RUSH TRANSCRIPT Day to ░░░░░░░░ I think it was ░░░░░░░░ solid number all around ░░░░░░░░ thing that jumped out ░░░░░░░░ me was your average ░░░░░░░░ earnings is pretty darn ░░░░░░░░ a four point four ░░░░░░░░ connected system at last ░░░░░░░░ Guess is with me ░░░░░░░░ Jeffrey Cleveland director and ░░░░░░░░ economist at adan in ░░░░░░░░ Jeffrey lucky get your ░░░░░░░░ take away from what ░░░░░░░░ saw on the labour ░░░░░░░░ and maybe maybe more ░░░░░░░░ how our Federal Reserve ░░░░░░░░ going to view this ░░░░░░░░ well I think this ░░░░░░░░ a very soft landing ░░░░░░░░ soft landing issue of ░░░░░░░░ can use that term ░░░░░░░░ report Yeah you had ░░░░░░░░ payroll growth Of course ░░░░░░░░ have been slowing over ░░░░░░░░ last year Everyone knows ░░░░░░░░ but the three month ░░░░░░░░ is still to 18 ░░░░░░░░ any other era we ░░░░░░░░ say what is the ░░░░░░░░ job drought So that ░░░░░░░░ Our one sector that ░░░░░░░░ a that s been ░░░░░░░░ is also one that ░░░░░░░░ knows information technology type ░░░░░░░░ So that s well ░░░░░░░░ everything else We re ░░░░░░░░ a pretty broad base ░░░░░░░░ in in in employment ░░░░░░░░ unemployment rate is still ░░░░░░░░ I think we re ░░░░░░░░ above the cycle low ░░░░░░░░ at three and a ░░░░░░░░ percent saw This is ░░░░░░░░ part I find most ░░░░░░░░ where the Fed has ░░░░░░░░ hiking Is it it ░░░░░░░░ it in historic hiking ░░░░░░░░ the most rapid hiking ░░░░░░░░ since in forty years ░░░░░░░░ the unemployment rate is ░░░░░░░░ where it was when ░░░░░░░░ hiking cycle began Dad ░░░░░░░░ leavers as a percentage ░░░░░░░░ total unemployed and July ░░░░░░░░ implant airport rose to ░░░░░░░░ point Six percent us ░░░░░░░░ notes across earlier That ░░░░░░░░ like a cycle hi ░░░░░░░░ even stronger data point ░░░░░░░░ this report than the ░░░░░░░░ headline number which I ░░░░░░░░ missed Analysts estimates generally ░░░░░░░░ Why is this I ░░░░░░░░ just not a bullish ░░░░░░░░ s go get em ░░░░░░░░ assign it seem get ░░░░░░░░ will If a if ░░░░░░░░ re seeing the soft ░░░░░░░░ picture than it suggests ░░░░░░░░ least the feds can ░░░░░░░░ can stay back on ░░░░░░░░ sidelines Of the soft ░░░░░░░░ you know story it ░░░░░░░░ it s not just ░░░░░░░░ It is a indication ░░░░░░░░ if this off on ░░░░░░░░ plane out and the ░░░░░░░░ the Fed doesn t ░░░░░░░░ a lot more to ░░░░░░░░ and I think you ░░░░░░░░ you see that today ░░░░░░░░ equity market loves that ░░░░░░░░ bond market will love ░░░░░░░░ as well I talked ░░░░░░░░ bond traders every day ░░░░░░░░ it would Is done ░░░░░░░░ if if we are ░░░░░░░░ the soft landing then ░░░░░░░░ argue that the Fed ░░░░░░░░ done even if you ░░░░░░░░ yes I ve gone ░░░░░░░░ immediate you you you ░░░░░░░░ up The kind of ░░░░░░░░ important issue is that ░░░░░░░░ this job market is ░░░░░░░░ stronger than this report ░░░░░░░░ When you dig into ░░░░░░░░ internals of the report ░░░░░░░░ be that will have ░░░░░░░░ growth The unemployment rate ░░░░░░░░ go even further Wage ░░░░░░░░ will remain forty five ░░░░░░░░ and I think in ░░░░░░░░ environment the Fed might ░░░░░░░░ be as pleased as ░░░░░░░░ markets are today with ░░░░░░░░ report Have a no ░░░░░░░░ type scenario where the ░░░░░░░░ is still above trend ░░░░░░░░ unemployment solid wage growth ░░░░░░░░ inflation is is too ░░░░░░░░ It s above two ░░░░░░░░ the Fed probably has ░░░░░░░░ to do in that ░░░░░░░░ and that environments I ░░░░░░░░ that s still a ░░░░░░░░ risk that that scenario ░░░░░░░░ right now everyone seems ░░░░░░░░ be gone and Are ░░░░░░░░ taken recession off the ░░░░░░░░ A while ago We ░░░░░░░░ thought after sb be ░░░░░░░░ there was the risk ░░░░░░░░ credit was going to ░░░░░░░░ more significantly That hasn ░░░░░░░░ played out I was ░░░░░░░░ looking at the lending ░░░░░░░░ in the weekly fed ░░░░░░░░ mean Still up five ░░░░░░░░ roughly year over year ░░░░░░░░ we have not seen ░░░░░░░░ collapsing credit borrowing A ░░░░░░░░ window has completely evaporator ░░░░░░░░ down so the stress ░░░░░░░░ the banking system is ░░░░░░░░ so the hard landing ░░░░░░░░ is imminent type stories ░░░░░░░░ were out there I ░░░░░░░░ Time being see you ░░░░░░░░ to push out your ░░░░░░░░ for a recession We ░░░░░░░░ the us economy growing ░░░░░░░░ than two percent this ░░░░░░░░ in our forecast now ░░░░░░░░ it Donna que forty ░░░░░░░░ basis So I know ░░░░░░░░ s a little bit ░░░░░░░░ bullish than the bloomberg ░░░░░░░░ suggest the consensus but ░░░░░░░░ s where we see ░░░░░░░░ here and today s ░░░░░░░░ report I think Year ░░░░░░░░ year I mean if ░░░░░░░░ two options here are ░░░░░░░░ landing are soft landing ░░░░░░░░ s the kind of ░░░░░░░░ that we see them ░░░░░░░░ out I m always ░░░░░░░░ about the next six ░░░░░░░░ the next six to ░░░░░░░░ months so that that ░░░░░░░░ carry us into middle ░░░░░░░░ next year I I ░░░░░░░░ realize for some investors ░░░░░░░░ viewers you either want ░░░░░░░░ You know the next ░░░░░░░░ to five years but ░░░░░░░░ could provide that so ░░░░░░░░ trying to be real ░░░░░░░░ realistic of it s ░░░░░░░░ t talking to one ░░░░░░░░ my colleagues yesterday It ░░░░░░░░ it s quite interesting ░░░░░░░░ if you have for ░░░░░░░░ next six months or ░░░░░░░░ the no landing scenario ░░░░░░░░ it s possible the ░░░░░░░░ has to do more ░░░░░░░░ they hike even more ░░░░░░░░ then there are some ░░░░░░░░ for that are down ░░░░░░░░ road that they could ░░░░░░░░ a more significant slowdown ░░░░░░░░ growth maybe some other ░░░░░░░░ market casualties So when ░░░░░░░░ think about these I ░░░░░░░░ think for the next ░░░░░░░░ six to 11 months ░░░░░░░░ don t have a ░░░░░░░░ or the Fed is ░░░░░░░░ on hold or maybe ░░░░░░░░ another Another time where ░░░░░░░░ don t think we ░░░░░░░░ going to see things ░░░░░░░░ is is a recession ░░░░░░░░ rate cuts and I ░░░░░░░░ that s really important ░░░░░░░░ take in because that ░░░░░░░░ big fun natural market ░░░░░░░░ We kind of were ░░░░░░░░ that play out earlier ░░░░░░░░ week with the flattening ░░░░░░░░ the treasury yield curve ░░░░░░░░ way I think about ░░░░░░░░ if it if the ░░░░░░░░ is on hold just ░░░░░░░░ they are then the ░░░░░░░░ end of the treasury ░░░░░░░░ can drift up Just ░░░░░░░░ for that reason You ░░░░░░░░ the earlier this year ░░░░░░░░ the expectation of the ░░░░░░░░ will be cutting and ░░░░░░░░ think Inversion in the ░░░░░░░░ but if that s ░░░░░░░░ out then of latter ░░░░░░░░ make sense of the ░░░░░░░░ of hurts something along ░░░░░░░░ lines This morning Austin ░░░░░░░░ be the prisons that ░░░░░░░░ Reserve bank of Chicago ░░░░░░░░ interviewed by bloomberg David ░░░░░░░░ in any kind of ░░░░░░░░ the same thing ache ░░░░░░░░ guess implication was they ░░░░░░░░ like they re making ░░░░░░░░ good head Holding inflation ░░░░░░░░ Economy into recession is ░░░░░░░░ that that is consistent ░░░░░░░░ kind of keep rates ░░░░░░░░ they are for a ░░░░░░░░ is does that seem ░░░░░░░░ yeah I think this ░░░░░░░░ again great news for ░░░░░░░░ Fed get the core ░░░░░░░░ has come down So ░░░░░░░░ course CPR We were ░░░░░░░░ six at the peak ░░░░░░░░ on year Now we ░░░░░░░░ four point Eight Three ░░░░░░░░ five as we saw ░░░░░░░░ morning below Where was ░░░░░░░░ the feds started I ░░░░░░░░ that this a best ░░░░░░░░ scenario for the for ░░░░░░░░ improvement on inflation without ░░░░░░░░ a downturn but that ░░░░░░░░ doesn t mean that ░░░░░░░░ Fed is going to ░░░░░░░░ cutting rates anytime soon ░░░░░░░░ with the unemployment rate ░░░░░░░░ three point five and ░░░░░░░░ even though we ve ░░░░░░░░ an unproven inflation inflation ░░░░░░░░ still above well above ░░░░░░░░ Fed s target stasis ░░░░░░░░ here might might be ░░░░░░░░ things play out but ░░░░░░░░ think that has implications ░░░░░░░░ two year treasury yields ░░░░░░░░ also 10 year treasury ░░░░░░░░ C p I n ░░░░░░░░ p I pretty producer ░░░░░░░░ index and next week ░░░░░░░░ number are you looking ░░░░░░░░ see Last month of ░░░░░░░░ course cp I was ░░░░░░░░ softer softer than expected ░░░░░░░░ I think very soft ░░░░░░░░ looking for that to ░░░░░░░░ back up a month ░░░░░░░░ month maybe a point ░░░░░░░░ percent month a month ░░░░░░░░ and change So a ░░░░░░░░ It could pour some ░░░░░░░░ water on the on ░░░░░░░░ soft landing scenario that ░░░░░░░░ play out but I ░░░░░░░░ it ties back to ░░░░░░░░ suspicion that the the ░░░░░░░░ is probably not done ░░░░░░░░ I think that would ░░░░░░░░ the conclusion If if ░░░░░░░░ do see a CPR ░░░░░░░░ so that that s ░░░░░░░░ the critical report For ░░░░░░░░ I Jeff appreciate it ░░░░░░░░ always getting your thoughts ░░░░░░░░ Cleveland he s a ░░░░░░░░ and chief economist at ░░░░░░░░ in regal me appreciate that