The Kobeissi Letter

The Kobeissi Letter

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Official X account for The Kobeissi Letter, an industry leading commentary on the global capital markets. Email us: support@thekobeissiletter.com

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The Kobeissi Letter

BREAKING: US small farm bankruptcies surged to 173 in the first half of 2025, the highest since the 2020 pandemic. This is 103 bankruptcies, or +147%, more than in the same period of 2023. This comes as high interest rates, trade tensions, and rapidly falling Chinese demand have crushed margins. Soybean, corn, and pork producers have been hit hardest as China shifts purchases to Brazil and Latin America. Meanwhile, US farm debt is projected to hit a record $561.8 billion this year, according to the US Department of Agriculture. US small farmers are in a recession.

The Kobeissi Letter

More evidence of a weakening US labor market: Non-farm payroll growth has failed to exceed +1.15% YoY for the last 4 straight months, marking the weakest increase since before the 2020 pandemic. The last time the job numbers experienced such weakness, excluding 2020, was 14 years ago. Historically, such muted labor market gains have been seen before recessions. Interestingly, non-farm payroll growth remained above +1.40% for 3 months at the start of the 1980s double-dip recessions. The worst part? Recent data does not yet include the annual BLS revisions. The labor is far weaker than many expect.

The Kobeissi Letter

BREAKING: President Trump is set to release a list of Epstein associates, per Fox News. Two weeks ago, the DOJ said there was no Epstein "client list." Odds of President Trump releasing any of the Epstein Files this year rise to 56%, per Kalshi.

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US auto loan delinquency rates keep on surging: Subprime auto loan delinquency rates just crossed above 5% for the first time in history. Since 2022, the 60-day delinquency rate for subprime auto loans has more than DOUBLED. Delinquency rates are now above the peak levels recorded in 2008 and 2020. Furthermore, prime auto loan 60-day delinquencies have risen to their highest in 14 years. All while the share of auto loan balances at least 90 days past due hit 5% in Q1 2025, in-line with the 2020 pandemic high. The car market bubble is bursting.

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BREAKING: US existing-home sales fell -2.7% MoM in June, to an annual rate of 3.93 million, the lowest in 9 months. Existing-home sales are now near their lowest level in 15 years. By comparison, the pre-pandemic average was ~37% higher. This comes as high mortgage rates are keeping home sales stuck at cyclical lows. Meanwhile, the median sales price rose +2% YoY last month, to a record of $435,300. The housing market remains historically unaffordable.

The Kobeissi Letter

BREAKING: President Trump issues a statement on his tour of the renovation of the Federal Reserve Building with Fed Chair Powell. Trump says the renovation “would have been much better if it never started” and Powell needs to “lower interest rates.”

The Kobeissi Letter

BREAKING: The US M2 money supply surged +4.5% YoY in June to a record $22.02 trillion. This marks the 20th consecutive monthly increase and the largest increase since July 2022. The surge brings M2 closer to the 2000–2025 average annual growth rate of 6.3%. Additionally, inflation-adjusted M2 rose +1.8% YoY last month. For perspective, US M2 Money Supply was ~$8.46 trillion, or 62% lower, at the end of the 2008 Financial Crisis. The US Dollar's purchasing power is in a perpetual bear market.

The Kobeissi Letter

BREAKING: Prediction market Kalshi and xAI establish partnership to bring Grok to prediction markets. The integration of financial markets and AI is growing rapidly.

Effective immediately, Kalshi and xAI are partnering to bring Grok to prediction markets. Two of the fastest growing companies in America are now on the same team. @xAI 🤝 @Kalshi

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Ether ETFs' inflows are exploding: Spot Ether ETFs posted a net inflow of $533.9 million on Tuesday, the 4th largest on record. By comparison, an all-time high of $726.7 million was seen on July 16th. This marks a 13th consecutive daily inflow, the longest streak since their debut. During this time, investors poured ~$4.0 billion into these funds. As a result, the cumulative net inflow for all Ether ETFs combined has exceeded $8.3 billion. Investor appetite for Ethereum is historic.

The Kobeissi Letter

Manufacturing employment is contracting: The ISM Manufacturing Employment index hit 46.8 points in May, marking its 4th consecutive monthly contraction. Manufacturing employment has contracted in 18 of the last 20 months. Such long negative streak has rarely ever occurred outside of recessions. As a result, manufacturing employment has declined by 82,000 jobs over the last year. US manufacturing jobs now reflect only 8% of total nonfarm payrolls, an all-time low. The manufacturing sector is struggling.

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