The Fed is about to cut rates while everything hits all-time highs. Stocks, Bitcoin, gold, home prices, rents, and household net worth are all near record levels. Unemployment sits at 4.2%. Yet the Fed still plans to ease.
“J.P.Morgan now expects the U.S. Federal Reserve to cut interest rates by 25 basis points at each of its next four meetings, bringing the policy rate to 3.5%.” https://money.usnews.com/investing/news/articles/2025-08-08/j-p-morgan-sees-fed-cutting-rates-at-each-of-its-next-four-meetings
There’s no way in hell the Fed should be cutting rates right now. The stock market is near all-time highs. Home prices, rents, Bitcoin, gold, and household net worth are all at or near record levels. Unemployment is just 4.2%. Prices for everything remain painfully high.
Consumers are tapped out. Same-store sales for U.S. limited-service chains tell the story. McDonald’s barely grew at 2.5%. Starbucks fell 2%. Taco Bell eked out 4%. Wendy’s dropped 3.6%. Burger King climbed 1.5%. Domino’s up 3.4%. Chipotle down 4%. Pizza Hut slid 5%. KFC also dropped 5%. Popeyes down 0.9%. Jack in the Box crashed 7.1%. Del Taco down 2.2%. Papa Johns grew just 1%. Dutch Bros stands out with 6.1%, Sweetgreen plummeted 7.1%, Potbelly rose 3.6%. https://x.com/jonathanmaze/status/1953789705167724737
People are too broke to even afford fast food. That’s what’s behind the softening labor demand and the slight rise in unemployment. Yet the Fed says inflation remains “somewhat elevated.” “Tariff-related inflation could limit the Fed’s dovish reaction function.” https://www.inc.com/phil-rosen/economic-outlook-fed-rate-cuts-labor-market-powell-trump-stock-market-investors/91222787
Mortgage rates rose last week—not because the economy grew, but because of tariffs. “Rates ticked up a bit last week in reaction to the current administration’s tariff policy and fears it will stoke inflation.” https://www.msn.com/en-us/money/realestate/will-mortgage-rates-rise-or-fall-this-august-heres-what-lending-experts-predict/ar-AA1JvNQq
The Fed ignores all this. Not one report mentions the asset bubbles or the fast food collapse. They cut rates right into a bubble. The country is hooked on low rates. Stopping that addiction looks worse than inflation.