On a Monday, the realization that a weaker job market is not to be celebrated, even if it means lower interest rates.

I'm David Brancaccio. We're starting the week with a bit of a headache after a strong hint last week that interest rates are going down slightly three and a half weeks from now.

Economist Julia Coronado is founder of macro policy perspectives

and teaches at the University of Texas. Good morning. Good morning. I'd sum up the mood on

Friday when the Dow reached a record high as, yay, interest rates are going down. That could help

corporate profits and spur demand. This morning, it feels different. We're looking at a little bit of a Jackson Hole hangover. On Friday, the Fed chair told us that

because he was worried about the labor market getting weaker, that the Fed would likely

proceed with at least one small rate cut in September. That's good news, maybe, but it also means that the economy is getting

weaker. I love these market players. Hey, the labor market is getting weaker. We're going to celebrate.

This is what you're pointing out, that irony. Exactly. Ultimately, the economy is a big ocean liner.

Lower interest rates might help, but the Fed is also

telling us that they can't go really fast because inflation is also going up. So they're really kind of

in a tough spot. That doesn't mean long-term interest rates, like mortgage rates, are going to come

crashing down. That is not happening in the markets that we're looking at this morning.

And the tariff policy that we're living under now can be inflationary with an import tax

driving up prices, but it also, as you've been hearing from businesses, makes them more

reluctant to hire more people, and then you have that labor market effect.

There's so much uncertainty about the future and about policy that firms have been very reluctant to take on new workers, and that is why we see the weak labor market.

And immigration policy, right? It shrinks the labor force. And so that makes the headline

number look a little stronger than it might actually be. That's right. The unemployment rate

hasn't gone up. We have fewer workers and less growth because of restrictive immigration. But the

unemployment rate is still fairly low. There's not a lot of unemployed people. If we choose restrictive immigration, but the unemployment rate is still fairly low. There's not a lot of unemployed people.

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