There have been some remarkable anomalies within the data for exports leaving and imports coming into the U.S. during the last several months.

One of those anomalies is closely tied to a practice called frontrunning, which we've seen quite a lot of during the last six months, particularly between the U.S. and China. We've mostly covered that activity in the form of Chinese exporters acting to beat the clock on the Biden-Harris administration's anti-free trade policies.

But the same practice has also been used by U.S. exporters seeking to ship as many affected goods as they could to China ahead before the Biden-Harris trade restrictions took effect. In the following chart, we show U.S. exports of high-tech computer chips effectively doubling after the Biden-Harris administration announced new sets of tariffs and export restrictions on these products during 2024.

That surge contrasts with the declines that took place after the Biden-Harris' first trade restrictions in 2022 and 2023, which went into effect with much less advance notice. Here are contemporary news headlines corresponding to the Biden-Harris administration's major anti-free trade actions involving restrictions on U.S. exports of high-technology computer chips to China indicated on the chart in the period from 11 September 2022 through 13 January 2025:

1. 11 September 2022: Biden to hit China with broader curbs on U.S. chip and tool exports
2. 5 September 2023: U.S. rolls out new chip-related export controls as China makes industry advances
3. 29 March 2024: U.S. updates export curbs on AI chips and tools to China
4. 31 July 2024: New US rule on foreign chip equipment exports to China to exempt some allies
5. 9 November 2024: US ordered TSMC to halt shipments to China of chips used in AI applications
6. 13 January 2025: Biden unveils last round of AI chip curbs aimed at China, Russia

The increase in high-value U.S. computer chip exports to China during 2024 played a role in boosting U.S. GDP in this period.

There's another anomaly involving imports that gained quite a bit of attention in the media after the Atlanta Fed's GDP "nowcasting" tool suddenly forecast a deep plunge in GDP for the first quarter of 2025. That plunge was caused by an unexpected surge of gold imports rushing into the U.S.

The next chart shows the value of gold bullion imported into the U.S. from January 2021 through January 2025. It shows the imported gold rush really began after October 2024, with the level of gold imports in January 2025 reaching four times the average monthly value of gold bullion imported in the 45 preceding months:

USA Trade Online provides more detail of which countries all that additional nonmonetary gold is coming from. Here are the top three and the amount by which their exports of gold bullion changed from October 2024 to January 2025:

• Canada: Increase from $143.4 million to $1.042 billion per month.
• Switzerland: Increase from $110.0 million to $572.8 million per month.
• Hong Kong: Increase from $0 to $241.5 million per month.

The import category registering these increases is "Gold, Nonmonetary, Unwrought Nesoi", where "Nesoi" is an acronym that translates as "Not Elsewhere Specified Or Included". Imports of monetary gold (such as minted gold coins) meanwhile show a mild decline in the period from October 2024 to January 2025.

Since much of the news coverage has focused on either London or Switzerland as being the source of the increase in imported gold, we were surprised to find Canada is the biggest contributor to the surge. We were likewise surprised to discover Hong Kong is the third largest contributor, seeing as the international banking center is controlled by China.

References

U.S. Census Bureau. USA Trade Online. [Online database]. Accessed 8 March 2025.

Freifeld, Karen and Alper, Alexandra. Exclusive: Biden to hit China with broader curbs on U.S. chip and tool exports -sources. Reuters. [Online article]. 11 September 2022.

Butts, Dylan. U.S. rolls out new chip-related export controls as China makes industry advances. CNBC. [Online article]. 5 September 2023.

Reuters. U.S. updates export curbs on AI chips and tools to China. [Online article]. 29 March 2024.

Freifeld, Karen. Exclusive: New US rule on foreign chip equipment exports to China to exempt some allies. Reuters. [Online article]. 31 July 2024.

Freifeld, Karen and Potkin, Fanny. Exclusive: US ordered TSMC to halt shipments to China of chips used in AI applications. Reuters. [Online article]. 9 November 2024.

