“The time has come for policy to adjust”, said Jerome Powell this morning at the Fed’s annual retreat in Jackson Hole, Wyoming. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”

On that nod from Mr. Powell, stocks are up and rates are trending down a little bit. Remember that mortgages and other long term rates fluctuate with market conditions, not precisely when the Fed pulls the trigger, as it were. Consequently, mortgage rates are dropping even before the Fed takes action next month.

Given the exacerbated weakness in the labor market brought to light this week by the Bureau of Labor Statistics upon discovering in their numerical review process that they overcounted the employed by 818,000, the FOMC will most assuredly cut rates next month, then probably again in November or December.