Death, taxes and the Biden admin reporting a stellar jobs beat… then revising it sharply lower one month later.

That was certainly the case moments ago when the BLS reported that in February a whopping 275K jobs were added, smashing both the median estimate of 200K and the whisper number of 215L. In fact, just one Wall Street forecaster – Seiji Katsurahata at Dai-Ichi – had a higher forecast at 286K.

And while February was a strong print, it’s just a placeholder until next month’s downward revision: that’s because January’s blowout 353K print was revised sharply lower to just 229K, down by a whopping 35%.

However, as usual, there was an ugly divergence between the Establishment survey (payrolls) and the Household survey (actual number employed), which declined once again, sliding to 160.968 million from 161.152 million, or down 184,000.

This means that the divergence between Payrolls and Employment extended as more people are forced to take on more than one job.

That wasn’t the only problem with today’s jobs report: despite the sharp jump in monthly payrolls, the unemployment rate unexpectedly rose to 3.9%, the highest since January 2022, vs estimates of a 3.7% unchanged print. Among the major worker groups, the jobless rates for Whites was unchanged at 3.4%, for Blacks rose 0.3% to 5.6%, Asians was flat at 3.4% as were Hispanics at 5.0%.

We also saw discrepancy between men and women. On International Women’s Day, the unemployment rate for adult women climbed by 0.3 percentage point, to 3.5%, while the jobless rate for men dipped. That said, the rates are now the same.

While the unemployment rate rose, the labor force participation rate was unchanged at 62.5%, disappointing expectations for a modest increase to 62.6%.

There was some more good news on the wage front, well if you are the Fed that is: the average hourly earnings growth dipped to 4.3% YoY from 4.4%, in line with expectations, while the monthly increase was just 0.1%, below the 0.2% estimate and down from a downward revised 0.5% print in January.

The average hourly earnings for all employees on private nonfarm payrolls edged up by 5 cents to $34.57, following an increase of 18 cents in January. Average hourly earnings were up by 0.1 percent in February and 4.3 percent over the year. In February, average hourly earnings of private-sector production and nonsupervisory employees edged up by 7 cents, or 0.2 percent, to $29.71.

In February, the average workweek for all employees on private nonfarm payrolls edged up by 0.1 hour to 34.3 hours, following a decline of 0.2 hour in January. In manufacturing, the average workweek was little changed at 39.9 hours, and overtime increased by 0.2 hour to 3.0 hours in February. The average workweek for production and nonsupervisory employees on private nonfarm payrolls increased by 0.3 hour to 33.8 hours, following a decline of 0.3 hour in January.

Taking a closer look at the job composition, we find that in February job gains occurred in health care, in government, in food services and drinking places, in social assistance, and in transportation and warehousing.

Some more details:

• Health care added 67,000 jobs in February, above the average monthly gain of 58,000 over  the prior 12 months. In February, job growth continued in ambulatory health care services (+28,000), hospitals (+28,000), and nursing and residential care facilities (+11,000).
• Government employment rose by 52,000 in February, about the same as the prior 12-month average gain (+53,000). Over the month, employment continued to trend up in local government, excluding education (+26,000) and federal government (+9,000).
• Employment in food services and drinking places increased by 42,000 in February, after changing little over the prior 3 months.
• Social assistance added 24,000 jobs in February, about the same as the prior 12-month average gain of 23,000. Over the month, job growth continued in individual and family services (+19,000).
• Employment in transportation and warehousing rose by 20,000 in February. Couriers and messengers added 17,000 jobs, after losing 70,000 jobs over the prior 3 months. In February, job growth also occurred in air transportation (+4,000), while warehousing and storage lost 7,000 jobs.
• Employment continued to trend up in construction (+23,000), in line with the average monthly gain of 18,000 over the prior 12 months. Over the month, heavy and civil engineering construction added 13,000 jobs.
• Retail trade employment changed little in February (+19,000). Over the month, job gains in general merchandise retailers (+17,000); health and personal care retailers (+6,000); and automotive parts, accessories, and tire retailers (+5,000) were partially offset by job losses in building material and garden equipment and supplies dealers (-6,000) and electronics and appliance retailers (-2,000).
• Employment showed little change over the month in other major industries, including mining, quarrying, and oil and gas extraction; manufacturing; wholesale trade; information; financial activities; professional and business services; and other services. 

Commenting on the report, Bloomberg economics chief Ana Galvao writes that “the combination of a mild upside surprise to payrolls but an unexpected increase in the unemployment rate muddles the picture for markets. BE’s Macro-Finance SHOK model suggests forecasts for Treasury yields would be little changed.”

And here is Capital Economics, which – very naively – had the second lowest payrolls forecast for February as if the Biden admin would ever admit the ugly truth: “The downward revisions to previous months gains leave recent growth looking less strong than previously thought. Alongside the rise in the unemployment rate to a two-year high and a much weaker rise in wages, there is less reason now to be concerned that renewed labor-market strength will drive inflation higher again.”

One thing is certain: markets loved the print with futures spiking to a new all time high and the dollar sliding to a new one-month low, as the BLS mandate of doing everything in its power to push markets ever higher until the election – reality and facts be damned – comes into full view. As for the reality, the following chart showing the correlation between private payrolls and the NFIB survey’s Small Business hiring plans (because in America it’s the small business that are responsible for most of the hiring), should tell you all you need to know.

Authored by Paul Joseph Watson via Modernity.news,

After Joe Biden shocked many by actually telling the truth that Laken Riley was killed by an “illegal,” Nancy Pelosi expressed her anger that the murderer wasn’t described as “undocumented”.

Yes, really.

The 22-year-old nursing student at Augusta University was kidnapped and killed by an illegal immigrant from Venezuela when she was jogging at the University of Georgia last month.

Marjorie Taylor Greene heckled Biden during his State of the Union speech and was actually successful in forcing Biden to tell the truth about the matter.

Although in true senile fashion, Biden called her “Lincoln,” he did say Riley was an “innocent young woman who was killed by an illegal”.

🚨MASK SLIPS: With hard drugs wearing off fast Joe Biden has a truly shocking moment of honesty & lucidity.

After MTG screams Laken Riley’s name Biden goes off prompter, rattled and admits:

“THOUSANDS of Americans are being Killed by ILLEGALS.”

Joe knows.

He doesn’t care. pic.twitter.com/P6T0RBDQtS

— Benny Johnson (@bennyjohnson) March 8, 2024

Nancy Pelosi was visibly annoyed that Riley’s killer was accurately described.

Pelosi slams Joe Biden for referring to Laken Riley’s kiIIer as an illegal:

“He should’ve said undocumented.”

pic.twitter.com/vMoAqSyZPe

— End Wokeness (@EndWokeness) March 8, 2024

“And he should have said undocumented, but it’s not a big thing, okay?” she told a CNN panel.

Apparently, it was a big thing to her, otherwise she wouldn’t have said it.

