Julia Coronado

We'll see how this goes.

So we got some tariff boost to consumer inflation, but we also saw it take a bite out of the labor market.

So how did companies react faced with the turbulence and the pressure on costs?

They got really cautious about hiring.

So we did see the imprint on the economy a little bit differently than we had expected.

Well, of course, they raise prices on anything we buy from Europe, and that just adds to the pressures companies are feeling on costs.

Probably the bigger impact is they just, it's not just the tariffs, it's the global conflict, the geopolitical conflict, and the

uncertainty that comes with that that could, you know, make it harder for companies to make decisions about investing and hiring people.

Well, Tom, I think actually the possibilities are fairly bimodal.

So if you look at the market and what it's priced for, it's priced for several rate cuts next year.

But I think either we're gonna get one and done because things are stabilizing and growth is gonna be okay and the AI story has enough legs to power the economy, or we're really starting, we're in the early game turning of the labor market

and the Fed's gonna have to cut not just to neutral, but through to neutral to an accommodative stance.

So it's one or the other, it feels like to me.

So first, if we start with the second half of this year, we have a read on Q3, and by all indications, it's very solid.

But early indications are Q4 is that it's kind of squishy.

The consumer auto sales have dropped.

I'm not sure what Dana told you on the holiday season, but people seem to be price sensitive, price conscious, budget conscious, not hunkered down in a corner, but not booming.

And so I think we're going to see

Strong Q3, subdued Q4.

On average, we'll see an economy that has downshifted from last year on balance in 2025.