Video Webcasts

Dr Ed's Video Webcast 10/25/23

The Middle East crisis seems to be escalating into a regional war with US involvement, existential stakes, and global effects. The S&P 500 fell to its 200-day moving average on Friday in response to the geopolitical risks. We expect it to breach that level this week even if the bond yield declines. The escalation of hostilities we expect prompts us to raise our odds of a US recession

Dr Ed's Video Webcast 10/19/23

To answer whether the latest bout of inflation in general will prove persistent or transitory, we must look deeper than the headline rate. Core rates exclude energy and food, but shelter arguably should be excluded to get the answer, as it too is still distorted by temporary pandemic-related factors. The resounding message we hear from September’s CPI data: Both headline and core CPI rates—ex shelter—were 2.0%

Dr Ed's Video Webcast 10/12/23

Today, we challenge another aspect of the hard landers’ narrative: the notion that consumers will retrench, leading the broad economy into a recession. True, many consumers must resume paying the student-debt piper soon, and many have depleted their excess pandemic saving. … But bigger forces are supporting consumer spending: Consumers simply don’t halt the spending they love to do when their incomes are secure and growing, as now, with wages

Dr Ed's Video Webcast 10/4/23

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

Dr Ed's Video Webcast 9/27/23

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’

Dr Ed's Video Webcast 9/8/23

What would it take for the Fed to abandon its hawkish stance? Three things, suggested Fed Chair Powell’s recent Jackson Hole speech: core PCED inflation dropping closer to 2% y/y, demand for labor dropping closer to the supply of it, and consumer spending cooling off a bit. All that can happen without a recession, as it has twice before in recent history, and the latest data on all

Dr Ed's Video Webcast 9/6/23

Is the surprising Q3 strength in the economy sustainable? Clues in the latest data releases suggest not, and our forecast calls for a renewed soft landing. A stronger-for-longer economy wouldn’t jibe with the Fed’s higher-for-longer interest-rate stance. ... But the economic outlook hinges much on what consumers do next. We don’t see them slamming on the spending brakes, as the hard-landers predict will happen when excess savings are

Dr Ed's Video Webcast 8/30/23

Today, we examine Fed Chair Jerome Powell’s Jackson Hole speech on Friday. The tone was more hawkish than we expected, with Powell saying that the Fed wouldn’t hesitate to raise interest rates further if needed to bring inflation back down to the Fed’s 2.0% target but failing to say what it would take for the Fed to lower interest rates given that inflation has been moderating.

Dr Ed's Video Webcast 8/23/23

Dr Ed's Video Webcast 8/16/23

Is the federal budget deficit getting too big for the bond market to fund without yields moving higher? That seems to be a growing concern in both the bond and stock markets. In the past, bond yields were determined mostly by the Fed’s response to inflation, which is moderating; supply and demand didn’t matter much, but they may now. Today, we examine why this period of deficit widening

Dr Ed's Video Webcast 8/9/23

This is ironic: Just when the most widely anticipated recession of all times is no longer widely anticipated, July’s employment report suggests that the Index of Coincident Economic Indicators is weakening. … With the consensus now elbow-to-elbow with us in the no-recession camp, our contrarian instincts are on full alert. The alternative scenarios of two prominent financial market prognosticators may give investors pause and keep the stock market treading water