Accuracy of Government Data In Question – Government Data Gathering

Employment data gathered and complied by the Bureau of Labor Statistics has once again come into question as the accuracy of the data continues to be an issue. The employment data includes responses that are gathered through surveys nationwide, which were affected adversely by the pandemic and have seen deterioration of accuracy over the past five years.

Data collected is conducted via surveys throughout the employment market, which includes layoffs, new hires, sentiment, wages, and employees quitting. The onset of the pandemic brought about a drop in surveys conducted as well as the method of data collection. A consistent drop in surveys over the past five years has led to less collected data as well as questionable accuracy surrounding gathered data.

Economists and analysts are concerned that the drop in surveys and continued issues with questionable data may be restricting the Federal Reserve from making proper and timely determinations surrounding the status of the nation’s labor market. Response rates for direct employment data conducted via interviews have fallen from roughly 65 in 2015 to less than 40 in the first quarter of 2025. There has also been a consistent drop in consumer interviews and expenditure tracking. This means that there is less data to formulate accurate and reasonable assumptions from, increasing the risk of making erroneous decisions regarding rates and the labor market by the Federal Reserve. (Sources: Labor Dept., BLS)

Which Countries Are Buying & Selling U.S. Treasuries – Treasury Market Overview

Foreign countries hold U.S. government debt in the form of Treasury bonds for various reasons, including trade, currency hedging and for investment. At one point, China was the largest holder of U.S. Treasuries as trade between the two countries expanded throughout the 1990s and 2000s. Eventually Japan became the largest holder of Treasuries in 2017, as trade expanded with Japan and as China began to limit its holdings of U.S. debt. As of March 2025, China’s holdings dropped to $757.2 billion, down from $784.3 billion the previous month and significantly lower than the $901.7 billion held in September 2022, validating a continuation of a multi-year trend. Analysts attribute this reduction to a combination of trade tensions, diversification of reserves, and possibly reallocating to other markets such as Europe where trade for China has grown. Japan is currently the largest foreign holder of U.S. Treasuries, with holdings rising to $1.13 trillion in March 2025, up from $1.059 trillion in December 2024. Japan’s purchases have increased for at least two consecutive months, signaling continued confidence in U.S. debt and its long term trading relationship. The U.K. has also increased its holdings, surpassing China as the second-largest non-U.S. holder with $807.7 billion in March 2025. The U.K. is often considered a custodial center, with much of the activity reflecting hedge fund and institutional flows. (Source: U.S. Treasury Dept.)

Country Holdings of Gold Shifting – Global Gold Reserves

Some of the same countries that have been selling U.S. Treasury positions, have been buying gold as global trade has been adjusting. There have been instances when countries have imposed exchange controls or a freeze on assets, such as on foreign securities. Gold provides the essential liquidity in these circumstances. Thus central banks from around the world accumulate and hold gold to afford such benefits.

For thousands of years, gold has been one of the most sought after metals in the world. It was first used as jewelry as early as 2600 BC in ancient Mesopotamia, what today is Iraq. Most notably, gold currently plays a significant role in the international monetary markets, where countries worldwide hold gold as a reserve. Holding gold as a reserve provides diversification among assets, economic security, and liquidity.

As trade tensions have risen, so has the divergence from traditional dollar denominated holdings by foreign entities to gold. The recent drop in value of the U.S. dollar since the beginning of the year has concurrently increased demand for gold as a stable holding for various central banks worldwide. The Unites States has also been accumulating gold over the past few months, reaching a reserve of over 8,100 metric tons of gold, the largest of any nation. (Sources: CIA Factbook, World Gold Council)

One Big Beautiful Bill Act Highlights 

Tax on Social Security:

The One Big Beautiful Bill (OBBB), also known as the Tax Cuts and Jobs Act of 2025, does not actually eliminate taxes on Social Security benefits, instead, it provides a temporary, income-based deduction for taxpayers aged 65 and older.

The deduction is $6,000 per individual and phases out for those with higher incomes over $75,000 for single filers, $150,000 for joint filers. The deduction is not limited to those receiving Social Security benefits, it also applies to all seniors within the specified income limits. The deduction is temporary and set to expire at the end of 2028. The OBBB does not make any changes to the Social Security program itself, such as the benefits structure or eligibility requirements.

StableCoins Evolving To Become More Accepted:

The GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025) is landmark legislation aimed at creating the first comprehensive federal regulatory framework for payment via stablecoins in the United States.The GENIUS Act establishes clear rules for the issuance, backing, and supervision of payment via stablecoins and digital assets pegged to a stable value such as the U.S. dollar. Long term, the act seeks to integrate stablecoins into the mainstream banking and payments system, providing legal certainty and consumer protections. (Sources: Tax Foundation, SSA.gov, TheWhiteHouse.gov)