Global Data Pod Weekender: Mixed nuts

(upbeat music) - Welcome to the JP Morgan Weekender on Bruce Kasmann. With me this weekender, Joe Lopton. Hey, Joe. - Hey, Poppa Bear. - Hey. Okay, so we got a little bit to talk about here. Obviously we have today's employment report. But before we get into what obviously will be a conversation more specifically about what happened today and how we process it. Let's just sort of put into some broader perspective. You know, I think the news flow we've been getting relative to our views have had a mix of things that provide some comforting supportive message and some concerning messages. And I think we need to kind of keep that balance as we then get honed in on what I think was generally a disappointing payroll report on a number of fronts. I think we have to kind of recognize that PMI's came in strong this week and are pointing to growth even above what I think is a reasonably upbeat view we have in our forecast. I think the URA news is looking better and we revised up our growth forecast there, partly on the back of a consumer that's doing a little better than we expected, or at least isn't doing as badly as was feared a couple months ago. A story in which I think the Asian economies, including Japan and the EMAX group outside of China and India are showing signs of having a demand engine. You know, these are all constructive things and the obvious, I think, offsets to that or if we could say let's say the two concerns would be the signs that even though China exports are lifting, it's survey data for July came off pretty hard. And you know, in our tracking of what we think is gonna come in and save the day for China in the second half, which is these bond issuances, you know, data that have not been utilized yet, certainly from our guys team in Hong Kong, don't think it happened in July. And then of course, employment report, which, you know, disappointed on the job count, which I think for July, I be okay, moving away from the total and the government pull back in education hires, which I think could easily be a seasonal factor, but then you look past that and you look at the week private number for July, which was 30K, and then you look at the backward revisions we're now averaging over the last three months, 40K per month on on private, which is, I think, you know, less than half of where we kind of would have expected it to be at this point in time. And then obviously, you know, there's a argument here that could be combined with a, what was a pretty decent productivity report this week and say okay, good, that's just productivity that growth we should embrace that, which I'm not certainly, but even if you would embrace that, I think, we'll then get to the Joe Luppton, where's the fuel for the household sector in terms of what the income numbers are showing here with not just the job numbers being soft, but also the wage numbers being soft. So I think the questions here are about whether the momentum that's signaled from this labor market report from the business sector or something we should take seriously when a lot of other indicators are suggesting that our forecast is building in a business sector outside attack that's supposedly lifting right now, whether we're being challenged in a way that we need to be taking that as a serious concern. And secondly, I guess we didn't mention as the U-Rate went down here, what is the real supply side issue that matters as it productivity led growth that's not just gonna keep this engine going, but it's gonna be a force holding back inflation as we can perhaps argue through the wage number today, or is it the weak labor supply that's actually led to a U-Rate that went down in July and is in some sense the more central driver in our own macro thinking. So I've gone on a lot, I'll just stop here. You can jump in whatever you wanna add to that. - Yeah, I mean, I guess I would just bring things by saying it is kind of a week that seemed to provide further start at least up until this morning was a week that was providing further evidence that everything was falling into place for this cyclical lift that we've been calling correctly for all year. The global composite PMI, it actually moved up to a level because- - I hope you don't feel you have to go through everything, I just want to- - No, I'm not, but three, I was gonna give a number, three percent annualized growth is pretty strong. Our forecast is two, three, so it's well above that and there was breadth in that report with this service is picking up. I guess manufacturing didn't nudge down, but I think with inventory is lean and you didn't mention the kind of piece that you put out updating our inventory proxy information on this suggesting we're pretty good, about three percent global manufacturing growth in the coming months here. Combined that with all the good Asia data, you mentioned China, but I'd also mention, yes, you're seeing some of the trade numbers come off the boil, but there's still the robust pace and then more importantly, you're seeing kind of domestic activity pick up in the region. I think that's a more balanced growth than I think if you can talk about the forecast in general, it's kind of moving to greater balance in this expansion, which is something that we need it. So that's all great. But then I think the latest news, not only the payroll report, but I think the consumers also gonna show some softness here. And yes, you're gonna say we are looking for that after what has been strong, but you're gonna feel it, and next week's-- - But the question, so we're gonna have a week retail sales report next week if our forecast is right. But let's ask the question is fundamentally, we have a soft payroll report, we have a softening in the income, labor income that comes out of it. Fundamentally, are you gonna be sitting here pushing hard on, hey, we need to watch out, the consumer might turn out to be a lot weaker than what we're