BREAKING: Goldman's chief economist says the market has the Fed wrong. Jan Hatzius, on CNBC Friday: "The markets are discounting three hikes and I would say that's not necessary." Goldman now expects one final quarter-point hike. In December. Before this, the call was October. It moved after August's cooler PCE and comments from NY Fed President Williams. Hatzius went further. A December hike "could be skipped" if inflation keeps printing around 0.2% a month. Goldman sees core PCE at 3.0% by Q4. The Fed's own median says 3.4%. If that holds, September's hike could end up being the cycle's only one. Friday's jobs report backed him up. September payrolls missed every estimate. Wage growth hit its slowest pace since 2021. October hike pricing dropped to just 4 basis points. December sits near 22. Here's the split Hatzius drew. Short end: "The market's pricing in too many hikes, so more likely than not, rates can come down." Long end: "More complicated." Less conviction. Treasury supply and term premium keep long yields elevated even if the Fed stops. That matters for mortgages. They track the long end, not the funds rate. Equities add another wrinkle. A strong stock market has been easing financial conditions. Strip that out, and rising long rates mean real tightening is already underway. The Fed may be closer to done than the market thinks. The 10-year may not care.