September 6, 2026
What You Need to Know Today:
Surprise! Economy added way more jobs than expected in August
The U.S. economy added 162,000 jobs in August, topping all estimates in Bloomberg’s survey of economists. The unemployment rate held steady at 4.1%. The participation rate–the perentage of the population that is working or looking for work–edged up to 61.6% in August, marking the first improvement in almost a year. The Bureau of Labor Statitics revised the jobs totals for both June and July–adding 55,000 jobs to the originlly reported totals. The advance in payrolls was led by a rebound in leisure and hospitality employment and government jobs. Manufacturing payrolls rose by the most since 2023, while construction firms added the most jobs since January. Stocks and bonds fell on the fear that the strong performance increased the odds of a interest rate incrase from the Federal Reserve at its Seotember 16 meeting.
Saturday Night Quarterback say, For the week ahead expect…
The Fed entered its formal pre-meeting quiet period today, Saturday, Septeber 5, ahead of its September 15-16 meeting. But that may just clear the field for other actors.
Surprise! Economy added way more jobs than expected in August
The U.S. economy added 162,000 jobs in August, topping all estimates in Bloomberg’s survey of economists. The unemployment rate held steady at 4.1%. The participation rate–the perentage of the population that is working or looking for work–edged up to 61.6% in August, marking the first improvement in almost a year. The Bureau of Labor Statitics revised the jobs totals for both June and July–adding 55,000 jobs to the originlly reported totals. The advance in payrolls was led by a rebound in leisure and hospitality employment and government jobs. Manufacturing payrolls rose by the most since 2023, while construction firms added the most jobs since January. Stocks and bonds fell on the fear that the strong performance increased the odds of a interest rate incrase from the Federal Reserve at its Seotember 16 meeting.
Nobody was hedged: The dollar’s plunge will run for a while longer
The dollar sank to the lowest level since May on Thursday, September 3 after Federal Reserve Governor Christopher Waller noted progress on inflation and as the yen surged against its major counterparts. The Bloomberg Dollar Spot Index fell 0.6% on Thursday, dropping against all of its Group-of-10 peers. The yen led gains, climbing 2.1% versus the greenback, as traders boosted bets on Bank of Japan interest-rate hikes and remained on alert for signs authorities were potentially stepping in to bolster the Japanese currency. The dollar is down about 2.6% this quarter and has weakened against all G10 peers as investors revive the debasement trade, the view that U.S. policies will erode the currency’s value. Treasury Secretary Scott Bessent’s moves to support the yen and contain rising U.S. yields have fueled those concerns, as have doubts over whether Federal Reserve Chair Kevin Warsh will raise rates to curb inflation amid Trump’s push for lower borrowing costs. The fact that the dollar moved so strongly lower on such a relatively minor catalsyt–one Fed governor saying the inflation picture might be improving- tells us a lot about the underlying structure of the currency market right now. Yes, the financial markets don’t have a lot of faith tyat Treasury Secretary Scott Bessent and Federal Reserve chair Kevin Warsh won’t use inflation and a weak dollar to solve the $40 trillion U.S. debt problem. But perhaps even more importantly in the short run–say the next six months or so, the big holders of US. dollar assets have gone into the recent sell off in the dollar way underhedged. If these investors simply move back to historic levels of hedging their portfolios against a decline in the dollar, we‘re looking at the equivilent of a lot of dollar selling.
What me worry? Trump’s Treasury Secretary says surge in bond yields is a sign of coming growth in econoy from AI
On Monday at the G20 meeting of finance ministers and central bankers in Asheville, North Carolina, Treasury Secretary Scott Bessent called the run-up in yields a “growth story.” Bessent’s argument is that stronger growth prospects–rather than expectations for higher inflation as a result of the renewed attacks between Iran and the U.S. or a massive $40 trillion U.S. debt–were fueling the rise in yields. The 10-year Treasury yield was at 4.78% on Wednesday, near the highest level in two years. The 30-year yield was at 5.26%, erasing the drop that followed Bessent’s bond market intervention announcement last month and hovering near its highest levels since 2007.
Stellar second quarter earnings with one asterisk
The blended earnings growth rate for the other 493 S&P 500 companies for the second quarter of 2026 was 31.8%, which is the highest earnings growth rate reported by this group of companies since fourth quarter of 2021 (32.4%). Why only 493 companies? Ah, the Magnificent 7 stocks. A special case as in other recent quarters. The “Magnificent 7” companies reported actual earnings growth of 118.5% for the second quarter, which is the highest earnings growth rate reported by these seven companies going back to at least the fourth quarter of 2020 (when Tesla joined the S&P 500). The top five contributors to earnings growth for the S&P 500 for the second quarter of 2026 were (in order) Alphabet, Amazon.com, Micron Technology, NVIDIA, and Chevron. Three of the top five contributors are “Magnificent 7” companies. But this is where that asterisk coomes in.
This market is just too damn expensive given the risks–Special Report 10 picks to stay (mostly) invested while cutting your risks
Could stocks move higher from here even though they’re more expensive than a year ago? Of course.
