After this week's rate cut, the Fed seems to be confused on what's next

Given that there has been a blackout of large amounts of economic data during the federal government's shutdown (other than a report last week showing US inflation was up to 3% over the previous 12 months), the Federal Reserve's Open Markets Committee had its meeting this week under unusual circumstances. So what info did they go on, and what did they decide to do?

Available indicators suggest that economic activity has been expanding at a moderate pace. Job gains have slowed this year, and the unemployment rate has edged up but remained low through August; more recent indicators are consistent with these developments. Inflation has moved up since earlier in the year and remains somewhat elevated.

The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty about the economic outlook remains elevated. The Committee is attentive to the risks to both sides of its dual mandate and judges that downside risks to employment rose in recent months.

In support of its goals and in light of the shift in the balance of risks, the Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 3-3/4 to 4 percent. In considering additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee decided to conclude the reduction of its aggregate securities holdings on December 1. The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective.

So the Fed sees higher inflation and a slower job market. That seems like a pretty bad situation.

Fed Chair Jerome Powell met the press after the rate decision was made, and many took notice that Powell mentioned a third rate cut in December "was not a foregone conclusion." When asked about that, the Fed Chair said that an increasing number of FOMC members were saying it may again be time to lay back and see how things play out.

The data and reports that we have been able to see in recent weeks indicates the US economy is still growing, even as the government has shut down and prices keep rising. One day after the Fed meeting, Chairman Powell gave an interesting response on why he thinks that may be.

Fed Chair Jerome Powell acknowledged Wednesday that the soaring stock market is helping support consumer spending — and the overall economy — right now.

If the market goes down, Powell said, it could hurt consumer spending. But spending wouldn't take a large hit unless the market plunged.

"I think it's certainly a factor supporting consumption right now," Powell said in response to a question asked by Yahoo Finance about how much of consumer spending and the economy hinges on the stock market remaining strong…..

Powell and others have noted the US is in a "bifurcated economy": Lower-income individuals are pulling back on spending, while wealthy individuals benefiting from market run-ups continue to drive spending — perhaps keeping the economy afloat.

According to a September analysis by Moody's Analytics chief economist Mark Zandi, Americans in the bottom 80% of the income distribution — those making less than $175,000 a year — are barely keeping their spending on pace with inflation. Meanwhile, the top 20% of consumers are growing their spending.

So what's keeping our economy afloat is an AI bubble that has a lot of belief in future activity, but so far hasn't resulted in much of anything that has improved everyday people’s lives. That's not a healthy situation.

It also helps to explain why US consumer confidence continues to fall even as records are being set on Wall Street. Regular Americans aren’t seeing the boost to their wages or job prospects that they had a couple of years ago, but inflation continues to rise at a higher rate than we had this time last year – when we were told inflation was so awful that enough swing/low-info voters got Donald Trump back to the White House on the issue.

And if stocks keep rising, that would be all the more reason to stop the rate cuts, to avoid further borrowing and speculation in an already overvalued market. Which means that the only way we should be seeing rate cuts in December is because we've seen a pickup in layoffsm the real economy has gone toward recession, and/or the stock market has lost a sizable amount of their 2025 gains. Yet the coked-up traders on Wall Street don't seem to understand this, and think that the party's just going to continue.

Cutting Wisconsinites off of SNAP is not only evil, it's dumb for WisGOPs and Trump to do.

If you're not paying daily attention to the news, it may be difficult to notice that we are nearly one month into a shutdown of the Federal Government. But a whole lot of people are likely to directly feel effects later this week, as approximately 700,000 Wisconsinites may see their SNAP benefits cut off on Saturday.

Last week, the [US] Agriculture Department issued temporary emergency funds to stabilize the Special Supplemental Nutrition Program for Women, Infants, and Children in Wisconsin, known as WIC. Even with that boost, however, the National WIC Association said Oct. 21 the funds are rapidly depleting across state agencies, an indication of how needed federal assistance is for vulnerable families….

But in an Oct. 24 memo from the Agriculture Department first reported by Axios, the federal government said it can't legally use contingency funds to pay for food stamps during the government shutdown, nor would it reimburse states that do cover the cost of benefits. Plus, the memo said, any transfers would take away from other funds, such as Child Nutrition Programs and the emergency funds from WIC.

