPI, services PMI, Eurozone January CPI, December PPI, Canada January services PMI
• Earnings: Alphabet, Eli Lilly, AbbVie, Novartis, Novo Nordisk, Mitsubishi UFJ, Banco Santander, Uber, QUALCOMM, UBS, Boston Scientific, ARM, CME Group, GSK, Mitsubishi Heavy Industries, Equinor, Credit Agricole
• Auctions: US Treasury quarterly refunding announcement

Thursday February 5

• Data: US initial jobless claims, UK January new car registrations, construction PMI, Germany December factory orders, January construction PMI, France December industrial production, Italy December retail sales, Eurozone December retail sales
• Central banks: ECB’s decision, BoE’s decision, Fed’s Bostic speaks, BoC’s Macklem speaks, BoE’s DMP survey
• Earnings: Amazon, Shell, Linde, BBVA, Sony, ConocoPhillips, BNP Paribas, Bristol-Myers Squibb, KKR, Intercontinental Exchange, Barrick Mining, Vinci, Cigna, Fortinet, Siemens Healthineers, ROBLOX, Ares, Rockwell Automation, Assa Abloy, Saab, ArcelorMittal, Estee Lauder, AP Moller - Maersk, Reddit, Atlassian, Vestas, BT, Blue Owl, Illumina, Affirm, Neste

Friday February 6

• Data: US January jobs report, February University of Michigan survey, December consumer credit, Japan December household spending, leading index, coincident index, Germany December industrial production, trade balance, France December trade balance, current account balance, Q4 wages, Canada January labour force survey, Sweden January CPI
• Central banks: ECB’s survey of professional forecasters, ECB’s Cipollone and Kocher speak, BoE’s Pill speaks
• Earnings: Toyota, Philip Morris International, Tokyo Electron, Societe Generale, Orsted, Telenor, Centene

Finally, looking at just the US, Goldman writes that the key economic data release this week is the employment report on Friday. There are several speaking engagements by Fed officials scheduled this week, including events with Governors Bowman and Cook and Vice Chair Jefferson

 Monday, February 2 

• 10:00 AM ISM manufacturing index, January (GS 48.5, consensus 48.5, last 47.9): We estimate that the ISM manufacturing index increased by 0.6pt to 48.5 in January, reflecting an increase in our manufacturing survey tracker (+2.0pt to 51.7).
• 12:30 PM Atlanta Fed President Bostic (FOMC non-voter) speaks: Atlanta Fed President Raphael Bostic will speak at the Atlanta Rotary Club. Moderated Q&A is expected. On January 30, Bostic said, "We should be waiting, and be more patient. We are still too high in inflation, so I think [policy needs] to be somewhat restrictive."

Tuesday, February 3 

• 08:00 AM Richmond Fed President Barkin (FOMC non-voter) speaks: Richmond Fed President Thomas Barkin will speak on the economic outlook. Speech text and Q&A are expected. On January 6, Barkin said, "Going forward, policy will require finely tuned judgments balancing progress on each side of our mandate."
• 09:40 AM Fed Governor Bowman speaks: Vice Chair for Supervision Michelle Bowman will speak at the Wall Street Journal Invest Live event. Moderated Q&A is expected. On January 16, Bowman said, "Absent a clear and sustained improvement in labor market conditions, we should remain ready to adjust policy to bring it closer to neutral. We should also avoid signaling that we will pause without identifying that conditions have changed."
• 10:00 AM JOLTS job openings, December (GS 7,300k, consensus 7,250k, last 7,146k)
• 05:00 PM Lightweight motor vehicle sales, January (GS 15.1mn, consensus 15.3mn, last 16.0mn)

Wednesday, February 4 

• 08:15 AM ADP employment change, January (GS +40k, consensus +45k, last +41k)
• 10:00 AM ISM services index, January (GS 53.0, consensus 53.5, last 53.8): We estimate that the ISM services index declined 0.8pt to 53.0 in January, reflecting an improvement in our non-manufacturing survey tracker (+1.1pt to 53.3) but a headwind from potential residual seasonality.
• 06:30 PM Fed Governor Cook speaks: Fed Governor Lisa Cook will speak on monetary policy and the economic outlook at the Economic Club of Miami. Speech text and moderated Q&A are expected. 

Thursday, February 5 

• 08:30 AM Initial jobless claims, week ended January 31 (GS 210k, consensus 212k, last 209k); Continuing jobless claims, week ended January 24 (consensus 1,850k, last 1,827k): We forecast roughly unchanged initial jobless claims (210k) reflecting upward pressure from seasonal distortions that is offset by downward pressure from severe winter weather.
• 10:30 AM Atlanta Fed President Bostic speaks: Atlanta Fed President Raphael Bostic will speak. Moderated Q&A is expected. 

Friday, February 6 

• 08:30 AM Nonfarm payroll employment, January (GS +45k, consensus +68k, last +50k); Private payroll employment, January (GS +45k, consensus +75k, last +37k); Average hourly earnings (MoM), January (GS +0.35%, consensus +0.3%, last +0.3%); Unemployment rate, January (GS 4.4%, consensus 4.4%, last 4.4%): We estimate nonfarm payrolls increased 45k in January. On the negative side, we estimate that the birth-death model—which will be updated with this report, more details below—could contribute 30-50k fewer jobs to payroll growth (on a seasonally adjusted basis) than in recent months and big data indicators indicated a modest pace of private sector job growth. Additionally, we expect unchanged government payrolls—reflecting a 10k decline in federal government payrolls that is offset by a 10k increase in state and local government payrolls. On the positive side, the pace of layoffs—a particularly important determinant of net job growth in January—remained subdued. However, the seasonal factors have evolved to expect smaller declines in employment in recent Januarys, limiting the potential boost from this channel. At the industry level, we expect rebounds in retail trade employment—which saw less holiday hiring than usual that should correspond to fewer January layoffs—and construction employment—for which unusually poor weather likely contributed to a decline in December. We do not expect a drag from Winter Storm Fern, which formed about a week after the reference week. We estimate that the unemployment rate was unchanged at 4.4% in January, though see risks as skewed to a decline: the bar for rounding down to 4.3% is not high from an unrounded 4.38% in December and the January unemployment rate appears to suffer from modestly negative residual seasonality (the unrounded unemployment rate has declined in each of the last three Januarys). We estimate average hourly earnings rose 0.35% month-over-month in January, reflecting positive calendar effects.
  • This month’s report will be accompanied by the annual benchmark revision to the establishment survey and a methodological update to the birth-death model. The BLS's preliminary estimate of the benchmark payrolls revision indicated that cumulative payroll growth between April 2024 and March 2025 would be revised 911k lower. We estimate that the final downward revision will likely be somewhat smaller—in the range of 750-900k—as job growth in the QCEW, which informs the revision, has been revised up since the BLS issued the preliminary estimate. The BLS will also update the net birth-death forecasts in the post-benchmark period (April 2025-December 2025) to incorporate information from the QCEW and the monthly payrolls survey. A downward revision to the post-benchmark period appears likely, reflecting the continued slowdown in the QCEW and weak private payroll growth during the post-benchmark period. Starting with this month’s report, the birth-death model will incorporate current sample information each month. This methodological change is intended to reduce the magnitude of annual revisions, as changes in employment at continuing establishments will provide a more timely signal about net job creation from firm births and deaths than the current methodology based on lagged QCEW data does. However, the methodological change could contribute to greater month-to-month volatility in payrolls readings, as the birth-death assumption will be impacted by the responses to the monthly survey.
• 10:00 AM University of Michigan consumer sentiment, February preliminary (GS 54.0, consensus 55.0, last 56.4) : University of Michigan 5-10-year inflation expectations, February preliminary (GS 3.2%, last 3.3%)
• 12:00 PM Fed Vice Chair Jefferson speaks: Fed Vice Chair Phillip Jefferson will speak on the economic outlook and supply-side inflation dynamics at the Brookings Institution. Speech text and moderated Q&A are expected. On January 16, Jefferson said, "In my view, the current policy stance leaves us well positioned to determine the extent and timing of additional adjustments to our policy rate based on the incoming data, the evolving outlook, and the balance of risks."

Source: DB, Goldman

Tyler Durden Mon, 02/02/2026 - 10:15

Huge Surge In New Orders Sends US Manufacturing Activity Near 4 Year Highs

With 'hard' data sustaining signs of solid growth (e.g. factory orders and jobless claims), 'soft' survey data has been bouncing back since the start of the year

This morning we get the final Manufacturing PMI data from S&P Global and ISM for January.

