What's Ahead for Rates, Jobs and Growth? Featuring Thomas Simons, Jefferies

In Episode 06 of Market Snapshot, SIFMA President and CEO Kenneth E. Bentsen, Jr. and Director of Research Heidi Learner are joined by Tom Simons, Chief U.S. Economist at Jefferies, to discuss the outlook for Federal Reserve policy, evolving labor market dynamics, AI investment and productivity, and what these trends could mean for interest rates, economic growth and capital markets.

You can listen to this conversation by following "The SIFMA Podcast" on Apple, Spotify, YouTube, or wherever you get your podcasts. Sign up to receive new episodes, delivered right to your inbox.

In This Episode

• The outlook for Federal Reserve policy and inflation
• Labor market trends, wage growth and demographics
• AI's potential impact on employment and productivity
• The AI investment boom and implications for interest rates
• Corporate debt issuance and demand for capital
• Midterm elections, Treasury yields and market risks

Featured Guest

Thomas Simons
Chief US Economist
Jefferies

Transcript

Kenneth E. Bentsen Jr.: Hello and thank you for joining us for the October edition of the Market Snapshot Podcast. I'm your host, Ken Benson, President and CEO of SIFMA. Featuring SIFMA's director of research, Heidi Lerner, Market Snapshot is a monthly podcast that takes a concise look at what moved markets and what to watch next. This month, we are grateful to be joined by Tom Simons, Chief U.S. Economist at Jeffries. Comments and questions are welcome. Listeners can reach us at digital at SIFMA.org. Tom, Heidi, thank you so much for joining us today. Let's start with the outlook for Fed policy. So, Tom, you've said that monetary policy has not been restrictive enough to meaningfully suppress hiring. If inflation falls but employment rates remain strong and wage growth uh begins to accelerate, would the Fed continue hiking until it sees something softening in labor demand as well?

Thomas Simons: Hi, Ken. Yes, thanks for having me this month. I do think that there probably is further action down the road coming from the Fed. But to be honest, my views have gone through a pretty aggressive round trip in just the last couple of weeks. Up until right before the September FOMC meeting, uh when they did, of course, hike, I had been thinking they were going to be on hold. I didn't think that there was anything within the underlying details of the inflation data that necessarily screamed that they needed to hike. It felt like inflation was fairly well concentrated in some areas related to things like AI or just oil, stemming from the disruptions to supply chains with the Strait of Or Moose. But I didn't really see any bleed through into a number of things that normally you'd start to get concerned with. You know, food is a great example. It's a very low margin business, high competition. It involves the movement of a lot of weight of goods, so shipping costs are very important. And food prices have been fairly stable overall. So, I do think they're still seeing some more disinflationary trends in housing. Some of the big things that were big contributors to core inflation in the last couple of years, like insurance prices have started to at least slow down. Some of them are actually starting to fall. So I thought that they were kind of moving along, getting some progress that was going in the right direction. Clearly, Kevin Warsh decided that it wasn't fast enough, and he convinced his colleagues to support a rate hike. And there's also a pretty different picture with the labor market now versus so you know September 18th. We had just come off a really, really strong payroll number in August. We had started to see some of the dip in participation rate from June and July start to reverse. And then of course the data that we got a week or two ago now has kind of hasn't quite invalidated that story. It hasn't shown that the labor market is deteriorating necessarily, but it does suggest that we're closer to stall speed than maybe it looked like a few weeks ago. So long story short, I do think that they will continue to look to potentially raise rates again. A lot of it is just gonna come down to you know really hyper focusing on some of the details in the next month's inflation data. And certainly if the labor market data starts to weaken, it's already coming from a really strong place. But if it starts to go in the wrong direction, I think that they would be very cautious about that.

Bentsen: Well, you know, so monetary policy tends to act with a lag. And you know, while you know you you noted that it it you you felt like core inflation seemed to be flattening out and maybe trending down, but the Fed obviously felt that they still needed to act at this last FOMC meeting. Where do you think inflation needs to before the Fed feels that they can that they can take a pause?

