In a normal world, we would get the October jobs report tomorrow. We would find out how many people were hired, laid off, and out of work. This is crucial information for the Federal Reserve as it weighs what to do with interest rates, but also for everyday Americans who are looking for work, for businesses who are trying to plan ahead.But with a government shutdown, we are flying blind without any official government hard data. and it has led us to rely on reports from private firms like Challenger. It est ...

Fed Independence & Political Influence - The president believes in Fed independence but will express his opinions freely [1] - Every president likely desires lower interest rates, even if higher rates benefit the long-term economy, due to potential negative impacts on the next election [2] Potential Future Actions - The market is waiting to see who the president will pick as Fed chair [1]

Tariffs and Trade - The administration believes the president has the authority to decide what constitutes a foreign policy emergency and implement tariffs [2][3] - Tariffs are considered a key tool to address trade deficits and enhance national security, interwoven with economic security [7] - Nearly $200 billion in tariff revenue has been collected as of September 30th [10] - Reversing or watering down the tariff policy could damage financial markets and confidence [12] - Contingency plans exist to implement tariffs through other avenues if the court rules against the administration [16] Economic Impact and Policy - The administration views tariffs as a centerpiece of the economic agenda, crucial for re-industrialization and attracting foreign capital [8] - A negative court ruling on tariffs could cause unnecessary economic pain and hardship [8] - The government shutdown could lead to a loss of up to $15 billion a week, potentially reducing GDP by half a percentage point [20][21] - The Treasury increased bill issuance to rebuild its balance, with bill issuance around 20% of total issuance, aligning with the historical average [24] - The administration believes interest rates are too high and hopes the Federal Reserve will lower rates, which would help the housing sector [24][25]

Labor Market Analysis - Private sector job growth swung positive in October to 42,000 from negative 29,000, with larger companies contributing more than midsize and smaller companies [1] - Alternative data, like that from ADP, suggests pre-existing trends in the labor market are continuing at a similar rate, with modest job creation and moderating wages [3] - Labor demand may not be as strong as desired from a cyclical perspective, indicating rates could be lower [4] - Changes to job creation levels due to policy changes like immigration are considered output gap neutral, as additional people both work and consume [6][7][8] - Low levels of growth may result from changing border policy, but monetary policy doesn't automatically respond to this [9][10] Monetary Policy Considerations - Monetary policy aims to balance supply and demand, avoiding both inflation and deflation [7] - Expansionary supply-side policies, like full expensing provisions from the tax bill, incentivize investment in new factory equipment and structures, pushing demand higher in the short run and expanding the supply side in the longer run [12][13][14] - Regulations shape the structure of the economy by influencing production possibilities and industry composition [15] - Monetary policy responds to the output gap, the outlook for inflation, and changes in the neutral rate [18] - An increase in national savings typically leads to lower interest rates [23] Inflation and Interest Rates - One perspective is that current policy is too restrictive, and a faster move to a neutral rate is preferred to avoid undue harm to the job market [25][26][28] - Tariffs are not viewed as a significant driver of inflation, and shelter/housing market inflation is expected to decrease more quickly than some colleagues anticipate [27][28] - High interest rates may already be causing a recession in parts of the economy, particularly housing [30] - The median projection from the September meeting suggested a third rate cut this year, implying a cut in December [35] - Core services inflation, when adjusted for imputed services like portfolio management fees, is closer to 2%, specifically 23%-24% [39][46] - Shelter disinflation is a critical factor in the inflation outlook, with expectations of benign shelter inflation due to market rents running at approximately 1% [47][49] Trade and Economic Uncertainty - Increased uncertainty over the tariff and trade environment could negatively impact the economy [21] - A ruling against the president's authority to issue tariffs could increase uncertainty, potentially pressuring growth and hiring [20][21]

Federal Reserve Governor Stephen Miran on Wednesday described data that showed employment at US companies increased in October as “a welcome surprise,” though he reiterated interest rates need to be lower https://t.co/FgXF2BVrdR ...

Note to the Fed from @claudia_sahm: Yes, inflation remains a concern and unemployment is relatively low, but cutting interest rates will help lower-income households and small businesses (via @opinion) https://t.co/O6oltfR9NU ...

RT Crypto Investor (@altcoinGemAlert)JUST IN: 🇺🇸 Treasury Secretary Bessent says the Fed should continue to cut interest rates if inflation is dropping. ...

🇺🇸 TREASURY SECRETARY BESSENT: If inflation is dropping, Fed should be cutting rates https://t.co/eaJbO0DR2t ...

JUST IN: 🇺🇸 Treasury Secretary Bessent says the Fed should continue to cut interest rates if inflation is dropping. ...

Federal Reserve Governor Christopher Waller said the US central bank should continue cutting interest rates at its next meeting in December, citing the risk of a continued slowdown in hiring https://t.co/hLINCDkjKx ...