Fed's Miran on Inflation, Jobs Market Fragility, and US Economy Outlook

Fed Governor's Inflation Outlook

• 💡 Fed Governor Stephen Myron indicated he would adjust his inflation forecast if rents were to increase materially, suggesting a potential shock to the housing market.
• 🧠 Myron's thesis on easing inflation relies on the idea that reduced demand for housing due to undocumented alien removals could lower prices, a theory debated by economists.
• ⚠️ The Fed's ability to directly affect shelter prices is limited, as it's more of a policy issue influenced by supply constraints and zoning regulations, and mortgage rates tied to long-term treasuries.

Labor Market Insights

• 📉 LinkedIn's Chief Economist Karin Kimbrough reports a sluggish labor market with hiring down 3.5% month-over-month and nearly 9% year-over-year, characterizing it as a 'hiring recession'.
• 🤝 Employers are 'hoarding' workers, leading to low quit rates and increased competition for job seekers, with hiring levels as low as 2013.
• 🛠️ Strong hiring momentum is observed in skilled trades (electricians, plumbers), commercial construction, finance, education, and healthcare, while entry-level white-collar roles and some tech positions are seeing less activity.

US Economy and Wall Street

• 📈 Goldman Sachs CEO David Solomon is optimistic about the US economy, expecting an acceleration into 2026, driven by aggressive fiscal stimulus from governments.
• 📊 Investment banking, particularly mega-cap deals (over $10 billion), is booming, playing to Goldman Sachs' strengths.
• 🚀 Jane Street, a trading firm, has achieved record quarterly trading revenues of $10.1 billion, outperforming major Wall Street banks, driven by technology and market voids left by capital-constrained banks.

Healthcare Workforce Trends

• 🏥 Demand for healthcare hiring remains strong, though at a slower rate, impacted by macroeconomic changes and Medicare/Medicaid reductions.
• 🌍 A significant portion of US healthcare workers (20%) are foreign-born, and a slowdown in immigrant healthcare worker entry since 2016 highlights the need to focus on domestic workforce development.
• 🎓 Addressing healthcare worker shortages requires increasing training programs, removing educational bottlenecks, and improving the overall experience for healthcare professionals, with technology and AI agents playing a supportive role.