Friday, everybody. Well. Trying. To use my my. Ear buds. Hopefully that'll solve the issue with the the volume problem that we've had over the last couple of weeks. Anyways, I want to jump right into it with the check on the markets, the S&P 500 still hanging in up year to date 14 1/2 percent. And up almost 1% for the week, The TSX is up about 2 1/2% year to date and up about 1/4 of a percent year to date. So to prepare for these weekly videos, as I may have said to some of you, I take notes throughout the week and by Friday mornings I usually have a pretty good idea of what I should be talking about. Today I looked at my notes and the message that came out of them was let's just hear what Jay Powell has to say on Friday, Jay Powell being the chair of the Federal Reserve Board. So I listen to speech so you don't have to. You're welcome. And what he said was that the goal of the Fed was to get inflation down to 2%, and he was pretty adamant about that, repeated it a couple of times. He went on to say that the the the Fed has made a lot of progress so far, but they're not done. They are prepared to raise again if needed and restrict policy to see that 2%. But they are going to proceed carefully. A year ago in July, inflation was 7% at its peak. And this past June it was down to 3.3%. Below trend economic growth and some softening in labor market conditions are needed to reach that 2% goal, he said. So far this year, GDP growth has come in above expectations and recent reading on consumer spending has been especially robust, he said. And now the housing sector is showing signs of picking back up. Further evidence of above trend growth could warrant further tightening of monetary policy. So in other words, raising rates. Job openings remain high, but our trending lower payroll job growth has slowed significantly. This all reflects A gradual normalizing of Labor market conditions. So it's a good thing. Powell acknowledged that the risk of tightening too much against tightening too little, although it's very much like we've heard before. It's really this consistent message of reaching out 2% target, but doing it carefully. Bloomberg put out a note this week that said. Remember around this time last year? Lots of people thought that a recession was basically assured. Instead, the economy has shown almost shocking resilience in the face of rapid pace, the rapid pace of rate hikes. Inflation is obviously cooled down since its peak in 2022, but there are concerns it could pick back up again with persistent labor market tightness and nominal wage growth that's above historical trends. So the question then is still about trade-offs. Do we wanna see that nice economic growth? But are we gonna see too much of that if we raise rates too much? Are we going to crush that growth and drive the economy into a ditch? It's filled with recession. Willing to pay now in terms of higher unemployment in order to get inflation all the way back down to 2% and keep it there. There is some wiggle room on the inflation front. Maybe. Can the Fed let it? Let it hover? Sorry. Can the Fed let inflation hover higher than 2%? Two or three weeks ago, we were probably at peak soft landing optimism. Lately, though, it's been a whiff of no landing again. Or maybe bumping, bumpy landing. So to summarize the feds comments and incorporate my analogies that you've grown to love. They're very clear they want to achieve this target inflation rate of 2%. They are not raising rates right now. They will be patient but persistent. Raising rates is not off the table, so. The wooden spoon still in the drawer. And they will not hesitate to use it. But right now, they're happy to let that Stew slow cook. Now I'm hungry. Now I'm going for lunch. Hope you guys have a great weekend. Talk to you soon.
