May 5 2025

Trade War Part 1: Main Street Holds Firm As April Jobs Report Shows Resilience Despite Tariffs

Trade War Part 2: China's Economy Shows Strain Under Tariff Blockade

"Bring Hollywood Home": Trump Authorizes Steep Tariffs on Foreign-Shot Films, Cites National Security

What Do People Ask AI? Coding Help Tops List in Analysis of 1 Million Queries

Trump Administration Resumes Collections on Defaulted Student Loans Monday

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Trade War Part 1: Main Street Holds Firm As April Jobs Report Shows Resilience Despite Tariffs

After a (deceptively) negative GDP print and a string of dire sentiment readings, there was a lot of market anxiety surrounding Friday’s jobs report. If the April numbers came in below expectations, it would be the hardest evidence yet that uncertainty and tariffs are taking their toll on the US economy. Didn’t happen: 177,000 jobs were added, well above the consensus forecast of 138,000, and the unemployment rate held steady at 4.2 per cent. The market rejoiced, with the S&P 500 up over 2 per cent. The 10-year Treasury yield bumped up 10 basis points as investors paired back expectations for Fed cuts. there were some real bright spots in the report…Over half of the job growth came from cyclical industries (private, excluding healthcare) — particularly warehousing, which could be a side effect of the recent surge in imports. 518,000 people entered the labour force, even with low migration. That suggests optimism about work prospects. And, despite concerns over Doge’s impact on the federal government, the rate of federal job losses slowed last month, and was revised down for March: On balance, Friday’s report was good news. Like the GDP report, it shows the US economy is standing strong. Yet, we are still on the precipice. The worst of the tariffs have not hit yet, and still could. Until they do, employers seem to be OK with growing their work force.Source: Unhedged

Trade War Part 2: China's Economy Shows Strain Under Tariff Blockade

According to official statistics, China’s economy grew 5.4 per cent year-over-year last quarter — above expectations and higher than China’s goal of 5 per cent. Chinese macroeconomic data should be taken with a grain of salt, however. Other indicators suggest softness. The Li Keqiang index, a popular proxy for China’s GDP that uses indicators ranging from train schedules to bank lending, expanded at 4.3 per cent year-over-year last month. Another alternative (and our favourite), the Capital Economics China Activity Index, put the growth rate at just 3.9 per cent. Whatever strength there was may have come from a surge in exports, as buyers in the US rushed to import Chinese goods ahead of tariffs. But to replace US demand in the coming months, China will need to find new buyers at home and abroad. That will be hard. Europe might erect its own trade barriers, and Chinese domestic consumption has not shown signs of life. Unhedged and various other commentators have observed that China may be in a better political position than the US for prolonged negotiations. Economically, however, it holds fewer cards.Source: Unhedged

"Bring Hollywood Home": Trump Authorizes Steep Tariffs on Foreign-Shot Films, Cites National Security

President Trump has found the next industry he wants to bring back to the U.S. with tariffs: Hollywood. Trump authorized a 100% tariff on films produced overseas, he said in a Truth Social post Sunday. He called it a response to tax incentives that have lured a substantial number of Hollywood productions outside the U.S. Films made by American studios are often shot in the United Kingdom and Canada, including this year’s highest-grossing film, “A Minecraft Movie.” “ The Movie Industry in America is DYING a very fast death,” the president wrote. He called international filmmaking incentives “a concerted effort by other Nations and, therefore, a National Security threat. It is, in addition to everything else, messaging and propaganda!”Source: WSJ

What Do People Ask AI? Coding Help Tops List in Analysis of 1 Million Queries

Researchers with the Anthropic Economic Index analyzed a million (anonymous) queries folks typed into the AI assistant known as Claude during February and March and used an in-house AI tool to group them into 630 categories, ranging from “draft a polite rejection message that maintains professional relationships” to “role-play as fictional characters in narrative scenarios.” The broad categories tilt toward programming-related questions, an area of expertise for Claude in particular and chatbots in general. (The Post has a content partnership with OpenAI which, according to a news release, means “ChatGPT will display summaries, quotes, and links to original reporting from The Post in response to relevant questions.”)

Source: Washington Post

Trump Administration Resumes Collections on Defaulted Student Loans Monday

The Trump administration is starting to put millions of defaulted student-loan borrowers into collections Monday and threatening to confiscate their wages, tax refunds and federal benefits. There are some five million borrowers whose loans are in default, many of whom haven’t made regular payments since the pandemic. Millions more are on the cusp of default, according to the Education Department. President Trump has made student-debt repayment a priority, a reversal from former President Joe Biden, who attempted to forgive swaths of student debt. Though a pandemic payment pause ended in 2023, the Biden administration extended a no-consequences period for those who didn’t pay through the 2024 election. The Trump administration says it doesn’t have the authority to wipe away student debt and must collect on it.Source: WSJ

May 5, 1961: Alan Shepard becomes the first American in space

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Sources

1. Unhedged newsletter
2. Unhedged newsletter
3. https://www.wsj.com/business/media/trump-authorizes-100-tariff-on-movies-made-overseas-757e3a10?mod=hp_lead_pos5
4. https://www.washingtonpost.com/business/2025/05/02/wild-stats-about-americas-place-world-plus-what-people-actually-ask-ai/
5. https://www.wsj.com/personal-finance/student-loans-debt-payments-collections-6fd28ed3?mod=hp_lead_pos4