Executive Summary: If war erupts in the Middle East, the higher oil prices that OPEC+ has been unable to achieve will be realized. Jackie examines the market dynamics that have kept oil prices down as well as the EIA’s

Executive Summary: The recent upward revisions to GDP and GDI are significant, suggesting an economy that’s even stronger than many suspected. Eric explains how the various elements interconnect, with stronger GDP than first reported meaning greater output, which means

Executive Summary: If AI proves to be as transformative as many expect, its adoption has barely gotten off the ground. As AI proliferates—accelerating the productivity growth that’s central to our Roaring 2020s scenario—will it mean mass layoffs? Eric examines

Executive Summary: The permabears have fueled much negativity about the outlooks for the US economy and stock market. Their analyses often don’t hold up to scrutiny. Today, Dr Ed puts the prospects of a recession and a bear market

Executive Summary: The interest-rate-sensitive S&P 500 Homebuilding industry index counterintuitively sank after the Fed launched its new easing cycle; the stocks had already rallied in anticipation of the move. Jackie examines whether the correction was warranted. The industry’s forward revenues

Executive Summary: Our Roaring 2020s scenario for the economy is our base case, to which we assign a 50% probability. Its linchpin: robust productivity growth and the bevy of benefits it brings to corporate America and the economy at

Executive Summary: The FOMC’s 50 bps rate cut last week stimulates an economy that doesn’t need much, if any, extra help, in our opinion. Eric takes a look at the labor market and long-term inflation expectations to describe why

Executive Summary: The Fed is starting a new easing cycle to avoid a recession that we don’t see coming, based on concern about labor market deterioration that we don’t see occurring. Today, Dr. Ed compares and contrasts the world

Executive Summary: With China’s economy moribund, particularly the consumer sector, Chinese manufacturers are flooding global markets with their inexpensive wares. Besides exporting goods, they’re essentially exporting deflation. Foreign governments aren’t pleased. Jackie reports on this state of affairs and what

Executive Summary: August’s rise in retail sales surprised many a hard-lander. We weren’t surprised given our strong outlook for consumer spending, based on the growing labor market and rising real wages. Consumer credit doesn’t threaten a balance sheet recession,

Executive Summary: The Fed is set to ease monetary policy by lowering the federal funds rate this week, but it will still be tightening policy by shrinking its balance sheet. However, as Eric explains, quantitative tightening hasn’t been very

Executive Summary: It’s a foregone conclusion that the Federal Open Market Committee will be launching a new monetary easing cycle by cutting the federal funds rate when it meets this week. But a weighty decision faces the committee: To

Executive Summary: Rapid earnings growth has sent the S&P 500 Aerospace & Defense industry’s share price index rocketing skyward. But how long can investors look past looming clouds? Jackie examines the industry’s fundamentals and valuation trajectories as well as

Executive Summary: While carry traders likely have more yen-funded positions to unwind, we’re not worried about another bout of extreme market volatility as a result. We don’t see the conditions that sparked the great unwinding exacerbating, Eric explains. The Bank

Executive Summary: Yes, the unemployment rate has inched up over the past year. No, that doesn’t reflect a weakening of the economy at large. Permanent layoffs are muted; wages are rising; CEOs plan to hire. No unemployment spike heralding

Executive Summary: 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

Executive Summary: Why did the managements of Walmart and Dollar General paint vastly different pictures of low-income consumers in recent Q2 earnings calls? Jackie explores the differences in the two companies’ business models and operating landscapes that account for

Executive Summary: If you’ve heard that Gross Domestic Income is a better measure of economic activity than Gross Domestic Product, forget it. The two are sending divergent signals currently, with the former much weaker than the latter; but GDP

Executive Summary: Today, Dr. Ed puts the notion of a recession still to come into perspective. Since 1945, the US economy has been in recession 14% of the time. Most of the nine recessions stemmed from the credit-crunching effects

Executive Summary: The collapse of China’s real estate segment and the response of the Chinese government—stimulating not consumption but production—are keeping the country’s exports high and effectively exporting deflation along with goods. This has ramifications for the economies of

Executive Summary: While we recommend a “Stay Home” versus “Go Global” investment allocation approach, we note that the EU MSCI is trading at a big discount to the US MSCI. But challenges constraining economic growth do abound in Europe.

Executive Summary: With the growing economy set to benefit from interest-rate cuts and a weaker dollar, will inflation heat up again? We’re sanguine on the inflation outlook in the near term, but not as certain about the long run,

Executive Summary: It was an unambiguously dovish Fed Chair Powell who described the Fed’s intentions for US monetary policy at the Jackson Hole gathering of global central bankers on Friday. In our opinion, he was too dovish for this

Executive Summary: AI’s power to transform operations in nearly every industry is bound to feed the productivity growth boom we expect, the crux of our Roaring 2020s scenario. But the unbridled propagation of AI poses some challenges. Dr. Ed

Executive Summary: The recent carry-trade unwind triggered unnerving market declines that weren’t warranted by asset fundamentals. But Dr. Ed and Eric don’t think investors need to worry about a repeat performance. Carry trades continue, but positions are less extreme

Executive Summary: Not only isn’t a recession headed down the pike, but the US economy is emerging from the pandemic tunnel with stronger potential GDP than it had prior to the pandemic. Today, Eric explains why he and Dr.

Executive Summary: Last week saw unfounded US recession fears and global financial market jitters go poof as quickly as they arrived. Dr. Ed examines what the markets were overreacting to when they beat a hasty retreat and the subsequent

Executive Summary: The US consumer’s spending hasn’t declined, but it has shifted—leaving retailers of out-of-favor items out of luck. Jackie recaps what company managements have revealed about what consumers do and don’t want to buy these days and pinpoints

Executive Summary: While the US federal budget deficit is on an unsustainable course, there’s good news about it: Income-tax receipts are up y/y—more evidence that no recession is on the horizon. And while spending also is up y/y, the

Executive Summary: As geopolitical tensions in the Middle East mount and Ukraine’s war with Russia intensifies oil prices may be starting to spike. So we reiterate our commodity- and equity-based hedges for these risks. On a happier note, Ed