A solid and stronger improvement in US manufacturing sector operating conditions (52.4 vs 52.0 exp) was signaled by January’s S&P Global PMI data amid the joint-sharpest upturn in production since May 2022.

However, growth was in part driven by inventory building as new orders, despite returning to expansion in January, increased only modestly.

ISM's Manufacturing was expected to rise from 47.9 to 48.5 in January but instead it soared to 52.6 - its highest since Aug 2022. This is the first print above 50 since January 2025.

Source: Bloomberg

This was the biggest MoM surge in the ISM print since April 2020 (COVID rebound), led by a huge surge in new orders and rise in employment (highest in a year) and prices (though elevated) are stable...

“News of the joint largest rise in factory production since May 2022 is tainted by reports of ongoing subdued sales growth," says Chris Williamson, Chief Business Economist at S&P Global Market Intelligence.

"Production growth consequently significantly outpaced that of new orders at the start of the year, resulting in a further accumulation of unsold warehouse inventory."

“Over the past three months, the survey indicates that factories have typically produced more goods than they have sold to a degree we have not previously seen since the global financial crisis back in early 2009."

This highly unusual situation is clearly unsustainable, hinting at risks of a production slowdown and a potential knock-on effect on employment, unless demand improves markedly in the coming months.

Williamson adds that “sluggish sales and order book growth are being commonly linked to customer resistance to high prices, in turn often blamed on tariffs, as well as increased uncertainty over the economic outlook."

While just below trend, business growth expectations for the year ahead are, however, holding up as firms anticipate improving demand, "thanks in part to lower interest rates, reduced import competition due to tariffs, and more government support."

However, as Williamson concludes, "political uncertainty remains a key drag on business sentiment."

Tyler Durden Mon, 02/02/2026 - 10:07

 

 

I am always looking for interesting and informative charts, especially ones I can include in my quarterly call that explain something clients are curious about or introduce a lower-profile idea. The call that kicked off 2026 dived into the weakness in the dollar. Given how significant the US Dollar weakness has been, let’s take a look at what has been happening with the world’s reserve currency and why it is significant to stocks, bonds, and commodities.

2025 was the year international stocks finally caught up to the US. Since the financial crisis, the US has led the world’s economy and equity markets. That changed significantly last year, as the S&P 500 and even the Nasdaq 100 lagged behind while international stocks gained over 33%. That was about twice the increase we saw in the U.S

 

And there’s a simple reason for this: The weakest U.S. dollar since 2017.

As the chart at the top of the page shows, every major currency has outperformed the United States currency in 2025 – even Japan.

That is not a coincidence. This isn’t partisan; it isn’t politics; it is simply a fact: the dollar was down 9.2%. The last time it was down this much was in 2017, when it fell 9.9%. Both years marked the first term of a Trump presidency; both involved tariffs; both alienated trade partners.

 

Here’s a straightforward explanation: U.S. trading partners are very unhappy with tariffs and defense policies. We are part of a deeply interconnected global economy, and although none of our trading partners has our level of wealth, they are not without options. They don’t support the end of the post-war alliances nor “America First” – and are responding accordingly.1

Thus, the trend we observed throughout 2025 was simply a Repatriation Trade. Overseas Investors, including private holdings, sovereign wealth funds, public funds, and other large pools of capital, decided to reduce some US-specific risk. They sold portions of their US holdings in dollars, converted that into their local currencies—euros, pounds, yen, Swiss francs, pesos, yuan—brought the cash back home, and then purchased local stocks and bonds.

I cannot imagine any other reason for every single major currency to appreciate so much against the US Dollar without some variation of the above occurring. Traditionally, rates and the dollar move more or less together; when we see this kind of decoupling, it usually means something unusual is going on:

 

This is what happens when your trading partners and our security partners are unhappy with your policies and vote with their dollars. (If anybody has a better explanation as to what’s going on, I’d love to hear it).

I am not a catastrophist; I don’t think this is the end of the dollar as the global reserve currency or the end of Pax Americana; it is, however, concerning and warrants attention. If you treat your trading partners poorly, they aren’t just gonna take it; they are going to respond in kind. They bought a chunk of their capital home. As it turns out, repatriating all those dollars made those markets do much better than US markets. Not that plus ~18% is terrible, it’s just relatively, we were the laggard.

What will cause this change? I don’t see this administration reversing course unless the Supreme Court forces them to do so. I am genuinely surprised they have failed to do so in what is an obvious case.

But that’s how I see the dollar story.

 

 

Previously:
IEEPA Tariffs Update (January 27, 2026)

Stocks, Bubbles & Market Myths (January 16, 2026)

Tariffs Likely To Be Overturned (November 5, 2025)

The Probability Machine (August 28, 2025)

Might Tariffs Get “Overturned”? (July 31, 2025)

MiB: Special Edition: Neal Katyal on Challenging Trump’s Global Tariffs (September 3, 2025)

 

See also:
A mysterious delay in the Supreme Court tariffs case
Jason Willick
Washington Post, February 1 2026

 

 

__________

1. Position Disclosures: In my personal account, my “2026 SCOTUS reverses IEEPA tariffs” trade is to be long GM, Ford, Caterpillar, and Walmart; the short Silver is a reflection that perhaps the dollar trade has gone as far as it might go for this leg…

See this chart from Jim Reid of Deutsche Bank, who noted: “It was a historic and extraordinary month for precious metals, even with the late pullback. In fact, gold (+13.3%) saw its best monthly performance since September 1999, and silver (+18.9%) posted a 9th consecutive monthly gain.”

 

 

The post What’s Going On with the Dollar? appeared first on The Big Picture.

Peak OnlyFans? Platform In Talks To Sell 60% Stake

Following the Wall Street Journal's reporting last week, Bloomberg has provided additional color on OnlyFans' plan to sell a 60% stake in a deal valued at about $3.5 billion. The report is based on people familiar with the matter and has not been confirmed by the company.

OnlyFans owner Fenix International Ltd. is in "early talks" with San Francisco-based Architect Capital to sell a 60% stake worth about $3.5 billion. The proposed structure includes roughly $2 billion of debt and may take months to formalize.

Architect Capital describes itself as an asset manager focused on improving businesses where it sees opportunities to build stronger financial infrastructure. Given OnlyFans' heavy reliance on sexually explicit content, it remains unclear whether a shift away from sex creators is part of the video platform's longer-term vision under potential new ownership.

OnlyFans has explored sale options since last spring, including a prior effort that valued the business at nearly $8 billion, as owner Leonid Radvinsky looks to monetize after pandemic-era growth.

According to publicly available data, Ukrainian-American Leonid Radvinsky owns Fenix.

British filings showed that Radvinsky had paid himself at least $1 billion in dividends since buying OnlyFans in 2018.

Meanwhile, Americans spend billions annually on OF subscriptions. 

Peak OF? 

• OnlyFans Model Gets Baptized, Reconnects With Jesus After Sex Spree

The Wall Street Journal reported last week that, in a presentation to investors, Architect Capital said it sees value in offering "services" to OnlyFans content creators. It's anyone's guess at what these services could be, whether financial infrastructure or creator tools...

Tyler Durden Mon, 02/02/2026 - 09:40

Throwback Waste Of The Day: Monkeys Throw Poop, And $600K

Authored by Jeremy Portnoy via RealClearInvestigations (emphasis ours),

Topline: In 2012, a study published by Agnes Scott College and Emory University concluded that chimpanzees that know how to throw their own feces have stronger communication skills than those that do not.

The National Institutes of Health must have used similarly primitive communication skills when deciding to award the study three federal grants worth $592,000 in 2011. The money would be worth $849,000 today.

That’s according to the “Wastebook” reporting published by the late U.S. Senator Dr. Tom Coburn. For years, these reports shined a white-hot spotlight on federal frauds and taxpayer abuses. 

Coburn, the legendary U.S. Senator from Oklahoma, earned the nickname "Dr. No" by stopping thousands of pork-barrel projects using the Senate rules. Projects that he couldn't stop, Coburn included in his oversight reports.   

Coburn's Wastebook 2011 included 100 examples of outrageous spending worth nearly $7 billion, including the cash wasted on the NIH’s monkey business.

Search all federal, state and local salaries and vendor spending with the world’s largest government spending database at OpenTheBooks.com. 

