I think that the economic news is good, but the market disagrees, and finds continued low initial unemployment claims and an upward revision of 3rd quarter GDP a reason for a sell-off.
Needless to say, the incentives for Wall Street are somewhat perverse. They find good news to be bad news because it will lead to more Fed rate hikes:
The U.S. labor market remains historically tight and resilient consumer spending propelled stronger economic growth this summer than previously estimated.
But economists say higher interest rates resulting from the Federal Reserve’s efforts to tame inflation could weigh on growth and hiring in the coming year.
New filings for unemployment benefits rose by a seasonally adjusted 2,000 last week but remain at historically low levels, the Labor Department reported Thursday. The 216,000 claims last week were in line with prepandemic levels, when the labor market was also tight, suggesting that employers are holding on to workers despite concerns about an economic slowdown.
In a separate report, the Commerce Department said third-quarter economic growth was stronger than previously estimated. The economy grew at a 3.2% seasonally adjusted annual rate, up from an earlier estimate of 2.9%, largely due to higher estimates of consumer spending. The third-quarter number snapped two consecutive quarters of contraction.
Taken together, the two reports point to an economy in expansion despite the Fed’s aggressive pace of interest-rate increases. Fed officials are looking to cool the economy to bring down inflation, which hit 40-year highs earlier this year.
The Federal Reserve is going to destroy us all.
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