Allen, Gregory C. Understanding the Biden Administration's Updated Export Controls. Center for Strategic & International Studies. [Online article]. 11 December 2024.

Carvajal, Nikki and Liu, Juliana. Biden unveils last round of AI chip curbs aimed at China, Russia. CNN. [Online article]. 13 January 2025.

Image credit: Gold ingots by Stevebidmead on Pixabay. Creative Commons CC0 1.0 Universal Public Domain Dedication.

The pace at which carbon dioxide is accumulating in the Earth's atmosphere slowed in February 2025 after peaking in January 2025.

The change comes as the first significant decline since the period from December 2022 through January and February 2023, which marked the end of China's "zero-COVID" lockdowns. The end of China's restrictions initiated a massive surge in carbon dioxide emissions, which rocketed up in during the following two years.

The initial surge in 2023 was prompted by China's lifting of its repressive policy and the reopening of its economy. That recovery proved to be weak however, so China's government instituted policies to stimulate its economy in late 2023 and in 2024, which propelled the nation's carbon dioxide emissions to new heights.

Two recent headlines emphasize the extent to which the policies of China's government contributed to carbon dioxide emissions. The first headline is from September 2024, the second from February 2025:

• China's coal use and output are rising, even as renewables surge
• China’s construction of new coal-power plants ‘reached 10-year high’ in 2024

Since China was already, by far and away, the world's largest source of carbon dioxide emissions, China's government's stimulus policies greatly contributed to the surge of carbon dioxide emissions during 2024.

The following chart illustrating the trailing year average of the year-over-year change in the concentration of atmospheric carbon dioxide measured at the remote Mauna Loa Observatory shows that two-year-long increase to a record high for the modern era, along with February 2025's decline:

Carbon Brief, the source of the second headline, provides more information about the policies that contributed the most to the increase of CO₂ in the Earth's air during the preceding 12 months:

Construction started on 94.5GW of new coal-fired power plants in 2024, according to the study. It says this is a sign of continued momentum in developing new coal projects, despite government pledges to “strictly” control the use of the fossil fuel. The report adds that 3.3GW of suspended projects also resumed construction in 2024.

Approvals for new coal construction rebounded in the second half of the year to 66.7GW, after permitting only 9GW in the first half.

Taken altogether, the report says this signals a substantial amount of new capacity will come online in the next few years, “solidifying” coal’s place as a major source of electricity.

China's government will miss all of the CO₂ emissions targets it claimed it was going to hit in 2025.

References

National Oceanographic and Atmospheric Administration. Earth System Research Laboratory. Mauna Loa Observatory CO2 Data. [Online Data]. Updated 5 March 2025.

Image Credit: Microsoft Copilot Designer.. Prompt: "A diagram showing a coal power plant emitting carbon dioxide. The power plant has the Chinese characters for 煤 (coal) written on it."

Front running is a trading practice that's based on knowledge of the future. If you're a trader and you know that an upcoming event will affect the market, you can make trades that will be to your advantage both before and after the future event takes place.

In the context of the stock market, front running carries a negative connotation because insider trading is often involved. But what if your trade is the business of imports and exports and political leaders have announced they are going to impose tariffs or other trade restrictions on the exchange of goods between countries at a specific date in the future?

In that situation, insider trading isn't an issue, but dealing with the consequences of the political actions on your import/export business is. Once political actions affecting trade between countries are announced, savvy traders will go to work. And one of the tactics they will use to deal with the upcoming event that will affect their business is to front run it to the greatest extent they can. They'll move as many goods as they can ahead of when new tariffs or trade restrictions will go into effect.

Take the example of trade between the U.S. and China. Over the last six months, we've focused a lot of attention on how China acted to frontrun anti-free trade policies announced by the Biden-Harris administration.