Key facts: Using MRIs of 78 chimpanzees, the study examined the neurological behavior that leads a monkey to “patiently wait” and throw “feces or wet chow” at zoo visitors.

Researchers found that poop-throwing differs from other chimpanzee behaviors because it is not “nutritive in form … It is difficult to imagine that human caretakers would overtly reward a chimpanzee with food immediately after they had just been soiled with feces by the very same ape.”

As lead researcher Bill Hopkins told Wired Magazine, “I’ve never in my life seen a chimp be given a banana for throwing s**t at someone.” 

Instead, chimpanzees throw their feces because they enjoy seeing humans’ reaction. Zoo visitors observed by the scientists would “negotiate with the chimpanzees to put down the projectile, or they will try to trick the ape by stopping, then dashing rapidly past the ape enclosure.”

Feces throwing was thus labeled as a form of “successful intraspecies communication” because it caused a reaction from humans. In fact, monkeys that engaged in the behavior were found to have more highly developed left brain hemispheres.

Thanks to taxpayers, the study resurfaced in 2017 to help journalists analyze a viral video of monkeys throwing their poop at a grandmother visiting a zoo in Grand Rapids, Michigan.

Summary: It’s much easier to excuse a monkey’s crude behavior than the money spent on NIH studies with questionable value to taxpayers.

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com

Tyler Durden Mon, 02/02/2026 - 09:20

The post Unmask ICE! appeared first on CEPR.

Trump Launches $12 Billion Strategic Mineral Stockpile To Counter China; Rare Earth Stocks Jump

The Trump administration is preparing to launch a major initiative aimed at protecting US manufacturers from disruptions in the supply of critical minerals, committing about $12 billion in initial funding to build a strategic stockpile of essential materials, according to Bloomberg. The project, known as Project Vault, is designed to reduce America’s dependence on China for rare earths and other strategically important metals. By creating a centralized reserve for civilian industries, officials hope to cushion companies against sudden shortages and sharp price swings that can disrupt production and strain finances.

Shares of MP Materials, USA Rare Earth, Critical Metals and other rare earth associated names are higher between 5% and 10% heading into the cash open on Monday on the news.

At this point it's safe to say last week's Reuters rare earth hit piece (authored most likely at the behest of a disgruntled short), which sent the sector tumbling on disputed claims the Trump administration was seeking to distance itself from the rare earth space by moving away from a price floor on critical metals and suggesting MP's deal with the government may be in question, has been thoroughly debunked. Even the MP Materials X account was mocking the grotesque misreporting:

Pathetic

— MP Materials (@MPMaterials) January 29, 2026

Project Vault will be financed through a mix of private and public funding: $1.67 billion is expected to come from private investors, while the US Export-Import Bank is set to provide a $10 billion loan with a 15-year term. The bank’s board is scheduled to vote on the deal, which would be the largest in its history.

More than a dozen major companies have joined Project Vault, including General Motors, Stellantis, Boeing, Corning, GE Vernova, and Google. Three large trading firms - Hartree Partners, Traxys North America, and Mercuria Energy - will handle sourcing and purchasing materials for the stockpile.

Some details about Project Vault’s structure were not immediately known, including the institutional investors providing the $1.67 billion (although JPMorgan will likely be among them). The senior administration officials said the project had been oversubscribed because investors are attracted by a credit-worthy group of manufacturers, their long-term commitments and the involvement of the US export-credit agency. 

The specific carrying costs that would be charged to those manufacturers, as well as the fees for the trading firms participating as procurement officers, weren’t disclosed.  Under the arrangement, companies that make an initial commitment to purchase materials at a specified inventory price later — and pay some up-front fees — will be able to present Project Vault with a shopping list of preferred materials they need. 

The project, in turn, will seek to procure and store the materials, with the manufacturers charged a carrying cost for the expenses associated with interest on the loan and holding the elements.  Manufacturers will be allowed to draw down their material stash as long as the firms replenish them. In the case of a major supply disruption, they will be able to access all of it, the officials said. 

Project Vault represents the first major public-private partnership under the Trump admin seeking reshoring of a critical supply chain, and blends government-backed financing with private investment and corporate participation. While the plan aims to strengthen domestic supply chains, it comes at a time when rare earth mining stocks such as MP Materials and USA Rare Earth are trading well below their recent highs.

Bloomberg writes that rather than focusing on oil, which naturally is at the basis of the nation’s emergency petroleum reserve, this new effort will concentrate on minerals such as gallium and cobalt.

These materials are used in a wide range of products, including smartphones, electric vehicle batteries, and aircraft engines. The stockpile is expected to cover both rare earth elements and other critical minerals whose prices tend to be unstable.

According to senior administration officials, the initiative would represent the first large-scale mineral reserve designed specifically for private-sector use. 

Investor interest has reportedly been strong, with officials saying the project is oversubscribed. They attribute this to the participation of major manufacturers, long-term purchasing commitments, and the backing of a federal credit agency. However, the identities of the main institutional investors and the exact cost structure have not yet been disclosed.

The program is part of a broader push to cut US reliance on China, which dominates much of the critical minerals supply chain. While the US maintains a reserve for defense needs, it has never created a similar system for civilian industries. The government has also expanded domestic investment and international cooperation with partners such as Australia, Japan, and Malaysia.

Momentum increased after China tightened export controls last year, forcing some US manufacturers to reduce output and exposing supply vulnerabilities. Under the system, companies will commit in advance to buy set quantities at agreed prices, pay upfront fees, and submit lists of needed materials, which Project Vault will acquire and store.

A central feature is price stabilization: firms must agree to repurchase the same volumes at the same prices in the future, a structure meant to limit volatility and protect against sudden cost spikes like the post-Ukraine surge in nickel prices. Trump is expected to discuss the plan with GM chief executive Mary Barra and mining entrepreneur Robert Friedland.

Tyler Durden Mon, 02/02/2026 - 09:02

Bill Maher Torches Virtue-Signaling Lefty Celebs For Ditching Causes Once They're Not The 'Current Thing'

After another awards show shitshow of anti-Trump-ism at The Grammy's, Bill Maher has had it with Hollywood’s relentless virtue signaling, and during his latest monologue on his HBO show Real Time with Bill Maher.

And he really let the glitterati have it. 

Maher, a leftist liberal himself, began with mock enthusiasm for the endless parade of political posturing that now infects every red-carpet event.

“How about everybody drop the politics for a couple of hours,” he quipped, “and just enjoy these happy, dopey celebrations of show business?” 

At last month’s Golden Globes awards, a number of celebrities wore small, stylized pins tied to the Renee Good shooting, including vague slogans like “BE GOOD” and “ICE OUT.” 

"Of course, this is for the mother who was murdered by an ICE agent, and it's really sad. I know people are out marching and all today, and we need to speak up," actress Wanda Sykes told Variety on the red carpet before the award show. "We need to be out there and shut this rogue government down, because it's just awful what they're doing to people." 

Maher, who was also at the event, recalled a reporter asking him why he wasn’t wearing a lapel pin at the Golden Globes last month for the shooting of Renee Good in Minneapolis. At the time, he said, “Well, it was a terrible thing that happened, and it shouldn’t have happened, and if they didn’t act like such thugs, it wouldn’t have had to happen. But I don’t need to wear a pin about it.” He then added, “If I had the chance to think about it, my answer would be exactly the same.”

Maher then skewered the hysteria that followed his comments at the Golden Globes, where critics accused him of “refusing to join Golden Globes activism.” 

His reply dripped with sarcasm.

“Golden Globes activism? Oh, you mean the activism of fixing a fucking pin to my suit? I’m sorry, it clashed with my keffiyeh.” He mocked the self-congratulation behind Hollywood’s symbolic gestures. “I hope I didn’t spoil the perfect record of pins and ribbons solving all the world’s problems. You can’t name a problem, from guns to AIDS to bullying to breast cancer, that still exists after people wore a ribbon for it—except all of them.”

The old liberal crusaders took a hit next. “You fucking posers. Three years ago, everybody was all into Ukrainian flags. What happened to that? Another cause tossed into the junk drawer with yesterday’s choke collar?” He called virtue signaling “body ornaments” and delivered one of his trademark zingers: “They’re just crucifixes for liberals. Because every time I see one, I think, ‘Jesus Christ.’”

Maher gave a nod to Ricky Gervais’s now-legendary roast of Hollywood’s award show activism during the 2020 Golden Globe awards, when he said, “Don’t use it as a platform to make a political speech. You’re in no position to lecture the public about anything. You know nothing about the real world.”