Could they gain another 29.8% in a year? It’s possible. But it strikes me as unlikely.
That sums up the current market puzzle very neatly, I think. Stocks are expensive and don’t seem to be pricing in potential very real risks. But stocks have returned almost 30% in the last year. And it’s very hard to walk away from the possibility of that kind of gain. Even if it is unlikely. What I’d suggest right now is a stock market strategy that takes into account both a solid appreciation of the excessive valuations in this market (along with a failure to price in risk), and the realities of investor psychology.
It is too difficult to go cold turkey on stocks right now and move 100% out of the market. On the other hand, you should be moving to reduce your exposure to the riskiest parts of the market–high multiple stocks–and raising your exposure to counter-cyclical or non-cyclical stocks. In this post, I’m going to give you 10 stock picks to use in executing that kind of strategy–a way to stay in the market and yet to reduce your risks.
Special Report: The Next Big Things and how to invest in them–Part 1 Quantum Computing; Part 2 Nuclear Fusion
A suggested quantum computing portfolio. If you want a piece of this Next Big Thing, but with less risk and less upside than a pure-play quantum stock, I’d suggest Alphabet/Google (GOOG). Among pure plays I’d include D‑Wave Quantum (QBTS), up about 235% year‑to‑date as of late 2025; Rigetti Computing (RGTI), up34% YTD by late December; and IonQ (IONQ), up around 25% year-to-date by late December.
Special Report: 3 Stock Market Bubbles: When will they burst? What to do now? Part 1, the AI bubble, Part 2, the debt market bubble, and Part 3, the cheap money bubble
This is a very difficult stock market. Even as stocks climb to new record highs. On the one hand, even investors who are all in, maybe even overweight to the long side, worry that this rally isn’t sustainable for much longer. By most historical standards valuations are off the charts. I get a steady stream of stories and posts asking whether XYZ stock has climbed to faro fast. Volatility on somedays can be downright scary with relatively minor events leading to big market moves. It’s simply very hard to stay on board this rally. On the other hand, it’s very hard to get off the train. I see lots of Wall Street analysts cutting recommendations from “buy” to “hold” on valuation fears, but I see almost no one saying “sell.” FOMO–fear of missing out–is just too strong. Which is totally understandable. The Standard & Poor’s 500 index was up 25.02% in 2024 and was up another 18.11% in 2025 to date through October 27. Market leaders have racked up even bigger gains. AI chip icon Nvidia (NVDA) was up 171% in 2024 and has gained another 39% in 2025 through October 27. It’s insanely difficult to walk away from those kinds of gains. So what’d you do?
Special Report: How to invest in our 3 energy crises–First 8 picks JCI, BEPC, LNG, SMNEY, GNRC, CCJ, EQNR and GVE
You don’t need the Department of Energy or the Energy Information Administration to tell you we have an energy crisis. (Good thing since they’re shut down with the rest of the Federal government today.) All you need to do is look at your electricity bill. This summer monthly home electric bills jumped in Trenton, New Jersey, for a typical home by $26. In Philadelphia, it increased about $17. And in Columbus, Ohio, it spiked $27. And your monthly bill doesn’t capture the full damage. In California,residential electric rates are up 62% in five years. In Maryland residential rates are up 54% in five years. Most frustratingly–and most importantly for investors–those bills don’t explain the nature of the crisis.
Or more accurately “crises.” Because we’re the middle of three, overlapping and interlocking energy crises. That are playing out on different timeframes that range from NOW to the next 5 to 10 years. It’s that last point that’s critically important for investors. Because to make money–and let’s be clear: like in all crises there’s money to be made investing in these three crises–you’ve got to understand the nature of each crisis and buy into it at the right time. Not so early that you sell in disappointment because your profits haven’t arrived yet. Not so late that all themes tasty profits are gone. This Special Report is about untangling the 3 energy crises, giving you a timeline for investing in each, and then calling out 10 picks you cause to profit from theses crises. Ya, ready?
Special Report: “10 better dividend stocks for a dangerous market”–Part 1 with 6 sells, Part 2 first buy COLD
You remember what The Rolling Stones sing? “You can’t always get what you want”?
In this historically expensive market with a slowing economy, with a falling dollar and a climbing government deficit, where no one knows what the Trump tariffs regime we lookalike in 60 days, and where stagflation where inflation rises even as the economy’s growth rate slows I know what I want: some safe dividend stocks to take some of the risk out of my portfolio, with tasty 8% dividend yields, with solid financials and low debt, and with relatively low exposure to any downturn in the economic cycle. Is that too much to ask? Well, apparently, Yes. Because I can’t find any stocks that fit the bill. Stocks paying anywhere near that yield, for example, come with more rick than I want to take on in this market and this economy. Especially because the last thing I want to do is add high-risk, go-for-broke dividend stocks to the “safe” side of my portfolio. But the Stones go on to advise “but if you try sometimes, you’ll find/You get what you need.” And that’s what this Special Report “10 better dividend stocks for a dangerous market” is all about.