forecasting, which is a soft monthly profile here, but something around one and three quarters percent growth in the third quarter. I mean, are you taking from the payroll report today a sign that we should really start to worry more seriously about the downside here? - I think it all comes down to, is there how much signal do you take in the latest payrolls numbers, which again, is a little bit more than just one monthly print that had some weird gov stuff. As you noted, the private as we, you had downward revisions. It's not like the run rate is not picking up nearly as much as we had thought, so it's kind of, if I can say that the alpha and the omega of this consumer story is the labor market, but I don't think you can continue running supercharged consumer spend during in a world where you have very, you know, flat to contracting labor income. The saving rate isn't going to keep going down indefinitely. I will say if there's any little kind of inkling of hope on the labor market front, it's probably the one piece of information you put the least bit of weight on, but I was really impressed with the employment. The global employment PMI completely more than reversed the big drop it's made over the last couple two months. So if you look at that, what it's signaling for development market, labor markets is that things are moving back up towards that kind of one percentage pace that we want to, that we need to start to feel comfortable about this cyclical lift and a consumer that can get the handoff from unsustainable wealth effects to more sustainable labor income. But payroll report today definitely puts you on your heels and how much signal you want to take on that. I don't know, you don't want to ignore it. We've been worried about downside risks and flagging those downside risks. So yeah, it makes you a little bit worried, but not changing the core view. - Okay. Where are you? I think the disappointment for you has been amplified by the fact that your kind of implicit baseline has been moving up a lot more. - No, Fair enough. I've been thinking we should get up to something close to 125,000 a month on private barrels here. And now we're sitting with the last three months at 40. That's pretty weak relative to it. And I think the other issue is if we look back at where we were the three month through May, the three month through June, we're running three month through June on private barrels are running like 97,000. So to go from running three month, 97,000 to three months at 40,000 is a, it's a momentum shift which you have to ask yourself the question are you gonna put weight on it or not? And I don't want to put too much weight on it, but I also don't want to buy any means ignore it. That's what I'm grappling with, is that are we missing something here? And you noted, the PMI survey we had the NFIB survey pick up the PMI I said the ISM services came off on employment, but the other claims data have been low and continue to be low And there's a lot of other things you can point to in the labor market Most of which are constructive. I would say not all ADPs obviously slowed There's some some indicators which have been softer, but I think you're you know the point We kind of have here is whether or not we're overstating positive momentum and whether or not we're Gonna find the kind of balance that I think we We need not just to kind of feel comfortable that this thing can be sustained But also I think it underscores the the call that this is a world in which you're gonna have pressure building on the Fed and we you know we haven't had September as our baseline forecast and I think Whether this report takes September out or not is something we should get to in terms of the conversation But I think the point that I had come at is that the reason why the Fed needs to hike the reason why central banks more broadly need to hike Is because you get a positive demand backdrop Uh, which is coming together with a labor market that when it Rebalances to the rest of the economy puts pressure from a from a a weak supply side point of view And I guess what's weird in today's report as you see that on the weak supply side without the demand Coming through, but if you don't have the demand On the way to the side part of it too or the wage inflation of course. Yes, so And also, I mean Right, I think just last week or two weeks ago we put out a note kind of To the extent that our call is that the labor market picks up and an unemployment rate keeps moving lower This is gonna put upward pressure on wages and it minimum put a floor under it And maybe even start to lift it and therefore that was Part of the service core service inflation stain elevated goods inflation coming up and that was underlies are more hawkish view on central banks Parts of that kind of are still tracking, which is the unemployment rate does keep moving lower But it's coming against the backdrop both of weak labor demand And not seeing the wages so Yeah, you can you can see why the If you just froze time and looked at this report and you say we're definitely not on definitely not on track for September hikes And if you get more of this than I think you are going to be worried more about the sustainability of the expansion again I'm not going there, but You have to view this as noise and you need some some bounce back or maybe let me pose it to you that way Do you think if we're sitting here in Or can you sustain 40,000 payroll growth for the next three months Before something breaks Yeah, you can just aim for the next three months, but I don't think they did for a little kind of putting it. Let's say we're at let's say we average kind of some 50 Payrolls for the next three months. How would you change your your outlook on growth inflation? Well, I think you'd have to cross-reference it with everything else, but obviously There's two different questions here about what disappointing payrolls would mean one is would it question your Fuse