Hedgie's Market Edge - September 22, 2025

Welcome back, folks. The Fed cut interest rates this week by 0.25%, which everyone expected. What nobody expected was Powell basically saying "we have no idea what comes next." When the people managing our economy admit they're unsure about the path forward, that's worth paying attention to.

Markets threw a party anyway, with small company stocks hitting their highest levels since 2021. But here's what worries me: the Fed's cutting rates even though inflation's still above their target, and they're doing it because the job market looks weak. That's like taking medicine for two different illnesses that require opposite treatments.

Let me break down what this actually means for your money and why the celebration might be premature.

Why the Fed Felt Forced to Act

The jobs numbers are genuinely concerning. Companies are barely hiring anymore, adding just 29,000 jobs monthly on average over the past three months. To put that in perspective, we need about 150,000 new jobs monthly just to keep up with population growth.