The Jobs Report Just Faceplanted… and the Fed’s Rate Cut Door Just Blew Of Its Hinges…

Imagine being the dude who fat fingered the inflate the numbers button over the last few months…. Oh wait, Trump just directed his team to give him the “You R Fired” treatment. 

The U.S. labor market just got kneecapped… and suddenly every single eye in the room just shot directly at J-Poww & the Gang, hoping, drooling, and praying for one last hit of easy money. 

(Source: Giphy) 

In short, July’s job growth was a measly 73,000. I don’t know about you, but that ain’t no soft landing. Worse, the Bureau of Labor Statistics quietly went back and deleted 258,000 jobs from the last two months. Uhh, what? Exactly. Meaning, June’s new number is now 14,000 jobs, with May being a laughable 19,000. 

(Source: Reuters) 

Of course, the BLS didn’t offer any real explanation… just the usual hand-wave about “seasonal factors” and “additional reports”. Translation: They don’t know either. Additionally, the unemployment rate climbed to 4.2%, the highest it’s been in over a year. And that’s with a labor participation rate that’s now declining for three months straight, down to 62.2%, as more people simply stopped pretending they were “between opportunities.” If the participation rate had stayed flat, we’d be staring at 4.3% unemployment right now… basically stagflation’s calling card. 

And yet, because of the BLS f*ck up over the last few months (or whatever you want to call it)... This is exactly what a crack looks like in real time. And it’s not just a little hairline fracture. It’s the kind that gets papered over by economists too embarrassed to admit that the "resilient labor market" meme is officially dead. Naturally, this begs the question: Is Trump’s tariff’s a stimulant or a sledgehammer? As we all know, Trump’s aggressive trade and immigration policies are starting to bite… and not in the fun, BDSM way (not that I know). We’re now beginning to see full-on stagflation risk, sluggish growth, and a Fed caught in a blindfold trying to cut rates without setting the economy on fire.

(Source: Giphy) 

Whereas, now the new 35% tariffs aren’t just warm, they are precision strikes. These are economic cluster bombs aimed at Canada, China, and your Amazon cart. Powell’s Fed is now stuck between keeping rates high to fight the resulting inflation… or cutting them to bail out a job market that just coughed up a lung. Meanwhile, the Supreme Court handed Trump the keys to the HR department, greenlighting mass federal layoffs. Already, 84,000 government jobs have been axed since January. More are coming. Entire agencies are preloading pink slips while Trump posts Truth Social jabs at Jerome “Too Late” Powell, calling him a disaster. (Which, to be fair, he’s not entirely wrong.) 

As for the actual labor supply, it’s evaporating. Immigration restrictions have throttled the workforce just as baby boomers are retiring in droves. Foreign-born workers dropped by 341,000 in a single month. The result? Fewer workers, but somehow wages are still stuck in the mud at 3.9% annual growth… because new jobs are mostly in part-time or low-productivity sectors. Construction and hospitality barely ticked up. Manufacturing, professional services, and wholesale trade? Shedding jobs. Federal jobs? Down again. The only major sector posting anything that resembles growth was healthcare and social assistance. Bigly.

(Source: Giphy) 

So yeah… about that rate cut. Crickets. The Fed just left rates at 4.25%-4.50%, pretending everything was fine. But after this report? The September meeting might feature less monetary policy and more CPR. And given the labor market is clearly coughing up blood, analysts are pricing in bigly cuts like they have something to lose on Kalshi. Meaning, this might be what we’ve been waiting for… even if it means things may not be what they seemed. Until next time, friends… 

At the time of publishing, Stocks.News holds positions in Amazon as mentioned in the article.