Morning Report: More evidence of a weakening labor market

Posted on June 5, 2025 by Brent Nyitray

Vital Statistics:

Stocks are flattish this morning on no real news. Bonds and MBS are up.

Home prices rose 1.4% quarter-over-quarter and 4.2% year-over-year according to the Clear Capital Home Data Index. The Northeast performed the best on a YoY basis, increasing 1.8% QoQ and 7.3% YoY, while the South performed the worst, where prices rose 0.8% QoQ and 2.1% YoY.

The Clear Capital Home Data Index is based on a repeat-sales methodology and a price per square foot model. It is faster than the competing indices like Case-Shiller and FHFA.

In the accompanying commentary, I discuss a couple major trends that are affecting real estate prices. Check it out.

Economic activity declined from late April to early June, according to the latest Fed Beige Book. It looks like about half the districts reported a decline, while 3 reported no change and reported growth. Employment was weaker: “All Districts described lower labor demand, citing declining hours worked and overtime, hiring pauses, and staff reduction plans. Some Districts reported layoffs in certain sectors, but these layoffs were not pervasive”, while prices rose moderately. Most districts expected prices to accelerate upward due to tariffs.

Wells reported that the Fed has removed the cap on asset growth imposed in 2018. “The Federal Reserve’s decision to lift the asset cap marks a pivotal milestone in our journey to transform Wells Fargo. We are a different and far stronger company today because of the work we’ve done,” said Wells Fargo CEO Charlie Scharf. “In addition, we have changed and simplified our business mix, and we have transformed the management team and how we run the company. We have been methodically investing in the company’s future while improving our financial results and profile. We are excited to continue to move forward with plans to further increase returns and growth in a deliberate manner supported by the processes and cultural changes we have made.”

More evidence of a weakening labor market: job cuts rose 47% compared to a year ago. They fell on a MOM basis compared to April however. “Tariffs, funding cuts, consumer spending, and overall economic pessimism are putting intense pressure on companies’ workforces. Companies are spending less, slowing hiring, and sending layoff notices,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas.

Government spending decreases (i.e. DOGE) remains the biggest reason for job cuts.

Separately, initial jobless claims rose to 247k last week, above expectations.

Filed under: Economy |

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21 Responses

  1. jnc4p's avatar
    jnc4p, on June 5, 2025 at 12:10 pm said:

    This is great:

    Label Makers

    Lawyers are in the litigation business.

    Doomberg

    Jun 05, 2025

    ∙ Paid

    “Growth for the sake of growth is the ideology of the cancer cell.”—Edward Abbey

    In April, Democratic lawmakers in the Colorado House of Representatives pushed a bill that would have required retail gas station owners to affix a sticker on each of their pumps. Modeled after the warnings on cigarette packages, the message to the state’s drivers was to be stark: burning fossil fuels “releases air pollutants and greenhouse gases, recognized by the state of Colorado as being linked to significant health impacts and global heating.” The bill stalled in the Senate, in part because of a proposed amendment by Republicans that would put warning labels on electric vehicle chargers highlighting the use of child labor in battery supply chains.

    https://newsletter.doomberg.com/p/label-makers

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  2. jnc4p's avatar
    jnc4p, on June 5, 2025 at 5:59 pm said:

    Vivek Ramaswamy is looking pretty smart for dodging the DOGE appointment right about now.

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  3. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on June 5, 2025 at 9:26 pm said:

    Wicker’s still butthurt over having to vote for Hegseth and for Walz being shunted aside.

    Like

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  4. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on June 7, 2025 at 1:59 pm said:

    Goddamn.

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    Reply
  5. jnc4p's avatar
    jnc4p, on June 9, 2025 at 12:29 pm said:

    Good read:

    “LA’s nullification crisis

    Violence results when elected officials pretend the federal government cannot enforce federal law in progressive jurisdictions

    Jeff Eager

    Jun 08, 2025″

    https://oregonroundup.substack.com/p/las-nullification-crisis

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  6. jnc4p's avatar
    jnc4p, on June 9, 2025 at 12:49 pm said:

    The irony:

    “Waymo suspends service in parts of L.A. after its robotaxis torched

    The Los Angeles Police Department also urged people to steer clear of downtown because burning lithium-ion batteries can release toxic fumes.

    June 9, 2025 at 12:05 p.m. EDT”

    https://www.washingtonpost.com/business/2025/06/09/waymo-cars-burned-los-angeles-protest/

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  8. jnc4p's avatar
    jnc4p, on June 11, 2025 at 9:37 am said:

    “Ms. Flores said she also owns an American flag but worried about carrying it at an anti-Trump protest because the stars-and-stripes iconography had become so associated with the MAGA movement.

    “Right now, it could look bad to raise the American flag because of the Trump administration,” she said. “If I put the U.S. flag outside my home, my neighbors would think I’m with Trump.””

    https://www.nytimes.com/2025/06/11/us/la-protests-mexican-flags-republican-reaction.html

    And thus he’s won.

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    • jnc4p's avatar
      jnc4p, on June 12, 2025 at 12:25 pm said:

      “”Having worked around the clock for years, if not decades, the imposed idleness was something I could not get used to,” said one lawyer who was assigned to the task force.”

      Like

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  10. jnc4p's avatar
    jnc4p, on June 12, 2025 at 12:26 pm said:

    Good read:

    What Makes Art ‘Left Wing’?

    The showrunner Tony Gilroy on the political ideologies of “Andor.”

    June 5, 2025

    Hosted by Ross Douthat

    https://www.nytimes.com/2025/06/05/opinion/film-hollywood-andor-politics.html

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  11. Brent Nyitray's avatar
    Brent Nyitray, on June 12, 2025 at 12:33 pm said:

    A dozen lawyers.. doesn’t sound like many-probably hyper partisan leftists who intended to sabotage Trump’s priorities

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  12. jnc4p's avatar
    jnc4p, on June 13, 2025 at 11:16 am said:

    Good NYT focus group with Gen Z on the post-COVID job market and their reaction to Trump’s second term so far.

    https://www.nytimes.com/interactive/2025/06/13/opinion/college-grads-focus-group.html

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