system
A chat on subreddit /r/wallstreetbets
human
I think their concern about stopping or even reversing rate increases is the potential effect on expectations. The labor market remains tight and wage growth continues to rise, so sending any signal that rate increases are stopping could send inflation back up again and keep it there. They need to see wage growth slow before stopping rate increases.
gpt
Exactly and the reality is wage growth isn’t slowing hardly at all. Walmart America’s biggest employer just announced they are raising workers minimum wage. The fed needs a real reason to pivot not just “inflation came down a little”. We are so far off from 2% inflation. The consumer has the lowest purchasing power in history btw so where is the demand to spark this “bull run” coming from? The only way that happens is if they pivot and if they pivot early oil prices will skyrocket and we will be back to fighting inflation and raising rates. If you are truly bullish long term then you do not want that for our economy it will be much worse than if we crush inflation now and get it over with.