The Wisconsin Department of Health Services, Evers said at a press conference in Racine Oct. 22, can't do anything without federal funds.

"We don't have money for November," Wisconsin Department of Health Services Secretary Kirsten Johnson, who was also at the Racine press conference, said.

And here is what you see when you go to the Wisconsin DHS website for information on future SNAP benefits, which is also known as Foodshare in our state.

Due to the ongoing federal government shutdown, November benefits for FoodShare members will be delayed. Foodshare benefits are 100 percent funded by the federal government and the shutdown will need to end before members can begin getting benefits again.

During the evening of Friday, October 24, the federal government provided additional information about FoodShare use during the federal shutdown. You may use any benefits currently on your QUEST card in November. To be clear, benefits that are already on your card will not be removed because of the shutdown and you can continue to use your current benefits to buy food during the shutdown.

Of course, if you’ve used up your October benefits on, you know, FEEDING YOUR FAMILY WITH INCREASINGLY COSTLY FOOD, then you’re out of luck.

Let me remind you that after the recently-released CPI numbers, food at home (generally thought of as "groceries") was up 2.5% in the first 9 months of the year, with little sign of slowing down.

In theory, state funds could be added in order to pay for the estimated $115 million for November’s FoodShare costs, but a leader of the Wisconsin Legislature says that will not happen.

Senate President Mary Felzkowski said in an interview on WISN-TV on Sunday that state lawmakers likely won't seek to backfill the federally funded food stamp program with state funding through the government shutdown, which is in its 27th day.

At the same time, U.S. Department of Agriculture officials issued a memo saying contingency funds won't be available to backfill the program, which is part of the Supplemental Nutrition Assistance Program…..

State lawmakers could choose to use state funds to cover FoodShare benefits for November, which would require lawmakers to vote to create a new funding appropriation or to expand an existing appropriation to deliver the state funds, according to the fiscal bureau.

Felzkowski, a Republican from Tomahawk, said Sunday that lawmakers are unlikely to do that.

"You know, $114 million is a lot of money. My heart goes out to people, but this is a federal issue. And I don't see the state having the resources to do that," Felzkowski said on WISN-TV's Sunday politics show "Upfront."

Now today, Wisconsin Dems such as Governor Evers joined with 24 other Dem-run states in filing a lawsuit to stop the Trump Administration from cutting off these SNAP benefits. And I even noticed that even the typically right-wing Wisconsin Grocers Association has asked that Trump/GOPs allow for SNAP benefits to continue.

“Food security is fundamental to the well-being of every Wisconsin family,” said Mike Semmann, WGA President/CEO, and added, “Grocers across the state – both in urban and rural communities – see firsthand how vital the FoodShare program is for families struggling to make ends meet. We urge policymakers to act swiftly.”

Wisconsin’s grocery workers are on the front lines of serving their communities, and the potential disruption of FoodShare benefits places additional strain on both customers and store employees. The WGA emphasizes that extending food assistance will help maintain stability for families, local grocers, and the broader Wisconsin economy.

“Wisconsin’s grocers remain committed to serving their communities, even as federal inaction creates uncertainty for families who rely on SNAP/FoodShare. This places our frontline grocery teams in the challenging role of explaining these impacts at the checkout. We urge our leaders to act swiftly so grocers can focus on what they do best – helping Wisconsin families put food on the table,” Semmann said.

That statement hints at another reason to continuing SNAP, outside of being a humane thing to not let people go hungry (which is the most important reason). Because it's good for the economy to have people continuing to buy and afford food.

The numbers show that every dollar given to North Texas families for food assistance played a massive role in the economy last year, totaling a 54% return on investment. 🔗 https://www.dallasobserver.com/news/dallas-advocates-says-cuts-to-snap-benefits-would-hurt-everyone-21832682 

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— Dallas Observer (@dallasobserver.com) March 1, 2025 at 1:30 PM

It seems like such an own goal for the Trump Administration to choose to cut millions of Americans and hundreds of thousands of Wisconsinites from food assistance at the same time when they refuse to negotiate on anything that might prevent people from getting cut off. And with the 2nd and 3rd-highest rate of the state's SNAP beneficiaries living in the districts of the 2 Wisconsin House Republicans most likely to lose in 2026 (Derrick Van Orden and Bryan Steil), you'd think that WisGOPs would care more about this and the blowback that will be coming if those Wisconsinites get cut off.

