The post Why Wall Street is ‘out of step’ with the real economy appeared on BitcoinEthereumNews.com. Financial markets keep rallying, but a look beneath the surface paints a much riskier picture for the months ahead. Many investors now warn that Wall Street is ignoring growing cracks in the U.S. job market and real economy, a disconnect that has led to major trouble before. Why Wall Street is so out of step History shows a persistent pattern. As EndGame Macro pointed out, when job openings decline and unemployment ticks up, the stock market often keeps climbing, until reality hits. In 2001, 2008, and again in 2020, stocks stayed buoyant on hopes of a Fed rescue or “new era” narratives, only to drop hard when weaker jobs data started to hit company earnings. Typically, this “catch-down” arrived within 6-12 months and: “It wasn’t gentle; it came with a sharp drop and a recession.” We’re seeing the same setup today. August’s jobs data was much softer than expected, with only 22,000 new jobs added and the unemployment rate rising to 4.3%. Meanwhile, the S&P 500 remains near record highs. Wall Street optimism is built on expectations of imminent Fed rate cuts, easy liquidity, and relentless momentum from tech stocks. Markets are “buying time” on the belief that central bankers will solve everything, but the labor market is already losing ground. Companies are slowing hiring, and long-term unemployment is rising. Once weaker labor figures hit corporate earnings, Wall Street typically adjusts quickly, and that adjustment tends to be sharp. This gap between Wall Street optimism and Main Street reality isn’t sustainable. When Fed rate cuts arrive, they might cushion the landing or even spark short-lived rallies. Yet history shows that deteriorating jobs data wins out before long, dragging stock prices lower as analysts slash profit forecasts. The risk: a sudden correction Wall Street’s current rally is fueled by liquidity expectations,… The post Why Wall Street is ‘out of step’ with the real economy appeared on BitcoinEthereumNews.com. Financial markets keep rallying, but a look beneath the surface paints a much riskier picture for the months ahead. Many investors now warn that Wall Street is ignoring growing cracks in the U.S. job market and real economy, a disconnect that has led to major trouble before. Why Wall Street is so out of step History shows a persistent pattern. As EndGame Macro pointed out, when job openings decline and unemployment ticks up, the stock market often keeps climbing, until reality hits. In 2001, 2008, and again in 2020, stocks stayed buoyant on hopes of a Fed rescue or “new era” narratives, only to drop hard when weaker jobs data started to hit company earnings. Typically, this “catch-down” arrived within 6-12 months and: “It wasn’t gentle; it came with a sharp drop and a recession.” We’re seeing the same setup today. August’s jobs data was much softer than expected, with only 22,000 new jobs added and the unemployment rate rising to 4.3%. Meanwhile, the S&P 500 remains near record highs. Wall Street optimism is built on expectations of imminent Fed rate cuts, easy liquidity, and relentless momentum from tech stocks. Markets are “buying time” on the belief that central bankers will solve everything, but the labor market is already losing ground. Companies are slowing hiring, and long-term unemployment is rising. Once weaker labor figures hit corporate earnings, Wall Street typically adjusts quickly, and that adjustment tends to be sharp. This gap between Wall Street optimism and Main Street reality isn’t sustainable. When Fed rate cuts arrive, they might cushion the landing or even spark short-lived rallies. Yet history shows that deteriorating jobs data wins out before long, dragging stock prices lower as analysts slash profit forecasts. The risk: a sudden correction Wall Street’s current rally is fueled by liquidity expectations,…