Maher, of course, agreed with Gervais, adding, “Celebrities absolutely do have a right to speak out. I’m just saying: Don’t. It’s having the opposite effect of what you want.”

Maher then pointed to the 2024 election cycle, where “every big name in show business came out for Kamala Harris, from Oprah to Clooney to Beyoncé, and she lost every swing state.”

Maher highlighted data showing that Taylor Swift’s political endorsement actually drove voters away. “Come on! Read the room, Democrats. Celebrities aren’t helping, and why would they?”

The problem, he argued, is that stars are the least relatable people in the country at a time when affordability dominates public concern, pointing out that “celebrities don’t strike people as relatable or in touch. What their activism mostly activates is eye rolls.”

Celebrities, I know it’s very important to you that you feel that you’re making a difference, and you are, you’re making independents vote Republican. pic.twitter.com/EozEfoF8OZ

— Bill Maher (@billmaher) January 31, 2026

Hollywood's fake activism has a short shelf life. Stars slap on pins and flags to look good, then ditch the cause when the spotlight moves on because their activism is more about making them look good than about the cause they’re promoting. Maher nailed it—these celebs treat virtue like cheap jewelry, shiny for one night, trash the next. People are sick of it. 

Maher ended the tirade with a final swipe at celebrity activism. “Democrats, it’s great you have all the big celebs, but people see them as an arm of the Democratic Party, which they already suspect for lacking common sense. I know celebrities mean well, and we thank them for having their heart in the right place.”

He added, “Just do you. Use your extraordinary talents for the noble cause of bringing relief from the problems that ribbons and pins can’t fix. I know it’s very important to you that you feel that you’re making a difference... so let me assure you, you are. You’re making independents vote Republican.”

 

Tyler Durden Mon, 02/02/2026 - 08:55

Futures Tumble As Plunging Metals And Bitcoin Spark Global Selloff, Margin Calls

Stock futures slide extending Friday's rout, although are well off session lows, with aggressive unwinds across commodities and a crypto rout adding to the risk-off mood and sparking cross-asset margin calls. As of 8:00am ET, S&P 500 futures are down 0.4%, rebounding from a drop of as much as 1% earlier; Nasdaq futures drop 0.8%, also trimming the drop by half, and lag with focus on AI concerns a key theme for pre-market trading. European stocks were weaker in early trade but have since returned to a positive footing, Stoxx 600 is up 0.2% and just a few points away from its all-time-high. Asian stocks retreated for a second session as risk-off sentiment dominated markets, with high-flying technology names and shares linked to precious metals leading an early selloff in a data-heavy week. The biggest action is in metals, with gold and silver extending sharp declines, though big declines are seen here. Oil fell with other commodities, with easing US-Iran tensions also contributing. Bitcoin plunged to a 10-month low in Asia trading as Korean Kamikaze piled on the short side, before trimming losses. The US economic calendar includes January final S&P Global US manufacturing PMI (9:45am) and January ISM manufacturing (10am). Fed speaker slate includes only Bostic (12:30pm)

In premarket trading, Magnificent Seven stocks were all lower (Tesla -1.9%, Nvidia -1%, Meta -0.9%, Alphabet -0.7%, Amazon -0.6%, Microsoft -0.6%, Apple -0.5%)

• US rare-earths stocks are rising as President Donald Trump is set to launch a strategic critical-minerals stockpile with $12 billion in seed money to lower reliance on China.(MP +4%, USAR +7%)
• Cryptocurrency-exposed stocks fall after Bitcoin tumbled over the weekend. Decliners include Coinbase (COIN), which is down 3%.
• Coterra Energy Inc. (CTRA) and Devon Energy (DVN) are combining to create a US shale producer with an enterprise value of about $58 billion, one of the largest oil and natural gas deals in years. Shares of Coterra are down 3%.
• Humana (HUM) falls about 2% after Morgan Stanley downgraded the health insurer to underweight, citing vulnerability in its Medicare Advantage business.
• Oracle (ORCL) climbs 4% after Fitch affirmed the company’s long-term issuer default rating at BBB. Oracle plans to raise $45 billion to $50 billion this year through a combination of debt and equity sales to build additional cloud infrastructure capacity.
• Walt Disney Co. (DIS) gained about 1% after reporting sales and profit that beat estimates in the first quarter of its fiscal year, boosted by a record $10 billion in revenue from the division that includes parks and cruises.

In corporate news, Oracle fell more than 3% in premarket trading before rebounding and turning green, after outlining plans to raise as much as $50 billion through debt and equity this year to expand cloud infrastructure capacity. As Wall Street braces for a borrowing binge to bankroll AI projects, investors are growing skeptical of the billions of dollars being spent, with little clarity on when returns will materialize. Nvidia CEO Huang said that a proposed $100 billion investment in OpenAI was “never a commitment,” although the company will participate in OpenAI’s latest funding round. Tech Watch looks at how concerns about the huge costs of AI are starting to boil over. Alphabet and Amazon report this week. 

Extreme volatility across commodities continued to be the center of attention in markets. Gold pared losses after falling as much as 10%. At one point, silver sank 16% before reversing most of the retreat. Brent tumbled about 5% after US President Donald Trump said Washington is talking with Iran. 

“Markets are nervous,” said Ulrich Urbahn, head of multi-asset strategy and research at Berenberg. “We see a broad selloff across markets in Asia, Europe and the US. With the volatility increase in gold, but also in silver, investors have to de-risk.”

Monday’s moves are unwinding gains in some of the strongest performers of 2026, including Asian tech, emerging markets and commodities. The reversal was partly triggered by Trump’s pick of Kevin Warsh to lead the Federal Reserve, a move that supported the dollar as traders saw the former Fed governor as tough on inflation and less inclined toward deep interest-rate cuts.

Spot gold and silver remain in the limelight with both extending Friday’s rout, although the metals are well off the worst levels as some Asian buyers make a comeback. Silver is down about 1.9%; earlier it briefly went negative on the year. “The impact of 2x and 3x leveraged longs on assets falling 20-30% is undoubtedly going to trigger margin calls on a lot of other collateral,” said Panmure Liberum’s Mark Taylor.

Bitcoin steadied after shedding nearly 13% since the start of the year, a plunge that briefly pushed it toward levels last seen when Trump retook the White House. The largest cryptocurrency has now fallen for four straight months, with the selloff shaped by an absence of buyers and waning conviction in its value as an alternative asset.

"This pullback looks healthy to me, there was really some excess across gold, silver and some tech stocks too,” said David Kruk, head of trading at La Financiere de l’Echiquier. “My take is that there will be a bounce back in the coming days.”

Equity volatility remains below its average over the past year, while the gold rally has shown a so-called vol-up/spot-up dynamic similar to what’s seen in AI and other frothy parts of the equities world. Retail traders had piled into the iShares Silver Trust (SLV) in the largest one-day net inflow on record last Thursday.

Gold, silver ETF daily notional volume in $ pic.twitter.com/H67ciLuvJW

— zerohedge (@zerohedge) February 2, 2026

Investors continue to parse what a Warsh-led Fed may mean. The selection of the economist known as much for his fierce criticism of the central bank as his changing views on monetary policy has shifted the debate to the Fed’s $6.6 trillion balance sheet and its very role in markets. 

Meanwhile, the US government stumbled into a partial shutdown Saturday while waiting for the House to approve a funding deal Trump worked out with Democrats. The funding lapse is likely to be short, with the House returning from a week-long break on Monday. 

“It’s typical of the 2026 constant stream of complicated news flow,” wrote Jim Reid, global head of macro research and thematic strategy at Deutsche Bank AG. “This follows a January that managed to both shock and awe in various ways, yet still delivered broad-based gains across all global assets.”

Not everyone is bearish: Robust earnings and well behaved inflation should counter geopolitical and other risks, JPMorgan strategists led by Mislav Matejka write. Traditional growth factors have been among the weakest-performing characteristics in US equities so far in 2026, a development “we view as healthy for the broader bull market,” notes Bloomberg Intelligence analyst Christopher Cain.