It almost makes me think that at this point, Dems should walk away and let the bad stuff happen. It's definitely better for electoral purposes, even if it shouldn't be done for human reasons. And maybe it's severe economic pain that's the only way to shake low-info Americans out of their apathy about the bad things that are going on and give the GOP the ass-kicking they deserve.

A bit more money for Wisconsin, as final 2025 numbers come in

We got the final numbers for the 2025 Fiscal Year in Wisconsin with this week's release of the Annual Fiscal Report. And things ended up even better than we thought they would, when it comes to amount of money the state had in the bank for its General Fund.

The state ended the 2025 Fiscal Year with a balance of $4.606 billion, nearly $268 million above what was originally budgeted, and more than $322 million above what was projected in May’s revenue estimates from the Legislative Fiscal Bureau. The extra General Funds appeared because overall spending was about $147 million under what was in the state budget, tax revenues were $88.6 million higher than predicted, and other departmental revenues and transfers also ended up above budgeted amounts.

This will allow for a little more cushion in this current 2-year budget cycle, although we are still on track to have that $4.605 billion dwindle to less than $1 billion by the time the budget ends.

The Fiscal Report also has this annual breakdown of General Fund expenses and revenues, which can be illuminating when you look at the trends over time. I decided to start with Fiscal Year 2010, the last year before Scott Walker and the GOP took over state government, and then take snapshots of every 5 years since then, to compare to how things are now.

In addition, let's remember that the Consumer Price Index went up by 46.6% in those 15 years, so file that away as you consider these numbers. And also note that we have had almost uninterrupted economic growth for the last 15 years, other than when the COVID pandemic took hold in 2020 (and we had largely recovered economically from that within 18 months).

On the revenue side, we've seen steady increases in individual income tax revenues of around 20% per 5 years. But we've seen a much quicker increase in both sales and corporate tax revenues, especially in the last 5 years as inflation picked up.

Other taxes in the state have consistently made up around $1.2-$1.3 billion of the state's total revenue throughout these 15 years, but note how excise taxes have plummeted (as those are often based on amounts of consumption and not prices), while insurance taxes have more than doubled.

As for expenses, like most states, Wisconsin's largest expense is aid to local K-12 public school districts, and the second-highest is for the state's share of Medicaid costs. But note that what is paid to public schools barely changed at all between 2010 and 2015 (Walker's first term), and while things aren't as flat over the last 10 years, most of that increase is categorical aids for special education, per-pupil aid and high-poverty or rural sparsity aids. Meanwhile, Wisconsin saw an increase of nearly 58% in funds spent on Medicaid and related Medical Assistance over the last 5 years, as the extra coverage from the Feds ended, and other COVID-era help faded away.

Over the last 15 years, K-12 public school funding and Medicaid have consistently made up about half of the state's General Fund expenses. But you can see that K-12 public schools take up and increasingly smaller share of that 50%, while Medicaid now accounts for nearly 1 out of 5 dollars of what the state pays out in its General Fund.

2 agencies are part of the next highest group of state expenses - Corrections and the UW System. Both were each just over 8% of state expenses in 2010, and while Corrections have largely stayed near that proportion of expenses, the UW System has dropped to less than 6% of total state cots. Conversely, what the state sends to local governments to reduce property taxes rose from just over 6% in 2010 to more than 10% in 2020, before settling above 8% for 2025. Another set of aids to local governments is shared revenue from the state, which deteriorated throughout the 2010s, but had a sizable increase in 2025 after a wide-ranging reform bill was signed into law.

I'd say the declining share of both K-12 public education and the UW System is quite a tell of priorities of what our state's done over the last 15 years.

But another type of education funding has had a giant leap in state funding over the last 15 years - vouchers for students that attend private schools, as well as charter schools. Vouchers only existed in Milwaukee and took up barely more than 1% in overall state GPR expenses in 2010, but now they take up more than 3% . Meanwhile, individual tax relief like the state's Homestead and EITC credits have declined to less than 1% of state expenses, as has funding relating to school costs for the state's Technical College System.

Seems like another trend that might need to be corrected in the coming years, eh?

