This Week in Barrons: 8.3.2025

In partnership with

•  History Rhymes…  Per H. Thompson/Andrew Ross Sorkin: In 1930, Ethelbert Stewart (our Commissioner of Labor Statistics, and "widely recognized as the foremost analyst on labor conditions in the U.S.") – was forced into retirement by President Hoover.  It seems that Mr. Stewart challenged the administration's false claims about employment.  On Friday, Pres. Trump fired Erika McEntarfer (Commissioner of Labor Statistics) hours after challenging his false claims of job growth.  In fact, Ms. McEntarfer had the audacity to report that “Job growth in the U.S. had slowed to a near-halt.

• Be careful what you wish for Mr. Pres… because you may think that we only gained +73,000 in July – but that number included +256,000 fake (birth-death)jobs.  Over-estimates by the birth/death model caused May & June’s job numbers to be revised lower by -258,000 jobs. So, the ‘real’ truth is that we LOST -183,000 jobs in July.

• Trading is not a part of any ‘Culture War’. Trading is real, and it’s a level playing field where the only known edge is scale. It’s a playground for speculators ‘n math geeks, and for engineers ‘n Uber drivers. Aside from the occasional meme interruption, trading remains a binary event that uses 2-sided markets to give the world a dose of reality. Nobody is getting scammed by penny-wide bid-asks, or by a 4% yield. You may not like Bitcoin trading at $116K or INTC at $20, but at least you can appreciate that those prices are real. When transactions have no fees, a traders’ losses are their own and not a result of any ‘Culture War’.

• Meta CEO Mark Zuckerberg’s vision…  is to “bring personal super-intelligence to everyone.”   Meta plans to develop AI assistants that “empower individual goals” rather than focusing on automating work. He’s positioned personal devices (like eye-glasses) as primary computing devices of the future. Zuck’s superintelligence lab (with its all-out poaching) has been the headline of the summer, but this personal vision fits well into Meta’s smart glasses success.  Meta is pushing a closed-source code shift vs. China’s open-source models.

• PalPal’s new “Pay with Crypto”…  slashes cross-border transaction costs by ~90% and opens the floodgates to a $3T crypto market, all while making it easier for merchants to grab payments from over 650m crypto users.  Merchants in the U.S. can now accept BTC, ETH, SOL, USDC, and nearly 100 other coins – using wallets such as: MetaMask, Coinbase, Binance, Phantom, and Exodus – to implement stablecoin conversions, near-instant settlement, and a flat 0.99% fee.  It also includes a full-stack payments overhaul: (a) Merchants can hold PYUSD and earn 4% interest.  (b) Freelancers can get paid instantly in crypto without begging Stripe for their own money.  And (c) PayPal is syncing with Fiserv to blast stablecoin rails worldwide.  PayPal is uniting five of the world’s biggest digital wallets into one open platform. 

   

  Tip #1:  Watch PayPal.  If it can replace the SWIFT system – without any of the compliance issues; Buy It.

   

• Debt balances in investors’ margin accounts surpassed $1T in June… an all-time-high and an 18% increase from April (the fastest move in history).  The moves signify investors’ growing appetite for risk, but buyer-beware – this debt-bubble is growing.

• June typically marks the best point of the year for home sales, but last month we saw a decline of 2.7% from May, and prices continued to make all-time-highs.  The median existing-home sale price rose to an ATH of: $435,000.

• The National Bank of Serbia will soon…  hold all its gold reserves within its own borders due to “an environment of increased global uncertainty.”

• DOGE, which Elon Musk previously led…  is deploying an "AI Deregulation Decision Tool" designed to help federal agencies identify and create a “Delete List” of government regulations that are no longer needed.

• Chrome just added AI-generated store reviews for U.S. shoppers…   it generates summaries based upon reviews from select partners.

• China’s Z.ai released its 'GLM-4.5' open-source AI model, that is…  cheaper to use than DeepSeek, includes reasoning, coding, and agentic capabilities, and it can even create PowerPoint decks with a single prompt.  

• Univ. of Maryland scientists have developed powdered artificial blood…  that can be stored, transported, and quickly mixed with water for use in life-saving emergencies.

