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In today's big story, interest-rate cuts are almost certainly coming, but the relief won't be felt immediately. It begs the question: Are the chances of a soft landing doomed?
What's on deck:
But first, oh boy.
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Our bend-don't-break economy might finally have reached its limit.
After a year of resiliency in the face of high interest rates, the cracks are showing in the US economy.
July unemployment data released Friday came in unexpectedly high. The US added 61,000 fewer jobs than expected, and the unemployment rate rose to 4.3%, its highest level since October 2021.
Investors were already on edge from a rise in jobless claims and weak manufacturing data on Thursday, so it wasn't long before the market started melting down. Dismal tech earnings certainly didn't help.
There is a silver lining to the market's pain: Rate cuts are almost guaranteed for September. In recent days, the question has shifted from "if" to "how much," as some speculate the Fed could make a half-point cut instead of the standard quarter-point reduction.
But it's not a silver bullet, and the rate cut's effect will take time to make its way through the economy. Relief will eventually be felt in the job market, but it won't be immediate.
That means those looking for jobs, or stuck in ones they're unhappy with, will have to wait a bit longer.
In the meantime, things could get worse. Like, a lot worse.
A recession indicator with an almost spotless record went off on Friday. The Sahm Rule is triggered when unemployment's three-month moving average moves 50 basis points above its 12-month low.
Still, Claudia Sahm, the former Fed official who created the rule, told Business Insider's Madison Hoff she doesn't believe we're in a recession, but acknowledged that "things are slowing down."
"It definitely should be a wake up call to policymakers," she added.
The slowdown is evident across industries.
Amazon warned last week about the erosion of consumers' spending power, previously a key factor in the economy's resiliency. McDonald's has experienced something similar, acknowledging last week that its prices are too high for some customers. And Big Tech keeps investing in AI despite no one knowing if it will pay off.
The result is the economy's chances of the long-discussed soft landing potentially being ruined.
When things go bad, people tend to point fingers. And plenty of economists are looking in the Fed's direction.
They feel the central bank didn't act fast enough. Central banks in Switzerland, Canada, and the UK have already started easing their policies.
Remember that these are some of the same experts who have waffled on the future of the economy for more than a year, predicting everything from a full-blown recession to a Goldilocks situation.
But if things do turn sour, it's a fitting bookend to what has been a difficult few years for the Fed. Its inaction in raising rates caused inflation to spike in the first place, and its hesitancy to provide relief could send us into a recession.
A quick recap of the top news from over the weekend:
The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Jordan Parker Erb, editor, in New York. Hallam Bullock, senior editor, in London. Annie Smith, associate producer, in London. Amanda Yen, fellow, in New York.