Hey Snackers,
If you’re packing small blocks of vacuum sealed product into your suitcase for an international flight, you’re not alone: the latest rage with American tourists is, according to the Wall Street Journal, hauling butter back from France.
France is, of course, known for its fantastic butter. Much of it is what is known as cultured butter, where the cream is fermented before being churned. This process helps amp up the butterfat content of the end product and gives it that classic straw-colored hue.
Cultured butter of various national origins is widely available in the US, but that hasn’t stopped the craze. The small-scale tourist import trend is, for the record, largely très bien so long as you are carrying less than five kilos into the US.
“Truly melts in your mouth,” was the review in an Instagram video posted by Toronto’s Shawn Molko. While we don’t doubt the accuracy of his review, we’d suggest that artisanally-produced butter carried across international waters might be held to slightly higher standards than merely conforming to ordinary butyraceous thermal properties.
Stocks dropped as oil reversed course and rose along with Treasury yields.
Is the vibe shifting?
Another day, another attempt by the US Treasury Department to lower government bond yields, and another trading session where they rose.
On Wednesday, for the first time since the financial crisis, the yield on 5-year US government debt rose over 5%, a little over a week after 10-year yields crossed the same threshold.
The Takeaway
Rising global crude oil prices got yields moving higher for both US and European government debt due to inflationary fears, and better-than-expected US manufacturing and services data and a relatively weak auction added additional pressure to Treasuries, Bloomberg reported.
The Treasury Department said it would buy back $6 billion in long-dated government debt as part of the previously announced plan to try to reduce supply, and thus, drive down rates. As we’ve previously covered, the bond market was underwhelmed when this program was announced earlier this month, and that mood seems little changed.
Off Wall Street, the economic mood among Americans could worsen markedly: on Wednesday the rise in government bond yields pushed mortgage rates past 7% for the first time since 2024.
A $5,000 Bike Shows Why It’s Hard to Build in America
Bloomberg reports on the struggles of Lauf, which sells high-end bikes that are assembled in the US with components made around the world and especially in China. Indeed, the heart of the global high-end carbon fiber bike industry is in Shenzen, and Lauf told Bloomberg that there is no plant in the US capable of making its lightweight frames.
That’s how many company-owned McDonald’s locations participated in a pilot program that displayed ads for other companies at the fast-food behemoth’s digital drive-thru menu boards. McDonald’s hopes to build its ad sales business into a $1 billion a year business.
Snacks Shots
🏈 TNF: The Green Bay Packers are solid favorites in Thursday night’s game against the Atlanta Falcons, with markets pricing in a 72% chance* that the Packers win this one.
📊 Fed: Expectations of another rate hike in October are growing, with the market priced chance of a 25 bps rate hike rising to 65% as of this week, up from 41% a week ago and 27% at the beginning of the month.
*Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.
What else we’re Snackin’
Snack Fact of the Day
The best performing stock of the past 45 years? It’s Home Depot, of course.
The Wall Street Journal ran the numbers:
“If you had invested $1,000 in Home Depot on the day of its IPO, that $1,000 (with dividends reinvested) would be worth roughly $16 million today—a greater total return than what you could have made from investing in any other stock in the S&P 500 on any day since.”
Thursday
NY Fed President John Williams due to speak at 4:10 a.m. ET.
BlackBerry and Darden Restaurants earnings due out premarket.
Richmond Fed President Tom Barkin due to deliver remarks at 8 a.m. ET.
Cleveland Fed President Beth Hammack scheduled to speak at 8:50 a.m.
Philadelphia Fed President Anna Paulson slated to speak at 10:10 a.m. ET.
Costco earnings due out postmarket.