So those are the numbers here in Wisconsin. Given the shrinking amount of money available, whoever is the next Governor and whoever runs the Legislature after 2026 is likely to have more constraints than we had have in the last few years. And maybe some of these trends of the last 15 years in both taxing and spending need to be revisited.

Trump/GOPs in DC forcing Wisconsinites to pay a lot for Obamacare. The WisGOPs are fine with that

Before the shutdown happened, the Congressional Budget Office said that it would cost around $35 billion a year for the next decade to bring back the expanded tax credits for Obamacare policies. In return, CBO says restoring the tax credits would not only allow milions more Americans to have health insurance, but would also cut the costs both out of pocket (due to the higher tax write-offs), and would lower the baseline premiums themselves.

CBO and JCT estimate that permanently enacting the expanded premium tax credit structure would increase deficits by $349.8 billion over the 2026–2035 period. Using HISIM2, CBO’s health insurance simulation model, the agency estimates that the number of people with health insurance would increase by 3.6 million in 2030 and by 3.8 million in 2035.

CBO also estimates that gross premiums for benchmark plans in the marketplaces would be 7.6 percent lower, on average, in each year from 2026 to 2035, relative to baseline projections. (The premium estimates reflect the amount before the tax credit is applied.) The estimated decline in benchmark premiums is the result of the expectation that people enrolling in the marketplaces would be healthier on average if the expanded premium tax credit were extended.

If the permanent expansion were enacted on September 30, 2025, CBO estimates, premiums for the 2026 plan year would be 2.4 percent lower than baseline projections. That estimate is less than the average effect of 7.6 percent over the next decade, in part, because it accounts for a 50 percent probability that 2026 premiums would not be adjusted to account for expected changes in risk pools because the assumed enactment date is later than insurers typically set their premiums.

The CBO goes on to say that there are other provisions in that Big Bunch of BS that would also iadd to the number of Americans with insurance if they were to be taken down.

CBO and JCT estimate that repealing the sections of the 2025 reconciliation act that affect the health insurance marketplaces would increase deficits by $271.9 billion over the 2026–2035 period. CBO estimates that the number of people with health insurance would increase by 2.8 million in 2030 and by 2.9 million in 2035.

That includes items which: ·Prevent various legal immigrant groups from getting tax credits, such as thos e who have received asylum, DACA recipients, temporary workers, student exchange visitors, and trafficking victims. It also includes lawfully present immigrants living below the poverty line.

None of the people listed above are "illegal immigrants", as the increasingly desperate Republicans claim. When they say this, they are LYING AND DEFLECTING.

And as a sidebar, I want to credit to the Journal-Sentinel’s Anna Kleiber for including this act of actual journalism at the end of her article on the health care part of the government shutdown.

Republicans say the Democrats' proposal would open up subsidized ACA coverage to people who are in the country illegally, but undocumented immigrants are largely ineligible for federal health benefits and don't qualify for comprehensive Medicaid coverage, Medicare or the Children's Health Insurance Program. They also can't purchase federally subsidized health plans on exchanges backed by the Affordable Care Act.

The Democratic plan would, however, restore coverage to certain categories of immigrants who would lose access to ACA due to the GOP tax-cut bill. Coverage would be restored to asylum seekers, refugees, people on work visas and students.

Undocumented immigrants have never been eligible for ACA subsidies and coverage. That would not change under the Democrats' proposal.

In addition, the Big Bunch of BS put up other barriers to non-immigrant Americans that want health coverage on the Obamacare exchanges, such as:

·Preventing anyone with incomes at or below 150% of poverty from enrolling at any time other than the regular enrollment period.

·After 2028, requiring paperwork on proof of income and having already filed a previous year’s tax returns if they’ve received tax credits for Obamacare. (who is going to be able to do that if they haven’t had to file their taxes at the time they need health insurance? And how long is it going to take to gather and verify that paperwork?)

·Forcing higher repayments of excess tax credits (which wouldn’t be known until taxes are filed the following Spring), which make people not be able to afford future policies, and not want to deal with getting Obamacare in the first place. Naturally, these types of regulations and extra efforts may delight privileged groups who want to see the needy suffer, but it sure won’t help improve our economy and health outcomes.

Put it together, and here's what the CBO has said are the costs, as well as the millions of Americans who would get health care if we got rid of those provisions from the Big Bunch of BS.