With another busy week of earnings on deck, the current market correction isn’t about earnings, Goldman strategists said, pointing to solid guidance from companies so far in the season. Out of the 167 S&P 500 companies that have reported so far, 78% have managed to beat analyst forecasts, while 16% have missed. Disney, Idexx Labs and Tyson are among companies expected to report results before the market open. Disney signaled in November that profitability will take a hit of hundreds of millions of dollars in the quarter, due to marketing expenses tied to the release of the film Avatar: Fire and Ash and the launch of the Destiny cruise ship. Earnings from Palantir and NXP Semi follow later in the day. 

European stocks were weaker in early trade but have since returned to a positive footing, Stoxx 600 is up 0.2% and just a few points away from its all-time-high. Here are some of the biggest movers on Monday:

• Pandora jumps as much as 9.9% as silver prices extend their slide.
• European miners fall as copper extends a slump from a record, while gold and silver fall again.
• Julius Baer shares fall as much as 5% after reporting lower profit. KBW said the results were “mixed and messy” and that revenue missed the consensus estimate because of “mild weakness across all key lines.”
• European oil stocks fall along with crude prices after OPEC+ kept March output plans unchanged and geopolitical risk eased, with President Donald Trump saying Washington is talking with Iran.
• BFF Bank shares slide as much as 33% after the Italian financial services firm cut its 2026 outlook and announced a change in CEO.
• European chip stocks fall, tracking declines in Asian and US peers, as momentum trades unwind globally along with gold and silver.
• Carl Zeiss Meditec shares slip as much as 2.4% after Barclays downgraded its rating on the stock to equal-weight from overweight, citing continued downside risks which are only “partially priced into the stock.”
• Auction Technology Group shares drop as much as 11% as FitzWalter Capital says it will not make another offer for the London-listed firm after its 400p per share bid was rejected last week.
• Pharming shares sink as much as 20% after the FDA requested additional data as part of the Dutch biopharmaceutical company’s supplemental new drug application for Joenja in children with a rare primary immunodeficiency known as APDS.

Earlier in the session, Asian stocks retreated for a second session as risk-off sentiment dominated markets, with high-flying technology names and shares linked to precious metals leading an early selloff in a data-heavy week. The MSCI Asia Pacific Index slumped as much as 2.1%, the most since Nov. 18. Tech-heavy benchmarks in South Korea and Taiwan fared worse and the Hang Seng Tech Index lost more than 3% in Hong Kong. An Asian gauge of the materials sector was down 3.6% as gold declined further following Friday’s plunge that was its biggest in more than a decade, and silver whipsawed in choppy trading. Stocks in Indonesia also resumed their selloff Monday, weighed by weaker commodity prices, complicating efforts by regulators to shore up confidence in Southeast Asia’s biggest equities market. Japanese equities outperformed as exporters got a boost from a decline in the yen. Meanwhile, Indian stocks tumbled during Sunday’s special session following a budget proposal to hike taxes on equity derivatives trades. In the week ahead, traders will be watching for central bank decisions in Australia and India, while Indonesia is due to release gross domestic product figures.

In FX, the Bloomberg Dollar Index is down 0.1% after an overnight bid faltered. The euro and pound sit near the top of the G-10 leaderboard but still have some way to go to claw back Friday’s losses versus the greenback.

In rates, Treasuries are off session highs, hold small gains led by long-end tenors, with support from bigger rally in gilts. TSYs are higher by 5 ticks with yields 1-2bps lower across the curve amid a big flight to safety amid cascading margin calls, especially in Korea. Front-end yields are little changed with long-end tenors about 1bp richer, flattening 2s10s spread by around 1bp. US 10-year near 4.23% trails UK counterpart by about 1bp. Bunds are down 7 ticks and gilts up 27 as the slump in commodities helps underpin the latter. US session highlights include manufacturing PMIs and a speech by Atlanta Fed President Bostic. Treasury coupon auctions resume next week with 3-, 10- and 30-year supply, starting Feb. 10; department is scheduled to release quarterly borrowing estimates at 3pm

In commodities, WTI oil futures are down around 5% amid positive recent geopolitical developments surrounding Russia/Ukraine and Iran. Bitcoin is now up 1.8%, after looking like at one point it could make a run at the April low. 

US economic calendar includes January final S&P Global US manufacturing PMI (9:45am) and January ISM manufacturing (10am). Fed speaker slate includes only Bostic (12:30pm)

Market Snapshot

• S&P 500 mini -0.4%
• Nasdaq 100 mini -0.8%,
• Russell 2000 mini -0.6%
• Stoxx Europe 600 little changed,
• DAX +0.2%,
• CAC 40 little changed
• 10-year Treasury yield -2 basis points at 4.22%
• VIX +1.7 points at 19.11
• Bloomberg Dollar Index little changed at 1187.5,
• euro +0.1% at $1.1867
• WTI crude -4.6% at $62.22/barrel

Top Overnight News

• House lawmakers are returning to Washington today to pass a funding deal that Trump worked out with Democrats last week. Approval would fund the Department of Homeland Security for two weeks, and the rest of the government through Sept. 30. BBG
• US Senate voted 71-29 to pass the USD 1.2tln government funding deal, and the House is expected to vote as soon as Monday on the plan after a brief government shutdown.
• Trump launches a strategic critical-minerals stockpile with $12 billion in seed money to insulate manufacturers from supply shocks.
• The venture, dubbed Project Vault, will marry $1.67 billion in private capital with a $10 billion loan from the US Export-Import Bank to procure and store minerals for manufacturers: BBG
• Iran signaled it hopes diplomatic efforts to avert a war with the US will bear fruit within days, after Trump said he is hopeful “we’ll make a deal.” BBG
• Oracle plans to raise up to $50 billion this year through a mix of debt and equity to expand cloud capacity. BBG
• Kevin Warsh’s nomination as Fed chair is reigniting debate over the central bank’s $6.6 trillion balance sheet. White House economic adviser Kevin Hassett told Fox that it should be “as lean as possible.” BBG
• Trump said Fed Chair nominee Warsh may get Democrat votes, and he hopes that Warsh will lower interest rates. In relevant news, Trump said on Friday that Warsh did not commit to cutting rates and he will probably talk about cutting rates with Warsh, while Trump also stated that Warsh will cut rates without White House pressure.
• China’s manufacturing activity unexpectedly improved in January, with the PMI rising to 50.3 from 50.1 a month earlier, according to a private survey. BBG
•  Japanese Prime Minister Sanae Takaichi's party is likely to score a landslide victory in next week's lower house election, a survey by the Asahi newspaper showed, heightening the chance the country will continue to pursue big spending and tax cuts. RTRS
• Narendra Modi unveiled a budget aimed at shielding India’s economy from Trump’s tariffs and providing fresh backing for strategic sectors such as rare earths, critical minerals and chips. Bond yields rose to a one-year high on the government’s record debt-sale plan. BBG
• Oil prices fell more than 4% on Monday after U.S. President Donald Trump said Iran was "seriously talking" with Washington, signalling a de-escalation of tensions with an OPEC member, while a stronger dollar also weighed on prices. RTRS
• SpaceX is in advanced talks to combine with xAI, people familiar said. The two firms could announce an agreement as soon as this week. BBG
• Fed's Bowman (voter) said on Friday that she supported a rate pause as inflation remains elevated, while she added that downside risks to the labour market have not diminished and that policy is modestly restrictive. Bowman also said that they should not imply that they expect to maintain the current stance of policy for an extended period of time, and noted she projected three rate cuts for 2026 in the December SEPs.
• Trump picked Brett Matusmoto to head the BLS: WSJ

Trade/Tariffs

• US President Trump warned of a very substantial response if Canada enacts a trade agreement with China, while he added that the US does not want China to take over Canada, which would happen with the deal that they are looking to make.
• South Korean Industry Minister Kim said they will speed up the implementation of investment legislation after returning from talks with the US, which he said cleared up misunderstandings regarding tariffs.
• EU industry association said on Friday that China proposed final anti-subsidy duties on EU dairy products at lower levels than in provisional duties with the final Chinese anti-subsidy tariffs on EU dairy products to go up to 11.7% vs. a maximum 42.7% in provisional duties.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were pressured amid several recent bearish themes, including the partial US government shutdown and surprise contraction in Chinese official PMIs over the weekend, while sentiment was also not helped by the recent historic collapse in precious metals and with tech-related weakness after reports that NVIDIA's plan to invest USD 100bln OpenAI stalled. ASX 200 retreated with underperformance in the mining sector after a tumble in metal prices, including last Friday's biggest intraday drop for gold in four decades, while sentiment was not helped by wide consensus for a looming RBA rate hike. Nikkei 225 initially bucked the trend with early support from a weaker currency and with the Takaichi trade in play after a poll showed that the ruling LDP is likely on course for a landslide victory at the snap election this upcoming Sunday. However, the index gradually wiped out its gains and more alongside the broad risk-off mood across the region. Hang Seng and Shanghai Comp suffered after disappointing PMI data over the weekend, which showed official manufacturing and non-manufacturing PMI unexpectedly slipped into contraction territory, while the private sector RatingDog manufacturing PMI data matched estimates and continued to show an expansion, but failed to inspire risk sentiment. Furthermore, Chinese telecom names were among the worst performers after Beijing notified about raising telecom services VAT to 9% from 6%.

