46. Fed Update: What is Event Risk? Could it Trigger a Sell-Off?

We recorded this on 08/01/2024, knowing that unemployment numbers will not drop until this podcast airs on 08/02/2024, and that might also change so keep that in mind. 

**Employment Report Update from Jess** 

Fed's View on Labor Market:Fed Chair Jerome Powell stated that the changes in the labor market are "broadly consistent with a normalization process." However, policymakers are closely watching for signs of deeper issues.

Unemployment Report Highlights:

• Unemployment Rate: Jumped to 4.3% in July, the highest in nearly three years.
• Hiring Slowdown: Significant reduction in hiring activities.
• Concerns: Increased fears of a weakening labor market and potential recession.
• Trend: This is the fourth consecutive monthly increase in unemployment, rising from a five-decade low of 3.4% in April 2023.
• Cause: The slowdown is driven by weak hiring rather than layoffs. 

Following the release of the employment data: U.S. Treasury yields dropped, meaning bond prices rose and we are in a sell off. 

Fed Meeting Notes aka The Powell-Point

Fed Chairman Jerome Powell announced on the latest FOMC press conference that there will NOT be any rate cuts. We're shocked, really. Let's go through the data! 

It's no secret that most of us Americans are feeling the impact of higher rates to borrow money and inflation. But finally! It's not just us smaller consumers feeling the heat, larger companies are as they reported revenue declines. And if the big companies feel it, they will have to make some changes. 

Price Stability + Max Employment & Event Risk

Something feels broken. The Fed has a toolkit to use when something is broken. Which means: rate cuts!

What does it mean for you?

We might see some sell-off in certain sectors

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