🇺🇸😬 US Private Sector Taking a Hit + Update

Jun 04, 2025

Happy Wednesday all,

Humphrey here. I haven’t written an intro in awhile due to some personal issues that I’m not quite ready to share yet, and I was busy this past weekend running the SD Half Marathon!

I was able to complete it in 1:59:30 - Sub 2 Hours was my goal all along. That comes out to an average mile time of around 9:04-9:05 per mile. I’ve also just signed up for the Chicago Marathon in October - so I start training for that tomorrow 💀

It was my goal in 2025 to do one “hard” thing for myself, whether professionally or personally - and I chose the Marathon as that goal. So I will continue grinding for that this year. Other goals from now until October include being a little lighter and free when it comes to interpersonal relationships, to make 100 short form videos - where 1 out of every 5-7 videos is a more personal video, and to launch my website to get it to around 10K visitors per month. It should be launching later this month.

I really hope if you are reading this, that you are doing well. I appreciate all the support and readership throughout the years, and without you my job could not be possible.

Enjoy this week’s Hump Days!

- Humphrey & Rickie

👀 Eye-Catching Headlines

Global Investors Have a New Reason to Pull Back From U.S. Debt (WSJ)

Dollar Tree Warns of Looming Profit Hit From Trump Tariffs (BBG)

Frothy Tech Returns Helped Mint 600,000 Millionaires Last Year (BBG)

Private sector hiring rose by just 37,000 in May, the lowest in more than two years, ADP says (CNBC)

How Wall Street’s Dream of Looser Capital Rules Is Edging Closer (BBG)

How Europe Is Losing the Global Tech Race, in Five Charts (WSJ)

The Weekly Brief

US Private Sector Hiring Cools to Slowest Pace in Two Years

In May, US private sector hiring decelerated significantly, adding only 37,000 jobs according to ADP Research.
- This marks the slowest pace of job growth in two years and fell short of all estimates in a Bloomberg survey for the second consecutive month. Nela Richardson, ADP's chief economist, noted that "hiring is losing momentum."
The slowdown was widespread, with sectors like business services, education and health, trade and transportation, and manufacturing shedding jobs. In contrast, leisure and hospitality, along with financial activities, saw increased hiring.
Following the report, President Trump reiterated calls for the Federal Reserve to lower interest rates. However, the Fed has maintained its current rates, citing inflation above its 2% target and the need for clarity on the economic impact of Trump's tariffs—a stance differing from the European Central Bank, which has been cutting rates.
While the ADP figures provide an early look at the labor market conditions, they aren’t always a precise indicator of the official government jobs report set to be released on Friday.
- However, despite the hiring slowdown, ADP highlighted that pay gains remained strong, with workers who changed jobs seeing a 7% pay increase, while those who stayed saw a 4.5% gain.

Wells Fargo Asset Cap Lifted by Fed After 7 Years, Paving Way for Growth

On Tuesday, the Federal Reserve lifted the seven-year-old asset cap on Wells Fargo, a significant victory for CEO Charlie Scharf that allows the bank to resume growth after a period of intense scrutiny and restriction.
- The Fed confirmed that Wells Fargo had met all the conditions of the 2018 enforcement action, which was imposed due to widespread consumer abuses, by completing remediation efforts and overhauling its corporate governance and risk management.
This move closes a chapter on nearly a decade of scandals that cost an estimated $39 billion in missed profits. Scharf called it a "pivotal milestone" and announced a $2,000 award for full-time employees.
The unprecedented asset cap, limiting Wells Fargo to its 2017 asset level of $1.95 trillion, was imposed by then-Fed Chair Janet Yellen due to the bank's slow response to scandals like the creation of millions of unauthorized customer accounts.
- Under Scharf, who took over in late 2019, Wells Fargo has simplified its operations by divesting several business units.
While some provisions of the 2018 order remain, the cap's removal now permits the bank to expand its balance sheet, increase lending, gather more deposits, grow its Wall Street operations, and potentially pursue acquisitions.

Average 401(k) balances dropped 3% in Q1 Due to Volatility

According to a new report by Fidelity, the nation’s largest 401(k) provider, the average retirement balance fell 3% in the first quarter of 2025 to $127,100.
- However, the majority of savers continue to contribute. The average 401(k) contribution rate, including employer and employee contributions, increased to 14.3%
While it may be tempting to stay focused on short-term market movements, it’s better to just let the market work itself out.
- Analysts from Wells Fargo found that the 10 best trading days by percentage gain for the S&P 500 over the past three decades all occurred during recessions, often in close proximity to the worst days.
According to CNBC, since 1950, the S&P has delivered positive returns 77% of the time.