The numbers have been big enough to affect the trajectory of the total value of goods traded between the two nations during the latter portion of 2024, moderately reversing what had been a long running downward trend that began after the Biden-Harris announced it would impose restrictions on trade between the U.S. and China in September 2022. The following chart chart shows how the total value of goods traded between the two nations has evolved from January 2016 through January 2025.

Although we've focused on China's exports to the United States in our coverage of the practice of front running in this trade, that practice has also been used to boost U.S. exports to China for the same reason of beating the clock on the new anti-free trade actions by the governments of the two nations.

We are planning an upcoming feature in the near future that will focus on some major anomalies that developed in the importing and exporting of goods to and from the U.S., at least one of which involves U.S. exporters frontrunning the Biden-Harris administration's trade sanctions. Anomalies so large they are materially affecting economic growth forecasts and the measure of the U.S.' gross domestic product.

We're also planning a separate feature to close the books on the Biden-Harris administration's anti-free trade policies, where we'll definitively answer the question of whether they had a larger or smaller impact on trade between the U.S. and China than the policies adopted by President Trump during his first term in office.

References

U.S. Census Bureau. U.S. International Trade in Goods and Services (FT900). U.S. Trade in Goods with China, Not Seasonally Adjusted, Nominal Figures, Total Census Basis. [Online database]. Accessed 5 March 2025.

Image credit: Photo by Zalfa Imani on Unsplash.

February 2025's jobs data showed little change for U.S. teenagers.

Overall, the seasonally-adjusted number of employed teens from Age 16 through 19 ticked up from January 2025, with 5,792,000 counted as having jobs. That's up from the August 2024 low of 5,390,000, but is still down from the May 2024 peak of 5,861,000.

Virtually all of that gain is found among older teens, Age 18 and 19. This portion of the teen population contributed a seasonally-adjusted 3,801,000 workers to the ranks of the employed in February 2025. This figure is the highest in years for this portion of the employed teen demographic.

The story changes however when we look at the trend for younger teens, Age 16 and 17. Representing the most marginal members of the entire U.S. labor force, younger teens saw their employment numbers peak at 2,357,000 in December 2022. Since then jobs held by this demographic have slid, primarily during 2024. February 2025 recording a seasonally-adjusted figure of 1,994,000, which was up some 5,000 from January 2025's level.

These numbers are captured in the following chart, which tracks U.S. teen employment from January 2021 through February 2025.

As a percentage of the teen population, the share of employed teens remained below their recent peaks in February 2025. For all working teens Age 16-19, February 2025's 32.4% employment-to-population ratio remains below the peak of 34.0% recorded in August 2022. For older teens, the peak of 45.9% in December 2024 is much more recent, with February 2025's level coming in at 45.6%.

Once again however, the story is different for younger teens. The share of working teens Age 16-17 peaked at 25.6% in April 2022. In February 2025, that figure is 20.9%. The next chart tracks the U.S. teen employment to population ratio from January 2021 through February 2025.

The months ahead may be rough going for teens with jobs and teens seeking jobs, especially younger teens if their nearly two-year long downward trend continues. We thought we'd end this month's analysis of the teen job market with WYTV's video discussing how to prepare your teenager for their first job:

But that doesn't answer the question of who hires teens. The Bureau of Labor Statistics' web site is a surprising poor resource for that kind of information, but we did find another resource that may be more useful. Hireteen has a curated list of companies that hire teens for specific job openings and also offers a teen job search.

Teens are, by definition, the most marginal members of the U.S. work force, having almost by definition the least amount of education, skills, training, and work experience of all age-based demographic groups. We pay attention to the job situation for U.S. teens because it can be a harbinger of things to come for the entire U.S. job market.

References

U.S. Bureau of Labor Statistics. Labor Force Statistics (Current Population Survey - CPS). [Online Database]. Accessed: 7 March 2025.

Image credit: Wanted ad on OpenClipArt. Public domain image.

