The Fed's break-even jobs growth number to maintain stable unemployment has fallen dramatically from ~150,000 pre-pandemic estimates to 70-80,000 in late 2024 to perhaps 20-30,000 currently, reflecting immigration's impact on labor supply and changing demographic needs.

Powell intentionally adopted a 'transitory' inflation framing in 2021-2022 as justification for the Fed's average inflation targeting framework, which allowed the Fed to tolerate overshooting without tightening policy.

Prior to the geopolitical crisis, on February 27th, the UBS CIO outlook was for 2.5% growth and declining inflation, with the Fed expected to cut rates a couple times, creating a constructive environment for risk assets.

Tariff impacts on goods prices have been appearing in PPI data and duties collected at the border, with aluminum and copper specifically showing tariff-driven price increases in manufacturing; this creates an inflationary headwind the Fed must acknowledge.

Tariff announcements have been recurring for a year with 'fits and starts,' suggesting policy uncertainty rather than permanent trade regime change; investors should monitor whether tariffs actually translate into sustained price pressures.

The worst version of AI that will ever exist is the one today; whatever AI becomes will be strictly better than current capabilities, making the current state the floor for performance.