• Our FED’s biggest revolt in 32 years began last Wednesday…  when there were multiple dissenting FOMC votes.

• India is the leading exporter of smartphones to the United States…  but DJT announced a 25% tariff on goods imported from India beginning Friday, along with a penalty for the country’s economic relationship with Russia.

• This week produced big-time earnings from Mag-7 members…  Meta and Microsoft struck first by obliterating Wall Street’s expectations, followed by strong showings from Amazon and Apple.  The reports made one thing clear: Mag-7’s bet on AI is paying off, and they’re continuing to double-down.

• Crypto Investor behavior is changing…  Crypto investors lately are buying IBIt as Bitcoin moves higher, but then not really selling it when it moves lower.  “Crypto investors are buying the ETF, and then HODLing it.”

• ~10 years ago, Ethereum was first mined…  and remains second to Bitcoin in market cap: (ETH = $460B / BTC = $2.3T).

• Kraken (the second-largest U.S. crypto exchange) is…  raising another $500m at a $15B valuation.  That would be the largest crypto money-raise since Circle’s pre-IPO cash grab and eToro’s SPAC circus.  I’m hearing: Kraken = IPO in Q1 2026.

• SEC launches “Project Crypto”… an initiative that will give U.S. financial markets increased transparency by bringing them “on chain”.

Used by Execs at Google and OpenAI

Join 400,000+ professionals who rely on The AI Report to work smarter with AI.

Delivered daily, it breaks down tools, prompts, and real use cases—so you can implement AI without wasting time.

If they’re reading it, why aren’t you?

Join 400K+ pros

• Wednesday…   we saw a Q2 GDP reading come in at 3% rather than the +2.4% that was forecast.  However, the key drivers of this U.S. GDP boom were: (a) A massive decline (-35%) in imports after April’s "Liberation Day" tariffs were announced. And (b) Consumption increasing by +1.4% (due to inflation) – vs. Q1’s +0.5%.  [FYI: Business investment declined in Q2, underscoring how nervous firms are to hire or spend in uncertain times.]  August is typically a slow month.  Markets have come a long way in a short period of time, and when you see companies like Visa post tremendous earnings, yet get sold off – it could be signaling that these markets are ready for a break.

• Thursday:  Yesterday, Fed Chair Powell reiterated that their current policy stance leaves them well positioned going forward.  Overall, he believes inflation is further from the Fed’s goal than employment.  He noted that the moderation of growth largely reflected a consumer slowdown, and that tariffs were increasing prices on goods and services.  The latest retail investor survey shows: (a) only 34% feel good about hitting their savings goals this year.  (b) 57% say that inflation is currently their biggest obstacle.  (c) 11% have cut back on 401(k) contributions, 40% are making fewer purchases, and 39% are buying cheaper stuff. Our FED’s favorite inflation indicator (the PCE) had its headline and core both increase in July.  Yesterday’s Fed selloff, saw a huge swell of selling pressure on the Russell 2000 – creating an issue moving forward.  The index doesn’t carry any of the big tech names, and it doesn’t benefit from widespread passive investments or outlandish leverage.  The index is dangerous because so many of Russell companies represent “Zombie” organizations. 

   

  Tip #2: The IWM could be setting up for another large divergence – especially after the META & MSFT show. 

   

• Friday:  U.S. futures dropped overnight along with declines in Europe and Asia after President Trump officially hit virtually every U.S. trading partner with sweeping tariff hikes.  His executive order formally authorized a hike in Canadian tariffs to 35%.  Most of the other "reciprocal" rates range from 15% to 40%, and will be implemented in seven days.  Foreign economies sorted into three groups based upon trade relationships.  The highest rates were set for countries that didn’t strike deals, and had high trade surpluses.

• Zuckerberg’s AI recruiting campaign rages on: More than a dozen staffers at former OpenAI CTO Mira Murati’s startup Thinking Machines Lab have reportedly declined Meta offers in the range of $200 to 500 million, and one employee reportedly turning down $1B+ over 4 years.  Despite the offers, not a single person from Thinking Machines Lab has accepted – mostly due to skepticism over Meta’s strategy and roadmap.  Meanwhile, Apple has lost multimodal expert Bowen Zhang to Meta – the fourth Apple AI researcher to jump in a month.

