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Good News for The Economy

When you look at the overall strength of the borrow, their debt as a % of income is the lowest in measured history. Notice the peak in 2008 as that crisis was unfolding, compared to today. Consumers are in much better shape.



That can be seen in the lower delinquency rates on all outstanding loans across the spectrum (mortgage, auto, credit card, etc.)



This stability emboldens the FED to keep raising interest rates - and one thing that would bring that to slow more quickly would be a problem with jobs. While the economy is slowing, we can see that we are at all time highs for job openings, with 2 jobs open for every 1 person looking for a job. That will also make it easier for FED to keep rates higher for longer.



TIP: If economy and jobs stay strong, and the bond market holds, the FED will keep rates higher for longer. It's how we think of bad news is good news... bad news for the economy is normally good news for the market IF they think the FED will stimulate (more money or lower rates), but right now they are trying to make the economy worse, so it has to get really bad before they start printing money or lowering rates again.

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