The Numbers Don’t Lie (But They’ve Been Lying to Us)
This 911,000 job revision isn’t happening in isolation. The previous year saw a downward revision of 598,000 jobs. That means in just two years, the government overestimated job creation by 1.5 million jobs. That’s not a rounding error—it’s a fundamental misrepresentation of our economic health. What’s even more concerning is that these revisions only cover through March 2024. The more recent months haven’t even been properly assessed yet. And if we look at the trend, job creation has been slowing dramatically, with June actually showing a loss of 13,000 jobs. The pattern is clear: each revision shows fewer jobs than initially reported, and the trend is moving toward net job losses. This suggests unemployment is likely higher than reported—another statistic that’s been notoriously massaged for political purposes.What This Means for Interest Rates and Your Mortgage
Today, as I record this, the Federal Reserve is announcing its interest rate decision. I’ve been predicting all year that rates wouldn’t come down as quickly as many hoped. While I initially thought we might see a quarter-point cut in September, given these dismal job numbers, a half-point cut is now possible. But what does this mean for your mortgage? Not much, unfortunately. Your 30-year mortgage rate has some correlation to the Fed rate, but you won’t see dramatic relief. Rates might drop a quarter percent, but not enough to spark a buying frenzy. For rates to truly impact the housing market, we need to see 30-year mortgages drop below 6%. If rates do fall into the 5% range, expect home prices to start climbing again as buyers rush back into the market. This creates a dilemma for potential homebuyers:- Wait for lower rates, but risk higher home prices when everyone else jumps in
- Buy now at higher rates, with the option to refinance later if rates drop
- Consider lenders offering no-cost refinancing options when rates eventually fall
The Danger of “Wait and See” Thinking
The biggest mistake I see people making right now is adopting a “wait and see” approach. This stuck energy is precisely what keeps you financially stagnant. While everyone else is frozen in uncertainty, the smartest investors are making moves. When nobody wants to buy is precisely when you should be buying. The masses rarely make wealth-building decisions—they’re typically too late to the party, following the lemmings right off the cliff. Consider what’s happening in various markets:- Real estate: Flat or declining in many areas, with sellers holding back
- Stocks: Still inflated despite economic warning signs
- Digital currencies: Seeing renewed interest despite volatility
- Gold and silver: Already experiencing significant movement
Are We Already in a Recession?
Looking at the economic data, we might already be in what I call a “quiet recession“—similar to what Japan experienced from the 1990s through the 2020s. Their economy stagnated for nearly 25 years. The Fed’s much-touted “soft landing” might actually be a “soft crashing” that leads to a deeper, longer recession than anyone planned for. Companies are being cautious about hiring, using AI and technology to improve efficiency rather than adding staff. This creates a vicious cycle—fewer jobs mean less consumer spending, which means less revenue for businesses, which leads to even fewer jobs. Small businesses, which employ the majority of Americans, are feeling the pinch just like individual consumers are. Many aren’t nimble enough to adjust quickly to changing economic conditions. The time for action is now. While the masses sit frozen in uncertainty, the wealthy and institutional investors are already making their moves. The question isn’t whether you should wait and see—it’s whether you want to be educated or ignorant about your financial future. Remember: Ignorance isn’t bliss. Ignorance is expensive. The right knowledge, training, and connections can literally be worth millions if you act at the right time. And that time might be right now, when everyone else is still waiting to see what happens next.Frequently Asked Questions
Q: How reliable are the government’s job reports?
Based on recent revisions, they’re not very reliable. The BLS has revised job numbers down by 1.5 million over two years, suggesting their methodology is flawed. They use a “birth-death” model that tracks new and closed businesses but misses many job changes within existing companies. These reports should be viewed as rough estimates rather than precise measurements.
Q: Should I wait for mortgage rates to drop before buying a home?
Waiting could be risky. If rates do drop significantly (below 6%), expect home prices to rise as buyers flood back into the market. Consider buying now if you find the right property, with plans to refinance later when rates drop. Many lenders are offering no-cost refinancing options to attract business in this challenging market.
Q: Are we heading into a recession?
We may already be in what I call a “quiet recession.” The job creation numbers have been consistently revised downward, and June actually showed job losses. This pattern resembles Japan’s decades-long economic stagnation. The Fed’s attempt at a “soft landing” might actually be a “soft crash” that leads to a prolonged period of economic weakness.
Q: What investment moves make sense in this economic environment?
The best opportunities often appear when others are fearful. Real estate could be attractive now, before rates potentially drop and prices rise again. Be cautious with stocks, which may be overvalued given the economic warning signs. Consider alternative investments that create passive income streams. Most importantly, avoid the “wait and see” trap that keeps most people financially stuck, while the wealthy and institutional investors are already positioning themselves.