Simons: You know, the level is probably less important than the direction at this point. It feels like this was not so much, you know, citing some say three-month annualized rate of headline or core inflation saying this is you know too high or this much above the 2% target or what have you. It felt like they were just kind of saying, like, okay, you know, we got this nice reversal in energy prices in June and July. You had negative headline print on the CPI, and believe a negative core print in the CPI in one of those months as well. Very unusual outside of the pandemic and you know the financial crisis. So it looked like we were seeing a pretty nice reversal, getting back to the trend that we were on, maybe say at the beginning of the year. Um and even that, you know, they were easing at the end of last year, you know, on concern that maybe they were putting a little bit too much pressure on the labor market, but they weren't particularly happy with the state of inflation. You know, I think that the the guidance was that it still was a a little bit too high and they wanted to get it down closer to target sooner than later. The problem is that that downside momentum in inflation, I guess that their read on it is that it it's kind of stalled out a little bit in August and didn't show a continuation that they you know they would have liked to have seen. So the key, I think, with the guidance that we got, you know, precious little as it was from Kevin Warsh after that F1C meeting is references to speed. So we would want to see on average, you know, a substantially slower month-over-month pace of inflation. And you know, I think less should be paid, you know, there should be less attention paid to the year-over-year numbers. They're really just telling us about what happened over an 11-month period that we've already seen. So it's really about the view going forward, I think.

Bentsen: And Heidi, you know, what what are you seeing in the data? Um and do you think that lines up with you know what the market is pricing in?

Heidi Learner: Yeah, if we look at what the market is pricing in, we've had a little bit of a whipsaw. Um initially, when we looked at prospects for an October height, um, they've really come way off. We had been as high as 70% for an October hike. And after one Fed voter suggested there was no need for urgency, those probabilities fell to about 20%. So the market has really discounted an October move. Um, things are a lot more balanced when we look at December, where there's just about an 80% chance of a hike. And that's down only very marginally from about 90-95% at the end of September. Um, so the likelihood that of a hike, at least from the market's perspective, is quite high. And I think to Tom's point, even though year-over-year inflation is a backward-looking measure, I think it's important to recognize that those figures every month this year on a year-over-year basis has been higher than every month that we saw on a year-over-year basis last year. So until that trajectory really starts to reverse, I think that December move is probably warranted.

Bentsen: So let's let's turn to the labor market. Tom, you were getting into this when we were talking about monetary policy. We have a report that just came out. Job openings once again seem to exceed the number of unemployed workers and payroll growth is is rebounded for the year. However, you have a lot of month-to-month volatility, and we've had you know revisions in both directions. I think this most recent report had revisions downward. How is the you know is the labor market genuinely re-tightened? Are these indicators potentially overstating the underlying strength? And what are the measures you're watching most closely?

Simons: So I think it's less about actual month-to-month job creation going forward that's going to be most important to keep an eye on, and really more of the other statistics about the labor force. So specifically the things from the household survey, the unemployment rate, wage growth, because we're battling against some pretty significant demographic trends that have really started to rear their head in the data, I would think. It's unclear how much immigration policy has you know whipsawed the recent trends in job growth. I think that it's obvious that it has arrested the increase in the size of the labor force since the beginning of last year. But I mean, you know, specifically the degree to which sort of the reclassification of people who are you know lost temporary protected status, whether or not that's caused them to sort of like drop out and come back in. It's a lot of noise that, you know, when you cut through, you know, doesn't really tell a compelling story. The unemployment rate, on the other hand, has been coming down, and the overall participation rate has been coming down, while prime age participation rate outside of a little hiccup that we had a few months ago has been at the highest level in 25 years. So what that tells me is that for the most part, people who want a job have one. You know, there are pockets of weakness in the labor market, and certainly amongst some different age cohorts where you know it is difficult to get a job, and maybe difficult to get a specific job that people are looking for. But in a broad sense, you know, most of the people in their kind of prime age working years and prime earning years are are earning. So the question of pressure, whether or not the labor market is really tightening, I think is going to come down to wage growth, right? At some point, it's gonna be more and more difficult to find workers. And you know, we've seen countless reports about the difficulty in finding skilled labor for you know years before the pandemic, let alone the last couple of years. That's just going to become something that I think is increasingly scarce over time. People with a lot of work experience in their career are gonna be becoming more scarce over time, and there is a risk that wage growth starts to accelerate as businesses start to you know sort of fight for employees that you know that are, like I said, becoming increasingly scarce. So the demographics are also probably weighing on wage growth a little bit and maybe understating how strong it is. You know, just it's a fact that as people retire and leave the labor force, they're probably at the top of their overall kind of lifetime earnings pace. So if we're replacing folks at the top end with new entrants that are you know much lower on the pay scale, the overall aggregate income numbers are gonna look maybe a little bit softer than what the experience of most people sort of in the middle of that range might feel.