The S&P 500 (Index: SPX) dropped 3.1% week over week, closing at 5,770.20 on Friday, 7 March 2025.

Much of the week's headlines tried to connect U.S. tariffs to the market downswing, but that misses a bigger story that's developing. The Artificial Intelligence balloon may be beginning to pop.

You have look at the week's second-tier market-moving headlines to get that part of the story. Many of the biggest drops were among the stocks of companies that had been riding high on the AI wave. And for what it's worth, AI-leader Nvidia (NASDAQ: NVDA) dropped well below the $3 trillion capitalization mark during the past week. Since the beginning of the year, NVDA has lost $1 trillion of its market capitalization.

Despite that loss, NVDA is still the third-largest company within the S&P 500. As such, what's going on with it and other AI-related stocks is enough to pull the S&P 500 lower. The latest update of the alternative futures chart shows the trajectory of the S&P 500 is running below the projected trajectory associated with investors focusing their attention on the upcoming future quarter of 2025-Q2.

That situation suggests the negative change in fortune for the AI sector of the stock market may be prompting a change in market regime. It's still too early to make that determination for sure, but it's a potential to which we're paying close attention behind the scenes.

Here are the week's market moving headlines:

Monday, 3 March 2025

• Signs and portents for the U.S. economy:
• Oil slides to three-month low as OPEC brings production cuts back online starting April 1
• Trump says Canada, Mexico tariffs to take effect on Tuesday; stocks tumble
• Fed minions say economy still growing, think recent data looks risky:
• Fed's Musalem expects continued economic growth, but sees risks in recent data
• Bigger trouble, stimulus developing in China:
• China February manufacturing hits 3-month high, but US tariff war clouds outlook
• China's Feb second-hand home prices narrows for seventh straight month, report says
• ECB minions’ rate cuts getting more likely in Eurozone as EU economy drags, may "stumble" into stimulus:
• Euro zone inflation ticks lower in boost to ECB rate cut bets
• ECB may fear stumbling into stimulus
• Nasdaq plunges more than 2%; S&P, Dow also drop as fears over Trump's tariff plans sink in
• Nvidia sinks, chips tumble amid China fears, Trump tariffs

Tuesday, 4 March 2025

• Signs and portents for the U.S. economy:
• Trade wars erupt as Trump hits Canada, Mexico and China with steep tariffs
• Goldman Sachs CEO: Trump wants to 'level the playing field' with tariffs, US recession has 'small, but not zero' chance
• Trump alerts American farmers: get ready for external tariffs April 2
• China hits US agriculture, says won't be bullied by fresh Trump tariffs
• Which U.S. agricultural products did China hit with tariffs?
• China to impose extra tariffs of 10%-15% on various US farm products
• Oil down on OPEC+ output increase, tariffs start and US pause on Ukraine aid
• Fed minions worry about tariffs and inflation they failed to fix after four years:
• Fed's Williams: Tariffs are inflation risk, rate policy in good place
• Bigger stimulus developing in China:
• China ramps up stimulus to guard economy from changes 'unseen in a century'
• Dow, S&P end lower by 1%, Nasdaq declines as Trump tariffs stoke trade war worries

Wednesday, 5 March 2025

• Signs and portents for the U.S. economy:
• Oil settles down more than 2% after US crude stocks build, OPEC+ hike, US tariffs
• Oil falls as OPEC+ plans to raise output, U.S. tariffs hammer sentiment
• US factory orders rebound in January on commercial aircraft
• Trump will delay some auto tariffs after Detroit Three push
• BOJ minions thinking about what's on their balance sheet and hiking Japan's interest rates:
• BOJ has no immediate plan to sell ETF holdings, deputy governor says
• BOJ vows to keep raising rates despite Trump tariff risks
• ECB minions see lack of growth developing in Eurozone, Germany to try to spend its way out of funk:
• Euro zone economy treads water again in February, PMI shows
• Exclusive: How the ECB dodged a payment disaster in 10 hours of tech meltdown
• German parties agree historic debt overhaul to revamp military and economy
• Spending U-turn puts Germany back in Europe's driving seat
• Nasdaq, S&P, and Dow closed out the day on top as Trump delays auto tariffs
• Wall Street gains as markets eye easing of trade tensions

