Ed Yardeni

Market Call: Latest Mideast War Raises Geopolitical Risks

Oct 7, 2023 2 min read paid

Hamas launched a coordinated surprise attack on Israel today. The timing suggests that Iran's mullahs instigated their surrogates in Gaza, hoping to disrupt the peace negotiations between Israel and Saudi Arabia. Israel will undoubtedly launch a massive counter0ffensive. The question is whether Hezbollah will open up a second front on Israel's north. Geopolitical crises in the Middle East have usually caused oil prices to rise and

Ed Yardeni

The Economic Week Ahead: October 9-13

Oct 7, 2023 2 min read paid

This is a big week for two big issues troubling the bond market, namely inflation and the US federal budget deficit. The BIG event will be September's CPI (Thu). This time, September's PPI (Wed) will be released the day before instead of the day after the CPI. The headline inflation rates of both were inflated by energy prices, particularly gasoline prices (chart). The core CPI will

Ed Yardeni

DEEP DIVE: The Debt Crisis Scenario

Oct 5, 2023 4 min read paid

Debt Crisis I: A Plausible Scenario? “We’re going to have a debt crisis in this country,” Ray Dalio, the founder of hedge fund Bridgewater Associates, warned in an interview with CNBC’s Sara Eisen that aired last Thursday. The two were speaking at a fireside chat at the Managed Funds Association. “How fast it transpires, I think, is going to be a function of that supply-demand issue, so I’

Ed Yardeni

Oil's Slippery Slope

Oct 4, 2023 2 min read paid

The 10-year Treasury bond yield fell for a change today. It peaked at 4.87% at 2:45 am, but ended the day at 4.72% thanks to falling oil prices and a weak September payroll employment report from ADP. Brent crude oil futures settled down $5.11, or 5.6%, to $85.81 a barrel while US West Texas Intermediate crude (WTI) fell $5.01, or 5.6%, to

Ed Yardeni

Dr Ed's Video Webcast 10/4/23

Oct 4, 2023 1 min read paid

Last week’s plentiful economic news netted out to support our optimistic economic outlook through next year, bringing more signs of improving productivity, surging investment in manufacturing, and manageable inventories. Last week also brought some mixed news and some outright bad news, but we still see a 75% chance of a soft-landing scenario with disinflation and a 25% chance of a hard landing. Longer term, we’re still convinced that

Ed Yardeni

Some Good News From The Bond Market

Oct 3, 2023 2 min read

Hurray! The bond market will be closed next Monday for Columbus Day. It has done enough damage in recent weeks. Today, the 10-year Treasury bond yield rose to 4.81% just because job openings edged up in August (chart). Nevertheless, we think the trend is still downward. The same goes for quits. Both are highly correlated with wage inflation as measured by average hourly earnings, which will be reported for

Ed Yardeni

Why Is the Bond Yield Soaring?

Oct 2, 2023 2 min read paid

The latest batch of economic indicators was weaker than expected. On Friday, we learned that real personal consumption expenditures rose just 0.1% during August. The core PCED edged up by only 0.1% during the month. September’s Consumer Sentiment Index fell 1.4 points to 68.1. As a result, the Citigroup Economic Surprise Index (CESI) is down to 47.3% from a recent high of 81.9%

Ed Yardeni

Market Call: The Wild Bunch

Oct 1, 2023 3 min read

Just after the S&P 500 nearly hit our year-end target of 4600 ahead of schedule on July 31, we concluded that the index might fall to its 200-day moving average, which is currently around 4200. It could easily do so during October since it closed at 4288 on Friday. Then we see a yearend Santa Claus rally back to 4600, or close to that level. That's

Ed Yardeni

The Economic Week Ahead: October 2 - 6

Sep 30, 2023 2 min read paid

The first week of the month is usually jampacked with employment indicator releases. On balance, we expect they will show that the labor market remains relatively strong. August's JOLTS report (Tue) could show that job openings fell but remained high as evidenced by the "jobs plentiful" series in the consumer confidence survey (chart). The jobs plentiful series also suggests less upward pressure on wages, as measured

Ed Yardeni

DEEP DIVE: Everyone's Making Semiconductors

Sep 28, 2023 4 min read paid

Large tech companies have been jumping into the semiconductor industry. Amazon, Google, Tesla, and others have developed semiconductors for use in their own operations instead of buying all of their semiconductors from Nvidia, Intel and the like. Custom-made chips tailored to their company’s specific requirements can perform better and are cheaper to make than buying other companies’ chips in the market. In the case of AI server chips, companies

Ed Yardeni

Saudis Have A Vision

Sep 27, 2023 3 min read paid

Saudi Vision 2030 is the vision of Saudi Crown Prince and Prime Minister Mohammed bin Salman (MBS). He wants to diversify the economy of his country. Saudi Arabia’s sovereign wealth fund aims to spend $40 billion a year on the domestic economy—including the construction of Neom, a futuristic city in the desert with an estimated price tag of $500 billion. By some estimates that requires that the price

Ed Yardeni

Dr Ed's Video Webcast 9/27/23

Sep 27, 2023 1 min read

The Fed has paused its rate hiking for now but not without warning that resumed tightening is possible. Either way, monetary policy will be kept restrictive for longer than investors previously expected, Fed Chair Powell has said. What does that scenario imply for the economic outlook? Peaks in the federal funds rate are coincident indicators of financial crises caused by restrictive policy, which often trigger credit crunches and recessions. That’

Ed Yardeni

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