If by some miracle we actually do get a soft landing from inflation, pretty much the entirety of Atlas (including me) will owe a lot of apologies to Jerome Powell.
Wrong he's trying to engineer a recession and create job losses. Powell isn't happy about today's news. It's why the stock market is reacting negatively. 'Soft landing' is a euphemism and double speak. It's not a soft landing from inflation, it's an economic recession they are hoping won't be that "bad"
Powell has no credibility he let Trump bully him from raising rates simply because Trump said he would fire him. Jerome Powell sucks.
The stock market is responding negatively because the market was hoping that a negative jobs report would scare the Fed into ending its fight on inflation sooner. The market's main interest is in having as much cheap money available as possible and actually fighting inflation reduces that. A positive outlook gives the Fed the option to continue trying to fix the inflation problem without being worried about crashing the employment market. If Powell wanted to engineer a recession and create job losses it would be absurdly easy to do so; he certainly wouldn't be talking about winding down interest rate increases.
A strong jobs reports means Wall Street thinks the labor market is still too hot and wage growth will continue. Powell has said time and time again he is worried about the rise in wages as a cause of rising inflation. While Wallstreet wants cheap money they don't want a recession which is also bad for stocks. Powell's roadmap is not the only idea or even necessarily the right idea, plenty of people have criticized him especially those who recognized inflation would be a problem before he did like Professor Jeremy Siegel. It's not clear the Fed even understands what caused inflation because nobody can say for certain what did.
“While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses,” Jay Powell.
And all of this is still undermined by the fact that when Powell knew he should have raised rates he let Donald Trump punk him into not raising rates and then cut them, one of the things that let the stock market run wild and created bubbles. So again he is not a credible steward of monetary policy.
