Look on the bright side, Jerome “too late” “too early” Powell… at least you’ll get some extra practice explaining yourself in front of microphones.

Remember just last week when the Fed pulled out the scissors and snipped rates a quarter point, citing “downside risks to employment”? Yeah, about that. New data just dropped showing jobless claims aren’t rising… they’re falling (“down tremendously”). First-time unemployment filings sank to 218,000 for the week ended Sept. 20, way below the 235,000 estimate and the lowest since mid-July. In other words: companies might be done hiring, but they’re definitely not firing.

And the labor strength wasn’t the only “oopsies” for Powell & Co. GDP for Q2 was revised up to 3.8% from 3.3% after the Bureau of Economic Analysis realized Americans are still spending like their credit card bills are getting lost in the mail. Personal consumption expenditures (nearly 70% of the economy) grew 2.5%, not the puny 1.6% they first reported. And big-ticket durable goods like planes, appliances, and computers rose 2.9% in August… when economists thought they’d fall 0.4%. 

(Source: CNBC)

Even housing, which has been the market’s zombie sector for years, perked up with new home sales jumping more than 20% in August (as we talked about in yesterday's Final Tally Email).

All that to say, you can go ahead and file this under: “emails Powell wishes he could unsubscribe from.” Because the Fed pulled the trigger on a rate cut thinking the job market was coughing up blood, but the latest numbers make it look more like it just did an Iron Man competition before breakfast. Hate to break it to you, but the whole “we’re protecting a fragile economy” story doesn’t exactly hold water when GDP’s chugging along and layoffs are basically nonexistent. Powell keeps insisting policy is “modestly restrictive,” but this data isn’t whispering weakness… it’s blasting “Eye of the Tiger” through a blown-out speaker.

That isn’t to say we should start freaking out yet. As of now, markets are still betting on two more cuts before year-end, in October and December, but you can bet your bottom dollar the Fed’s wishing it held the receipts on that September move. At this point, there’s a better chance of us all finding out from Kash Patel what was actually in the assassin’s texts than there is of the Fed sticking to its “labor market weakness” script.

At the time of publishing this article, Stocks.News doesn’t hold positions in companies mentioned in the article.