EndGame Macro
Cuts for Stability, Not Growth And Reading the Fed’s Play
The headline labor market can look fine while the engine underneath is losing torque. Job openings can tick up and still be consistent with a no hire and no fire economy where companies keep reqs posted, but they’re not really adding bodies. In the latest JOLTS, openings are basically steady around 7.67M but hires are drifting lower and the quits rate has slid to 1.8%. That’s the tell. People don’t quit when they’re confident, and companies don’t hire when they’re uncertain. That’s a market getting quieter and more fragile at the edges.
It Comes Down To Debt Roll Over And The Systems Plumbing
The whole system has become more interest rate sensitive because so much financing is short dated and rolling. When rates stay high, it doesn’t just hit mortgages, it hits Treasury interest expense, CRE refinancing, weaker corporate balance sheets, and bank credit appetite. So a cut isn’t just that they think inflation is solved, it’s also that they don’t want the refinancing wall to turn into a credit event.
And that’s where the bill purchases come in. QT is over and the Fed is pivoting to reinvestment and reserve management, buying Treasury Bills then is less about juicing the economy and more about keeping bank reserves ample so money markets don’t seize up under heavy issuance. Fed officials have basically framed this as plumbing and not QE because the goal is market function and liquidity stability, not lighting a new demand boom.
What I Think This Is Signaling For The Market
This is a cut cycle that’s trying to extend the runway, not launch a new expansion. The front end can rally (policy path down), but the long end can stay stubborn if deficits and issuance keep term premium elevated which is why you can see 10s rise even as the Fed eases. In that world, risk assets can still catch a liquidity bid, but it tends to be choppier and more selective because good balance sheets and real cash flows do better than stories, and credit is the place you watch first for stress.
In my opinion they’re cutting because the economy is cooling in the ways that matter (hiring, quits, credit), and they’re managing reserves because the plumbing matters more when the cycle is late and the debt load is rolling fast.
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Cuts for Stability, Not Growth And Reading the Fed’s Play
The headline labor market can look fine while the engine underneath is losing torque. Job openings can tick up and still be consistent with a no hire and no fire economy where companies keep reqs posted, but they’re not really adding bodies. In the latest JOLTS, openings are basically steady around 7.67M but hires are drifting lower and the quits rate has slid to 1.8%. That’s the tell. People don’t quit when they’re confident, and companies don’t hire when they’re uncertain. That’s a market getting quieter and more fragile at the edges.
It Comes Down To Debt Roll Over And The Systems Plumbing
The whole system has become more interest rate sensitive because so much financing is short dated and rolling. When rates stay high, it doesn’t just hit mortgages, it hits Treasury interest expense, CRE refinancing, weaker corporate balance sheets, and bank credit appetite. So a cut isn’t just that they think inflation is solved, it’s also that they don’t want the refinancing wall to turn into a credit event.
And that’s where the bill purchases come in. QT is over and the Fed is pivoting to reinvestment and reserve management, buying Treasury Bills then is less about juicing the economy and more about keeping bank reserves ample so money markets don’t seize up under heavy issuance. Fed officials have basically framed this as plumbing and not QE because the goal is market function and liquidity stability, not lighting a new demand boom.
What I Think This Is Signaling For The Market
This is a cut cycle that’s trying to extend the runway, not launch a new expansion. The front end can rally (policy path down), but the long end can stay stubborn if deficits and issuance keep term premium elevated which is why you can see 10s rise even as the Fed eases. In that world, risk assets can still catch a liquidity bid, but it tends to be choppier and more selective because good balance sheets and real cash flows do better than stories, and credit is the place you watch first for stress.
In my opinion they’re cutting because the economy is cooling in the ways that matter (hiring, quits, credit), and they’re managing reserves because the plumbing matters more when the cycle is late and the debt load is rolling fast.
