The Morning Call---Did we just see the peak in yields? Follow through.

 

The Morning Call

 

10/2/26

 

The Market

         

    Technical

 

            Thursday in the charts.

https://www.zerohedge.com/markets/red-october-stocks-bonds-black-gold-bounce-together?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI2OTM4Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MDg4NjYyMiwiZXhwIjoxNzkzNDc4NjIyLCJhdWQiOiJ6aC1naWZ0In0.Xh2f99vTXP25LTp6qkWpkob9CuAuc9Gr8UZKfmYqv1g

 

            Thursday in the technical stats.

            https://www.barchart.com/stocks/momentum

            https://www.barchart.com/stocks/market-performance

            https://www.barchart.com/stocks/sectors/rankings

            https://www.barchart.com/stocks/signals/new-recommendations

 

            The DJIA breaks down.

            https://talkmarkets.com/article/dow-jones-breaks-down-as-bond-market-turmoil-raises-equity-risks

 

            The latest from Goldman’s desk.

https://www.zerohedge.com/the-market-ear/king-dollar-back-and-europe-cracking?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI2OTQxIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MDg4MDY4MSwiZXhwIjoxNzkzNDcyNjgxLCJhdWQiOiJ6aC1naWZ0In0.zAnPhEFjEYdeS_KjjcjWTuI7oOYSY5HoObUwlT2i0RI

 

 

            King dollar is back.

https://www.zerohedge.com/the-market-ear/king-dollar-back-and-europe-cracking?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI2OTQxIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MDg4MDY4MSwiZXhwIjoxNzkzNDcyNjgxLCJhdWQiOiJ6aC1naWZ0In0.zAnPhEFjEYdeS_KjjcjWTuI7oOYSY5HoObUwlT2i0RI

 

 

            Friday morning setup

            https://www.zerohedge.com/markets/massive-short-squeeze-yields-rate-hike-odds-plummet-after-piss-poor-payrolls-print

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

                          August construction spending was up 0.9% versus estimates of 0.0%.

 

The September final manufacturing PMI came in at 55.9 versus projections of 57.0.

 

The September ISM manufacturing index was 54.5 versus consensus of 55.0.

                          https://bonddad.blogspot.com/2026/10/the-inflationary-ai-data-center-boom.html

 

September nonfarm payrolls were up 29,000 versus expectations of up 90,000; the September unemployment rate was 4.2% versus 4.1%; September average hourly earnings rose 0.1% versus +0.3%.

https://www.zerohedge.com/markets/jobs-huge-miss-sept-payrolls-plunge-just-29k-below-all-estimates-july-revised-negative

 

                        International

 

The August Japanese unemployment rate was 2.5% versus forecasts of 2.4%; the September YoY CPI was 2.7% versus 2.3%; the YoY core CPI was 2.7% versus 2.4%.

 

The September EU flash CPI was +0.6% versus projections of +0.5%; YoY core CPI was 2.8% versus 2.5%.

 

                        Other

                  

                          August median household income.

                          https://politicalcalculations.blogspot.com/2026/10/median-household-income-in-august-2026.html

 

              Iran

                  

               Overnight news.

               https://www.zerohedge.com/military/us-sends-another-carrier-more-marines-mideast-trump-threatens-post-midterm-bombing

 

               Abu Dabai plans Hormuz bypass.

               https://www.zerohedge.com/markets/zero-hormuz-abu-dhabi-crown-prince-readies-tens-billions-turn-fujairah-hormuz-bypass

                  

              Oil is flowing from the Middle East, but prices remain high, Why?

   https://www.nytimes.com/2026/10/01/business/energy-environment/oil-prices-iran-war-trump.html?unlocked_article_code=1.FVE.m_ou.9V1rAe_v0UOC&smid=url-share

 

 

             Fiscal Policy

 

              Central banks cannot fix the sovereign debt problem.

              https://www.zerohedge.com/markets/central-banks-cannot-fix-sovereign-debt-bubble

 

            AI

 

              There is no free boom.

  https://www.zerohedge.com/markets/there-no-free-boom?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI2NzU4Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MDg2MDkzOCwiZXhwIjoxNzkzNDUyOTM4LCJhdWQiOiJ6aC1naWZ0In0.9PMIPwQ8xlMHVkIImIiyTYFrcnFalNEMwEsY-bg1c44

                       

              Data center boom faces increasing obstacles.

              https://www.zerohedge.com/energy/data-center-boom-faces-mounting-obstacles

 

              Tech’s trillion dollar internal inconsistency.

              https://www.apollo.com/wealth/insights-news/insights/daily-spark/tech-trillion-dollar-internal-inconsistency

 

              The catalyst for an AI bubble break.

              https://www.gmo.com/globalassets/articles/quarterly-letter/2026/gmo-quarterly-letter_3q-2026.pdf

 

Even though I am skeptical of the ‘in ten years we will all be dead’ doomsday scenario, there are some potential ethical issues.

https://yoshuabengio.org/en/blog/why-are-ai-agents-lying-cheating-and-coordinating

               

     Investing

 

            These were all published before this morning’s nonfarm payroll report. The question arises---was this the peak in yields? Follow through.

 

            Bond yields hit highest level since 2002.

                        https://www.nytimes.com/2026/10/01/business/bond-yields-10-year-treasury.html?unlocked_article_code=1.FVE.Sgzo.eyHLxhw4PEVM&smid=url-share

 

            Bonds aren’t cheap yet.

https://www.zerohedge.com/markets/bonds-arent-cheap-yet-goldman-says-long-end-still-totally-bidless?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI2OTAxIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MDg2MjQ5MSwiZXhwIjoxNzkzNDU0NDkxLCJhdWQiOiJ6aC1naWZ0In0.ONxwCghl44hGsKzsdxqiu3zx-w9r1NbgVWzCsl2t05w

 

            Ten year yields going to 8%.

https://www.zerohedge.com/markets/here-we-go-again-feds-original-sin-means-10y-yields-are-going-8-ts-lombard-warns?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI2ODU4Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MDg2NDI5NiwiZXhwIjoxNzkzNDU2Mjk2LCJhdWQiOiJ6aC1naWZ0In0.YzoaO8yhzxvs9WF7ZDbokcAi5mR-Kpugt8nOnZSez5c

 

            Hedge funds are still buying Treasuries and that could be a problem.

            https://talkmarkets.com/article/hedge-funds-are-still-buying-treasuries-and-that-could-become-a-problem

 

            And the US isn’t the only one with bond market/interest rate problems.

            https://www.zerohedge.com/markets/debt-crisis-back-european-bond-markets-crash-cds-explode-amid-france-budget-panic-contagion

 

            Preserve and protect.

            https://giftarticle.ft.com/giftarticle/actions/redeem/5ad6a151-f3ff-414a-bcf2-fba503290077

 

            Where is the stock market volatility?

            https://awealthofcommonsense.com/2026/10/where-is-the-stock-market-volatility/

 

    News on Stocks in Our Portfolios

 

 

 

What I am reading today

 

            Beware of ‘junk fees’ in your mortgage contract.

            https://www.npr.org/2026/09/15/nx-s1-5968763/housing-home-buying-junk-fees

 

 

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