Fed's in line for another cut in December, says Goldman Sachs' Jonny Fine

Economic Outlook - The Federal Reserve is expected to implement another interest rate cut in December, with a positive growth outlook for 2026 [2][3] - There may be a divergence between economic growth and employment, with significant layoffs occurring as companies adapt to AI technologies [3][4] Labor Market Dynamics - Current labor market conditions reflect companies preparing for future efficiencies driven by AI, rather than immediate layoffs [5] - Although growth is anticipated to improve, the quality of the labor market may enhance without returning to previous hiring levels [5] Credit Market Insights - The credit market has experienced a "golden era," but there are emerging issues, particularly in high-yield defaults and strains in the subprime consumer segment [6][7] - Concerns about broad contagion in the banking sector are considered exaggerated, though monitoring is warranted [8][9] Growth Drivers - Economic growth is expected to be significantly influenced by AI-related capital expenditures and infrastructure development [10] - The influx of capital for AI growth is coming from various sources, including private credit and corporate balance sheets [11] Market Conditions - The investment-grade corporate bond market has seen limited growth, but this is beginning to change, impacting both investment-grade and high-yield markets [12][13]