Archive

It's A Banana!

Jul 28, 2022 1 min read

Real GDP fell 0.9% (saar) during Q2, following a 1.6% decline during Q1. That's a "growth recession" in our opinion. It is widely believed that two consecutive quarters of declining real GDP is an outright recession. However, it won't be an official recession until the Dating Committee of the National Bureau of Economic Research says so. They might not do so since

Ed Yardeni

DEEP DIVE: How Much Rate Hiking Does QT2 Equal?

Jul 28, 2022 3 min read paid

Melissa and I have been wondering how much federal funds rate hiking does the current round of quantitative tightening (QT2) equal? Last week, in the July 20 Morning Briefing, we asked a similar question about the 10% increase in the US dollar index (DXY) since the start of this year.

Ed Yardeni

Summer Rally

Jul 27, 2022 1 min read

We've been making the case that June 16 might have been the bear-market low in the S&P 500 when it closed at 3666.77. It was up 2.6% today to 4023.61, a 9.7% gain since last month's low. Today's performance was especially impressive. Instead of focusing on Fed Chair Jerome Powell's hawkishness on inflation at his press

Ed Yardeni

No Recession In Today's GDP Indicators

Jul 27, 2022 1 min read paid

Ed Yardeni

Consumers Have Nothing To Fear But The Future

Jul 26, 2022 1 min read

Consumers are looking into their crystal balls and they don't like what they see. Even though the present still looks bright, the future is looking darker. July's Consumer Confidence Index (CCI) continued to decline in July as it has been since mid-2021 (down to 95.7), led by its falling expectations component (down to 65.3) (chart below). The current conditions component edged down in July,

Ed Yardeni

Germany's Economic Outlook Taking A Dive

Jul 25, 2022 1 min read paid

Ed Yardeni

Industry Analysts Shaving S&P 500 Earnings Estimates

Jul 25, 2022 1 min read

The industry analysts who cover the S&P 500 companies are starting to lower their earnings estimates for 2022 and 2023. Consider the following: (1) They haven't cut their estimates by much, so far, but enough to flatten S&P 500 forward earnings after it rose to a record high four weeks ago. (Forward earnings is the time-weighted average of analysts' consensus earnings estimates for

Ed Yardeni

DEEP DIVE: The Dollar & TINAC (There Is No Alternative Country)

Jul 24, 2022 2 min read paid

As we observed yesterday, the geopolitical mess around the world continues to favor the US dollar, suggesting increasing net capital inflows from overseas into the US financial markets. That helps to explain the recent peaking of the bond yield, which should provide some support to the valuation multiples of stocks.

Ed Yardeni

The Economic Week Ahead, July 25-29, 2022

Jul 24, 2022 2 min read paid

The week ahead is jam-packed with economic data that are likely to show weakening economic activity and some signs of peaking inflation. In addition, the latest FOMC statement, released Wednesday, will probably announce a 75bps rate hike. Now consider the following:

Ed Yardeni

More Signs of Slowing Global Economy

Jul 22, 2022 1 min read

Today, S&P Global released its flash estimates for the purchasing managers indexes (PMIs) of the US, the Eurozone, the UK, and Japan. They are showing that the global economy is slowing in both the manufacturing and services sectors: (1) The US services index dropped from 52.7 in June to 47.0 in July. It has been on a downward course since March’s recent high and signaled

Ed Yardeni

More Signs of A Mid-Cycle Slowdown

Jul 21, 2022 1 min read paid

The latest batch of economic indicators are in line with our mild recession outlook (a.k.a., a mid-cycle slowdown). We now have June's Leading and Coincident Economic Indexes (LEI & CEI) and July's NY and Philly regional business surveys, which are conducted by five of the 12 Federal Reserve district banks. The averages of the five tend to closely track the national manufacturing purchasing managers

Ed Yardeni

China Scrambles to Avoid Lehman Moment

Jul 20, 2022 1 min read

How do you say "Lehman Moment" in Chinese? The Chinese government is scrambling to avert such a calamity resulting from China's real estate bust. There's a global housing recession underway, led by China. That's why the price of copper has been in a freefall, plunging 33% from $4.94 on March 4, 2022 to $3.31 today (chart). We’ve been tracking

Ed Yardeni