The entire basis for what the Fed is now calling a “mid-cycle” adjustment rests upon a specific view of the labor market. There was weakness in consumer spending, there remains weakness in business investment, but none of these cross currents or headwinds are going to matter. Americans are experiencing robust employment conditions which when these reassert themselves will cycle the economy through nothing more than a minor rough spot. This is the mainstream baseline. The one rate cut was just a little insurance to make sure it stays that way. Nothing at all panicky about it. Jay Powell says the employment figures are ... (full story)