Top Asian News

• Japanese PM Takaichi said in a speech on Saturday that the yen’s recent depreciation boosted exporters and returns from the government’s foreign exchange fund, while she failed to address concerns regarding the effect on consumer prices. However, she attempted to clarify on Sunday that she was referring solely to the need to build an economic structure that can withstand currency fluctuations, and not to stress the advantages of a weaker currency.
• Japan’s ruling LDP party is likely to win a landslide victory and exceed a majority of 233 seats, while the ruling bloc may win more than 300 seats in the 465-seat parliamentary snap election on February 8th, according to an Asahi survey.
• Chinese President Xi called for China’s renminbi to attain global reserve currency status, according to FT.
• India increased infrastructure spending in its annual budget with the capital spending target for the upcoming fiscal year lifted by around 9% to INR 12.2tln, while it proposed to boost manufacturing in strategic sectors including rare earths and semiconductors, as well as proposed a tax holiday up to 2047 for foreign cloud companies making data centre investments in India. Furthermore, it strongly emphasised fiscal restraint and targeted reducing the debt-to-GDP ratio to 50% (+/-1%) from 56% by 2030/2031 and estimates the fiscal deficit will decline to 4.3% from 4.4% of GDP, while it is to raise the Securities Transaction Tax on futures and options trading.

European bourses (STOXX 600 -0.1%) opened broadly on the backfoot, but have since gradually moved higher to display a mixed picture. European sectors are mixed. Insurance leads whilst Basic Resources and Energy are the clear laggards, driven by significant pressure across the underlying commodities space.

Top European News

• UK PM Starmer said the UK should consider re-entering talks for a defence pact with the EU, while he added that Europe needs to step up and do more to defend itself in certain times, according to The Guardian.
• UK and Japan agreed to deepen defence and security cooperation.

Central Banks

• BoJ's Summary of opinions noted that one member said financial conditions remain accommodative even after a rate hike in December. One member said no need to worry too much about impact on corporate profits as long as rate hike pace is not too fast. One member said appropriate to continue raising policy rate if economic and price projections materialise. A member said current financial conditions still significantly accommodative judging from economic strength and fallout from recent weak yen. A member said if overseas rate environments change this year, there is risk BOJ may unintentionally fall behind a curve. A member said that the bank has been examining response of economic activity and prices and financial conditions to each rate hike and has been raising the policy interest rate, while it is appropriate for the bank to continue to do so. One member said BoJ should raise the policy rate at intervals of a few months. One member said some indicators of long-term inflation expectations have already started to show stability.
• ECB SAFE: "Inflation expectations were broadly unchanged across horizons, with firms continuing to report upside risks to their long-term inflation outlook.". Firms reported a net tightening in bank loan interest rates and in other loan conditions related to both price and non-price factors. Financing needs rose modestly, accompanied by a small perceived decline in availability. Inflation expectations were broadly unchanged across horizons, with firms continuing to report upside risks to their long-term inflation outlook. The use of artificial intelligence is widespread among euro area firms, though most firms use it very infrequently or moderately.

FX

• The DXY is essentially flat and trades within a very narrow 92.17-97.29 range. Newsflow over the weekend has been light from a Dollar perspective, so attention will be on a data-packed week ahead (incl. ISMs, PMIs & jobs data) and on developments related to the current partial US government shutdown. On the latter point, lawmakers managed to work out a deal on Friday – the House is now set to vote on either Monday or Tuesday; House Speaker Johnson predicts the partial shutdown will end by Tuesday.
• G10s are mostly losing vs the USD (ex-GBP & EUR), which are currently incrementally firmer. Nothing is really driving things for the GBP this morning (PMIs were revised a touch higher). In Europe, EZ PMIs were broadly subject to mild upward revisions, and this was reflected in the EZ-wide figure – nonetheless, it still remains in contractionary territory. CHF initially flat, but now underperforms as the risk tone improves.
• Focus this morning has also been on the Aussie & Kiwi, which are currently posting mild losses vs the USD. Downside comes amidst the continuation of pressure seen in underlying metals prices; XAU -4.5% this morning. From a central banking perspective, the RBA is set to give a policy announcement on Tuesday. Markets currently price in a 76% chance of a 25bps hike, a recent shift from expectations of a pause – traders cite strong jobs data and inflation remaining above target.
• Volatile trade for USD/JPY. Initially gapped higher (154.84) and gradually rose towards a session peak (155.51) within an hour, before paring that move. Since, trade has been rangebound. The earlier bout of weakness in the JPY comes after Japanese press circulated comments via PM Takaichi, where she seemingly talked up the benefits of a weaker JPY – but this was later clarified by the PM. On the subject of Takaichi, recent polls suggest that the ruling LDP is likely on course for a landslide victory at the snap election this upcoming Sunday. In more detail, Asahi reported that the LDP-JIP coalition could “secure more than 300 seats”, far surpassing a simple majority of 233.

Fixed Income

• JGBs began the week on the backfoot, down to a 131.32 low, amid the latest election polling. Asahi's poll has the LDP on track for a standalone majority and, when combined with JIP, to over 300 seats and by extension within reach of the 310 super-majority level in the 465-seat Lower House. However, the pressure proved somewhat fleeting given the global risk-off move and as XAU remains for sale, fixed has benefited. Action that been sufficient to lift JGBs into the green with gains of c. 10 ticks and the 10yr yield below 2.25%; however, the 40yr yield remains firmer and holds at highs of 3.94%.
• USTs are being dictated by the risk tone. Just off a 112-02 peak, firmer by c. five ticks as things stand. The tone is driven by the continued pullback in metals, weak Chinese PMIs, NVIDIA reporting, the likely temporary US government shutdown and as we await the first remarks from Trump's Fed Chair pick and any potential SCOTUS update re. tariffs. While there is no schedule for the latter two points, today's docket does have the S&P Final Manufacturing PMI and then the ISM figure.
• EGBs are contained this morning. Bunds found haven allure overnight and got to a 128.36 peak, with gains of 20 ticks at best. However, the benchmark has gradually come off best into the European morning as the region's risk tone inches higher, and equities go from being well in the red to somewhat mixed. No move seen to Final Manufacturing PMIs. As it stands, Bunds are near-enough unchanged but around 10 ticks off their 128.04 trough.
• Gilts lead this morning. Catching up to the overnight bid seen in peers. Since, in limited newsflow but as the tone continues to recover, Gilts have pulled back from their 91.21 peak to just above the figure, though it continues to outperform with gains of c. 20 ticks. Not driving price action but a narrative to keep an eye on is a piece in The Telegraph that Labour's Rayner is constructing a war chest and has begun offering Cabinet roles to her supporters, as part of a plot to succeed PM Starmer.

