TAG Industrial Watch: February 14, 2026

Over the last week, we received a slew of economic data that heavily impacts the U.S. economy. Starting with the employment picture, the Challenger Report showed that U.S. employers announced the most layoffs in January for the month since the depths of the Great Recession in 2009. To make matters worse, January’s announced hirings were the weakest for the month since the Challenger report began in 2009. Then came the January jobs report by the Bureau of Labor Statistics, where the big news was the full-year revisions for 2025. Instead of total nonfarm employment expanding by 584,000 (which already included significant previous downward revisions), the new estimate falls to 181,000. Job growth in 2025 collapsed from the 1.5 million jobs created in 2024, marking the weakest year since 2009 outside of the pandemic year.

Instead of the usual holiday bump, retail sales flatlined in December from the previous month and were only up 2.4% year-over-year. Given that the Consumer Price Index (which arguably understates price increases) was up 2.7% during that time, real retail sales in December 2025 were lower than the same month a year earlier. Last but not least, news broke that Chinese regulators began ordering state banks to offload their holdings of U.S. Treasuries. With $683 billion worth of Treasuries, China ranks as the third-largest foreign holder of America’s debt.

The weakness in the jobs market, compounded by the drop in real retail sales, is a serious alarm bell for recession. With nations like China offloading U.S. Treasuries, the Federal Reserve will be pressured to further inflate the money supply (which increases prices) to buy Treasuries in an attempt to keep interest rates from rising. The threat of stagflation that TAG has been warning about for years appears to be at the economy’s doorstep. However, industrial investors who have been following TAG’s research and analysis need not worry, but be prepared to benefit from high interest rates, rising prices, and stagnant growth.