• Truflation, the leading real-time alternative inflation metric…  showed inflation starting the year around 3%, falling to 1.2% in April, and now sitting near the Fed’s target of 2%.  The biggest threat looming on the horizon is the massive government spending that we are witnessing.  The US government has increased the national debt by approximately $500B since the beginning of July. Per Anthony Pompliano, “Whether we get the rate cut or not, every data point is telling us: (a) Politicians can’t stop printing money.  (b) Our FED will eventually lower rates (further debasing the Dollar).  And (c) Asset prices are going higher.  Investors should: sit tight, stay long, and chill.

• ChatGPT’s new study mode won’t just give you the answer: OpenAI has launched a new study mode for ChatGPT that will help students learn by working through problems step-by-step instead of just handing them the answers.  The feature offers interactive prompts with questioning, and hints to guide students through their queries. It, then, organizes responses into digestible sections and quizzes you along the way.

• Volatility Strikes Back…  on extremely high volume.  On Thursday, September volatility futures were +2 points higher than August volatility – one of the largest gaps in history.  This told everyone who was listening, that volatility would rise by about +2 points during the next 15 days.  And on Friday, volatility moved higher and we started closing that gap by at least 50%.  As proof, on Tuesday the VVIX was at 88, and on Friday it had moved 27% higher to 112.

  Tip #3: The VIX is signaling that 2-sided trading is BACK.  

• Bonds go on the defensive…  having an immediate reaction to the Jobs data – rallying from 113 to 115 and driving 10-Year rates from 4.4% to 4.2%.  Instantly, the chance of a FED interest rate cut jumped to over 80% in September. 

  Tip #4: Watch Bonds in the coming week, because it appears that Institutions are Buying Bonds to Reduce Portfolio Risk – thereby reducing equity allocations.

• Dollar sell-off drives Gold to new highs… so I actually BOT the September 5^th $308 / $313 Call Spread on GLD. 

  Tip #5:  If the Dollar continues to decline and/or Bonds continue to be bought – GOLD will jump off the page. 

• Pockets of strength are Homebuilders (XHB) and Healthcare (XLV)…  and it scares me when defensive stocks suddenly move higher.  When investors sell – they do not discriminate.  This wakes me up to the potential of a lot more selling.

• The critical threshold for the /ES is 6250…  We had broken out of our 100-point volatility box to the upside, and in the last 24 hours slammed back into the base of the box – right around 6250. 

  Tip #6: If we move under 6250 next week, the next stop will be 6,000 on the /ES.

• SPX Expected Move (EM):

  o Last Week’s Move = $90 … and we moved an additional ~70 points below its EM.

  o Next Week’s Move = $137 … and we moved more than that on Friday.  I don’t think that this number is big enough!

  Tip #7:  Do NOT SELL Volatility, and buy any ‘n all NEW Long positions with DEFINED RISK!

   

• Factually:  (a) The S&Ps closed up +2.2% for July (+7.8% YTD), and subsequently slipped -1.6% the first day of August. (b) Volatility and Credit Spreads are seeing their normal seasonal upturn. (c ) Investors are skewing portfolios heavier and heavier into tech stocks. And (d)  US electricity demand has broken out to a new all-time high. 

  Overall, Per Callum Thomas: Investors have shifted their focus from ‘rebound management’ to ‘full-risk-on’ – as the recovery from the April low fizzles, and seasonal headwinds begin to weigh.  Short-term technicals are tenuous, pressure points are building, but medium-to-longterm trend indicators remain healthy.

   

  HODL’s: (Hold-On for Dear Life)

  - (+) IBIT – Blackrock’s Spot Bitcoin ETF ($64.2 / in at $24)

  - (+) ETHA – Ethereum ETF ($26.5 / in at $13.5)

  - (+) Physical Commodities = Gold @ $3,416/oz. & Silver @ $37.1/oz.

  - Bitcoin (BTC = $114,000 / in at $4,310)

  - Ethereum (ETH = 3,450 / in at $310)

  - (+) GLD – Gold ETF ($309.7 / in at $212)

   

  Options for Income:  De-Risking a Portfolio… (using IBIT as an example)

  - BUY-n-HOLD the IBIT ETF

  - BUY PUTs: 1 Std. Dev. Lower, Expiring in 3-weeks.