Bentsen: And Heidi, what are you watching closely in the labor market?

Learner: I watched a few things. And one thing you mentioned are the revisions, which were pretty substantial. We saw a real deterioration in the prior two months, and I think one thing that maybe got a little bit lost in the headline is that August payrolls actually contracted and we lost 10,000 jobs. So we still have a three-month average of just around 50,000 and a 12-month average monthly gain of jobs of around 45,000. So still decent numbers. But we really haven't seen this increase in unemployment claims. So for now at least, I think we still continue with this low hire but still low fire regime. Two other things I'm looking at. One is the private sector employment diffusion index that's a little in the weeds, but it basically looks at the percentage of industries where employment is increasing, plus one half of the percentage of industries where employment is unchanged. And anything below 50 indicates that there are more industries that are contracting. And we saw the first print below 50 in September and a pretty sharp deterioration from August. So I think that's one thing that merits watching, just the concentration of jobs and where those jobs are being created. And then I'll just mention one last point. We still have a very benign unemployment rate at 4.2%. But if you look at the composition of those who are unemployed, more than 27% have been unemployed for 27 weeks or more. So 20% of 27% of the total unemployed have been unemployed for at least six months. And there's a lot of research that suggests that the longer you're unemployed, the more likely you are to be unemployed. That 27% number is up from about 23.6% a year ago. And I think perversely, to the extent that some of those unemployed workers fall out of the labor force, we could actually see the unemployment rate decline, but again, not for good reasons. So I think watching those figures is something that's taking a lot of my attention.

Bentsen: So, Tom, I want to come back to what you were talking about in terms of of what's going on in the labor market, issues around potential impact of declining immigration and and and you know foreign-born work participation in the labor force, softness in certain demographic sectors, and then turnover in the labor supply, in some cases, between you know going from older workers to to younger workers and potentially having softness, an impact or creating softness in in overall income growth. Do you take all those together, you know somewhat dramatic changes in the labor supply issue, how that affects both income growth as well as wage pressures? Does this does this is a supply-side impact that the feds you know may have to rethink their approach to monetary policy and their you know you know meeting their mandate and how they think about the labor inputs to their to developing monetary policy.