FED MAY CUT RATES AND BOOST BILL PURCHASES
The Fed is expected to cut rates to 3.50%-3.75% Wednesday. Bank of America predicts an extra move: ~$45B in monthly short-term Treasury bill purchases to maintain bank reserves and prevent liquidity issues. Combined with MBS reinvestments, total bill purchases could reach ~$60B/month. These “Reserve Management Purchases” aren’t QE—they aim to keep money markets functioning, not stimulate lending. While critics may see it as money printing, the move could reassure markets amid rising Treasury issuance and concerns about tightening liquidity. tweet
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*Walter Bloomberg (@DeItaone) on X
FED MAY CUT RATES AND BOOST BILL PURCHASES
The Fed is expected to cut rates to 3.50%-3.75% Wednesday. Bank of America predicts an extra move: ~$45B in monthly short-term Treasury bill purchases to maintain bank reserves and prevent liquidity issues. Combined…
The Fed is expected to cut rates to 3.50%-3.75% Wednesday. Bank of America predicts an extra move: ~$45B in monthly short-term Treasury bill purchases to maintain bank reserves and prevent liquidity issues. Combined…
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He did 0 pull-ups as his form was terrible and those don't count https://t.co/y4rH0dppOL
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He did 0 pull-ups as his form was terrible and those don't count https://t.co/y4rH0dppOL
BREAKING: RFK Jr. smashes 20 pull-ups at the airport, at 71 years old. https://t.co/5He9Av2M1g tweet
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EndGame Macro
Dollar General Is Expanding Again And That Should Make You Think…
This is a huge signal to me. Dollar General announcing 450 new stores for 2026 isn’t the kind of expansion you see when the consumer is strong, it’s the kind you see when a company expects a larger share of the country to be shopping at the bottom rung. You don’t build hundreds of ultra discount locations because the middle class is thriving; you build them because more households are about to trade down.
During 2008–09, when unemployment rose and real wages slipped, dollar stores were one of the only retail formats expanding aggressively. They picked up foot traffic from stressed shoppers, pulled in new customer segments who were being squeezed, and kept growing even after the recession technically ended because the habits stuck. The dollar store decade wasn’t born out of prosperity, it was born out of strain.
So when Dollar General is closing a small number of weak locations but still rolling out 400–500 new ones, mostly in rural and lower income areas, it’s not a flex of confidence in a booming economy. It’s a quiet admission about where they believe the consumer is headed with more price sensitivity, more budget stress, more communities where the only reliable business model is selling the cheapest version of everyday life. Expansion on this scale is a macro signal and it’s telling you the market for bargain priced necessities is still growing.
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Dollar General Is Expanding Again And That Should Make You Think…
This is a huge signal to me. Dollar General announcing 450 new stores for 2026 isn’t the kind of expansion you see when the consumer is strong, it’s the kind you see when a company expects a larger share of the country to be shopping at the bottom rung. You don’t build hundreds of ultra discount locations because the middle class is thriving; you build them because more households are about to trade down.
During 2008–09, when unemployment rose and real wages slipped, dollar stores were one of the only retail formats expanding aggressively. They picked up foot traffic from stressed shoppers, pulled in new customer segments who were being squeezed, and kept growing even after the recession technically ended because the habits stuck. The dollar store decade wasn’t born out of prosperity, it was born out of strain.
So when Dollar General is closing a small number of weak locations but still rolling out 400–500 new ones, mostly in rural and lower income areas, it’s not a flex of confidence in a booming economy. It’s a quiet admission about where they believe the consumer is headed with more price sensitivity, more budget stress, more communities where the only reliable business model is selling the cheapest version of everyday life. Expansion on this scale is a macro signal and it’s telling you the market for bargain priced necessities is still growing.
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Twitter is the only place you argue with CEOs and heads of states while sleeping in the kitchen
https://t.co/R2npQs9pM5
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Twitter is the only place you argue with CEOs and heads of states while sleeping in the kitchen
https://t.co/R2npQs9pM5
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I'm calling mom
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I'm calling mom
This dragon attacks your city…
Who do you call first? https://t.co/KBBFMj1j5L tweet