U.S. New-Home Sales Surge 12.4% in July

The video discusses the unexpected rise in new home sales, which increased by 12.4% instead of the anticipated 2% decline. The volatility of new home sales is highlighted, and the importance of maintaining this growth is emphasized. The discussion shifts to the US economy, which is underperforming expectations, and the Fed's monetary policy. The Fed's cautious approach to raising interest rates is explained, with a focus on the shadow Fed funds rate and its implications for future rate hikes.

How does the speaker view the current state of the US economy based on the text?

What is the significance of the Fed's shadow rate as discussed in the text?