“You do think he should have said undocumented?” Pelosi was asked.

“We usually say undocumented,” she responded.

Who is she even being offended on behalf of, the actual murderer?

*  *  *

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.

US stock-index futures reversed earlier gains and traded near session lows before the release of the February jobs report at 830am (consensus expects a 200k print, a slowdown from last month’s 353k print: see full preview here) and after Fed Chair Jerome Powell indicated the central bank is getting close to the confidence it needs to cut interest rates. S&P 500 futures were down 0.2%, while Nasdaq 100 and Dow Jones futures were down 0.3% at 8:00am ET, reversing earlier gains of as much as 0.2%. Powell said Thursday the Fed will “begin to dial back”rates once it’s confident inflation is moving sustainably at 2%. 10-year yields slid to a one-month low 4.07%, and the dollar skidded for the sixth straight day after the yen surged following a Reuters report the BOJ may hike as soon as this month. Across Europe, bond yields dropped and the euro slipped, after the ECB lowered its inflation forecast, indicating monetary easing could begin in June, a view more rate-setters backed on Friday. Commodities are mixed with Energy flat, metals higher, and Ags mixed. NFP is today’s macro data focal point. Fed’s Williams speaks later but mkt remains focused on Powell’s comment of “not far” from having confidence to cut rates.

In pre market trading, both AVGO and MRVL traded down after reporting disappointing earnings; they are trading -2.4% and -5.9% pre-mkt but NVDA is +3.2% pre-market, taking its market cap increase this year to more than $1 trillion as demand for AI chips shows no signs of letting up. The stock on track to rise for a seventh consecutive session, its longest winning streak since November. The world’s most valuable semiconductor maker is valued at about $2.32 trillion and is inching closer to Apple’s $2.61 trillion market cap and MSFT’s $3.04 trillion.

The balance of the Mag7 are higher ex-MSFT. Consumer earnings were positive, led by COST and GPS but COST appears to be a sell the news event; stocks are+7.4% and -5.0% pre-mkt, respectively. Here are some other notable premarket movers:

• AerSale sinks 20% after the aircraft engineering company reported revenue and adjusted profit for the fourth quarter that trailed estimates.
• Amylyx Pharmaceuticals tumbles 80% after the company said the AMX0035 PHOENIX study missed endpoints.
• Broadcom slips 1.8% after the chipmaker reported semiconductor solutions revenue that missed the average of analysts’ estimates
• Carvana rises 5% as RBC issued an upgrade and doubled the price target to a Street-high $90.
• Costco drops 4.1% after the warehouse club chain reported second-quarter revenue and gross margin that didn’t meet consensus expectations. Citigroup said it’s hard to see catalysts that can drive Costco’s shares higher.
• DocuSign rises 8.6% after the e-signature company reported fourth-quarter results that beat expectations and gave an outlook that is seen as strong.
• Domo falls 12% as the application software company’s outlook pointed to ongoing growth pressures.
• Eli Lilly & Co. slips less than 1% as the company’s Alzheimer’s disease drug donanemab faces further delays in gaining approval
• Biogen gains 3.7%; Biogen markets Leqembi with partner Eisai, which received FDA approval to treat Alzheimer’s in July
• Funko jumps 7% after the maker of bobble-head dolls reported fourth-quarter profit and sales that came in ahead of estimates.
• Gap advances 8% after the clothing retailer reported fourth-quarter EPS that topped consensus expectations. Jefferies highlighted the continued improvement in results at Gap’s namesake brand and Old Navy.
• Marvell Technology slips 5.6% after the chipmaker gave a first-quarter forecast that was weaker than expected. Analysts note that AI was unable to offset weakness in other parts of the business.
• MongoDB drops 8.8% after the database software company gave a full-year forecast that was much weaker than expected.
• Porch Group rises 22% after the home services software company reported revenue for the fourth quarter that beat the average analyst estimate.
• Samsara jumps 14% after the application software company’s full-year forecast topped analyst estimates.

How markets move from here will likely be determined by US employment data, with the consensus forecasting that 200,000 new jobs were created last month, well down from January’s 353,000. The crowd-sourced whisper number is 215k. Hourly wage growth is also expected to slow (full preview here).

“If we get a very robust number, the bond market looks vulnerable,” said Charles Diebel, a macro advisor to Mediolanum International Funds. “It may also start challenging risk assets’ performance, which is based on expectations that interest rates and bond yields will fall.”

Elsewhere, late on Thursday Joe Biden delivered the State of the Union Address in which he stated they will work to rebuild the economy and that unemployment is at a 50-year low, Biden said he is seeking to make healthcare tax credit permanent, while he added that Americans pay more than anywhere else in the world on prescription drugs and he is ending this.

European stocks were also in the green, with the Stoxx 600 up 0.2% and set to log a seventh consecutive week of gains. The financial services subindex leads gains, led by UBS, which rises to a 16-year high on a Morgan Stanley upgrade; energy names also gained. Among individual stock movers in Europe, HelloFresh SE plunged by a record 48% after the meal-kit firm said it no longer expects to achieve previously provided 2025 goals. DS Smith Plc climbed almost 8% after Mondi Plc agreed to buy the company for £5.1 billion ($6.5 billion) to create one of the largest makers of packaging. Here are some of the biggest movers Friday:

• UBS gains as much as 4.8% after being raised to overweight at Morgan Stanley, predicting a strong comeback for the investment banking pipeline will spur long-term structural upside for the bank
• Grifols rallies as much as 26% from near 12-year lows after the company filed annual consolidated accounts with an unqualified opinion from auditor KPMG
• Maire shares rise as much 6.7% in Milan after Algerian state energy company Sonatrach awarded the Italian company a $1.1b contract for a linear-alkyl-benzene plant
• DS Smith gains as much as 7.6% to 350p after Mondi agreed to buy the company for £5.1 billion in an all-share deal that would create one of the world’s largest makers of packaging
• Informa rises as much as 2.4%, after the publishing firm’s earnings. Raised guidance, overshoot on revenue and larger-than-expected buyback in 2024 were highlights, according to analysts
• Mattioli Woods soars as much as 32% after Pollen Street Capital’s deal valuing the company at about £432m; Deal represents a premium of about 34% to Mattioli Woods’ March 7 closing price
• HelloFresh plunges by a record 48% after the meal-kit firm said it no longer expects to achieve previously provided 2025 goals, while setting 2024 profit target well below analyst expectations
• Suess MicroTec falls as much as 7% as Hauck & Aufhaeuser downgraded the German semiconductor company to hold, noting a mismatch in valuations and Ebit margins

Earlier in the session, Asian stocks rose, on track to cap a seventh-straight week of gains, as technology shares rallied again on dovish signals from the US central bank as well as ongoing optimism about artificial intelligence. The MSCI Asia Pacific Index advanced as much as 1%, extending its weekly gain to about 2% and set for its longest weekly win streak in more than three years. Tech harware shares were the biggest boosts to the regional gauge, with TSMC rallying for a fifth day. Most markets gained, with Hong Kong, South Korea and Japan among the leaders. India was closed for a holiday.