  - SELL Covered CALLs: 0.75 to 1 Std. Dev. Higher, Expiring in 2-weeks.

   

  ‘De-Gen’ Economy:

  - SLV: Silver… ($33.6 / in at $31.2)

  - VIX: Volatility Index … ($20.3 / in at $16)

  - ASPI: ASP Isotopes … ($8.9 / in at $5.88)

  - GLD: Gold ETF … BOT the Sept 5, $308 / $313 Call Spread for $2

  - UDN Dollar Bearish Index 1X … BOT the $18 Sept Calls for 75 cents.

   

  Please be safe out there!

• _{Expressed thoughts offered within the BARRONS REPORT, a Private and free weekly economic newsletter, are those of noted entrepreneur, professor and author, R.F. Culbertson, contributing sources and those he interviews.  You can subscribe by visiting: https://rfsfinanicalnews.beehiiv.com/subscribe.}

• _{Please write to Mr. Culbertson at: <[email protected]> to inform him of any reproductions, including when and where copy will be reproduced. You may use in complete form or, if quoting in brief, reference <http://rfcfinancialnews.blogspot.com/> and/or https://rfsfinanicalnews.beehiiv.com}

• If you'd like to see R.F. in action - please feel free to view the TED talk that he gave on Fearless Investing.

• Creativity = https://youtu.be/n2QiPSe_dKk 

• Sales = https://youtu.be/blKw0zb6SZk

• Startup Incinerator = https://youtu.be/ieR6vzCFldI

• To unsubscribe please refer to the bottom of the email.

• Views expressed are provided for information purposes only and should not be construed in any way as an offer, an endorsement, or inducement to invest and is not in any way a testimony of, or associated with Mr. Culbertson's other firms or associations. Mr. Culbertson and related parties are not registered and licensed brokers. This message may contain information that is confidential or privileged and is intended only for the individual or entity named above and does not constitute an offer for or advice about any alternative investment product. Such advice can only be made when accompanied by a prospectus or similar offering document. Please make sure to review important disclosures at the end of each article.

• Note: Joining BARRONS REPORT is not an offering for any investment. It represents only the opinions of RF Culbertson and Associates.

• PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THERE IS RISK OF LOSS AS WELL AS THE OPPORTUNITY FOR GAIN WHEN INVESTING. WHEN CONSIDERING ALTERNATIVE INVESTMENTS (INCLUDING HEDGE FUNDS) AN INVESTOR SHOULD CONSIDER VARIOUS RISKS INCLUDING THE FACT THAT SOME PRODUCTS AND OTHER SPECULATIVE INVESTMENT PRACTICES MAY INCREASE RISK OF INVESTMENT LOSS; MAY NOT BE SUBJECT TO THE SAME REGULATORY REQUIREMENTS AS MUTUAL FUNDS, OFTEN CHARGE HIGH FEES, AND IN MANY CASES THE UNDERLYING INVESTMENTS ARE NOT TRANSPARENT AND ARE KNOWN ONLY TO THE INVESTMENT MANAGER.

• Alternative investment performance can be volatile. An investor could lose all or a substantial amount of his or her investment. Often, alternative investment fund and account managers have total trading authority over their funds or accounts; the use of a single advisor applying generally similar trading programs could mean lack of diversification and, consequently, higher risk. There is often no secondary market for an investor's interest in alternative investments, and none is expected to develop.

• All material presented herein is believed to be reliable but we cannot attest to its accuracy. Opinions expressed in these reports may change without prior notice. Culbertson and/or the staff may or may not have investments in any funds cited above.

To Subscribe: https://rfsfinanicalnews.beehiiv.com/subscribe

Remember the Blog: <http://rfcfinancialnews.blogspot.com/>  and/or
https://rfsfinanicalnews.beehiiv.com.

Until next week – be safe.

R.F. Culbertson

<mailto:[email protected]>

http://rfcfinancialnews.blogspot.com

https://rfsfinanicalnews.beehiiv.com