Prof G Markets What the Fed’s Third Rate Cut Means for 2026
277 snips
Dec 11, 2025 
Mark Zandi, Chief Economist at Moody's Analytics, dives into the implications of the Federal Reserve's third interest rate cut. He discusses fragile growth forecasts for 2026 and the impact of labor market signals on this decision. Zandi also highlights the importance of political factors in shaping future Fed actions. Additionally, Scott Galloway shares insights on SpaceX's unique advantages and his cautious stance on pre-IPO investments, while Ed discusses MacKenzie Scott’s remarkable $7.2 billion philanthropic efforts.
AI Snips
Chapters
Transcript
Episode notes
Fed Near Neutral Spurs Dissent
- The Fed cut rates by 25 bps as markets expected, but showed unusual dissent with three votes.
- Mark Zandi says the fed funds rate is near neutral, which explains the split among policymakers.
Policy Tradeoffs Drive Fed Division
- Fed disagreement stems from estimates of the neutral rate and policy tradeoffs.
- Tariffs, restrictive immigration, and politics are amplifying those disagreements, says Mark Zandi.
Labor Data Drove The Cut Despite Gaps
- Missing official data due to the shutdown made decisions harder, yet labor signals were clear.
- Zandi notes job creation stalled and layoffs and war notices pointed to a weakening labor market.