In FX, the Bloomberg Dollar Index is down 0.1%. The Japanese yen raced to the top of the G-10 FX leader board, rising 0.8% versus the greenback after Reuters reported the Bank of Japan are leaning toward exiting negative rates in March. The weaker dollar also helped the pound scale a seven-month high.

In rates, treasury yields dropped to a one-month low with price gains led by belly, extending Thursday’s sharp steepening move in the 5s30s spread ahead of February jobs report. Treasury yields richer by 1bp to 2bp across the curve with belly-led gains steepening 5s30s by 1bp on the day, after the spread ended Thursday wider by almost 5bp. US 10-year yields around 4.07% with bunds outperforming by 2.5bp in the sector. German government bonds have gained as several European Central Bank policymakers suggested an April interest rate hike should not be completely ruled out. A crucial gauge of wages in the euro zone also slowed at the end of last year. German two-year yields fall 6bps to 2.78%.  According to BBG, the IG dollar issuance slate is empty so far with no offerings expected; six companies priced $7b Thursday, sealing third straight weekly total over $50b. 

In commodities, oil prices are little changed, with WTI trading near $79. Gold surged above $2,160 an ounce, rising for an eighth day. The precious metal could rise to $2,300 in the next six to 12 months, analysts at Citigroup Inc. predicted.

“Macro and rates aside, we are seeing massive buying by China, not only at central bank level, but also from a wholesale level, with demand flows for January and February being the most on record,” Ned Naylor-Leyland at Jupiter Asset Management said in a note.

Bitcoin took a breather and holds just above $67k while Ethereum continues to advance as it closes in on USD 4k.

Looking to the day ahead, the main data highlight will be the US jobs report for February. Otherwise, there’s the German and Italian PPI readings for February. From central banks, we’ll hear from the Fed’s Williams and the ECB’s Simkus and Holzmann.

Market Snapshot

• S&P 500 futures up 0.1% to 5,167.25
• STOXX Europe 600 up 0.2% to 504.07
• MXAP up 1.1% to 177.85
• MXAPJ up 1.2% to 538.05
• Nikkei up 0.2% to 39,688.94
• Topix up 0.3% to 2,726.80
• Hang Seng Index up 0.8% to 16,353.39
• Shanghai Composite up 0.6% to 3,046.02
• Sensex little changed at 74,119.39
• Australia S&P/ASX 200 up 1.1% to 7,846.98
• Kospi up 1.2% to 2,680.35
• German 10Y yield little changed at 2.27%
• Euro down 0.1% to $1.0932
• Brent Futures up 0.6% to $83.43/bbl
• Gold spot up 0.3% to $2,167.50
• US Dollar Index little changed at 102.79

Top Overnight News

• Japanese corporate wages are set to jump as annual negotiations w/unions wrap up on March 13, paving the way for the BOJ to eliminate neg. yields by April. RTRS
• A growing number of Bank of Japan policymakers are warming to the idea of ending negative interest rates this month on expectations that this year’s annual wage negotiations will yield strong results. RTRS
• China’s auto sales in Feb crashed 21% Y/Y and 46% M/M, although a sharp rebound in sales and production was forecast for this month. WSJ
• For American tech companies in China, the writing is on the wall. It’s also on paper, in Document 79. The 2022 Chinese government directive expands a drive that is muscling U.S. technology out of the country—an effort some refer to as “Delete A,” for Delete America. WSJ
• Huawei and its partner SMIC relied on US technology to produce an advanced 7-nanometer chip last year, people familiar said. The revelation underscores the fact that China still can’t entirely replace foreign components and equipment. Separately, China is raising more than $27 billion for its largest chip fund to counter US curbs. BBG
• Momentum built for a June ECB rate cut as policymakers echoed that prospect, with a few — such as Francois Villeroy — even suggesting a swifter move in April shouldn’t be completely ruled out. But officials won’t necessarily lower rates at every meeting once the cuts start, Martins Kazaks cautioned. BBG
• Joe Biden targeted Donald Trump in his State of the Union address without mentioning his rival by name. He laid out the makings of a reelection platform including plans to raise taxes on the wealthy and corporations. Biden also sought to portray his age as an asset, going out of his way to appear energetic. BBG
• Saudi Arabia has transferred a $163bn stake in national oil group Aramco to its sovereign wealth fund as the once conservative state investment group seeks to grow its assets to fund projects to modernize the economy. The transfer of 8 per cent of Aramco to the Public Investment Fund is the third time in the past two years the government has increased the sovereign wealth fund’s stake in the world’s largest oil producer. FT
• Concentration within the US equity market has surged to a multi-decade high. The 10 largest US stocks now account for 33% of S&P 500 market cap and 25% of S&P 500 earnings. GIR

A more detailed look at global markets courtesy of Newsquawk

APAC stocks took impetus from the fresh record levels on Wall Street amid dovish tailwinds. ASX 200 printed a fresh record high as the top-weighted financial industry led the gains seen in most sectors. Nikkei 225 initially approached just shy of 40,000 but with gains capped after disappointing Household Spending. Hang Seng and Shanghai Comp. were somewhat varied as the Hong Kong benchmark conformed to the upbeat mood, while the mainland was less decisive amid lingering tech-related frictions between the US and China.

Top Asian News

• China NPC Standing Committee said it will formulate a financial stability law, a law on rural collective economic organizations, a value-added tax law and a private sector promotion law, while it will revise the mineral resources law, enterprise bankruptcy law, unfair competition law, accounting law, public bidding law, the statistics law, and civil aviation law. Elsewhere, Hong Kong’s government issued a draft of a new national security law which includes state secrets, espionage, and foreign interference, according to Reuters.
• US lawmakers advanced a bill on Thursday that would ban TikTok in the US unless it cuts ties with its Chinese parent ByteDance within six months, while House Majority Leader Scalise said the House will vote next week on the TikTok crackdown.
• Three US Senators urge President Biden to hike tariffs on Chinese imported autos saying they could endanger American automotive manufacturing, according to a letter.
• China is raising a USD 27bln chip fund in order to counter mounting US restrictions, according to Bloomberg

European bourses, Stoxx600 (+0.2%) are mixed and trade has been contained within recent ranges, as the US NFP at 13:30 GMT / 08:30 ET remains in focus. European sectors are mixed; Financial Services takes the top spot, led higher by UBS (+4.1%), which benefits from a broker upgrade at Morgan Stanley. Energy is also higher, benefitting from broader strength in the crude complex. Telecoms is found near the bottom of the pile. US Equity Futures (ES +0.1%, NQ U/C, RTY +0.2%) are modestly firmer, and with trade fairly rangebound as traders await  the US NFP report at 13:30 GMT / 08:30 ET. In terms of stock specifics, TSMC (+3.5%) benefits after reporting that its revenue rose 11.3% Y/Y.