about the sustainability of the underlying recovery and you know, this is what we're talking about is there enough fuel here To create balance for the household sector that it keeps spending that's That's a question and that becomes a concern if you can't get job growth if you can't get job and wage gains that give you decent labor income growth That's one point then I think there's a second point here, which is whether or not we have a underlying Structural change in the production functions which a lot of people are pushing either because of weak labor Supply or because of technology changes, which means that you're going to get 2% 2 and a half percent US GDP growth almost entirely Through productivity gains that that's a story which can be Challenge from the point of view of are you getting the income that the household sector needs But it's a story that could be also challenging our view With a world in which you get very little in terms of job growth But you get enough in terms of wage Wage gains and other income sources that the household sector can sustain. I mean, I get that but you're not you're not Seeing that and what you're seeing is labor. I mean, I'm not this isn't well. You were seeing it last year Joe to be fair labor income in the US last year grew almost Something like 4 and a half percent in a world in which we hardly had any job growth Right, that was because wages were still coming off the boil from the the high inflation period It was pretty much a one-way track downward and wage inflation over it wasn't like you had some cyclical wage lift Coming from AI productivity gains Um, well, we don't know that we don't know the wage breakdown in the um I mean you you laid out you laid it out there But I would be more forceful. I I don't think And of course you can always be wrong right no one has a crystal ball, but no, but the point is you want to say Like you know you know what wage inflation is gonna be and you know what job growth is gonna be And you're gonna put them both very weak then obviously you have a problem But wage inflation is is not is not job growth. It's a different dynamic Uh, and you know Bruce, but you were kind of in again how you this wasn't your call But you were saying like maybe there's and we've not only wasn't your call you've pushed back against this for the past year But you're saying maybe we need to get more weight to the idea that you can just have this tremendous productivity AI story that keeps GDP going Without any jobs and to us good old fashioned cyclical economists we say look The real resilience over the past year has been the consumer. It hasn't been some kind of weird uh, you know AI kind of driven GDP It's the consumer that has held up and the consumer has held up because Without labor income it has driven its saving rate down over two percentage points, which is well very big And that can't keep going like that and I think you're gonna start off This quarter as you have been kind of saying you accept that the consumer is gonna take a big I want to make a caveat on what you say You you say Without labor income I say without jobs I think there was labor income in nominal terms that was pretty solid There wasn't disposable income disposable income since the middle of last year has been held back and I think in that context you've had um A uh a consumer that uh has lowered its savings rate has had okay The job growth up until very recently was running over 4% Um on a year ago and and a sequential basis Uh, and then obviously recently it got hit by the inflation shock But I don't think it's right to say there wasn't any labor income. I think there was Relatively weak disposable income in real terms and the consumer lowered its savings rate It was very weak job growth But I think it'd be a mistake to say the consumer hasn't had any labor income over the course of the last uh 12 18 months Right, so the consumer has not had purchasing power And has continued to spend and as we look forward In a world where wages are now a lot lower Not wage inflation is not like it was in a world where we're contemplating if we're taking signal in this report Which is a that's a we're not because we're not like radically changing our views here But if you were to say well what number are you gonna put on labor income? I just want to make sure I mean if you put a number that says labor income is going to be You know somewhere four and a half percent could you have a consumer that's going to grow to and out of that four and a half percent, you know Uh, hours or or employment is only growing half a percent that's That's sustainable that's I put I mean compensation of Of employees has been running kind of closer to Three and a half percent to three no, that's not right Uh In the last three months last 12 months orders average three three the last 12 months is 4.2 Um Right that it was so the last four quarters this average about four if I'm looking at quarterly But that's because you had this monster gain in the third quarter of last year Well, these things are noisy. I'm just saying the trend is That noisy they're kind of going if you want to if you want to argue that's going to slow down to three Then yeah, you have a problem what I'm saying is you can have configurations of weak job growth and decent labor income That's all I'm saying this is not a point which we really want to spend the time arguing about but I don't think you should Link is a one-to-one proposition job growth and labor income It over that 12 over that 12 month period Listeners, let's be clear what we're talking about you think there's going to be a big acceleration and wages to give you this kind of Labor income story even if jobs our week, you're saying, well, maybe wages could suddenly magically reaccelerate here in a world maybe a distance. I just made a point here. In that 4.2% over the last 12 months on labor income, the hours numbers from the productivity report, the hours numbers