Ed Yardeni

Market Call: The Worst & The Best Of Times

Sep 15, 2024 2 min read

A Tale of Two Cities by Charles Dickens famously begins, ''It was the best of times, it was the worst of times.'' Two weeks ago was the worst week for the stock market so far this year. Last week was the best week for the stock market so far this year. In the July 28 Quicktakes, we wrote: "Our hunch is that the stock market

Ed Yardeni
Eric Wallerstein

The Economic Week Ahead: September 16-20

Sep 15, 2024 3 min read paid

The main event this week is the FOMC meeting (Wed). The Fed is widely expected to cut the federal funds rate (FFR), but with a heated debate over whether it will be 25bps or 50bps. Perhaps more important than the size of the first cut will be the Summary of Economic Projections (SEP), which will provide Fed officials' updated forecasts for real GDP growth, the unemployment rate, inflation, and

Ed Yardeni
Eric Wallerstein

DEEP DIVE: What Will The Fed Do?

Sep 13, 2024 4 min read paid

The financial markets have been expecting more cuts in the federal funds rate (FFR) than Eric and I have all year so far. At the start of this year, the markets anticipated six to seven rate cuts in 2024 (Fig. 1 below). We expected two to three at most. The markets were more dovish on the rate outlook than we were because of investors’ widespread belief that the Fed would

Ed Yardeni
Eric Wallerstein

Zettascale Computing Is Coming Using Nvidia's Blackwell Chips!

Sep 12, 2024 2 min read paid

Yesterday, stock prices initially fell sharply following August's CPI report, but AI fever quickly turned the S&P 500 around to a 1% gain. Yesterday, Oracle announced it is taking orders for the first "zettascale" AI supercomputer, which will be powered by up to 131,072 Nvidia Blackwell chips. Nvidia CEO Jensen Huang also told a Goldman Sachs conference that demand for their Blackwell chips

Ed Yardeni
Eric Wallerstein

CPI Triggered Stock Market Hissy Fit

Sep 11, 2024 3 min read

This morning's CPI report showed inflation continues to moderate. Nevertheless, stock prices initially fell sharply on the news. While the headline CPI was up 0.2% m/m as expected, the core rose 0.3% instead of the expected 0.2%. That minor difference convinced lots of traders that the Fed would cut the federal funds rate (FFR) by 25bps rather than 50bps on September 18. Nevertheless, the

Ed Yardeni
Eric Wallerstein

Dr Ed's Video Webcast 9/11/24

Sep 11, 2024 1 min read paid

The latest batch of labor market indicators has caused a temporary “growth scare,” in our opinion. Concerns that economic growth is slowing have convinced the markets that the Fed will open up the easing spigots and cut the federal funds rate by more than we expect. … Previous peaks in the yield-curve spread suggest that the bond yield is close to bottoming. … There were bright spots in the employment report too:

Ed Yardeni
Eric Wallerstein

China Is The Source Of The Deflation Trade

Sep 10, 2024 2 min read paid

Forget about a recession in the US. Currently, it is China's recession/depression that is weighing on oil prices, global bond yields, and the dollar. Weak Chinese demand for oil caused OPEC today to trim the outlook for global oil demand, further depressing oil prices. Brent crude oil prices fell below $70 a barrel on Tuesday to their cheapest since December 2021 (chart). Declining oil prices dragged the

Ed Yardeni
Eric Wallerstein

No News Is Good News

Sep 9, 2024 3 min read paid

Dr. Ed was interviewed on Bloomberg Surveillance this morning at 7 a.m (see link below). Ace journalist Lisa Abramowitcz noted that during the summer, we were saying that the economy is resilient and doesn't need much monetary stimulus, which might cause a meltup in stock prices. Now we are saying that if the Fed cuts the federal funds rate (FFR) by 50bps instead of 25bps on September

Ed Yardeni
Eric Wallerstein

The Economic Week Ahead: September 9-13

Sep 8, 2024 3 min read paid

This week's economic indicators will be primarily focused on inflation. Barring any unexpected surprises on the inflation front, the financial markets may care more about the few labor market indicators. The FOMC entered the blackout period ahead of its September meeting yesterday, sparing markets from an extra source of volatility. We expect the combination of a normalizing hiring, inflation, and interest rate environment (a.k.a. Immaculate Disinflation)

Ed Yardeni
Eric Wallerstein

Market Technicals: Is Sentiment Bearish Enough To Signal A Market Bottom?

Sep 8, 2024 2 min read

We asked Joe Feshbach for an update of his take on the stock market from a trading perspective: "Even with the recent decline in the stock market, I’m still recommending a cautious/defensive approach to stocks. My two biggest concerns have been the optimistic levels that the sentiment indicators have reached and the parabolic moves in technology charts followed by their significant recent declines. We’ve had a

Ed Yardeni
Eric Wallerstein

Market Call: Carry-Trade Unwind Part II