Top European News

• Vivendi Advances Plan to Split Media Conglomerate in Four
• CPP to Acquire 17.5% Stake in NetCo From Telecom Italia
• Just Group Rises on Dividend Boost, ‘Record Low’ Business Strain
• Grifols Shares Jump as Auditor Greenlights Its Annual Accounts
• ECB’s Simkus Says Interest-Rate Cuts May Begin in June
• Zelenskiy Travels to Turkey in Bid to Shore Up Defense Support
• HelloFresh Slumps Most Ever After Meal-Kit Maker Scraps Target
• Klarna’s CEO Looks to Google for ‘Perfect’ Listing Blueprint
• BE Semiconductor Volume Jumps to More Than Five Times Average

FX

• DXY is flat as losses in EUR offset gains in JPY. The range for the session is 102.69-90 with NFP set to be the main driver for the USD. A soft release could see the DXY move closer to 102; a level not breached since 5th Jan.
• EUR is the only currency across the majors on the backfoot vs. the USD with ECB speakers out in full force and guiding markets towards a June cut. The pair is potentially showing some fatigue after venturing as high as 1.0955 with traders mindful of NFP later which will likely act as the main catalyst for the pair today.
• JPY has continued to extend on its weekly gains vs. the USD as markets increasingly position for a more hawkish BoJ amid reporting that the BoJ is to review its YCC programme and “leaning toward” ending negative rates in March. USD/JPY now down as low as 146.89; a soft NFP print could see the 200DMA come into view at 146.17.
• Antipodeans are both firmer vs. the USD with AUD marginally more so. AUD’s climb this week has seen it rise from 0.6477 base to a current peak of 0.6644 after taking out its 10, 21, 50, 100 and 200DMAs.
• PBoC set USD/CNY mid-point at 7.0978 vs exp. 7.1863 (prev. 7.1002).

BOJ

• BoJ considers new quantitative monetary policy framework, via JiJi; would show the outlook of JGB buying amount.
• BoJ is to reportedly review Yield Curve Control as it considers new quantitative policy framework, according to JiJi.
• BoJ leaning towards ending negative rates in March and key determinant will be outcome of March 13 wage talks, via Reuters citing sources.
• BoJ is reportedly mulling buying nearly 6tln of JGBs under new quantitative policy framework, according to JiJi.

ECB

• ECB’s Villeroy says an ECB rate cut is “very likely” in Spring, describes Spring as April-June 21st. More and more confident on inflation. Need to avoid haste on rates and avoid acting too late. Timing for cuts remains a minor issue, there is a large consensus that risks are in balance and a rate cut will come. French economic growth will surpass the European average.
• ECB’s Kazaks says they could take pauses on the rate-cutting journey, via Bloomberg; wage growth appears to be easing somewhat. Rate cut bets are more consistent with the baseline. How much easing occurs this year is data dependent. ECB will not be on autopilot once reductions commence.
• ECB’s Muller says they need more confidence on prices prior to conducting rate cuts, via Bloomberg. Optimism is returning to the EZ.
• ECB’s Rehn says a faster than expected slowdown in inflation is good news. Risks of a premature rate cut have substantially decreased; matter of cuts will be reviewed in April and June.
• ECB’s Simkus says there are all conditions to move to a less restrictive monetary policy; a cut in June is “very likely”; a cut in April cannot be ruled out but probability is low.
• ECB’s Holzmann says rate change may be in preparation.
• ECB’s Vasle reiterates current level of interest, if held long enough will get inflation to target.
• ECB’s Nagel sees a rising chance of a rate cut before policymakers’ break for summer, although this will be data-dependent, but the prospects have brightened, according to Bloomberg.

Fixed Income

• Bunds are bid, after stronger than expected German Industrial Orders and a slew of ECB speakers which are on the dovish-side/echo-Lagarde overall and increasing the focus on June while a handful have not entirely dismissed April. Bunds printed a session high at 133.84 and is yet to surpass its WTD high at 133.96.
• USTs have been moving in tandem with EGBs with fleeting pressure on the latest BoJ sources piece via JiJi/Reuters but action overall is relatively contained into the US NFP report.
• Gilts are the incremental outperformer despite a lack of specific newsflow. Action which has taken Gilts to within a handful of ticks of the WTD peak and around 50 ticks above post-Budget levels. Currently around 99.80 and higher by 39 ticks thus far.

Commodities

• Crude is now lower after spending much of the session in the green despite a lack of fresh headlines this morning and a rather tentative risk profile ahead of the US jobs report. Brent Apr sits around USD 83.00/bbl after making peaks at USD 83.84/bbl earlier.
• Precious metals are in the green despite a steady Dollar this morning, with some possible tailwinds from heightened geopolitics as the Israeli incursion into Rafah looms if no ceasefire deal is reached. XAU topped yesterday’s USD 2,164.80/oz high and rose to a fresh ATH of USD 2,168.79/oz this morning.
• Base metals are higher the board amid the recent tailwinds seen on Wall Street and then APAC, with dovish rhetoric from Western G10 central banks keeping the complex propped up.
• Shanghai Warehouse Stocks: Copper +24.7k/T, +11.5%; Zinc +11k/T, +11.3%; Lead +9.9k/T, +18.8%

Geopolitics: Middle East

• US President Biden announced that the US military will construct a port in Gaza to allow more humanitarian aid to arrive and confirmed there will be no troops on the ground while a senior official earlier stated that the port is to allow Gaza humanitarian aid deliveries and will take weeks to complete, while troops to remain on vessels offshore.
• Two civilians reportedly killed in a Turkish airstrike in the Duhok province of northern Iraq, via Reuters citing sources.
• “Iranian presidential aide: If Kuwait decides to extract oil and gas from the Durra field, we will do the same”, according to Al Arabiya

Geopolitics: Other

• US President Biden stated during the State of the Union Address that they are facing an unprecedented moment and he assures that Russian President Putin will not stop at Ukraine, while he added they can stop Putin by helping Ukraine with weapons and his message to Putin is that they will not walk away and will not bow down.
• North Korean leader Kim Jong-Un guided an artillery firing drill on Thursday, according to KCNA.

US Event Calendar

• 08:30: Feb. Change in Nonfarm Payrolls, est. 200,000, prior 353,000
  • 08:30: Feb. Change in Manufact. Payrolls, est. 7,000, prior 23,000
  • 08:30: Feb. Change in Private Payrolls, est. 165,000, prior 317,000
  • 08:30: Feb. Unemployment Rate, est. 3.7%, prior 3.7%
  • 08:30: Feb. Underemployment Rate, prior 7.2%
  • 08:30: Feb. Labor Force Participation Rate, est. 62.6%, prior 62.5%
  • 08:30: Feb. Average Weekly Hours All Emplo, est. 34.3, prior 34.1
  • 08:30: Feb. Average Hourly Earnings MoM, est. 0.2%, prior 0.6%
  • 08:30: Feb. Average Hourly Earnings YoY, est. 4.3%, prior 4.5%

DB’s Jim Reid concludes the overnight wrap

As you read this, I’ll be embarking on my first business trip to Australia for a decade before a brief run through Asia. My memories of this trip in the years gone by is turning up to meetings on Monday morning in Sydney having not slept at all on Sunday night and feeling absolutely awful due to a combination of tiredness and being on a caffeine drip. If there’s a silver lining, the era- and season-defining Liverpool vs Man City game kicks off at 2.45am Sydney time on Monday morning. So I’ll have something to keep me company as I can’t sleep.

