Conundrum
The past week delivered three milestones:
- 106 consecutive months of jobs growth, the longest streak in US history (by far).
- 121 consecutive months of economic expansion, the longest streak in US history (a fresh record).
- First rate cut after 11 years.
If the third milestone seems to you as if it's quite disconnected from the first two milestone - you're absolutely right.
The Fed cutting rates while the US unemployment rate at 3.7% is a precedent. Since 1982, when it started to (specifically) target the Fed Funds Rate, the Fed had never cut rates