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STAGFLATION NIGHTMARE: Fed Poised to Keep Rates Steady in 2025!
Bank of America Declares NO RATE CUT Next Year!
In a shocking turn of events, Bank of America economists are sounding the alarm! They firmly believe that the Federal Reserve won’t be cutting interest rates in 2025—despite recent job figures that suggest an economic shake-up could be on the horizon. Why? The U.S. faces a looming battle against stagflation: a terrifying combo of stagnant growth and soaring prices—NOT a recession!
THE UGLY TRUTH: Job Data Shouldn’t Spark Panic!
Economist Aditya Bhave and his team point to a record downward revision of 258,000 jobs from the previous two months, the second largest cut in modern U.S. history—this isn’t just numbers; it’s chaos! But BofA argues, hold your horses! They say we’re not heading into a recession; instead, the market is mixing up stagflation with a slowdown!
The crux of their thunderous claim? A shocking dip in foreign-born labor! With immigration policies tightening, our workforce is running low, squeezing supply while demand remains stuck in neutral. In layman’s terms, the typical signs of labor slack like rising unemployment are NOT budging!
TRUMP’S POLICIES DISMANTLED: The Economic Ripple Effect!
BofA shakes its finger at two major policies from the Trump era: brutal immigration restrictions and an avalanche of import tariffs! These are the culprits behind our potential economic crisis.
Policy #1: CRUSHING Immigration Rules!
Immigration changes have backfired hard, choking off labor supply before we even knew it! The foreign-born workforce has plummeted, eclipsing native job gains, despite natives making up around three-quarters of jobs. Shocking statistics: construction, manufacturing, and hospitality—usually bustling sectors—saw a monstrous loss of jobs, thanks to these policies!
Policy #2: TARRIF TORNADO!
As if that weren’t enough, here comes the tariff tidal wave! Since July 4, tariffs shot up to around 15%, and punishingly high prices for core goods are rearing their ugly heads—up 0.53% in June, the fastest rise in 18 months! Buckle up because inflation is still hovering above the Fed’s comfort zone!
FED IN A DILEMMA: Rate Cuts Could Spell DISASTER!
With the market buzzing about a rate cut this fall, Bank of America warns against it. If the Fed cuts rates without proper evidence that inflation and the job market are under control, it may invite a disastrous acceleration in inflation, forcing a quick and embarrassing reversal!
As we brace ourselves for the August jobs report, all eyes are on the Fed. If unemployment rises above 4.4%, or inflation unexpectedly drops, they might reconsider! But until then, hold onto your wallets—NO CUTS ARE ON THE WAY!
Get ready for a wild economic ride!
photo credit: fortune.com
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