from the labor market report have numbers which are much lower than you would get if you thought that the right measure for wages was the ECI or average hourly earnings. You understand what I'm saying? Hour is there growing only like, you know, three or five tenths. So to have a 4.2 on a year ago on compensation, you have to have an hourly comp number of something like three and three quarters. There's a difference between the, so what I'm saying is if we continue to run something like that, if we're stable at something like that, then and you run half a percent on jobs, on jobs and hours, you could get a consumer that this is a story. I'm not, I'm not a believer of the supply side miracle story. I'm not a believer of the productivity led growth story, but I'm not saying it's impossible in terms of its ability to happen with a consumer that gets income, which you need to basically continue on the path you've been blessed year so. I don't even know if I'm fighting with you on this. I just want to, I'm not sure what it is, what numbers you have in mind. I thought we were talking about what happens if we sustained the, say, 30,000 on 30, 40,000 on jobs here. So let's call that. I don't know. Half a percent, maybe three, four tenths on hours, whatever you want to do. What do you want to do with wages now in this world? I'm just saying if you can keep income 4% or higher, which I think is perfectly reasonable in some scenarios under this, then you can hold it together. You're looking at, but I kind of feel like we're tracking closer to three and a half, but you're tracking closer to three and a half on what? What did wages just do today? This is my point. The point is there are different measures of compensation per hour that that gets you different, different types of outcomes. If you put an average hourly earning number alongside the hours worked from payrolls, you'd have a lower number than the national accounts number was giving you. I want to put in a number like three and a half to three on wages, and which is kind of at least by the measure of wages we tend to look at when we look through this. That's about what we've been averaging. I want to consider a half a percent. So that gives you about maybe three and a half to four percent labor income. Then you're either going to have to have a lower savings rate or lower inflation to keep consumption at 2 percent. That's just the math. That's what I'm saying. I would be surprised if we got the lower inflation. I wouldn't be too surprised if we got the lower savings rate. I would be surprised if we got hours and labor income that low. Anyway, these are all the downsides that you had been probing me on in recent weeks. Certainly wasn't our baseline where it felt like everything was moving in the positive direction. But I think the point I want to just come back to is a simple point. There's a debate here about what the job number today tells you about the business cycle from the point of view of business behavior and how it's translating into labor income. I'm struggling with the message that you get from this report, which on the margin, and I don't mean on the margin on the month. It means a margin on the three-month trajectory feels like it's softening. That doesn't feel to me right in terms of what I'm seeing in the economy more broadly. But we can't ignore that signal. It's a concern. It's not the only thing you want to pay attention to, but it's a concern. That's a fun thing. Then there's another conversation, which is, could there be a structural shift in this economy where the business sector that's still willing to expand is able to do so without putting much on the back of labor input? And is that sustainable? I think you've done another way to put it. I was going to say this. Another way to put it in. Yes, very well. The last year. Can you get a repeat of life? We made a very key central call that you really are going to struggle to repeat last year. That you needed to generate jobs to keep this expansion going. But from my point of view, the problem with last year is that last year wasn't that structural story. Last year was not a story of the labor market was driven by a business sector that wants to expand but is able to generate all these productivity gains. It was a mix of some pretty negative behavioral shifts towards caution. In some sectors of the economy, pretty much outside of outside attack and sectors. To be fair, like when I look at our confidence numbers on businesses and I keep telling the story of fading business caution, it took a big hit in the second quarter. And we have a forecast that it's going to be recovering. There might be a month where you're starting to see it recover. But it's still depressed here. I'm not going to completely reverse our story. I think it's the right one and it's certainly better than it was last year. But I think more work needs to be done. I agree with you. We had a pretty big rise in the composite expectations index. It went from like minus one to minus point six or something in August. It was a big move up for the US. Unless I got my data wrong. I just like the future output index. Well, I think the one I prefer to use, which is the one we have been using is our composite, which includes services and yeah, factoring PMI. It also includes the Fed Regional Service, which I put out. If I just look at what happened in the composite PMI, future output, it moved up, but it's still quite depressed. Right. And I would put weight on as we do in our composite index. I put weight on the Regional Fed surveys, which made a more significant move up. And if you look at that again from the context of the US number, it's actually made a nice move up now. It's sitting, I think pretty much at its highest level. It moves six tenths up. It's now four tenths off. It's historical norm in April. It was at minus one point three and may minus one point five. So it's moved up quite a bit in the last two months. So