Fed Considers Bond Purchases as Labor Market Falters

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[1] Fed data suggests central bank has stopped losing money - KITCO (https://www.kitco.com/news/off-the-wire/2025- ...)[2] Trading Day: Fed hopes fire risk rally - Reuters (https://www.reuters.com/world/china/global-ma ...)[3] The Job Market Is In Its Worst Stretch Since The Pandemic - Investopedia (https://www.investopedia.com/the-job-market-i ...)

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Dec 04 2025, 13:06

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Dec 04 2025, 08:33

US Debt Sparks Bond Collapse, Gold Bull Run Warnings

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This view is echoed by former Treasury Secretary and Goldman Sachs co-chairman **Robert Rubin**, who has drawn parallels between the current market complacency and the period preceding the "Black Monday" crash of October 19, 1987. At the core of these concerns is the U.S. national debt. The Congressional Budget Office (CBO) estimates that debt held by the public will reach 99.8% of GDP in fiscal year 2025, double the 50-year historical average of 51%. Rubin noted this is a significant increase from 30% in 2000 and cited forecasts from the Budget Lab at Yale suggesting the ratio could climb to a more realistic 130-140%. Rubin stated that while the timing is "impossible to predict," the nation is running a significant risk by continuing on an unsound fiscal path. ## Market Implications ### U.S. Treasuries Under Pressure The alignment of fiscal and monetary policy, often referred to as fiscal dominance, poses a direct threat to the U.S. bond market. If the **Federal Reserve** is perceived as monetizing government debt to keep borrowing costs low—effectively inflating its way out of the problem—investor confidence could erode rapidly. This scenario, warned against by Rubin, could trigger a sharp sell-off in U.S. Treasuries as investors demand higher yields to compensate for rising inflation and credit risk. ### Gold's Dual Narrative Gold prices have rallied, with spot prices recently trading around $4,217 per ounce, supported by weak economic data and rising expectations of a **Federal Reserve** rate cut. The probability of a 25-basis-point cut at the December FOMC meeting is currently priced at approximately 89%. However, **Gavekal** presents a contrarian long-term thesis. Gave predicts that an appreciation in Asian currencies around 2026 could end the current gold bull market. 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Dec 04 2025, 08:25

WPP Stock Decline Forces FTSE 100 Exit

## Executive Summary Advertising holding company **WPP** is set to be demoted from the **FTSE 100** index, effective after the market closes on December 19. The removal is a direct consequence of a catastrophic stock performance, with shares losing nearly two-thirds of their value this year. This event marks a significant blow to the company's prestige and investor standing, reflecting deep-seated concerns about its future in a rapidly changing industry. ## The Event in Detail Index operator **FTSE Russell** has confirmed that WPP will be replaced by property investment firm **British Land Co. (BLND)** following a regular quarterly review. WPP's prolonged share price decline has pushed its market capitalization below the required threshold for inclusion in the UK's premier stock index. This demotion is a symbolic fall from grace for a company once widely regarded as the global leader in the advertising and marketing communications sector. ## Market Implications The immediate consequence of the FTSE 100 exclusion is forced selling from passive investment funds and exchange-traded funds (ETFs) that benchmark against the index. This automatic liquidation event is expected to introduce further price volatility and significant downward pressure on WPP's stock. Beyond the technical selling, the demotion may negatively impact broader investor sentiment, potentially increasing the company's cost of capital and making it harder to attract new investment. ## Expert Commentary While detailed commentary is limited, industry analyses point to structural issues as the cause of the decline. Reports have highlighted a "client exodus and AI threat" as primary drivers for the stock's collapse. This suggests that major customers are leaving and that the company is struggling to articulate a defense against AI-driven disruption in creative and media services. Furthermore, other analyses have called into question the company's "new strategy," implying that recent turnaround efforts have failed to convince investors of a clear path back to sustainable growth. ## Broader Context WPP's struggles are emblematic of a seismic shift across the entire advertising landscape. Traditional agency holding companies are facing existential threats from multiple fronts. The rapid advancement of **generative AI** is commoditizing services that were once a core part of the agency value proposition. Simultaneously, a growing number of large corporations are moving their marketing and advertising functions in-house to gain more control and reduce costs. The "client exodus" cited in reports is a clear data point showing a loss of confidence in the traditional agency model, and WPP's demotion from the FTSE 100 serves as a stark warning for the entire sector.