Simons: Yeah, I think it should. I can't necessarily speak to the you know more nuanced views of most of the policymakers. I think that you know some of these discussions about the intricacies and and the and the details of the data are fascinating for us, but they're not very good material for the luncheons and things that most of these Fed speakers generally present at. So I think that there's a lot of things that you know have been very difficult for certain cohorts within the labor force for a number of years, and conversely, it has been difficult for businesses looking to hire people for the last several years as well. So, you know, one area where there has been a lot of slack, a lot of you know, well-publicized difficulty, turbulence, you might say, in people getting a job, is recent college graduates. And I feel for them, you know, this has been a very tough period of time for the last, you know, basically since the beginning of the pandemic. You had a number of people who had their education interrupted by the pandemic, whether that caused them to take longer to get out of school, just deteriorated their experience in school, or you know, perhaps maybe unfairly sort of deteriorated their reputation of how sort of ready to work they might be coming into the labor force. That's starting to get behind us now. I mean, as we get into the class of 2027 that's out this year, I mean, you know, I think most universities had relaxed most of their policies about social distancing and remote learning by 2023, so they should have had you know four-year experiences that were a little bit more closer to normal. But the problem is now that as you know I highlighted before, if they're coming into a labor market that is dealing with a decreasing amount of experience and skill in the aggregate, right? As you're replacing someone who is, say, 65 years old and retires, they're taking 40 years of work experience away from you know, from the business, essentially, the you know, the the business could leverage their experience not only for their productivity, but also to train younger workers as well. This is also after a period of time where there was an enormous amount of turnover that I think probably put some middle-tier experienced folks into some more senior roles that maybe they weren't totally prepared for. And you know, as their older coworkers left, you know, they didn't have a lot of guidance on how to handle certain situations or just generally remain as productive as they were. So I can imagine a situation where businesses are you know focusing on trying to replace the skilled workers that they lose while kind of losing sight of the importance of building up the bench and keeping the pipeline full and still continuing to hire these younger workers. Because at some point before long, if the demographic trends continue as it looks like they are now, those businesses are gonna be caught out in a bad way, the same way they were in, say, 2021 when wage growth really accelerated sharply. It's all gonna come down to whether or not productivity can keep up. You know, I mean, if we get a late 90s style, you know, 4% a year productivity gain, then maybe businesses won't be so concerned about you know trying to pay up to try to find more skilled labor. But if AI kind of falls even the slightest bit short of what it looks like, you know, we might we might expect, then wage pressure is probably going to accelerate. And I think there's a skew of the risks, right, that be based on these demographics that are not going to change anytime soon. If wage growth starts to accelerate, it could you know kind of steeply go back to much higher levels than we saw a few years ago, um, more likely than it kind of slowing down below, say, a range of like two and a half to three percent per year.

Bentsen: So that's a that's a good good way to segue to AI. And you know, you kind of got into that a little bit, um, but may we dig in some more of like what what's the impact of AI going to be or what's it gonna mean for employment, productivity, and then ultimately monetary policy and rates? You know, one of the Tom, one of the more counterintuitive points you published in a piece this summer on the labor market is that it we were talking about as job openings are been rising in professional and business services, including some of the occupations thought to be most exposed to AI. So you know, could AI initially be a net creator of skilled employment, even if it dis eventually displaces workers? And you know what in the data is telling you what effect is dominating?

Simons: Yeah, you know, I think that if we look at some of the job openings data for the last couple of years, I've seen some presentations that suggest that there are a number of you know kind of exposed industries that have seen you know sharp contractions in job openings over the last several years. And I would just caution about comparing levels of job openings to say 2022 or 2023, when there were, I believe at one point more than two times the number of openings per unemployed people and the unemployment rate was under 4%. So rather, I think there is some you know pretty compelling evidence that as the job openings level started to come way down, closer to that one to one ratio, it's leveled out. It hasn't gone down below one to one. The Joltz job opening series doesn't have a hugely long history. It only goes back to about 2000, so we don't have a many other cycles to compare with. But prior to the late 2010s, it was actually unlikely that there would be, or unusual, I should say, that there were more than one opening per unemployed person. So we're looking at this as kind of like maybe table stakes for a stable labor market, but in actuality it was a signal of a pretty tight labor market not that long ago. So, you know, to the point of technology and jobs, you know, there's always disruption going on. If it wasn't for AI, we would have some other great technology we'd be working on, I'm sure, that would be you know potentially threatening maybe not so much the knowledge workers, which are not used to being under threat from technology, but you know, some other area of the labor market. I would say that if you go back into the history and you look at you know, sort of data from post-Industrial Revolution, post-World War II, more specifically, there are only a handful of jobs that you can find in, say, like the 1950s that really don't exist today. You know, like an elevator operator, a phone operator, those sorts of things, like they're totally gone, but everything else has at least evolved, if not um, you know, continue to grow because technology presents more and more opportunities. And same thing with if if bigger businesses are having difficulty in sort of maintaining headcount or they want to tear them down, and these you know, workers I think can leverage AI skills to you know do things on their own in startups and whatnot that they wouldn't necessarily be able to do in prior technological regimes. So I think overall in the long term, I'm generally fairly optimistic about the impact of technology on labor. It's just that there are displacement issues in the in the transition process. And you know, certainly one person who loses their job doesn't really care about what the overall aggregate data looks like. Um that you know becomes more of a social issue than anything else.