I think we can reverse the $51 billion in additional funding for ICE and the military for next year that Trump/GOP threw into this budget, and maybe shear off some of those tax cuts to the rich and corporate, and we will easily be able to restore the tax credits. After all, people having and keeping health insurance would do a lot more to improve our society and our economy than whatever ICE, the military and the giveaways to the rich and corporate are doing these days.

But it just the people that will lose health insurance that are going to get hurt in the coming weeks due to the Trump/GOP's BS Bill. The Kaiser Family Family Foundation recently estimated that post-credit premiums for a typical Obamacare exchange policy will more than double for Americans that continued getting covered that way.

Based on the earlier federal data and more recent other publicly available information, KFF now estimates that, if Congress extends enhanced premium tax credits, subsidized enrollees would save $1,016 in premium payments over the year in 2026 on average. In other words, expiration of the enhanced premium tax credits is estimated to more than double what subsidized enrollees currently pay annually for premiums—a 114% increase from an average of $888 in 2025 to $1,904 in 2026. (The average premium payment net of tax credits among subsidized enrollees held steady at $888 annually in 2024 and 2025 due to the enhanced premium tax credits).

That report from KFF also includes a good illustration of how these enhanced credits go on top of what already existed with the original ACA, and how the end of those credits will result in some serious sticker shock.

And the premiums themselves will be significantly higher on the exchanges next year, even more than CBO predicted a month ago. That's in part because costs in health care keep going up, and in part because fewer people will be able to purchase coverage in general, making it likely that those remaining will be more frequent and costly users of insurance.

KFF says that the median premium for individuals buying policies on the exchange will rise by 15%, and a look at Wisconsin’s announced increases for next year’s policies shows that our state’s median is around that point. But some companies are raising it by quite a bit more than that.

It’s worth remembering that an especially large number of working-poor Wisconsinites rely on the exchanges for their health insurance because of the WisGOPs’ refusal to expand Medicaid through the ACA, which would allow people between 100% and 138% of the poverty line to go onto BadgerCare while also grabbing a larger percentage of coverage from the Feds (this includes single individuals making between $15,650 and just under $21,600 this year, and a family of four with income between $32,150 and a bit below $44,400). That didn’t change in the Big Bunch of Bollocks, and is a way to extend health coverage to people without them having to worry about what might happen to costs and coverages on the exchange.

And yet, less than 2 weeks ago, we saw state-level Wisconsin Republicans not only continue to refuse to expand Medicaid in the state, they also didn't want Wisconsinites to get the enhanced tax credits to help in pay for their Obamacare policies.

With less than 24 hours until a potential shutdown of the federal government, Wisconsin Assembly Republican leaders are urging the U.S. Senate to pass a spending bill that extends funding without the Affordable Care Act subsidies Democrats want.

Assembly Speaker Robin Vos, Majority Leader Tyler August and other leaders sent a letter Sept. 29 to Senate leaders asking them to pass the GOP spending plan and avert a shutdown.

"Holding the federal government funding hostage is not just a Washington D.C. debate for political points, it will have real and immediate consequences that cannot be overlooked," the lawmakers wrote. "From impacting pay for our troops, first responders, and firefighters to affecting critical services for seniors and veterans and disrupting food assistance for families in need, a government shutdown would inflict severe consequences that are completely avoidable."

First of all, there's nothing stopping Senate GOPs from removing the filibuster to pass this budget. They are choosing not to, which allows Dems to block any Continuing Resolution despite having only 47 Senators vs 53 Republicans.

And if Republicans think wanting to increase health coverage, and not allowing the bill to pass until that happens is "scoring political points", then maybe they shouldn't stick with such unpopular policies that will lead to higher costs for the 300,000+ Wisconsinites that currently get insurance on the Obamacare exchanges. It's up to Dems at the state level in Wisconsin to tell voters that ALL REPUBLICANS are good with the extra costs that Wisconsinites are facing. Because they clearly are, as the self-inflicted idiocy that Trump/GOPs in DC are doing with health care is fully supported by the WisGOPs in the Legislature.

And it's why I think Dems in DC should stand strong and not go out of their way to bail out the GOPs by expanding these tax credits before Americans have to sign up for Obamacare in the coming weeks, unless there's also an agreement to get ICE off our streets and stop having Russ Vought steal our tax dollars and try to lay off the DC workers that actually know stuff. Because when everyday people actually see and feel what's changed under Trump/GOP Big Bunch of BS, they're going to furious, and they will rightfully blame the GOPs for it.

