Trump forced the Federal Reserve, and the data was far lower than expected! Tonight, the United States released its May "small non farm" data: the ADP private employment report in May only increased by 37000 people, far below the expected 114000, with a previous increase of 62000 people. 37000 is the lowest level since March 2023. In addition, the ADP data for April was lowered by 20000 to 60000. This can't fit in anymore Immediately, Trump said that Powell must cut interest rates now! He also said, 'This is unbelievable, Europe has already cut interest rates nine times.'. At present, the US Treasury is facing enormous pressure, which is the direct reason for Trump's continuous approach to the Fed's interest rate cuts! On the one hand, interest rate cuts can reduce the cost of the US government issuing bonds (the current interest burden is becoming increasingly heavy, to the point where it is almost impossible to pay off the interest); On the other hand, it is still necessary for the Federal Reserve to restart QE and provide unlimited protection for US bonds! At present, to what extent has the US bond market become difficult? This morning, there was a news: the US Treasury Department set a record for repurchasing US bonds and began "QE for the Federal Reserve"! At 2:00 p.m. EST Tuesday (June 3), the US Treasury Department announced the results of its latest treasury bond bond repurchase operation - up to $10 billion, which is the largest single treasury bond repurchase operation ever conducted by the US Treasury Department. Originally, the US Treasury issued bonds, that is, sold treasury bond; The current situation is that some of the treasury bond bonds in the United States are no longer available, and the Federal Reserve is unwilling to release water, so the US Treasury Department can only buy back the bonds itself to cover the bottom of the US treasury bonds. But the fact is that the US federal budget deficit for fiscal year 2025 will reach $1.865 trillion, accounting for 6.2% of the gross domestic product (GDP). Institutions predict that the US fiscal deficit for the 2026 fiscal year may reach $2.2 trillion, with the deficit ratio rising to 7%! The US Treasury Department actually doesn't have money either. The money to buy back treasury bond is actually: borrowing new to pay old! The US Treasury Department plans to raise $514 billion in funding for the April June quarter of 2025, with the majority of the funds used to repay maturing debts and repurchase operations. This "new for old" debt rolling model is its conventional operation: raise funds by auctioning new treasury bond (such as 10-year, 30-year bonds), and then use these funds to buy back the old bonds with poor liquidity in the market. To use a term that is easier for us Chinese to understand, it is called 'robbing the east wall to make up for the west wall'! Because there are many types of US Treasury bonds in the market, if the liquidity of that bond is too poor and no one wants it at all, the US government will come forward to repurchase some to provide a safety net. This kind of behavior can only be temporary emergency and cannot last too long. So, that's why Trump is so eager to repeatedly approach the Federal Reserve's interest rate cut. The Federal Reserve's June interest rate meeting has only two weeks left, so there is no hope of a rate cut in June; The next one will be the interest rate meeting at the end of July. Let's see if the US bond market can hold on until the interest rate meeting at the end of July... The three-way game between the Federal Reserve, the US government (Trump team), and the market will continue. No matter how much this process twists and turns, the ultimate result is that the market is really "dead to show you", which will force the Federal Reserve to take action!