As I take off, wondering how I’m going to fill the next 24 hours, welcome to yet another payrolls Friday. I’ll be viewing it on the plane WiFi somewhere around Iraq by my calculations. Ahead of this, markets continued to advance yesterday, with investors growing more hopeful about the prospect of rate cuts this year, particularly after the ECB’s decision leant in a dovish direction. That helped equities climb on both sides of the Atlantic, with the S&P 500 (+1.03%) up to another record high and moving back into positive territory for the week. In fact, if the S&P can hold those gains today, then that would mean it’s recorded 17 out of 19 weekly gains for the first time since 1964. So we’re on the brink of a major milestone, with little seemingly able to knock markets from their gains at the moment.

That ECB decision was a big catalyst for the rally, since although it left rates unchanged, several aspects suggested the window for rate cuts was coming into view. For instance, its latest inflation projections were revised downwards, with headline inflation seen at 2.3% this year, 2.0% in 2025, and 1.9% in 2026, while core inflation is expected at 2.6% this year, 2.1% in 2025 and 2.0% in 2026. So in a couple of years the ECB is pointing to core being back at target and headline being slightly underneath. Alongside that, the near-term growth forecast was revised down, with 2024 lowered by two-tenths from December to 0.6%. In President Lagarde’s comments, there was also something of a steer towards June, saying that “We will know a little more in April, but we will know a lot more in June”. Our European economists continue to see June as the likely starting point for cuts, while noting that Lagarde’s tone gave the impression that the ECB wants to move slowly through the easing cycle. See their full reaction here.

In turn, that meant investors dialled back the prospect of an April cut, which now stands at just 14%, whereas the prospect of a cut by June was largely stable at 92%. So there’s a pretty solid conviction that June is now most likely, and that’s the same month that markets are expecting the Fed’s first rate cuts as well, with a cut 96% priced by June.

The amount of Fed rate cuts priced in by December rose by +4.5bps to 92.4bps yesterday, helped by some dovish-leaning remarks from Powell. Speaking to the Senate Banking Committee, the Fed chair suggested the FOMC was “not far from” the confidence it needed “to begin to dial back the level of restriction”. Later on, Cleveland Fed President Mester struck a measured tone affirming expectations of rate cuts later this year but saying that “the bigger mistake would be to move rates down too soon or too quickly”.

The central bank news flow was generally very positive for markets, since for much of February, the trend had been to push out the timing of rate cuts, and there was growing speculation that they might not happen at all this yea r. But this week we’ve now seen both the Fed and the ECB signal that they want to dial back their restrictive policy soon, which has led to growing confidence that rate cuts are set to happen as soon as the summer. Clearly we’ve got the US CPI release next week, and we’ve seen inflation narratives shift a lot over the last couple of years, but when it comes to markets, there’s a growing confidence that the soft landing and rate cuts are still firmly on the table.

That backdrop led to another round of all-time highs for equities, with the S&P 500 (+1.03%) reaching another record, and taking its YTD gain above 8%. The advance was a broad-based one, which saw the small-cap Russell 2000 (+0.81%) hit its highest level in almost two years, whilst the Magnificent 7 (+2.46%) had its best day since Nvidia’s earnings a couple of weeks ago. Meanwhile in Europe, the STOXX 600 (+0.99%) closed above the 500 mark for the first time, and there were fresh records for the DAX (+0.71%) and the CAC 40 (+0.77%) as well.

Whilst equities were rallying strongly across the board, the picture was also positive but more mixed on the rates side. In the Euro Area, yields moved lower following the ECB decision, with those on 10yr bunds (-1.5bps), OATs (-2.1bps) and BTPs (-2.5bps) all falling back. Meanwhile, in the UK there was a noticeable flattening in the curve, with the 2yr yield up +4.1bps, and the 10yr gilt yield up +0.6bps, which followed the fiscal easing in the previous day’s budget from the government. Then in the US, there was a bull steepening, with the 2yr yield down -5.3bps to 4.50% and the 10yr down -1.9bps to 4.085%.

The front-end US rates move weighed on the dollar, with the broad dollar index (-0.53%) posting its sharpest decline of the year for the second day in a row. The euro rose to its strongest level against the dollar since mid-January (+0.32% to 1.094), despite initially trading lower during the ECB press conference.

Overnight in Asia, equities are mostly rising across the board with the Hang Seng (+1.38%) leading the gains as I type, with the KOSPI (+1.14%) and the Nikkei (+0.26%) also higher. That strength follows on from growing anticipation yesterday that the Bank of Japan would end their negative interest rate policy as soon as the meeting on March 19. So equities in the west go up on rate cutting expectations whilst in Japan they go up on rate hiking ones!

That meant the Japanese Yen was the strongest-performing G10 currency yesterday (+0.82%), hitting its highest level against the dollar in over a month. Elsewhere in the region, China has seen a couple of negative headlines within the property sector, with several companies seeking restructuring options on their debt. Off the back of this, Chinese equities are currently trading sidewards, with the CSI 300 down -0.05%, and the Shanghai Comp up +0.12%. US futures are fairly flat.

Looking forward, attention will be back on the US today, as the February jobs report is coming out. In terms of what to expect, our US economists are forecasting a +200k increase in nonfarm payrolls, which would keep the unemployment rate at 3.7%. For their full preview and to register for their post-release webinar, see here. The print follows some very strong reports over the last couple of months, and the January print had nonfarm payrolls growing by +353k, the highest in 12 months. The uncertainty is around storms in the survey week and a low response to last month’s survey so the prospects of a big miss or revisions in either direction are higher than normal. Ahead of that, we also got the weekly initial jobless claims yesterday, but that was much as expected, coming in at 217k over the week ending March 2 (vs. 216k expected).

Lastly, the rally in gold (+0.63%) continued over the last 24 hours, which sent the precious metal up to a new record of $2158/oz in nominal terms. It also marked its 7th consecutive daily advance, which is the first time that’s happened since 2021. Bitcoin also edged up yesterday, rising +1.28% by the end of the European session to $67,332, and is currently trading at $67,000 as I type. In a short update, Marion Laboure and Cassidy Ainsworth-Grace explain five reasons why Bitcoin reached a record high and why they expect prices to continue to go even higher this year. See here for the report.

