Part 3/12:
However, underlying economic conditions paint a less optimistic picture. Treasury data reveals that the US government’s cash reserves are dangerously low, hinting at imminent action—possibly another round of money printing or QE—to meet debt obligations. Fed Chair Jerome Powell signaled that they would consider rate cuts only if there's an unexpected weakening in the labor market—an ominous sign given recent data indicating deteriorating job conditions and economic stress.
Much of the narrative from policymakers remains paradoxical: Despite acknowledging some signs of economic strain, they continue to assert that the economy remains “strong,” creating a disconnect that markets are beginning to sense.