FedWatch's Ben Emons explains why he found September's jobs report to be 'bullish'

Economic Data and Federal Reserve Outlook - The September labor report is viewed positively, indicating a rise in the unemployment rate due to more individuals re-entering the labor force, with approximately 475,000 people coming back [2] - The report suggests that while there may be some softening in the labor market, it is not experiencing a significant downturn, which supports the Federal Reserve's current stance [3] - Market reactions show a decrease in the probability of an immediate rate cut by the Fed, with current odds at around 40% for a cut in December [4] Inflation and Interest Rates - The Federal Reserve is likely to maintain its current interest rates due to persistent inflation issues, despite a stable labor market [5][6] - There is speculation that bond yields should be closer to 5% due to economic stimulus and investment, yet current yields remain around 4.1% [8] - The bond market is experiencing low volatility, attributed to a lack of major surprises from the Fed and a shift in investor interest towards bonds as a hedge against equity market fluctuations [9][11] Private Credit Concerns - The rapid growth of private credit is drawing attention from the Federal Reserve, with recent events such as the termination of the Blue Owl merger highlighting potential stresses in this sector [12][13] - The Fed is expected to collaborate with regulatory bodies like the SEC and FSO to monitor private credit more closely to prevent issues similar to the subprime crisis [13][14] - The opacity and illiquidity of private credit markets are causing concern among investors, impacting overall market sentiment [14][15]