there's a significant rise going on there. In fact, the US and our composite global number is the big mover in terms of what we saw in July and also the last couple of months. Yeah. So, but yeah, I mean, this is the issue, Joe. The issue here is what are you conceptualizing is the narrative in this economy. And my narrative is that businesses are outside of tech are getting feeling more comfortable, that there's moved moving towards expanding in areas that they were contracting last year. It's not uniform. We're obviously not seeing enough in jobs yet. We're also not seeing the inventory dynamic kick in, but we're seeing the spending. We're seeing the sentiment. We're certainly getting some late market indicators, which are improving. And now a question is, are we going to carry through on this or not? And I do think if we do carry through on it, we're supposed to get over 100,000 jobs per month. And that is that is a call which both can be challenged because I'm wrong on the cyclicality of the story, but also I think a lot of people would fight me on the structure, which is say the economy is going to grow 2 to 1/2% it can do without jobs in a world in which productivity. You write on the kind of the the coral area or a contrapositive of that view, which is if you don't get the jobs, you're not going to see the growth. Well again, I think there's two, I don't want to belabor what we've been saying. I think there's two stories here. If you're not getting the job because behavior on the business sector side is cautious, then I think yeah, we're not going to get an economy that's going to do well. But I think there is a structural story here where you can get a balance between household income and corporate income. If you're generating growth overall and if behavior is constructive, I think you can do it. It's not what I think is going to happen, but I wouldn't fight it to the nail by any means. So if we switch gears a little bit, we had talked central banks, we had talked laid out some markers. I think you and I were similar on the markers of saying something over 100,000 on payrolls, three month average through September, unemployment rate that's either four two or lower and a core CPI that's kind of high side two tens, two or three. That would be sufficient to generate a hike. Obviously this payroll report moves in the opposite direction. If you really want to get a 100,000 or stronger for a three month average with this report, if you're taking with no revisions, you'd have to see some pretty punch she won 50s. So does that take September hike off the table? Doesn't take it off the table, but it certainly makes it, I think, well, below a 50% probability at this point. I mean, I guess the way I would look at it is this, I think the big call is can the Fed go into the September meeting, feeling reasonably comfortable, or at least willing to give the economy a chance, such that it can feel like it's on track to have inflation move down, not just off of the first half highs of 2026, but to start to track its own forecast for two and a half percent core PC for 2027. I don't think there's any doubt if we keep getting high core inflation readings, they're going to feel like that's a problem. But I do think they have to balance that against what their level of comfort is with growth, and also what they're seeing in terms of their their perceptions of slack, labor market, and otherwise. So we had two months in a row, three month moving average of 40,000 on private payrolls, momentum is shifting. If you come in next month and you get 150,000, you're not going to have a three month average of 100,000 on payrolls, and with no revisions, you're still going to be below it. But you probably feel like, okay, this was noise, and we got to just smooth through that. So if you got that, and the U-rate hit 4-1, and you got two core inflation numbers at 0.23 or higher, then I think the arguments for a rate hike in September are still pretty good. It's I think less about the three month average on payrolls, but how much do you put strength on this momentum shift? And I think you could take some of it out if the numbers in the next payroll report was strong enough in terms of raising questions about the noisiness of the payroll front. On the other hand, I think if you come in next month and you get another low private payroll number, 30,000, I personally don't think you hike even if the inflation news is high. You just have to worry more about this downside, kind of like what you were talking about a few minutes ago, and you got to give this thing some more time to reveal itself to you. And I think in some ways right now, the payroll and the inflation numbers are probably the ones that matter. The unemployment rate, which in some context probably matters, is probably only going to matter as if you think about the barbell of what's inflation and what's your growth momentum. It's only if you're kind of taking the weight off of the growth momentum story that the U-rate starts to come back into the picture as a significant indicator. Yeah. We'll see. I mean, I don't know. There's other obviously you made the point before, and I think it's important that we're looking for a soft July on consumption. And I think that it's going to be a soft month, I guess, in jobs and in consumption. We'll see what the other data print. The surveys weren't soft in July. So claims weren't soft in July. So there's other things going on. But if we're getting the soft consumption number, then that does reinforce the questioning, okay, do we need to pay more in mind to momentum in terms of what this labor marketer force telling us? And that's why you have to take that concern out of their minds. I think if you go back and look at who matters here, I'm going to argue that the people that matter for the September decision, unless Warsh wants to come in full guns blazing and say, hey, I want to hike guys. I think he could probably push