Good morning. With support from an improved second-quarter GDP revision, the job of the Fed in the coming months gets a bit murkier … as there may be reduced need to focus on unemployment if sizable layoffs don’t occur … while thoughts of inflation start to re-enter the discussion. Related to this … according to Yahoo Finance … policymakers have started to go public with their views as the disagreements become more visible … with Chicago Fed President Goolsbee pointing out inflation has “… been above the 2% target for almost five years in a row, and it’s going the wrong way …” Countering this, Trump appointees call for more aggressive cuts and Treasury Secretary Bessent said yesterday on Fox that “rates … need to come down” just a short while after saying he’s not pushing for rate cuts.” The scary thing is that we won’t know for about a year (as we review unemployment, GDP and inflation numbers at that time) which “camp” was right. And being wrong can be quite costly indeed. Meanwhile, stocks are down to start the day … and attention starts to be paid on a possible government shutdown in less than one week’s time. The problem … okay … one of the problems … is an increase in unemployment has yet to appear, but what can stop improvements here … quicker than a UN escalator … is the Administration’s threat for “mass, permanent firings” if the budget situation is not quickly resolved. I’ve been using AI a great deal in recent days to help with PowerPoint slides and am becoming increasingly amazed with what it is helping to produce. But what caught my eye was an article this morning in Reuters, pointing out people deciding on what stock to buy simply by asking ChatGPT. This is far from an endorsement … very far … as a machine will not ask important questions that an advisor would … and omitting something (“garbage in, garbage out”) won’t help at all. And giving personal, detailed, private information to a “bot?” Good luck figuring out where that eventually ends up. You might think of ChatGPT as a confidant and close friend … but this friend might be horrible at keeping secrets. On a final note, I sense people are getting bored with binge-watching shows and typical sports … as a new entrant (per last article below) has entered the competitive arena. Competitive Sauna (“aufguss”). What? I was fascinated by this, saw there was a local sauna competition … but applied and was rejected. They said I was too fat. Too fat to be in a sauna competition? That really steams me up. Have a great day, Joseph G. Witthohn, CFA Have any questions? Please contact info@teamemerald.com
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