Hi friend 👋🏼

From an iconic hotel sale to new signs of economic trouble, and a macro mood swing boosting crypto, this week is a mixed bag.

Let's dive in and make sense of it all.👇

The Weekly Fun Fact 🤔

Tinder’s cofounder just bought LVMH’s only U.S. hotel. Yes, that Tinder.

El Encanto, a historic Santa Barbara estate that once hosted Clark Gable and Hedy Lamarr, has changed hands for $82.2 million.

The luxury resort, perched above the Pacific and known for its elegant bungalows, was sold by LVMH to Justin Mateen (Tinder’s cofounder) and his brother Tyler. The plan? Pour up to $40 million into renovations, add boutique retail spaces, and potentially launch a members club. It’s the ultimate real estate swipe-right moment for the Mateens.

Onto this week’s topics🚦

🔴 A rare labor warning for the U.S. economy 🧨

For the first time since March 2023, private sector payrolls in the U.S. have turned negative, with 33,000 jobs lost in June. This sharp decline caught nearly every economist off guard, as most had forecast a gain of 95,000. Sectors typically seen as stable, like business services and healthcare, saw some of the biggest cuts, while only a few areas such as leisure and hospitality posted modest gains.

The implications? Big. Market watchers are now accelerating bets on a Federal Reserve rate cut. The chance of a July rate reduction rose to 25%, and a September cut is now fully priced in by traders. Still, wage data shows some resilience. Job switchers are seeing salary hikes of nearly 7%, suggesting the market isn’t in full crisis mode, yet.

But this downturn raises questions about the broader strength of the economy heading into fall.

🟡 Liquidity crunch ahead? Why the Fed may hit pause on QT 🛑

An under-the-radar move could shake financial markets over the next few months: the Treasury is about to suck up $500 billion to refill its cash account, draining liquidity from the banking system. This is called the TGA rebuild, and it’s triggered by the passage of Trump’s new budget bill.

Here’s why it matters: as money flows into the TGA, bank reserves fall, and if they drop too far, it could destabilize financial markets. We’ve seen this before in 2019, when a similar drain sparked the repo crisis. This time around, there's already chatter that the Fed might end its Quantitative Tightening program early to avoid those risks.

QT has already been reduced twice this year and is now running at just $20 billion/month. Ending it entirely would remove a significant headwind from markets. It wouldn’t be a massive liquidity injection on its own, but the psychological and strategic signal to investors would be clear: risk-on is back.

🟢 Crypto isn’t waiting, the bull market may already be here 📈

Crypto bulls are waking up. Data suggests that we may already be mid-cycle, not early-stage, as global liquidity climbs and real-time inflation sticks close to the Fed’s 2% target. That sets the stage for multiple rate cuts, which could turbocharge risk assets, especially digital ones ($BTC hit a new all time high of +118K USD).

One of the more telling metrics? The ISM index just nudged up, it's sitting just below 50, indicating we might be at the start of a new expansion phase. That level often marks the beginning of strong altcoin performance. Meanwhile, Bitcoin appears to be lagging behind the rise in global liquidity, which historically has led to explosive price action in the months that follow.

This isn't just about $BTC either. Altcoins are beginning to stir as institutional capital quietly enters the space.

A 90% probability of 2-4 rate cuts this year gives additional fuel to the trend.