Stocks Sink on Solid September Jobs Report
Real Vision: Finance & Investing
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Why the Fed Is Focusing on the Sticky Wage Inflation
The Fed thinks if wages remain sticky, companies are going to keep raising prices in order to offset that labor cost. For your service company, on average, two-thirds of your expenses are labor. It's the biggest chunk. But it's just this complete back upside down thesis of the Fed is originally, they wanted inflation because they think that higher inflation will lead to stronger wage growth. Now they want to cut down wage growth while inflation is still high. The problem with that is now is their front view window in driving down that road is actually looking at data that is getting older and becoming more dated than before.
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