Bentsen: Well, they I want to take that step further. You you talked about you know the you know job openings have been particularly strong among small businesses, and you know, and you know just noted in fact, you know, people you know could be leaving larger companies and but but they they could start their own firms, they could leverage technology, leverage AI. And is that happening at scale? And are you seeing a wave of of business formation and labor reallocation that um maybe is it being picked up in the data?

Simons: Yeah, I mean it it's really difficult to say right now for you know, the primary reason is that it's very difficult to get data on what kind of AI. deployment there really has been. You know, I mean I think I've seen a few handful of series on survey responses of whether or not the businesses are using more AI or not. There's a um one that's put out by the Census Bureau that asks, you know, are you using more AI or you know or less? That number has just been kind of on a up and to the right for the last two or three years. And then they also asked did you add or or decrease headcount? And you see like actually, you know, the number of people that say they increased headcount has gone up and the number that have decreased has been mostly steady. You know, there's month to month wiggles, but I think that if we were seeing a broader displacement, you would kind of see like yes I'm using more AI, no I'm not hiring more people, and yes I'm getting rid of people. So it's actually kind of showing showing the opposite. I think eventually there will be more clarity on this once we get through you know some of the the broader data sets that are you know released with longer lags and you know eventually we'll probably come up with a better way to measure how much AI is being used beyond just kind of like blunt token volume you know spend type of data. But you know the bottom line is that there is a lot of good evidence about small business formation. I think that it's probably undersold a little bit considering sort of the chaos that we've seen politically this year with you know on a geopolitical stage that we are in the middle of a a massive capex boom that is in fueled in part by the accelerated bonus depreciation from the one big beautiful bill. So I don't know I'm not a small business entrepreneur. I've never put one together but I know that if I had to be spending a lot of money to buy equipment to set it up this would be a pretty good year to do it. And you know maybe that bonus doesn't you know last for for too much longer.

Bentsen: So you you framed the AI question also as is whether its impact appears first with lower cost or stronger demand. What indicators would let us distinguish those two effects in real time and how much does that sequencing matter for Fed policy?

Simons: Sequencing matters a lot right and I think that we're in this very turbulent period where you have, you know, if you kind of dust off your old economics textbook and you go to the index and find the chapter on total factor productivity, what happens is like the classic example is exactly what we're seeing now, which is that you have this voracious demand for capital as income rises and everyone wants a piece of the pie, you have the government continuing to borrow at a fairly robust pace, we'll say and the idea of a risk-free asset not really presenting much of an appetizing you know alternative for investors in an environment where risk risky assets tend to trade with almost risk-free properties. So a ton of investment going in every dollar that can be found is being paid for, is being borrowed. And what eventually happens is that the Fed has to be careful about allowing the business cycle to continue without tightening too much. Eventually you would think that the increase in productivity will lower unit labor costs. The labor share of income should increase a little bit as the you know excessive boom investment period starts to cool off a little bit and then you get some pretty significant disinflation. And really the the best analog in recent history is the mid-1990s when you know Alan Greenspan saw unemployment falling in you know 1993 early 1994 ripped rates up 250 basis points and then eased a little bit through the beginning of 1996 did one one-off rate hike in March 1997 that may end up looking pretty similar to this rate hike that we ended up with in in September um and then eventually cut rates at the end of 1998 when we had you know LTCM and the Russian default and whatnot. And if you look at inflation over that time inflation started out you know PCE inflation for instance was less than 3% for the beginning of that period started to moderate a little bit and then by 1998 1999 was very very low like within you know very close to zero. So it's a you know with the increase in actual realized productivity that we saw in the last three or four years of that decade averaging over 4% that's that's the the boom of the the internet and and the gift that it sort of gives the economy going forward. Now of course we did end up with a lot of carnage in the markets and whatnot in 2001 as we sort of realized that the investment CapEx boom was was more or less over and there's a number of other complicating factors there as well but it remains to be seen if we'll be in a in a similar position as we get on the other side of this. But a biggest point forward I just want to kind of quickly summarize is that we're used to these things moving very quickly. I think it can feel like it's been going on for a long time but if you lay it over previous CapEx cycles they can go much, much longer than you think and they take a long time to deliver the results irrespective of whether that's like you know kind of dumb technology like railroads or canals or if it's the internet or AI.

