Wealthion Macro Bites 10/1/25

For the 15^th time since 1981, the U.S. government commenced shutdown on Wednesday as deep partisan divisions prevented Congress and the White House from reaching a deal.  Immediate impacts include delay of Friday’s employment report, suspension of scientific research, withholding of pay for U.S. troops and furlough of 750,000 federal workers at a daily cost of $400M.  Analysts are warning a three-week shutdown could boost the unemployment rate from 4.3% to 4.7%.  President Trump threatened to punish Democrats with deep cuts to government programs and the federal payroll.  “We’ll be laying off a lot of people. They’re going to be Democrats.”

Lithium Americas (LAC) and Thacker Pass joint venture partner General Motors reached a non-binding agreement with the Department of Energy (DOE) to advance the first $435M draw on a previously announced $2.26B DOE loan.  First draw terms include a deferral of $182M in debt service over the first five years.  In addition, DOE will receive a 5% equity stake in LAC through warrants to buy common shares at $0.01 per share, and a 5% economic interest in the JV through warrants to buy non-voting equity units at $0.01 per unit.  LAC shares are up 31% in premarket trading.

Dallas Fed President Lorie Logan proposed the Fed shift its focus from its fed funds benchmark (which has served as the Fed’s main policy tool for decades) to a benchmark that tracks repo transactions, which would allow the Fed to operate in a more stable and established market, potentially increasing the effectiveness of monetary policy.

In the latest example of a world adjusting to Trump tariffs, South Korean September exports surged 12.7% (vs. +7.8% est.) with exports to the U.S. down 1.4% but to Europe +19.3% and to the ASEAN bloc +17.8%.

Euro Stoxx 50 +0.48%, S&P futures -0.46% and Nasdaq futures -0.5%.  DXY dollar index -0.05%, spot gold +0.5% and spot silver +1.3%.