Commodities

• Crude benchmarks have slumped at the start of the new week following geopolitical headlines over the weekend that have eased rising tensions in recent weeks. Axios' Ravid reported that a US-Iran meeting could take place this week, after weeks of potential signs of a strike in Iran. US President Trump also told reporters that Iran was seriously talking with Washington. WTI and Brent began trade just shy of USD 65/bbl and USD 68/bbl, respectively, before steadily falling lower throughout the APAC session to a low of USD 61.44/bbl and USD 65.45/bbl as markets price out the potential of further escalation. Benchmarks have rebounded slightly but remain near session lows.
• Nat Gas futures continue to pare back the rise in prices following the Arctic storm, with Dutch TTF now trading below EUR 35/MWh after topping at EUR 43.38/MWh at the peak of the storm worries. Overnight, Russia announced that it will permit gasoline exports for fuel producers through to the end of July to avoid overstocking.
• Precious metals continue to slide, with spot gold and silver falling as much as 10% and 16%, respectively. The initial selloff was initiated early last Friday on the possibility (and then confirmation) of Kevin Warsh being announced as the new Fed Chair.
• During the APAC session, XAU steadily trended lower as Chinese participants took the opportunity to lock in profits, falling just shy of USD 4400/oz. As the European session continues, the yellow metal continues to rebound and is returning back to USD 4700/oz; but ultimately, remains lower by over 4%. Similarly, after falling to a trough of USD 71.40/oz, silver prices have rebounded to USD 80/oz.
• Alongside precious metals, 3M LME Copper gapped below USD 13k/t and drove to a low of USD 12.43k/t, weighed on by the broader risk-off tone and weak Chinese PMIs. Copper prices remain below USD 13k/t but have recently rebounded just shy of session highs of USD 12.95k/t.
• Turkey raises lower price limits on some gold and silver funds.
• OPEC Secretariat receives updated compensation plans from Iraq, the United Arab Emirates, Kazakhstan, and Oman.
• Eight OPEC+ members agreed on Sunday to maintain the pause in oil output hikes in March.
• US President Trump said he welcomes investment from China and India in Venezuelan oil, while he announced that they have already made a deal for India to buy Venezuelan oil.
• Russia will permit gasoline exports for fuel producers through to end-July to avoid overstocking, although it extended the ban on exports for non-producers, as well as the ban on diesel and other types of fuel for non-producers until end-July.

Geopolitics: Ukraine

• Russia's Kremlin said that they have narrowed their differences on some issues with Ukraine but not on complex issues, next round of trilateral talks on Ukraine will take place in Abu Dubai on Wednesday and Thursday.
• Ukrainian President Zelensky said Ukraine is ready for substantive discussions and is interested in results, while he announced the next trilateral peace talks between the US, Russia and Ukraine will take place in Abu Dhabi on Feb. 4th-5th.
• US envoy Witkoff said he held constructive talks with Russian special envoy Dmitriev on Saturday in Florida as part of the US effort to end the war in Ukraine.
• Russia’s Medvedev said victory will come soon in the Ukraine war, but it is equally important to think about how to prevent new conflicts, while he also commented that US President Trump is an effective leader who seeks peace and that they never found the two nuclear submarines Trump spoke about deploying closer to Russia.

Geopolitics: Middle East

• Iranian Supreme Leader Khamenei warned that if the US launches a war, it won’t stay confined to Iran and would likely escalate into a broader regional conflict, according to Iran International. It was separately reported that Iran renewed its threat to strike Israel in which Iranian army chief Major-General Amir Hatami warned that “If the enemy makes a mistake, it will without doubt endanger its own security, the security of the region, and the security of the Zionist regime”.
• US officials said a meeting between the US and Iran could take place in Turkey this week, according to Axios’s Ravid.
• Iran's foreign Ministry said US President Trump has not set a deadline for negotiations, via Alhadath on X.
• Iran announces it has summoned all the EU ambassadors in the Islamic Republic to protect the bloc's listing of the paramilitary Revolutionary Guard as a terror group.
• Persian Gulf states are warning US officials that Tehran's missiles program remains capable of inflicting significant damage to US interest in the region, via X.

US Event Calendar

• 9:45 am: United States Jan F S&P Global US Manufacturing PMI, est. 52, prior 51.9
• 10:00 am: United States Jan ISM Manufacturing, est. 48.5, prior 47.9

DB's Jim Reid concludes the overnight wrap

Welcome to February with another big sell-off in Gold (-5%) and Silver (-10%) overnight, and a partial US government shutdown that isn't as severe as the record one before Xmas, and is expected to get resolved soon. Nevertheless it's typical of the 2026 constant stream of complicated news flow. This follows a January that managed to both shock and awe in various ways, yet still delivered broad based gains across all global assets in our monthly performance review when measured in USD terms—a genuinely rare occurrence. It was perhaps fitting then, that the month ended with extraordinary volatility: Silver saw its largest daily fall since 1980 (36% at the intraday lows,  26.3% at the close), while Gold recorded its biggest one day decline since 2013 ( 8.95%). With the overnight moves, Silver is now around $5 below its real adjusted level from 1790—something we explored in last Monday’s CoTD here. As we noted, even incorporating the dramatic 1980 boom and bust and the recent surge, Silver has failed to outperform inflation over more than 230 years of data. So while I’ve long been a bit of a gold bug given my strong views on the inflationary consequences of fiat money, the recent run up in precious metals feels to have an enormous speculative element. Friday’s moves, almost certainly driven by positioning and margin dynamics, only reinforced that impression.

Volatility began to build on Thursday, but the clear catalyst for Friday’s sell off appeared to be news in the early UK hours that Kevin Warsh had secured the nomination for Fed Chair. Warsh is known to be more hawkish on the balance sheet than other candidates, pushing back against the prevailing debasement narrative that has supported precious metals. That said, price action had long since detached from any sane discussion on debasement, but it often takes only a small ripple to trigger a broader correction, especially when there is leverage around. Our economics team explored the implications of Warsh’s nomination in detail on Friday here. The Dollar responded to the news with its strongest day since May, while EM assets—after an excellent month—saw sharp reversals across equities and FX.

Henry has just published his usual performance review here, and despite the late month turbulence it was still a very strong January for global assets. Silver (+18.9%) and Gold (+13%) topped the performance tables, joined by oil (+16.2%), which posted its biggest monthly gain in four years. Outside our formal performance review, it’s also worth noting that Bitcoin is currently down about -14% year to date after a difficult few days. It now sits around -40% below its October 2025 peak and back at levels first breached in November 2024. Over that same period, Gold has doubled.

Elsewhere in Asia, Brent crude futures are down by -5.4%, also being impacted by the commodities deleveraging and news that Washington is in talks with Iran. S&P 500 futures are down by -1.21% and NASDAQ 100 (-1.59%) and DAX futures (-1.02%) are also lower. The KOSPI is at the forefront of the regional equity declines, plummeting around -5.0% as major chipmakers, Samsung Electronics and SK Hynix, saw their shares drop between -5.70% and -6.50% respectively. Moreover, the Hang Seng (-2.70%) and the Hang Seng Tech index (-3.87%) are also experiencing significant retreats as an AI-driven sell-off accelerates. In other markets, the Nikkei (-1.02%) is also trading in negative territory, with the CSI (-1.40%) and the Shanghai Composite (-1.64%) also declining amid a broader regional downturn. So a pretty uncomfortable start to February.

The coming week will revolve around a dense run of US macro releases, with the January jobs report set to dominate attention on Friday. We also have the ISM surveys, consumer sentiment and the latest Treasury’s quarterly refunding details. Central banks be in focus with decisions due from the ECB, the BoE (both Thursday) and the RBA (tomorrow). Elsewhere we have the latest global PMIs and inflation in Europe. Corporate earnings include Alphabet (Wednesday), Amazon (Thursday) and AMD (Tuesday). Remember that Meta (+6.56%) and Microsoft (-8.50%) saw big moves in either direction last week with both having a 10% plus intra-day rise and decline respectively. 

Looking at more detail into the week ahead, Friday’s employment report is the highlight, with forecasts pointing to another modest payroll gain (consensus at +50k and +37k for headline and private respectively) and no change in either the unemployment rate (4.4%) or the pace of hourly earnings growth. Ahead of that, the JOLTS data tomorrow and the ADP report on Wednesday will give early clues on labour market momentum. The week also brings the manufacturing ISM on Monday and the services ISM mid week, followed by the University of Michigan’s February sentiment survey on Friday. Fixed income investors will also be watching Wednesday’s quarterly refunding announcement and today’s Treasury borrowing estimate closely.

Central banks will remain a major theme as well. The ECB and Bank of England both meet on Thursday, and neither is expected to adjust policy, with the ECB likely extending its on hold stance for a fifth straight meeting and the BoE seen keeping Bank Rate unchanged once again. The Reserve Bank of Australia is also expected to stand pat tomorrow. Additional colour on financial conditions will come from the Fed’s senior loan officer survey today and the ECB’s latest bank lending survey tomorrow.

Across Europe, the flow of flash January inflation reports continues, with France tomorrow and Italy and the broader euro area following on Wednesday. Sweden publishes its CPI on Friday. Several Eurozone economies will also release December retail sales and trade figures, while Germany rounds out the week with its factory orders and industrial production numbers. It'll be interesting to see if they show continued evidence of the fiscal stimulus.