Bentsen: So you know thinking about productivity which we you know which we think usually as being disinflationary um we're in you know as you point out I think we're we're people are projecting that the Fed's projecting that we will see a bump or boom in productivity from AI. Do you think a sustained AI product AI related productivity or an AI productivity boom would raise the neutral rate and while putting downward pressure on unit labor costs and inflation?

Simons: So I think for now that's what we're seeing. Just because like you know kind of the all-else equal fair price of risk-free capital is is going up um the you know sort of perceived need for a hedge right now doesn't feel like it's that strong so that is kind of pushing um rates higher and we're we're in a period of time where demand for capital is way higher than it than it normally is. It's way above trend. So for now I think that's the case. I'm not a hundred percent sure that it's you know certain that it ends up reducing the long the neutral rate by a substantial amount later on. In theory there should be still plenty of demand for capital when you're on the other side of it after it has lowered the cost or sort of democratized the access to a number of different technologies. In a capitalist economy you want to be doing sort of as much as possible you know the theory of monot or the um assumption of monotonicity right so um I think that we will eventually sort of see what we did in the late 1990s which was a a pretty you know strong period of time for um for growth for productivity low inflation but you know I think that probably policymakers are a little bit reticent to assume that we're gonna get these very large productivity numbers. That period of time that I referenced in late 1990s is extraordinary if you look back in the in the in the data. And also I think if you look back in the data it's probably you know if you're not very familiar with the sort of the history of the productivity series you might look at it and say like this isn't all that impressive right now despite the a a century of of just tremendous technological change and and you know productivity that people can feel it doesn't really look like that in a straight line in the data. And you know consequently you know if I were to tell a layperson for instance that 4% productivity is a massive increase over 2% productivity they may not necessarily appreciate that but you know Fed policymakers know that they probably shouldn't be assuming something bigger than what we saw during that last extraordinary period.

Bentsen: Right if I recall at that time when we did see that bump though we had been in a period before right where productivity had been rather low. Yeah.

Simons: So and so to your point in the scheme of things it seemed like a big bump at the time but yeah and you know we've gone through a similar period here as well you know in the you know think again it's easy to forget that in I believe of 2021 2022 there were periods of time where productivity was quite low or even negative my theory on that is that it's you know probably a number of factors contributed to it but just this sort of like reconstruction of the economy it it recorded you know it required a lot of activity a lot of investment in you know finding people putting people back together that just kind of got us back to square one rather than put us in a position where the economy is going to grow. We're past that I think that that's probably a similar analog to say the early 1990s when the Cold War was ending, you know the defense industrial sector was reorganizing, unemployment was quite high, but then it started to come back down lower. You go through this period in the middle of the cycle where interest rates are high and productivity is is solid and then you kind of cross your fingers you hope that on the other side of it you get the payback of the higher productivity and the lower inflation. But again that depends on the delivery of the technology and the investment in the technology being commensurate with its you know with its production and whether or not it actually has that impact on the economy.

Bentsen: So Heidi you know from a capital markets perspective are you seeing AI related investment show up in financing activity such as corporate debt issuance I mean how could you not um and you know a lot of a lot of project finance and and the and the like yeah no we we definitely are and whether it's financing data centers or other forms of CapEx um there's been really a surge in corporate issuance.

