Dealers were left holding a modest 10.94%, while Direct bidders stepped in for a record 31.92%, up from 29.50%—apparently deciding that if foreigners won’t show up to the party, someone has to. This now-familiar choreography—Indirection fading, Directs charging in—has become a recurring feature of coupon auctions and may only grow more pronounced if foreign reserve managers continue to quietly trim their Treasury allocations.

Overall, it was a remarkably steady auction—proof that Wall Street has not yet received the memo that bonds are the riskiest asset to own under the reign of the ‘Educated Yet Idiots’ . In a world rediscovering inflation and policy chaos, the bond once crowned as perfectly safe is now gently being rebranded as “conditionally stable”—terms and conditions, of course, apply.

In the Middle Kingdom, January’s soft inflation, arriving politely before Lunar New Year, is less a warning than a reminder: when the calendar shifts, so do the numbers. As the old base runs high and festival demand waits for February, CPI briefly bows, only to rise again in due course—much like a student who appears late but knows the lesson. Factory prices show early signs of warming, aided by commodities, though deflation still lingers like an uninvited guest. As Confucius might say: with steadier policy and stronger households, demand will follow—but haste will not make it arrive sooner.

For investors focused on underlying economic health, the spread between core CPI and core PPI remains instructive. Unlike in the U.S., where this margin proxy has oscillated between positive and negative territory over the past year, China’s spread has widened again, suggesting improved pricing power. In the Middle Kingdom, sector leaders appear able to defend margins—supporting earnings resilience and, by extension, the potential for higher valuations.

In a nutshell, China’s January inflation dip looks more calendar quirk than cautionary tale, as improving core price spreads signal resilient margins and steadying momentum beneath the surface.

In the magic world of the Digital gulag, voter ID has triumphed at last—just not where one might expect. Somalia, once shorthand for disorder, is rolling out biometric identification to enforce “one person, one vote,” calmly linking citizenship to ballots without cries of oppression.

https://pjmedia.com/tim-o-brien/2026/02/07/thanks-to-voter-id-somalia-is-embarrassing-america-on-election-integrity-n4949240

Meanwhile in the “United Socialist America,” voter ID proposals are branded as suppression, while in places like Minnesota, the very district Omar represents, debates persist over whether allowing voters to vouch for others without standard ID safeguards strengthens access or weakens confidence.

https://www.kttc.com/2026/01/03/how-does-vouching-work-minnesota-elections/

In America, you may not need an ID to help choose the leader of the free world—but try logging into Discord without one. Starting in March, users will need a face scan or government ID to access “adult” corners of the platform, with AI quietly pre-screening everyone else for good measure. Naturally, this is all in the name of protecting children—a phrase that now doubles as a universal master key for expanding digital surveillance. From the UK to Australia to France’s VPN debates, the pattern is familiar: safety first, anonymity last. Once platforms become identity checkpoints, “verification” stops being about age and starts being about access, data, and control—because nothing says freedom online like uploading your passport to join a chat server.

https://discord.com/press-releases/discord-launches-teen-by-default-settings-globally

In a few words, voter ID is branded exclusionary in the U.S., yet nations with shakier histories—and even Gen-Z chat platforms—treat verification as basic credibility. If requiring ID is suppression, what do we call the doubts that arise without it? In Mogadishu, the logic is simple: no reliable ID, no reliable ballot. In America, the fight is less about mechanics than meaning—access versus assurance—leaving a mature democracy still debating the fundamentals of trust it assumes it already has.

After a “Jubilee Year” that felt suspiciously lean for workers, the statistical magicians struck again: January payrolls posted their strongest gain in over a year, and unemployment obligingly dipped to 4.3%. Employers added 130,000 jobs—conveniently after revisions revealed last year’s hiring was far weaker than first advertised, averaging just 15,000 a month and ultimately benchmarked nearly 900,000 lower. Health care once again did the heavy lifting, construction chipped in, manufacturing managed a cameo, and federal payrolls kept shrinking. All this even as job openings hover near post-2020 lows and headline-grabbing layoffs roll on—proof that in modern labour economics, reality may fluctuate, but the headline always finds a way to shine.