the committee in that direction. But if he's kind of still sitting here not pushing that view, then I think the decision gets made by people like Waller, who I think is important. And as you know, over the last year, Waller has had a concern when he's seen job growth weekend because he's recognized this issue around stall speed and tipping points and things of that sort and perhaps. That's probably a little unfair to everyone else. I think everyone gets those concerns, Bruce. Well, I think he's expressed it more articulately in terms of his discussion among, I'm talking about Fed officials. I'm not talking about everybody. I'm talking about two, like I don't know. I think somebody. Who expresses that view and the same? I mean, I think that's what's good about him is he's somewhere in the middle of the committee and he's willing to articulate it with more, I think, granularity, what's driving his thinking and how it changes over time. And that's where I think watching how he responds to this, how he responds to incoming news, given that he is, I think, somewhere in the middle of this thing, the way he swings towards September is going to tell the tale. And I do think, unless you take out the sense that there's some reason to be questioning momentum, then you don't hike in September. Yeah, yeah. I mean, fair enough. I think he does carry some way, part largely just because he's a probably a pretty vocal presence in the in the boardroom I imagine, given his personality type. So that's why I. And yeah, I give him, he's kind of plugged in and he's kind of former head of research. So he knows the lingo, maybe others don't feel that way, but in terms of, you know, thinking about weakness in the labor, but you don't have to be a rocket scientist to see this payroll report and say, like, "Huh, maybe we should pause a little bit." And it's, you know, you had Barkin from the St. Louis Fed today kind of expressed that he's not voting, but still, you know, saying this is not a labor market that looks like it's in need of hiking right now. That's a sentiment, I'm sure, after today's report is felt by a number of people. I mean, I'm kind of curious, just so listeners know, we still, our house view is still December for a hike. So that's certainly not changing on today's news. What about elsewhere, Bruce? Like, I was kind of quickly looking as you are talking what markets did, market pricing did. There wasn't much of a move on today's news. Like, what's the read through to other central banks here? I had felt a Fed that hikes in September was going to be a bit more, have a bit more impact on a BOJ who meets the day after that meeting. Do you think that's changing? We've all been close to kind of changing that view. We did make some changes in our call today for the BOJ, but that was more about pace of hikes with a few more hikes. It's important that we put in three hikes for next year. So we have them hiking four times effectively. Yeah, they get to 2%. And I think that is indicative of the shift taking place underlying at the BOJ. And I think you're right, there's a sensitivity to the Fed. I think given particularly the potential dynamics around currencies, I think if the Fed would go in September, and we'd be getting a signal that they'd be going, I think that would make it far more likely the BOJ follows. But I think independent of that, the BOJ is getting more pocketish. We have the tax cut that was agreed upon on the VAT cut. We've got the economy doing well. That's part of what we started off by talking about is I think the Asian economy is outside of China showing a decent amount of domestic demand momentum now. So I think the BOJ moving more rapidly than the market is expecting makes sense. And I think it's not sensitive too much to the timing and magnitude of the Fed as long as we're not actually sitting here watching a US economy weekend in a way that we're not expecting. That obviously would change a far broader set of issues for us around central banks as well as more more fundamentally the outlook. So I mean, I think there's more pressure here for the BOJ to move. I think and we made the change in our forecast day. I think it's going to be more pressure for the ECB if our guys are right that growth is going to be around close to one and a half that's to the Fed, but definitely to the extent we revised up growth and we still feel like inflation. Is it a bit more of an issue there? Yeah, I think getting getting more than one more ECB hike makes sense if our forecasts are tracking and we don't have a more serious issue to deal within terms of things happening in the Middle East or something like that who knows what we're not talking about that, but let's let's leave that off the table for today. So yeah, and I think there's I think the basic point is that if our global views are playing out, it's not going to be a dramatic story because I don't think it's about inflation moving sharply up. It's about inflation not moving down and it's about growth showing resilience. So I think there's going to be a fairly broad but somewhat shallow central bank tightening cycle that's going to take hold here. And the feds should be part of it if our macro views are right. Let's hope our macro views are right. So on that note, let's maybe end this. I'm disappointed. I'm also a little confused, but that's that's life. So on that note, let's thank everybody for the downside risk that we had been flagging and just say this kind of upset a little bit, but not not changing our kind of core views, but I think we've just gone from feeling like we've had upside and things were tracking our upside risk to even our baseline view that we've been pushing. I think view that kind of has now come back down and now actually has a little bit of downside, but it's still just more about risk rather than kind of changing modal views. All right, let's end it there. Thanks everybody. I hope we can continue next week on the weekend.