To the day ahead now, and the main data highlight will be the US jobs report for February. Otherwise, there’s the German and Italian PPI readings for February. From central banks, we’ll hear from the Fed’s Williams and the ECB’s Simkus and Holzmann.

By Nour Al Ali, Bloomberg markets live reporter and strategist

Another robust showing in US non-farm payrolls could reignite the dollar’s ascent while prompting a decline in Treasuries heading into the weekend.

Expectations for February’s nonfarm payrolls hover around 200k, with estimates in a Bloomberg survey within one standard deviation ranging from 168k to 228k.  The highest estimate is an outlier projecting 286k.

Data has surpassed expectations for the past two months, with January seeing a surge in wages.

The Fed committee’s outlook for three interest rate cuts this year may be revised during the March 19-20 meeting. Chair Jerome Powell said that the Fed is “not far“ from confidence needed to start cutting rates. That spurred a decline in two-year Treasury yields on Thursday, while traders added to bets on a June cut. The dollar also extended its losing streak to the longest since October.
 
Should the data surprise once again, it’ll fuel a goldilocks narrative that revives the dollar rally if market bets on a June cut re-adjust. Swaps tied to policy-meeting dates show traders pricing in about 22 basis points of Fed cuts in June, and about 90 basis points by December.

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

People who tested positive for COVID-19 and took ivermectin as a treatment recovered faster than a comparison group, a new study found.

The time to self-reported recovery was a median of two days faster among the ivermectin recipients, according to the large UK study.

The quicker recovery period was statistically significant.

People who received ivermectin were also less likely to be hospitalized or die, with 1.6 percent of ivermectin recipients being hospitalized or dying versus 4 percent of the comparison group, which received typical care, which in the UK is largely focused on managing symptoms.

Ivermectin recipients also enjoyed a reduction of severe symptoms and sustained recovery, according to the study.

The paper was published by the Journal of Infection on Feb. 29.

The study covered an open-label trial that involved 2,157 ivermectin recipients and 3,256 who received typical care from June 23, 2021, to July 1, 2022. Participants were randomized and reported symptoms and recovery.

Researchers Say Findings Don’t Support Using Ivermectin

The authors, including Christopher Butler, a University of Oxford professor and joint chief investigator of the trial, downplayed the positive findings in part because the hazard ratio of 1.14 was lower than what authors pre-specified as a meaningful ratio, or 1.2. Hazard ratios are a way to determine whether a treatment is beneficial.

The authors also focused on the lack of differences in the number of days participants felt sick in the previous two weeks, impact on work, and likelihood of using the health care system at 3, 6, and 12 months following treatment.

“Overall, these findings, while evidencing a small benefit in symptom duration, do not support the use of ivermectin as treatment for COVID-19 in the community among a largely vaccinated population at the dose and duration we used,” the authors said.

Funding for the research came from the UK government.

Conflicts of interest included one researcher receiving grants from pharmaceutical companies, including AstraZeneca, and other authors receiving grants from the University of Oxford.

The trial, known as PRINCIPLE, was touted by investigators as “the world’s largest clinical trial of possible COVID-19 treatments for recovery at home and in other non-hospital settings.”

“Ivermectin is readily available globally, has been in wide use for many other infectious conditions so it’s a well-known medicine with a good safety profile, and because of the early promising results in some studies it is already being widely used to treat COVID-19 in several countries,” Dr. Christopher Butler, a University of Oxford professor and joint chief investigator of the trial, said when it was announced ivermectin would be assessed. “By including ivermectin in a large-scale trial like PRINCIPLE, we hope to generate robust evidence to determine how effective the treatment is against COVID-19, and whether there are benefits or harms associated with its use.”

Doctors Weigh In

Dr. Pierre Kory, an American physician who was not involved in the trial, said that the authors wrongly downplayed how ivermectin improved recovery from COVID-19.

“PRINCIPLE was a profoundly positive study that was instead analyzed and written up as a negative one,” Dr. Kory, who has long promoted ivermectin as a COVID-19 treatment, wrote in an essay.

He accused the authors of undertaking “statistical chicanery” by coming up with the pre-specified hazard ratio (HR), noting that no such level was used in other parts of the PRINCIPLE trial.

“A hazard ratio does not need a pre-specified level. If the HR is > 1.0, and it is statistically significant, it is a robust finding,” he said.

The positive findings should also be interpreted in the context of recipients only receiving one dose per day across three days and being directed not to eat food before ivermectin, Dr. Kory said.

Dr. Butler and his co-authors said “no food should be taken two hours before or after administration” despite previous research finding that taking ivermectin with food increases plasma concentration.

Participants also received ivermectin a median of five days after symptom onset, a period of time considered by some to be too late to have much of an impact. Ivermectin works best when applied within 24 hours of symptom manifestation, according to a meta-regression of ivermectin studies.

Dr. Butler did not respond to a request for comment.

There have been additional studies that found ivermectin worked against COVID-19. The drug, commonly used for purposes such as combating malaria, has divided scientists since 2020, when doctors around the world began using it to treat COVID-19.

Some other research, including a U.S. trial, has found that ivermectin did not improve time to recovery.

Dr. David Boulware, another American doctor, who helped run that trial, argued on X that the faster recovery recorded in the UK trial was similar to the quicker recovery reported in an open-label trial of molnupiravir, an antiviral sometimes used to treat COVID-19.

“Molnupiravir also had a 2 day faster improvement in symptoms over ‘usual care’ yet no benefit existed in double-blind trial,” Dr. Boulware said on X. “Placebo effect influences self-reported symptoms.”

Authored by Lear Zhou via The Epoch Times (emphasis ours),

Chenguang Gong, a Chinese American who has been accused of stealing U.S. infrared missile detection technology, was listed as one of 558 “young talents” in the 12th Thousand Talents Plan run by the Chinese Communist Party (CCP) in 2016.

The list of talents was issued by the Task Force Office of Overseas High-Level Talent Recruitment Programs under the Organization Department of the Central Committee of the CCP.

A complaint by the U.S. Attorney’s Office claimed that Mr. Gong transferred 3,600 files from his work laptop to three personal storage devices from March 2023 to April 2023.

It also claimed that Mr. Gong possessed in his personal storage devices files marked as “confidential” that appeared to belong to several of Mr. Gong’s former employers. These devices were taken from his temporary residence in Thousand Oaks, California, following an FBI search on May 8, 2023.

Mr. Gong, 57, of San Jose, was arrested on Feb. 6 and was bailed out on a $2.5 million bond following a hearing in San Jose the next day. He was indicted on Feb. 27 by the Assistant U.S. Attorney’s Office, making it a formal criminal case.

The case has since been transferred to the Central District Court in Los Angeles, where Mr. Gong made his first appearance on Feb. 20.

A post-indictment arraignment hearing will be decided upon soon.

The Thousand Talents Plan

The Chinese regime offers hefty financial incentives—including research funding, salaries, and housing—via many different talent recruitment programs to entice overseas Chinese and foreign experts into working in China’s science and tech sectors.

