This is a pretty important topic, and I think most reporters are doing a nice job of covering it. The data is pretty clear.
I haven't read this particular piece. But the thesis sounds about right. It echoes what Powell said at Jackson Hole: "Overall, while the labor market appears to be in balance, it is a curious kind of balance that results from a marked slowing in both the supply of and demand for workers." (https://www.tker.co/p/fed-chair-powell-jackson-hole-2025)
Slower job creation -- all other things equal -- should put upward pressure on the unemployment rate. But the immigration crackdown has been taking out a lot of people who otherwise would be seeking work. So the effects on both the numerator and denominator of the unemployment rate calculation are offsetting each other.
But all of it bears close watching. The economy can only deteriorate so much before it has a material negative impact on earnings and stock prices. I'll keep you posted on developments in the newsletter.
Sam, curious if you saw this piece and your thoughts on the unemployment rate being propped up by shrinking economic activity?
https://newrepublic.com/article/200101/trump-employment-immigration-shrinking-economy
This is a pretty important topic, and I think most reporters are doing a nice job of covering it. The data is pretty clear.
I haven't read this particular piece. But the thesis sounds about right. It echoes what Powell said at Jackson Hole: "Overall, while the labor market appears to be in balance, it is a curious kind of balance that results from a marked slowing in both the supply of and demand for workers." (https://www.tker.co/p/fed-chair-powell-jackson-hole-2025)
Slower job creation -- all other things equal -- should put upward pressure on the unemployment rate. But the immigration crackdown has been taking out a lot of people who otherwise would be seeking work. So the effects on both the numerator and denominator of the unemployment rate calculation are offsetting each other.
The economy is cooling, and I'd argue the odds of tipping into a recession are the highest they've been in years. (https://www.tker.co/p/economic-growth-slowing-approaches-tipping-point)
Goldman Sachs did a nice job explaining why corporate earnings and stocks have been able to decouple from economic growth (https://www.tker.co/p/corporate-revenue-economywide-activity-divergence)
But all of it bears close watching. The economy can only deteriorate so much before it has a material negative impact on earnings and stock prices. I'll keep you posted on developments in the newsletter.
Thank you!