Futures are up sharply on optimism surrounding AI and Fed rate cuts. That’s right. Things are going so well that the Fed needs to drastically cut rates. Or, so the logic goes.

Seemingly everyone agrees that the economy is increasingly polarized, with the “haves” doing very well and the “have nots” under a lot of stress. It seems highly likely that AI taking away entry level jobs will exacerbate this problem – with those affected facing much higher healthcare, utilities and student loan expenses. Will the market care?

The deportations taking place across the country will no doubt open up some jobs, but I don’t see new college grads with $30,000+ in student debt lining up to pick strawberries.

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Whether this is a lasting rebound will depend on whether TPTB can force VIX back into the falling purple channel – which also means back below the SMA200 at 19.26ish.

There’s also still a lot of work going into stabilizing currencies.

The 10 year is bouncing a bit today. The trick is getting rates down due to falling inflation and not due to a panic. It’s all a matter of perception.