GOOD MORNING! Treasuries held their early gains and added to them after the ADP Employment Change Report indicated the private sector slowed in August and the ISM Service sector survey’s employment subcomponent remained subdued and in contraction. The overall ISM PMI revealed improvement in increases in business activity and new orders. The price subcomponent remained highly elevated, highlighting the Fed’s dilemma with the potential of stagflation. With initial jobless claims for unemployment benefits slightly higher than expected, the Fed will likely put more emphasis on weakening labor conditions, making the markets more confident that the Fed is going to resume easing rates. Stocks responded by moving higher and setting a new record high closing for the S&P. New York Fed President John Williams, addressing the New York Economics Club, didn’t offer any pushback to the markets’ thinking. It would take a very strong employment report to upside the apple cart. That is not expected. Bloomberg’s survey of economists are guessing that non-farm payrolls rose just 75,000 and the unemployment rate ticked up to 4.3%. The accuracy of the data has become suspect due to falling survey response rates, rising complexity and less funding for data collection have caused data quality from the Bureau of Labor Statistics (BLS) to deteriorate. Expect revisions and volatility.