The corporate earnings calendar remains active, with attention in the US turning to two members of the Mag-7 — Alphabet on Wednesday and Amazon on Thursday — alongside a range of other tech firms such as Palantir, AMD and Qualcomm. Major healthcare names are also reporting, including Eli Lilly and AbbVie in the US and Novartis and Novo Nordisk in Europe. Broader US earnings include updates from PepsiCo, Walt Disney and Uber. In Europe, several banks are scheduled to report, while in Japan, Toyota, Sony and Tokyo Electron will be among the key companies releasing results.

Over the weekend, data revealed that China's official PMI for January fell back below 50 again at 49.3, down from December's 50.1, and below expectations. The Manufacturing PMI has been in contraction for nine of the past ten months, reinforcing concerns that December's data may have been an anomaly rather than the beginning of a sustained recovery.

Simultaneously, the official non-manufacturing PMI decreased to 49.4 in January (compared to the expected 50.3), down from 50.2 the previous month, marking the lowest level since December 2022. This decline was attributed to weak post-holiday demand, cautious consumer spending, and ongoing challenges in the property sector. Conversely, a private survey presented a more positive outlook, indicating that China’s manufacturing activity improved to 50.3 in January (compared to 50.1 in December), and marking the strongest level since October.

Recapping last week, the biggest news happened on Friday when Trump announced Kevin Warsh as his Fed nominee. The confirmation led to a cross-asset sell-off amidst expectations that Warsh would be more hawkish than other candidates – particularly on the balance sheet. So that led to a global risk-off mood and triggered a sharp pullback in precious metals. On Friday gold (-8.95%) posted its largest daily decline since 2013 (-1.87% over the week). And silver registered its largest drop since 1980 at -26.36% (-17.44% over the week). To give some perspective, earlier in the week gold posted its best 8-day run since the GFC, rising to $5,417/oz on Wednesday, while silver also reached a new high of $116.70/oz before ending the week at $85.20. So some remarkable volatility playing out in precious metals. 

Equities had also advanced earlier in the week, with the S&P 500 briefly surpassing the 7000 threshold on Wednesday, before ending the week +0.34% higher at 6,939 (-0.43% on Friday). The reversal in equities was partly driven by Microsoft results, which saw the software giant’s shares fall -9.99% on Thursday. Combined with the Warsh news, that left the NASDAQ slightly down on the week (-0.17%, -0.94% on Friday), although the Mag-7 managed to outperform (+1.02%, -0.32% on Friday), supported by Meta’s +10.40% surge on Thursday after its own results suggested AI was boosting ad revenue growth.

In bond markets, Trump’s Warsh nomination added to the steepening in the US Treasuries curve. While 2yr yields fell -3.7bps on Friday (-7.1bps over the week) amid the risk-off mood, 10yr (+0.4bps, +1.1bps over the week) and 30yr (+1.9bps, +4.6bps over the week) moved higher. On Wednesday, the FOMC had held rates steady at 3.50%-3.75% as expected, with Chair Powell offering little near-term guidance but suggesting that the next move is still likely to be a cut.

We also saw sizeable volatility in other asset classes. In FX, the dollar index fell by -0.62% over the week, despite a +0.74% rebound on Friday helped by Trump’s Warsh nomination. Elsewhere, oil prices continued to climb higher, with Brent (+7.30%, -0.03% Friday) rising to its highest level since July amid rising concerns that the US may pursue military action against Iran, with Trump saying that the next US attack would be “far worse” than the strikes last June if Iran did not reach a deal.

Finally in Europe, the mood was more positive with the STOXX 600 ending the week +0.44% higher (+0.64% on Friday), though the DAX (-1.45%, +0.94% Friday) and CAC (-0.20%, +0.68%) retreated after weak results from the likes of SAP and LVMH. We saw mixed economic data, with a soft German IFO expectations reading on Monday (89.5 s 90.3 expected) but a stronger Euro Area Q4 GDP on Friday (+0.3% q/q vs +0.2% q/q expected). We also got stronger than expected German HICP print (+2.1% vs +2.0% expected). Despite this, yields on 10yr bunds (-6.3bps, +0.3bps Friday) and OATs (-5.6bps, +0.6bps Friday) moved lower over the week

Tyler Durden Mon, 02/02/2026 - 08:37

'Out Of Stock': As Lunar New Year Looms, AsiaPac Dip-Buyers Emerge In Gold

"I came to buy because the price of gold dropped today," said Ng Beng Choo, a 70-something retiree who arrived early in the morning at the headquarters of Singapore's United Overseas Bank (UOB), the city-state's only bank offering physical gold products to retail investors.

Bloomberg reports that clients and walk-in buyers crowded into a dedicated lounge for bullion transactions. 

Overnight, after an initial puke (catch-down) in precious metals, gold prices are bouncing back, as it appears retail investors are 'buying the dip' across AsiaPac.

The extent to which Asian investors buy the dips will play a key role in determining the direction of the market from here.

While the Shanghai benchmark price extended losses after the market opened, it was still trading at a premium over the international price. 

Over the weekend, buyers flocked to the country’s biggest bullion marketplace in Shenzhen to stock up on gold jewelry and bars ahead of the Chinese New Year.

“The combination of heightened volatility and the proximity of the Lunar New Year will prompt traders to trim positions and reduce risk,” said Zijie Wu, an analyst at Jinrui Futures Co.

At the same time - particularly in peak buying season - the pullback in prices is likely to support retail demand in China, he said.

Rather than seek to sell, many retail investors appeared to be trying to buy the dip in gold, which fell to near $4,400 an ounce on Monday after Friday's seemingly more technical (ands spectacular) liquidation.

“In my career it’s definitely the wildest that I have seen,” said Dominik Sperzel, the head of trading at Heraeus Precious Metals, a leading bullion refiner.

“Parabolic,” “frenzied” and “untradeable” were all descriptions of the market on Friday, wrote Nicky Shiels, head of metals strategy at MKS PAMP SA.

January 2026, she said, would go down as “the most volatile month in precious metals history.”

But, "fundamental changes played only a minor role in the recent developments,” said Dominik Sperzel, head of trading at Heraeus Precious Metals.

In silver, “limited market liquidity and high leverage significantly amplified the downward momentum,” he said.

“The bottom line is that the trade was way too crowded,” said Robert Gottlieb, a former precious metals trader at JPMorgan Chase & Co. and now an independent market commentator, adding that a reluctance to take further risks would constrain market liquidity.

Bloomberg also reports that in central Sydney, a queue of people snaked out into the street from an ABC Bullion outlet near Martin Place. 

“I lost a lot of money” on Friday, but “tomorrow’s a new day,” said Alex, a man in his 20s who was lined up outside the Sydney store to buy bullion, declining to give his full name.

In Thailand, where gold bars and jewelry are popular, people keep their holdings rather than selling off, Thanapisal Koohapremkit, Chief Executive Officer at Thai brokerage Globlex Securities Co. said.

“It’s still a buying trend in here in Thailand,” said Kuhapremkit.

“ They’re holding the old position and then just hold and see.”

Retail buyers may be betting that the main drivers of gold’s ascent - an increasingly unpredictable Trump and the debasement trade where investors avoid currencies and sovereign bonds - are still intact.

That optimism was shared by Michael Hsueh, an analyst at Deutsche Bank AG,, which said in a note on Monday it was sticking with its forecast for gold to get to $6,000 an ounce.

(1) We argue that the adjustment in precious metal prices overshot the significance of its ostensible catalysts. Moreover, investor intentions in precious (official, institutional, individual) have not likely changed for the worse as of yet.

(2) Gold's thematic drivers remain positive and we believe investors' rationale for gold (and precious) allocations will not have changed. The conditions do not appear primed for a sustained reversal in gold prices, and we draw some contrasts between today's circumstance and the context for gold's weakness in the 1980s and 2013.

(3) We see signs that China has been a prominent driver of precious metal investment flows. Thus, the rise in SGE premiums late last week is an important sign of amplified buying interest in gold. Together these suggest the rationale for a positive outlook has not changed from that described last week (see chart above)

Finally, returning to where we started, Bloomberg reports that at UOB, many customers who hadn’t pre-ordered were disappointed.

All products from MKS PAMP SA, one of the world’s most recognized bullion brands, were sold out, while people who arrived late were out of luck. 

“Due to overwhelming response, the buy queue tickets have all been fully issued for the day,” according to notices posted around the UOB headquarters. “Your patience is appreciated.”

Tyler Durden Mon, 02/02/2026 - 08:25