Through these programs, the CCP hopes to quickly turn China into an industrial and innovation powerhouse, one that ultimately outperforms Western countries.

The program known as the Thousand Talents Plan was initiated in 2008 and went underground after U.S. authorities realized its underlying goal in 2018.

The FBI explains on its website that all of China’s talent plans incentivize their participants to steal foreign technology. The website states that while the United States welcomes international collaboration in research and development, American businesses should take measures to keep their intellectual property safe and should understand that talent plans encourage illegal conduct.

“Even if talent plan participants who steal information are eventually caught and prosecuted, the damage done to your organization by intellectual property theft may be irreversible,” the FBI warns.

The ‘Victim Company’

Pamela Reese, director of the Malibu-based company Marketing & Communications of HRL Laboratories, confirmed with The Epoch Times in an email that it is the “Victim Company” mentioned in the complaint. Mr. Gong worked with the company’s Visual Systems Laboratory from January 2023 to late April 2023.

“When HRL became aware of suspicious activity being conducted by Gong, the company immediately began an investigation, terminated his employment, and notified relevant authorities,” Ms. Reese said. “HRL has continued to cooperate with the U.S. Federal Bureau of Investigations (FBI) on its case against Gong and will provide ongoing support as needed.”

HRL Laboratories is under active contract to develop new sensors with enhanced performance for use in space-based missile warning and tracking, space-based surveillance, and airborne infrared countermeasures systems, including by the U.S. Department of Defense.

The alleged stolen trade secrets include methods, designs, techniques, processes, specifications, testing, and manufacture of the advanced Readout integrated circuits used in HRL’s infrared sensors, and the mechanical cooling systems of these circuits.

The sophisticated integrated circuits technology is required to achieve low noise, a high dynamic range, a high resolution, and a fast readout rate when collecting electrical signals from infrared photodetector arrays and outputting the data in a standard format.

These trade secrets are foundational technologies that support the business of HRL Laboratories, Leslie Momoda, executive vice president of the company, told FBI agents according to the complaint.

If other entities were to obtain the designs or development roadmaps for these key technologies, they would be able to replicate and improve them, making HRL less competitive, according to Ms. Momoda.

“Additionally, if the Victim Company’s Trade Secret Information was obtained by a foreign government, it would compromise U.S. national security,” Ms. Momoda told the FBI agents.

Suspicious Resignation

“As a top physical science and engineering research organization who regularly works with U.S. government customers, HRL has robust information security practices designed to detect and document suspicious activity,” Ms. Reese told The Epoch Times.

However, according to the complaint, HRL Laboratories only began monitoring Mr. Gong’s network activity right after he sent in his resignation on April 14, 2023, claiming that he was not doing a good job.

The resignation was suspicious because Mr. Gong had been working for HRL for less than three months, and he had performed well.

Daniel Maier, Director of Security of HRL Laboratories, told FBI agents that his department discovered that between March 30, 2023—two weeks before Mr. Gong submitted his resignation—and at least April 25, 2023, Mr. Gong transferred more than 3,600 files from his work laptop to three personal storage devices, a Verbatim USB flash drive and two Western Digital disk drives.

Vice President of Vision Systems Lab Raphael Ricardo told FBI agents that Mr. Gong was given access to the HRL’s full data repository in light of Mr. Gong’s managerial role. In other words, Mr. Gong was granted access to the full history, specifications, and roadmap of HRL’s products.

“It would also have required time and effort to export hundreds of CAD design files, which contained the technical blueprints for the Victim Company’s products and technologies, from the Victim Company’s UNIX system to a Microsoft Windows operating system,” FBI special agent Igor Neyman wrote in his affidavit attached to the complaint.

So far, only the Verbatim USB flash drive was found when the security team of HRL searched Mr. Gong’s belongings on April 26, 2023. The FBI believes the flash drive was used as temporary storage due to its relatively low capacity.

The FBI didn’t locate the two Western Digital drives or another possible digital device that contains files transferred from the intermediate Verbatim flash drive.

Theft From Other Companies

“GONG took and retained thousands of documents, stored on a variety of digital devices, that appear to belong to several of GONG’s former employers,” the complaint states. “Many of these documents bear confidentiality markings indicating their sensitive nature.”

The relevant companies Mr. Gong has worked with include Texas Instruments (“Company 2,” from 2010 to May 2014) and international defense, aerospace, and security company BAE Systems Inc. (“Company 3,” from May 2015 to October 2019).

A proposal of a high-performance AD/DA converter, which Mr. Gong submitted multiple times to various Chinese entities, appears to relate to technology Mr. Gong worked on at Texas Instruments, the complaint states.

The applications of the proposal in 2013 and 2014 allowed Mr. Gong to get onto the 2016 Thousand Talents Plan’s “Young Talents” list.

The FBI found CAD files containing the technical designs and blueprints for integrated circuits or other products from at least “Company 2” and “Company 5” in Mr. Gong’s personal digital devices that were confiscated following a search warrant, according to the complaint.

“I took a risk (because I worked for [Company 3], an American military industry company) and thought I could do something for the country’s high-end military integrated circuits,” Mr. Gong wrote in a letter to a talent plan recruiter after he traveled to China in September 2019 to attend an in-person presentation regarding his high-performance converter proposal in Hangzhou.

In a video presentation included with Mr. Gong’s 2020 submission, Mr. Gong used a video containing the model number “LTN4323” of a high-performance 4K resolution CMOS sensor developed by BAE Systems Inc.

Mr. Gong stated that his product extensions included a “low-light/night vision dual-use CMOS image sensor” for use in military night vision goggles and civilian applications.

Mr. Gong faces 10 years in federal prison if convicted.

The last decade has witnessed a remarkable surge in the global number of millionaires.

By 2022, 1.1% of the world’s adults were millionaires, up from 0.6% in 2012. So, how to know if you belong to the top 1% in your country?

In this infographic, Visual Capitalist’s Omrio Wallach illustrates the net wealth required to enter the club in selected countries and territories. The data is sourced from the Knight Frank Wealth Report 2024.

The 1% Club

The individual net wealth required to join the top 1% can vary across countries.

European hubs top the list, with small countries like Monaco or Luxembourg having extremely high wealth barriers to joining the top 1%.

According to this year’s report, Monaco leads with $12.9 million required to join the 1% club. Currently, more than 30% of Monaco’s estimated 38,000 residents are millionaires.

Luxembourg follows at $10.8 million, with Switzerland at $8.5 million securing the third position.

The U.S. ranks fourth at $5.8 million. Despite having the most ultra-wealthy individuals, the country’s high population base brings the law of averages into play.

In the Asia Pacific region, Singapore leads the pack with a requirement of $5.2 million, while Hong Kong comes second at $3.1 million.

Interestingly, a person in Hong Kong needs almost three times more wealth to join the 1% club compared to someone in Mainland China.

How to Join the 1% Club?

