Tonight at 8:30 PM, the U.S. non-farm payroll data will be released, and this time, Wall Street's top investment bank Standard Chartered has just made a bold statement: as long as new jobs are below 40,000 and the unemployment rate exceeds 4.4%, the Federal Reserve will not hesitate to cut interest rates by 50 basis points. This is not a guess, but their precise critical point calculated through internal models.
Why is this number so deadly? Today, we will thoroughly analyze this potentially explosive signal that could trigger a global market reaction. You may have heard many analyses about the Federal Reserve's interest rate cuts, but today I want to tell you a truth that 99% of people do not know: the real threshold for the Federal Reserve's interest rate cut is not the commonly believed 4% unemployment rate, but rather 4.4%. This number hides a fatal flaw in the U.S. economy that it is afraid to publicly acknowledge.
Just this morning, Standard Chartered's urgent report disclosed for the first time that the Federal Reserve has quietly adjusted their unemployment rate tolerance threshold, and this adjustment directly relates to everyone's wallet. For the past decade, everyone has believed that once the unemployment rate exceeds 4.4%, the Federal Reserve would immediately take action.
But the reality is that the labor force structure in the United States has undergone fundamental changes, with workers over 55 years old accounting for over 35%. These individuals are exiting the workforce at an astonishing rate. However, official data has seriously overestimated the actual employment situation; last week's exposure of the 550,000 phantom job scandal is the best proof that these jobs do not exist, yet the Department of Labor included them in the employment data.
In other words, the U.S. job market is much worse than officially acknowledged. Even more terrifying is that a 4.4% unemployment rate is a death threshold. Historical data clearly shows that once the unemployment rate reaches this level, the consumer confidence index will plummet by 15 points, and the risk of default on corporate high-yield bonds will directly trigger a $1.2 trillion debt storm, potentially even affecting the U.S. election situation.
Internal documents from the White House show that an unemployment rate exceeding 4.4% will lead to an 8% drop in support for key swing states. Therefore, the Federal Reserve is not playing a numbers game in economics; they are playing a political survival game.
Why is new job creation below 40,000 going to become another key indicator? The market generally expects this non-farm data to be 75,000, but the ADP private employment data released this morning has already given a warning that the actual employment growth in August was only 38,000, the lowest level since 2020.
Even more astonishing is the largest employer in the United States, Walmart. Internal emails leaked today show that they plan to cut 23,000 jobs directly in the fourth quarter. Meanwhile, Google's DeepMind team has just released a report confirming that generative AI has replaced 12% of entry-level white-collar jobs in the United States.
This data is telling us one thing: the job market is deteriorating at a pace far beyond expectations. Standard Chartered's model reveals a terrifying chain of transmission; if new jobs indeed drop below 40,000, the real GDP growth rate in the United States would directly fall below 1.2%, and corporate capital expenditure would instantly freeze. Boeing has already announced today that it will delay five production lines, and the Federal Reserve will be forced to initiate crisis response mode.
It's like what Buffett said when he sold bank stocks in 2024: when the employment engine stalls, any central bank's gradualism is self-deception. If you feel this script sounds familiar, it's because the exact same thing happened last September.
Before the release of the non-farm data in August 2024, the market expected new job creation of 72,000, with an unemployment rate of 3.9%, but ultimately the scandal of 800,000 phantom jobs broke. The Federal Reserve directly cut interest rates by 50 basis points, and today we are witnessing almost the same scene, with new job expectations of 75,000, an unemployment rate of 4.1%, and rumors of 550,000 phantom jobs circulating widely, pushing the probability of a 50 basis point rate cut to 53%. History is repeating itself, and this time it may be crazier than last year.
I know you are most concerned about: what does this have to do with me? The answer is simple: when the unemployment rate exceeds 4.40%, meat prices in supermarkets may drop by 15%, but the prices of healthcare and education services will soar by 20%, as the government will be forced to cut subsidies. And for workers, the value of vocational skills certificates will suddenly surge by 34%, and the user base of gig economy platforms may explode by 300%. This is not alarmism; it is data that LinkedIn and Uber have already validated in 2024.
So tonight at 8:30, when the non-farm payroll data is released, what we will see is not just a number, but the real health of the global economy. The Federal Reserve's interest rate cuts have never been a victory for economics, but a countdown to a survival crisis. Do you think this data will drop below 40,000? Will the unemployment rate rise to 4.4%? Remember, the market carries risks, and any decision requires independent thinking.