Thursday, 6 March 2025

• Signs and portents for the U.S. economy:
• US trade deficit hits record high in January on imports surge
• Fed minions don't want to cut rates too soon, start noticing well-developed problems with U.S. economy:
• Fed's Waller, leaning against March cut, sees easings later in year
• Fed's Harker says warning signs emerging for US economy
• Bigger trouble, stimulus developing in China:
• China's imports tumble as demand skids, trade war heats up
• China's January-February exports, imports weaker than expected
• More words than deeds from China on consumption keep deflation in play
• ECB minions cut interest rates again to prop up Eurozone economy:
• ECB cuts rates for sixth time in face of economic upheaval
• ECB cuts rates again but risk of April pause growing
• Nasdaq ends down 2%, S&P slides in tech- and tariff-led rout before U.S. jobs report
• Nasdaq-100 plunges; see which 10 names are struggling the most
• Wall Street sells off as tariff concerns mount, Nasdaq confirms correction

Friday, 7 March 2025

• Signs and portents for the U.S. economy:
• US Treasury's Bessent says economy may slow in shift away from public spending
• Bidenomics Hangover Worsens: Subprime Auto Loan Delinquencies Hit Record High In January
• Trump delays tariffs for goods under Mexico, Canada trade deal
• Oil up, but off highs as Trump warns new Russia sanctions possible
• US estimates it will take $20 billion and years to refill oil reserve
• Fed minions say they're in no rush to cut rates again, are expected to cut rates again in June 2025:
• Fed expected to cut rates in June as jobs data raises potential red flags
• Fed Chair Powell signals possible tweaks to 'dot plot' rate-path forecasts
• Powell says tariffs could feed inflation, Fed must wait to determine the impact
• Fed should be careful, deliberate with interest rate policy, Daly says
• Fed's Kugler says rate policy likely on hold for some time
• Fed may need to stay patient on rates until summer, Bostic signals
• Fed's Bowman signals she may pay more attention to job market in policy debates
• Fed's Williams: Data points to stable inflation expectations
• Bigger trouble, stimulus developing in China:
• China to boost food imports from Latin America, Europe as US trade war escalates
• JapanGov minion says Japan doesn’t need to worry about deflation anymore:
• Japan ready to declare end to deflation, economy minister says
• Japan's largest union group sees biggest wage hike demand in over 30 years
• Not as bad trouble developing in Eurozone:
• Euro zone economy grew faster than initially thought in Q4
• Stocks end higher as Powell soothes economic worries, but post sharp weekly loss
• Equal weight S&P 500 outperforms in 2025 as market-cap weighted index declines
• Nvidia loses $1T market cap since hitting record high earlier this year

The CME Group's FedWatch Tool projects the Fed will resume cutting rates with a quarter point rate reduction when Fed meets on 18 June (2025-Q2). The FedWatch tool now anticipates rate cuts at 6-12-week intervals in the second half of 2025, with quarter point rate cuts forecast for 30 July (2025-Q3), and 29 October (2025-Q4).

The Atlanta Fed's GDPNow tool's projection of what real GDP growth will be in the 2025-Q1 declined from last week's -1.5% annualized growth rate to -2.4%. The GDPNow estimate is believed to be sending a false signal given very high imports of gold to the U.S. (originating from Canada, Switzerland, and surprisingly, Hong Kong), which have shown up as imports in trade data, but which have not yet been updated in inventory data tracked by the GDPNow tool. Forecasts of GDP in 2025-Q1 will be revised higher after accounting for the imported gold rush.

Image credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon of a Wall Street bear about to pop a balloon that says 'AI' with a dart".