- Employers showed how to pave the road to productivity by adding not 1, not 2, but 199,000 workers to their payroll last November. You could say we’re working the economy like a fresh lump of clay on a pottery wheel.
- This hiring spree, fired up like a caffeine-fuelled all-nighter, hints that the economy might finally find its cushion for a soft landing, instead of the usual feeling of being booted off an airplane at 50,000 feet without a parachute.
- However, all this economic energy might come with a bit of a rain on the parade. The Fed is now more likely to keep their interest rates hugged tight rather than let them go on a spring break.
Here’s my Hot Take on This
So, the Economy is Like a TiVo, Skilfully Fast-Forwarding Through the Boring Bits
And Just When You Thought Fed Rate Cuts Could be the Spring Chicken of the Financial Coop, They’re Now Playing Hard to Get
Okay, so here’s the deal: The economy’s got 199,000 more employees, as if the whole population of Salt Lake City, Utah suddenly took up arms… I mean, jobs. Naturally, the hope is that these masses would help cushioning the economy’s crash landing like those inflatable slides in aircraft emergency landings. Although, on the honest side, those don’t even look that comfortable.
There’s another twist in the tale: This bravado from the muscle-flexing economy got the Fed’s procrastinating on those tempting spring rate cuts. As such, while everyone expected the Fed to be like Oprah with rate cuts – “You get a cut, and you get a cut, everyone gets a cut!” – it now appears the host has left the show and we’re stuck in the reruns of higher interest era.
To sum it all up, our economy is playing reality TV: sometimes dramatic, sometimes silly, but never boring. Like a good trampoline, it’s bouncing back, even though we didn’t know it had springs in the first place, and making those rate cuts less probable. Time to stock up on the popcorn and buckle up, folks. We’re in for an interesting ride.
Original article: https://www.inman.com/2023/12/08/mortgage-rates-rebound-on-surprisingly-strong-jobs-report/
