What evidence is there that we are not at or very near the neutral rate right now? GDP is a solid but not excessive 2.8%, inflation is less than 3% and unemployment is near historic lows (& in the frictional unemployment zone). The Fed should not have reduced the Fed Funds rate yesterday but should have waited to see how the economy would unfold... if anything, the neutral rate might be higher instead of lower.
Job market is in trouble. Only GDP producing jobs are healthcare and leisure. Over 200,000 jobs last month and unemployment goes up! Markets are not the economy. Typically they keep going up as the economy falls apart
What evidence is there that we are not at or very near the neutral rate right now? GDP is a solid but not excessive 2.8%, inflation is less than 3% and unemployment is near historic lows (& in the frictional unemployment zone). The Fed should not have reduced the Fed Funds rate yesterday but should have waited to see how the economy would unfold... if anything, the neutral rate might be higher instead of lower.
Job market is in trouble. Only GDP producing jobs are healthcare and leisure. Over 200,000 jobs last month and unemployment goes up! Markets are not the economy. Typically they keep going up as the economy falls apart