Description

In Episode 204 of the Facts versus Feelings Podcast, Ryan Detrick, Chief Market Strategist at Carson Group, and Sonu Varghese, Chief Macro Strategist at Carson Group, dig into why "everything's running hot" across the US economy. The hosts unpack the August jobs report, including a much stronger than expected 162,000 jobs created, upward revisions to prior months, a tick higher in labor force participation, and a steady 4.1% unemployment rate now sitting below 4.5% for a record 59 straight months. They also dive into which sectors are hiring, the truth behind tech layoff headlines, and why the Challenger job cuts data may be overstating labor market weakness.

Later in the episode, the team covers scorching-hot ISM manufacturing and services data, surging commodity prices (copper, oil, diesel, gasoline), and what it all means for the Fed's rate decision next week, with markets pricing in real odds of a hike rather than a cut. They also touch on Lululemon's earnings miss, the AI-driven software rally, and pause to reflect on the 25th anniversary of 9/11.

[Key Takeaways]

• August payrolls came in at 162,000, blowing past expectations, with prior months revised higher, a rare reversal after a long stretch of downward revisions.
• The unemployment rate held at 4.1%, marking 59 consecutive months below 4.5%, a record in the data series going back to the 1940s, while labor force participation ticked up for the first time in 11 months.
• Job growth over the past three months has been led by cyclical, higher-paying sectors, healthcare, professional/business services, construction, and manufacturing, accounting for the vast majority of gains.
• ISM manufacturing and services indices both showed activity and prices running hot, with services prices hitting their highest level since August 2022, reinforcing the "running hot" theme in growth and inflation.
• With nominal GDP growth strong and inflation elevated near 3%, markets are pricing in real odds of a Fed rate hike rather than a cut at the upcoming meeting, a sharp shift from where sentiment stood just weeks ago.

Jump to:

0:00 - Welcome And Running Hot Theme

1:45 - Why Jobs Data Looks Underrated

8:00 - Payroll Revisions And Trend Changes

14:45 - Participation Rate And Unemployment Reality

20:30 - Sector Jobs Tech Weakness And AI

26:30 - Layoffs Data Myths Versus Scale

32:45 - Fed Odds And Running It Hot

41:00 - ISM Signals Prices And Commodities

48:45 - Stocks Versus Yields And Market Positioning

55:20 - 9/11 Memories And Lasting Impact

59:10 - Wrap Up Livestream And Disclosures

Connect with Ryan:

• LinkedIn: https://www.linkedin.com/in/ryandetrick/

• X: https://x.com/RyanDetrick

Connect with Sonu:

• LinkedIn: https://www.linkedin.com/in/sonu-varghese-phd/

• X: https://x.com/sonusvarghese?lang=en

Questions about the show? We’d love to hear from you! factsvsfeelings@carsongroup.com