The US unemployment rate reached 4.4% in September, which is a bit higher than expected. Recently, the market has been speculating whether the Federal Reserve will cut interest rates in December, and the probability has been fluctuating, but I still think they will eventually cut.

The reasons are not singular. It’s not just that inflation isn’t as high as imagined, nor is it only that employment is weakening, and it’s certainly not just the occasional “liquidity crunch” in financial markets. The real pressure on the US is debt.

US corporate debt is massive, government debt is even more staggering, and American households are also overwhelmed by debt.

A family dares to spend because they have money, not because reckless spending will make them rich. The same logic applies to a country.

As debt continues to grow, interest becomes harder and harder to bear, and eventually there will be problems. In order to prevent these problems from exploding, the only option is to lower interest rates as soon as possible so that everyone—government, companies, households—can keep going.

Right now, this is pretty much the situation globally: too much debt, too much risk, and everyone is holding on. So as soon as there’s a chance to ease the pressure, the Fed will definitely take action.

This is the core logic behind why I believe there’s a high probability of a rate cut in December.