The New Normal ?

Permanent High Rates from the Fed

The Fed has finally come around to the idea that interest rates are very likely to be higher for as far as the eye can see.

Wall Street was expecting the Federal Reserve’s Summary of Economic Projections to indicate officials now expect two cuts instead of the three they’ve been forecasting since the end of last year. Fed officials went further by bringing the median expected benchmark rate up to 5.1 for year-end, implying just one cut this year.

More importantly, Fed officials significantly raised their expectations for interest rates over the longer run. The median expected federal funds was on a downward trend until it hit 2.5 percent in the summer of 2019. For years after that, it seemed locked in place despite serious gyrations in the economy. It dipped once to 2.4 percent in the summer of 2022 but never climbed.

That changed in March, when the projections showed the median longer run expectation rose to 2.6 percent. In the latest set of projections, this jumped all the way up to 2.8 percent.

This is a clear indication that the Fed understands—and wants markets to understand—that the path of interest rates has shifted upward. We’re in an economy with much stronger inflationary pressures, and the interest rates required to keep inflation tame will necessarily be higher. - Breitbart

 

Jobless Claims Surge to 242,000

Initial applications for US unemployment benefits jumped last week, suggesting a surge in layoffs and adding to concerns that the economy could be weakening.

First-time claims for unemployment benefits rose by 13,000 to 242,000 in the week ending in June. This increase follows similar rises in the previous two weeks, pushing claims to their highest level since August 2023, as reported by the Labor Department on Thursday.

The recent uptick in claims has exceeded analysts' expectations. An Econoday survey had projected a median forecast of 222,000 claims, indicating a significant discrepancy between the anticipated and actual figures. This marks a notable trend of rising claims over the past few weeks.

The surge in unemployment claims could signal potential challenges in the labor market. As claims reach their highest point in nearly a year, economic analysts and policymakers will likely scrutinize these developments closely to understand the underlying causes and implications for the broader economy.

 

75% of American Job Growth Has Gone to Migrants Since 2019

A recent analysis reveals that 75% of American job growth since 2019 has gone to migrants, both legal and illegal. This trend, linked to President Biden's labor market policies, has resulted in a significant influx of foreign-born workers. During this period, fewer than one million U.S.-born Americans joined the workforce, while 3.2 million migrants found employment.

The study highlights a continuing decline in labor participation among working-class American men, particularly those without a bachelor's degree. Labor force participation for men aged 25-54 has dropped significantly since 1960, contributing to historically low levels despite recent recoveries to pre-pandemic figures.

Breitbart News has chronicled these shifts, noting that the foreign-born population in the U.S. now stands at a record 51.6 million. The influx of migrants is reshaping the labor market, raising concerns about the impact on native-born American workers and long-term economic trends.

For more details, you can read the full article here.

 

Something to Think About

Leadership in the government is crucial for ensuring effective governance and the well-being of the nation. Strong leaders set clear visions, make informed decisions, and inspire public confidence.

They play a pivotal role in addressing national challenges, fostering economic stability, and safeguarding public interests. Effective leadership in federal institutions also promotes accountability, integrity, and transparency, which are essential for maintaining public trust.

Ultimately, the quality of leadership shapes the nation's policies, impacts the daily lives of citizens, and guides the country toward a prosperous and secure future.

 
Previous
Previous

Washington Is Clueless

Next
Next

Navigating Historic Times