Learner: If we look at corporate issuance year to date through September versus the same period in 2025 we're up by 25%. And that's really impressive given what we've seen in the move in rates this year. So against the backdrop of rising rates to have that kind of increase. If you look at the Mag 7 for example um through all of 2025 in dollar terms we had almost 90 billion dollars of issuance and for the first nine months only of 2026 we're at almost 230 billion dollars and obviously we still have three months to go. So there's just been a tremendous amount of issuance coming to market and of course that raises the question to what extent if any do we begin to see a crowding out effect given that we're also seeing um a real increase in treasury issuance too so let's close with what our audience should watch for for this month Tom start with you we have midterm elections coming up in basically 30 days a little less than 30 days um how have markets typically fared during this period and are there any shifts that investors should be on the lookout for yeah so I took a look at this recently and it actually surprised me quite a bit because if we go back and look at the last several midterm cycles, um, you know there are some unique ones, right?

Simons: In 2002, for instance, I believe that we were coming off of Republicans full control of Congress and George Bush and the Republicans actually picked up seats you know in the post-911 period. And if I'm mis identifying that as 2006, I apologize. But suffice to say, you know, it's well known that the incumbent party usually loses seats in Congress if not complete control of Congress when you go from sort of uniparty control in an early part of a presidential cycle into the midterms. When you look at the years where that was the case you actually see a fairly consistent pattern of you know if you just look at like the 10-year yield for instance it tends to rise throughout the year it kind of accelerates in August, September, October and then after the election it starts to come down lower. And I gotta say I've like as I was looking at this data I was stunned at how consistent it was. I think it's because it's the trade that like if we go from uniparty control to you know kind of congestion in Congress we just assume that there isn't going to be as much fiscal expansion in future years and thus you know not only are you kind of marking down your growth expectations as a consequence but you're also marking down your your issuance expectations as well. I don't really have any sort of insight into whether or not the either party is going to perform all that well in these elections. I think that you know the these days a lot can happen in a short period of time. I would think it's unlikely that the Republicans escape by and maintain control of each you know both sides of Congress. But I think it's important to kind of keep an open mind that anything is possible especially in this you know given given the way that recent elections have gone compared with how you know polling ahead of time had you know had gone. And I just quickly like add one more thing in terms of you know in the next month things to watch for something that I generally don't put too much attention to especially to investors outside of you know specifically Treasuries but the Treasury refunding announcement their quarterly refunding announcement in the beginning of November could be very interesting. We've seen the Treasury get a little bit more creative with expanding their buybacks in the long end of the curve. You know clearly with rates at these levels they're pretty uncomfortable with you know continuing to issue longer-term debt or really any debt at these levels. So you know they tend not to surprise the market. They tend to be very transparent in their communication but this is a new administration that has different ways of going about things and you know you got to really for something that ends up most of the time being kind of a a you know low impact announcement that there's a possibility that could be more interesting this time around.

Bentsen: Okay so that's that's that's interesting because that's something that I mean I think I think your your comment about you know what has traditionally happened in midterms and and terms and you know the comparison between unit government to split government that theory is it's been out there for a while and and the data is the data but adding quarterly refunding says to that is a that will be an a very interesting thing to watch Heidi what are you what are you watching from a market data perspective and can you tell us you know what you're covering in the latest you know edition of the our SIFMA insights on market metrics and trends which will be coming out shortly.

Learner: Yeah um something kind of piggybacking on what Tom mentioned which is looking at long end treasuries we're looking at equity market activity in the Treasury long bond ETF and the associated options activity and particularly what we can infer about positioning given call and put volumes so should be interesting given the moves we've seen in the rate markets.

Bentsen: Great well we'll be looking forward to that and that with that that wraps up our discussion today Tom, Heidi, thank you both for your thoughtful insights and discussion and I want to thank all of our listeners for joining us and to learn more about SIFMA and our work to promote effective and resilient markets please visit us at SIFMA.org and we'll look forward to seeing everyone again in November for the next edition.