Monetary Matters with Jack Farley Market Tumbles On Rosy Jobs Data | Jack & Max Break-Down Non-Farm Payroll (NFP) Sell-Off and Current Macro Regime
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Jan 10, 2025 The recent non-farm payrolls report shows a job surge that surprises markets, igniting debates on economic health amid recession worries. The impact of rising inflation expectations and the divergence in market performance between small and large-cap stocks are dissected. There’s a deep dive into the correlation between stocks, bonds, and gold amid sell-offs driven by strong economic data. Perspectives on market conviction contrast long-term optimism with short-term caution, highlighting the significance of personal financial circumstances.
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Market Reactions
- Markets reacted strongly to Friday's jobs report and inflation expectations data.
- Both equities and bonds sold off, with the 30-year treasury yield briefly exceeding 5%.
Strong Jobs Report
- December's job growth exceeded expectations, with 256,000 jobs added.
- The unemployment rate dropped significantly to 4.08%, defying recession predictions.
Rising Inflation Expectations
- Consumer inflation expectations rose to 3.3%, contradicting Jack Farley's view that inflation is controlled.
- Both one-year and five-year expectations increased, potentially spooking markets.