Key Takeaways
- US June jobs data showed unemployment falling to 4.2% but nonfarm payrolls missed expectations by a wide margin (57K vs 114K), with prior months revised down by 74K, signaling a cooling labor market.
- The Trump family cryptocurrency project is widely criticized as an apparent corruption scheme: $TRUMP token down 98%, $MELANIA down 99%, while the family profited $1.4 billion, drawing bipartisan condemnation.
- AI industry faces valuation questions: Lyn Alden argues frontier AI companies' fair value is below recent funding rounds, with open-source models advancing and competition intensifying, while others note AI token giveaways as a tactic to acquire IP.
- Market extremes persist: bond market drawdown longest on record at 71 months, Bitcoin down 54% from Oct peak, and semiconductor stocks up 237% in 14 months exceeding dot-com peak, amid high liquidity correlation.
1. US Economic Data Shows Mixed Signals
- The US unemployment rate fell to 4.2% in June, below the historical average of 5.7%, but nonfarm payrolls added only 57K, far below the expected 114K, while April and May data were revised down by a total of 74K. — via 1 2
- Average hourly earnings grew 3.5% YoY and 0.3% MoM, in line with expectations, and average weekly hours held at 34.3. — via 1
- The ISM Manufacturing PMI prices paid index dropped 9 points to 73 in June, the largest monthly decline since July 2022, and factory orders fell 1.3% MoM but beat expectations excluding transportation. — via 1
- The market now prices a 55% probability of a rate hike in September, with no cut expected in July. — via 1
2. Trump Family Cryptocurrency Project Under Fire
- The Trump family's crypto project is described as one of the most blatant corruption cases in US political history: Donald Trump stated “everyone is making money,” but investors in $TRUMP token lost 98%, and $MELANIA lost 99%, while the family profited an estimated $1.4 billion. — via 1
- Commentators note Trump personally made more money from crypto than all US-listed crypto companies combined, undermining his “pro-crypto president” claim. — via 1
- @jason calls it the biggest scam, criticizing Trump for profiting over $1.1 billion (disputed/unverified exact figure) from crypto while his supporters lose heavily. — via 1
3. AI Industry Faces Valuation and Competition Pressures
- Lyn Alden identifies a valuation problem in AI: if AI really needs a national bailout, the market has already responded; fair value of frontier AI companies is below recent funding rounds, with open-source model progress, intensifying competition, and excessive financial engineering. They argue the market should be allowed to work without bailing out investors. — via 1
- @jason warns that AI frontier models are giving away free tokens to startups and discounts to big companies to steal IP, innovation, and business, and the only defense is open-source software. — via 1
- Raoul Pal notes the Nasdaq has a 97.5% correlation with global liquidity, arguing that expensive valuations are due to currency debasement and that liquidity is the key driver of all asset prices, which contextualizes AI stock valuations. — via 1
- Lyn Alden adds that agentic AI is driving a surge in mobile app releases but lacks user growth, indicating potential overinvestment. — via 1
4. Extreme Market Conditions Across Assets
- The US bond market drawdown has lasted 71 months, the longest on record; Bitcoin is down over 54% from its October 2024 peak, the largest and longest decline since 2022; semiconductor stocks have rallied 237% over the past 14 months, exceeding the dot-com bubble peak, driven by the AI frenzy. — via 1 2 3
- Raoul Pal reiterates that liquidity is the key driver: the “Everything Code” framework shows asset prices are a function of global liquidity, not fundamentals alone. — via 1