And given how panicky and absurd the GOPs on Capitol Hill are acting these days, it's clear they know they're losing as well.

Republicans have had 15 years to come up with an Obamacare replacement plan. They still haven’t

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— Catherine Rampell (@crampell.bsky.social) October 9, 2025 at 3:21 PM

ISM numbers indicate a slowing September for the real economy

In the later part of the week, we got indicatons that the real economy slowed down in September. This includes, the Institute for Supply Management's PMI Manufacturing Index that came out on Wednesday, which showed that sector continued to struggle.

Economic activity in the manufacturing sector contracted in September for the seventh consecutive month, following a two-month expansion preceded by 26 straight months of contraction, say the nation's supply executives in the latest ISM Manufacturing PMI® Report….

"Looking at the manufacturing economy, 67 percent of the sector's gross domestic product (GDP) contracted in September, down from 69 percent in August. Twenty-eight percent of GDP is strongly contracting (registering a composite PMI® of 45 percent or lower), up from 4 percent in August. The share of sector GDP with a PMI at or below 45 percent is a good metric to gauge overall manufacturing weakness. Of the six largest manufacturing industries, only one (Petroleum & Coal Products) expanded in September, compared to two in August," says [Susan ]Spence, [who chairs ISM’s Manufacturing Business Survey Committee].

In addition, prices for manufacturers continued to rise at a widespread and significant level.

The ISM® Prices Index registered 61.9 percent in September, decreasing 1.8 percentage points compared to the previous month's reading of 63.7 percent, indicating raw materials prices increased for the 12th straight month (though at a slower rate compared to August). The Prices Index has increased 11.6 percentage points over the past 11 months. In the last eight months, the index reached its highest levels since June 2022, when it registered 78.5 percent. All of the six largest manufacturing industries — Machinery; Computer & Electronic Products; Food, Beverage & Tobacco Products; Petroleum & Coal Products; Transportation Equipment; and Chemical Products, in that order — reported price increases in September. "The Prices Index reading continues to be driven by increases in steel and aluminum prices that impact the entire value chain, as well as tariffs applied to many imported goods. Higher prices were reported by 32.5 percent of respondents in September, down from 33.5 percent in August. The share of respondents reporting higher prices trended up from November 2024 (12.2 percent) to April (49.2 percent), which was the highest level since June 2022 (65.2 percent)," says Spence. A Prices Index above 52.8 percent, over time, is generally consistent with an increase in the Bureau of Labor Statistics (BLS) Producer Price Index for Intermediate Materials.

"The highest level since 2022" is not good at all when you're talking about inflation, as that was when rices were increasing at a rate above 1.0% a month, and year-over-year inflation was at 9%.

Then on Friday, ISM reported that the service sector also underperformed in September.

The report was issued today by Steve Miller, CPSM, CSCP, Chair of the Institute for Supply Management® (ISM®) Services Business Survey Committee: “In September, the Services PMI® registered an unchanged reading of 50 percent, 2 percentage points lower than the August figure of 52 percent. The Business Activity Index moved into contraction territory in September, registering 49.9 percent, 5.1 percentage points lower than the reading of 55 percent recorded in August. This is the first time the index has entered contraction territory since May 2020. The New Orders Index remained in expansion in September, with a reading of 50.4 percent, down 5.6 percent from August’s figure of 56 percent. The Employment Index remained in contraction territory for the fourth month in a row and the fifth time in the last six months; the reading of 47.2 percent is 0.7 percentage point higher than the 46.5 percent recorded in August.

And just like we're seeing in the goods sector, prices are going up for services as well, and with less need to get more orders coming in for the future.

“The Prices Index registered 69.4 percent in September, a 0.2-percentage point increase from August’s reading of 69.2 percent. The index has exceeded 60 percent for 10 straight months, its longest such streak since 30 consecutive readings above 60 percent from October 2020 to March 2023.