To be part of the top 1% club of one’s country or region often requires a combination of advanced education, entrepreneurship, strategic investments, and even luck. While there’s no guaranteed path to entry, consistency and time are key factors.

In the U.S., for instance, many individuals and families who have surpassed the 1% threshold have done so over time.

Authored by Megan Redshaw via The Epoch Times (emphasis ours),

A new study found that COVID-19 infection can cause cognitive deficits that persist for over a year and lower IQ scores in severe cases. Those with persistent symptoms that resolved had small cognitive deficits similar to those with a shorter illness duration.

In a large-scale observational study published on Feb. 29 in the New England Journal of Medicine (NEJM), researchers invited 800,000 people with varying levels of COVID-19 exposure and duration to take an online cognitive assessment and follow-up survey. Cognitive difficulties have been implicated in numerous syndromes following COVID-19, including long COVID, suggesting infection may have lasting effects on the mental processes of the brain.

The study’s authors hypothesized there would be measurable cognitive deficits after COVID-19 that would scale with the severity and duration of the illness. They also speculated that objective impairments in executive and memory function, especially poor memory and brain fog, would be observable in those with persistent symptoms.

Using an assessment tool for cognitive function, researchers estimated global cognitive scores among participants with a history of previous SARS-CoV-2 infection who had symptoms for at least 12 weeks—whether resolved or not—and among a control group of uninfected participants. While cognitive and memory deficits were small for people with mild infection who recovered from COVID-19 quickly, impairments were more pronounced in those with severe disease.

Greater Impairment With More Severe Disease

Of 112,964 participants who completed the survey, those who recovered from COVID-19 with symptoms that resolved in less than four weeks or by 12 weeks post-infection had similar small deficits in global cognition compared with those who had never had COVID-19.

Participants who had mild COVID-19 with resolved symptoms experienced a 3-point drop in IQ compared to uninfected participants. Those with unresolved persistent symptoms had a 6-point loss in IQ, and those with COVID-19 admitted to the intensive care unit experienced a 9-point loss in IQ. Reinfection with SARS-CoV-2 caused an additional loss in IQ of nearly 2 points compared to those who were not reinfected. An IQ, or intelligence quotient, is a number used to represent the relative intelligence of an individual.

According to the study, memory, reasoning, and executive function tasks were the strongest indicators of impaired cognitive function, and these scores correlated with brain fog symptoms reported by participants. More significant deficits were seen in those with unresolved persistent symptoms and those infected with earlier variants of the SARS-CoV-2 virus compared with those who never had COVID-19. Additionally, study participants who were hospitalized had greater deficits in cognitive function compared to those who were not hospitalized. 

“By using an innovative cognitive test which has also been completed by people who did not have COVID-19, this important and well-conducted study provides the first accurate quantification of the scale of cognitive deficits in people who had COVID-19,” Maxime Taquet, a fellow in psychiatry at the National Institute for Health and Care Research at the University of Oxford, said in a statement. 

Mr. Taquet said researchers found a small but obvious association between COVID-19 and cognition that was more pronounced at extremes.

“The risk of having more severe cognitive problems was almost twice as high in those who had COVID-19 compared to those who did not, and three times as high in those who were hospitalized with COVID-19,” he noted.

In an editorial published Feb. 29 in the NEJM, Drs. Ziyad Al-Aly and Clifford Rosen said the study’s results are concerning and have broad implications that require further evaluation to determine the functional impact of a 3-point loss in IQ and why one group of participants was more severely affected than another. 

“Whether these cognitive deficits persist or resolve along with predictors and trajectory of recovery should be investigated. Will Covid-19-associated cognitive deficits confer a predisposition to a higher risk of Alzheimer’s disease or other forms of dementia later in life? The effects on educational attainment, work performance, accidental injury, and other activities that require intact cognitive abilities should also be evaluated,” they wrote. 

Study Implications for People With Long COVID

The study’s participants were part of a larger community sample of nearly 3 million people in the Real-time Assessment of Community Transmission (REACT) study assessing SARS-CoV-2 transmission in England. Although the researchers did not say whether participants in the study had long COVID, people with long COVID frequently report persistent cognitive impairment.

There is no accepted universal definition for the condition, but the Centers for Disease Control and Prevention (CDC) broadly defines long COVID as “signs, symptoms, and conditions that continue to develop after acute COVID-19 infection” that can last for “weeks, months, or years.” The term “long COVID” also includes post-acute sequelae of SARS-CoV-2 infection, long-haul COVID, and post-acute COVID-19.

Nearly 7 percent of U.S. adults surveyed by the CDC in 2022 said they’ve experienced long COVID. Although U.S. regulatory agencies claim vaccinating against COVID-19 can reduce the risk of developing long COVID and the current paper suggests vaccination with two or more doses may provide a slight cognitive advantage, a recent paper published in the Journal of Clinical Medicine did not find a significant link between the presence of comorbidities or infection severity and the emergence of long COVID symptoms.

The NEJM study has several limitations, including reliance on subjective reporting to identify individuals with ongoing symptoms and self-selection bias. People with long COVID may have enrolled in the study, but those with more severe impairments may not have been able to participate in the survey. Additionally, certain groups were overrepresented in the study compared with the base population. Baseline cognitive data before SARS-CoV-2 infection was also unavailable, so researchers could not assess cognitive change or infer causality.

Just when you though you’ve hit “peak transgender”, you ain’t see nothing yet…

That’s because soldiers in Spain are starting to change their genders from male to female to earn benefits that are only available to females, according to a new report from the NY Post. 

The benefits include higher pay and better sleeping quarters and the gender switch has been made possible due to the military’s honoring of a “self-identification law” which was put in place in 2023 to help transgender people. 

The report points out that 41 men in Spain’s north-Africa autonomous city Ceuta now list as female after the law change. Only four have changed their name and a a “majority” of them have kept – wait for it – their male genitals and even their beards, according to the report. 

Army Corporal Roberto Perdigones commented: “On the outside, I feel like a heterosexual man, but on the inside, I am a lesbian. And it is the latter that counts. This is why I made the legal change to become a woman.”

He added: “For changing my gender, I have been told that my pension has gone up because women get more to compensate for inequality. I also get 15 percent more salary for being a mother.”

“I even have a private room in the barracks, all to myself, with a private bathroom. This is because I cannot be with men as I am a woman, and I did not consider it appropriate to be with biological women out of respect for them,” he added. 

The Post reports that the transgender legislation, enacted on December 22, 2022, permits individuals aged 14 and above to alter their identity without requiring psychological or medical assessments, though those between 14 and 16 require consent from parents or guardians.

Children aged 12 and older can change their gender identity with judicial approval. Additionally, Spain’s left-wing administration aims to increase female representation in the Guardia Civil and National Police to 40 percent. Conservative critics have labeled these measures as “woke” progressive actions.

“I have already seen several cases among my colleagues, and it is going to increase,” one civil guard source concluded.