With unemployment now sitting above its two-year average, the celebrated “boom” is starting to look less like expansion and more like a cycle quietly clearing its throat.

In a nutshell, January’s shiny jobs headline masks heavy downward revisions, narrow sector strength, and a rising unemployment trend—suggesting the “boom” may be entering its late-cycle encore rather than a new act.

As policymakers debated the fate of the Middle East in the Oval Office, the Treasury quietly sold $42 billion in 10-year notes—and despite a characteristically upbeat preview from fake news crystal ball, the auction landed with a thud.
The high yield came in at 4.177%, barely changed from the prior two months, but it tailed the 4.163% when-issued level by 1.4bps—the largest tail since August 2024—suggesting demand was about as enthusiastic as the pre-auction forecasts were confident.

The bid-to-cover slid to 2.388, its weakest showing since August 2025—though to be fair, it might have looked worse had the Fed’s SOMA account not politely scooped up $11.9 billion to keep the party from ending early.
The internals weren’t exactly a confidence booster either: Indirects dropped to 64.5%, well below their recent average, Directs cooled to 22.1%, and Dealers were once again left holding the bag at 13.54%—their biggest haul since, yes, the ever-memorable August 2025. At this point, that month deserves its own commemorative plaque.

Overall, this was a 10-year auction best described as “character building.” Arguably the weakest refunding in over a year—and certainly the ugliest benchmark outing since 2024—it seems investors are slowly reconsidering the fairy tale of the “risk-free” asset.
In a world of rising issuance, stubborn inflation, and geopolitical plot twists, bondholders are discovering that “risk-free” may simply mean the risks arrive in a more sophisticated font.

Waymo’s “fully autonomous” robotaxis apparently come with a helpful human appendix—remote operators, including staff in the Philippines, who step in when the AI hits a real-world plot twist. During Senate testimony, the company confirmed that these “fleet response agents” assist vehicles when algorithms get confused, though exact numbers remain conveniently unspecified. Critics question the cybersecurity, latency, and branding implications of calling something autonomous when it occasionally needs a long-distance co-pilot. Waymo insists it’s merely a safety backup—less “driverless car,” more “AI with a phone-a-friend.”

https://www.govtech.com/transportation/waymo-says-its-robotaxis-get-help-from-workers-overseas

So, it turns out the “driverless future” doesn’t eliminate jobs—it just relocates them to lower-cost time zones. Rather than AI heroically replacing human drivers, certain roles are quietly outsourced to cheaper labor markets, doing wonders for margins if not for domestic employment.

Welcome to the next phase of innovation, where artificial intelligence and global arbitrage work hand in hand to protect valuations—because when capital meets labor, efficiency usually wins.

The Macro Butler joined Umar Tasleem on Türkiye’s Diplomacy (A-News) for a lively exchange—unpacking the ripple effects of Japan’s February 8 election, America’s growing appetite for cheap and abundant energy, and why the Super Bowl increasingly resembles a modern edition of ‘Panem et Circenses’.

After all, nothing reassures a nation about its economic future quite like fireworks, halftime shows, and commercials—especially when the grid still needs enough coal to power the AI revolution behind the scenes.

https://themacrobutler.substack.com/p/interview-with-turkiyes-diplomacy-c02

As the world endures yet another AI-induced mood swing, the U.S. Treasury calmly wrapped up the week by selling $25 billion in 30-year bonds to what appeared to be bottomless demand. The issue cleared at a 4.750% high yield, down from 4.825% in January and the lowest since November—apparently investors decided that three decades is a perfectly reasonable commitment in uncertain times. Even more impressively, it stopped through the 4.771% when-issued level by 2.1bps, the strongest stop since “Liberation Day” in April 2025—proving that while algorithms panic, bond buyers occasionally keep their composure.

Demand was more than respectable: the bid-to-cover jumped to 2.662 from 2.418, the strongest showing since January 2018—apparently 30-year paper is back in fashion.
One small detail, of course: the Fed’s SOMA account quietly tendered for and accepted a sizable $7.1 billion, adding to the previous day’s $11 billion haul in the 10-year. When the long end calls, it seems the usual investors—and a very familiar one—are happy to pick up the phone.