“The Inventories Index dropped into contraction in September after three months in expansion territory, registering 47.8 percent, a decrease of 5.4 percentage points from August’s figure of 53.2 percent. The Inventory Sentiment Index expanded for the 29th consecutive month, registering 55.7 percent, up 0.2 percentage point from August’s figure of 55.5 percent. The Backlog of Orders Index was in contraction territory for the seventh month in a row, registering 47.3 percent in September, but with a 6.9-percentage point jump from the August figure of 40.4 percent to hit its highest reading since April (48 percent).

Put all this together, and you have a pretty gloomy picture.

These ISM reports should get extra attention from you as the government shutdown continues, because the regularly-scheduled releases of the US government's jobs and unemployment claims data has already been delayed, and September's inflation reports for later this month are also likely to be set back. So for us and the Federal Reserve, they will have to go on reports like the ISM to figure out where things stand with the overall economy. And from what we saw from the ISM, a stagflationary situation seemed to be happening for September.

JOLTS and other jobs data both tell us little is happening

The government shutdown in DC kept Jobs Friday from being a thing this week, but that doesn't mean there isn't data we can use to figure out where things stand. For example, we got a surprisingly bad payrolls report for September that came out on Wednesday.

So this not only means that private sector job growth in September was down by 32,000 in the ADP, but there was also 11,000 fewer jobs through August than what was previously reported.

Naturally, the stock market rose on this bad jobs news, and continued to rise for the rest of the week. Likely because a dying jobs market might encourage the Federal Reserve to further cut interest rates, which enables more coked-up traders to throw more money into making the AI Bubble even larger. Not really anything that helps the majority of Americans who make their money in wages.

And that ADP report came on the heels of a just-under-the-shutdown-deadline report that showed a low amount of hiring in the previous month.

Tuesday’s data further confirmed that the US job market has grown increasingly stagnant. Excluding the onset of the pandemic in early 2020, the rate of hiring fell in August to 3.2%, matching the lowest rate since 2013, BLS data shows.

“That’s the worst level since the Great Recession era, when unemployment was 7% or higher, with the exception of April 2020,” Heather Long, Navy Federal Credit Union’s chief economist, wrote in a note on Tuesday. “The job market has been frozen for close to a year now, and it appears to be getting worse for job seekers. Americans feel stuck in this economy without job opportunities or hopes of buying a home. This needs to change.”…

In August, job openings plummeted by 115,000 positions to 188,000 in construction, which logged its second-largest monthly decrease of openings on record.

Hiring [in construction], however, picked up slightly, as did the number of workers who quit. Construction, which is closely watched as an indicator of economic activity, has been dogged by high interest rates, a persistent housing affordability crisis, deportations of workers and tariff-related uncertainty.

Hiring was listless across most sectors, especially white-collar industries where activity was flat in August, according to Tuesday’s report.

As you can see, hiring has trended down, especially since April. But people aren't losing or leaving jobs as much either, and while there is a slight increase in layoffs and decline in quits in 2025, it's not enough to show a full-fledged recession is underway.

And while we didn't get a jobs report for September from the shut-down federal government, we did have a different indicator come out on Thursday that said that even fewer people were landing jobs in September.

U.S. employers announced fewer layoffs in September but hiring plans so far this year were the lowest since 2009, a report said on Thursday, adding to evidence of a labor market standstill as the demand and supply of workers fall because of policy and technology advances.

The report from global outplacement firm Challenger, Gray & Christmas does not normally attract much attention. But together with other private data, it has become more prominent due to a U.S. government shutdownthat has led to major economic releases being suspended, including the closely watched employment report for September that was due on Friday....

Challenger, Gray & Christmas said planned job cuts dropped 37% month-on-month to 54,064 in September. Employers have so far this year announced 946,426 job cuts, the highest year-to-date since 2020.

Hiring plans so far this year have totaled 204,939, the lowest year-to-date since 2009 when the economy was just emerging from the Great Recession.

And yet we haven't seen too much evidence of a consumer slowdown, or a significant slowdown in activity. Just stall speed and stagnation in some spots, and an absurd amount of investment into a type of technology that doesn't seem to be adding much to people's day-to-day to existence, outside of a lot of bad "art and content" that isn't helping the culture or is interesting to anyone with a mental age above 12.

But hey, as long as people keep pumping money into something that claims it'll lead to even less hiring and even more social and economic inequality, that's all Wal Street and tech oligarchs need to hear! That's a normal and sustainable economy, isn't it?