Yardeni QuickTakes (Page 53)

DEEP DIVE: Consumers Running Out of Excess Saving. Will They Drop Or Continue To Shop?

May 17, 2024 4 min read paid

Bears have been growling since mid-2022 that the US consumer will soon be “tapped out” of the excess savings accumulated during the Covid-19 fiscal stimulus spree from 2020 to 2021, forcing them to rein in spending. Consumers also may soon have maxed out their credit cards, according to this gloomy narrative. Consider the following: (1/4) Sure enough, two San Francisco Fed economists in a May 3 post observed that

Ed Yardeni
Eric Wallerstein

Dr Ed's Video Webcast 5/16/24

May 16, 2024 1 min read paid

Today, we look at cracks in the story that consumers are cracking. Crack proponents expect consumers to start saving more and spending less because they’ve depleted their excess saving from the pandemic years. We expect personal saving rates to stay low and consumer spending to stay high as Baby Boomers, done with paying college tuitions and mortgage loans, spend their sizable nest eggs. (Many apparently are buying big-ticket items

Ed Yardeni

Bad News About Goods Is Good News For Bonds & Stocks

May 16, 2024 2 min read paid

The Dow is flirting with 40,000 currently, confirming that good news is good news and bad news is also good news for the stock market these days. That's because the bad news is also good news for the bond market. On balance, the news is that inflation is moderating and the economy is growing. Yesterday's April CPI report confirmed that inflation remains on course to

Ed Yardeni
Eric Wallerstein

Inflation's Puzzle Pieces Painting Bullish Picture

May 15, 2024 2 min read paid

The S&P 500 rose to a new record high of 5308.15 following today's economic numbers. It could easily reach our yearend target of 5400 well ahead of schedule! For now, we are sticking with this target, as well as 6000 for 2025 and 6500 for 2026. That's consistent with our Roaring 2020s scenario (60% subjective probability). If the market continues its near-vertical ascent,

Ed Yardeni
Eric Wallerstein

Good News on Inflation & Jobs Today

May 14, 2024 2 min read paid

Ed Yardeni
Eric Wallerstein

The Blob Keeps Growing. So Why Aren't Bond Yields Soaring?

May 13, 2024 2 min read

The federal deficit narrowed a bit to $1.63 trillion over the 12 months through April (chart). However, over the same period, the US Treasury had to raise $2.63 trillion by issuing marketable securities, which now total a record $26.9 trillion. The Treasury had to borrow more than the deficit to replenish its checking account at the Fed, which was down to almost zero last June. The blob

Ed Yardeni
Eric Wallerstein

Market Call: Sharp U-Turn

May 12, 2024 2 min read paid

The S&P 500 bottomed most recently on April 19 at 4967.23, rising to 5222.68 on Friday. That's very close to its record high of 5254.35 on March 28. That's a very sharp U-turn! It's getting closer to our 5400 end-of-year target and it is only May. Stock prices rallied as the Q1 earnings reporting season delivered better-than-expected results (chart)

Ed Yardeni

The Week Ahead: May 13 - 17

May 12, 2024 3 min read

The week ahead is jampacked with economic indicator releases. The big ones are for inflation, retail sales, and production. They may be somewhat stagflationary on balance, showing inflation remains too high while economic growth is slowing. Nevertheless, we still expect to see inflation moderate with solid economic growth over the rest of this year. Here are a few observations on this week's key indicators: (1) CPI. The Cleveland

Ed Yardeni
Eric Wallerstein

DEEP DIVE: The Causes of Recessions & Bear Markets, a Recap

May 11, 2024 4 min read paid

There are three ways that recessions typically are triggered: 1) a monetary-tightening-induced financial crisis turns into a credit crunch; 2) a geopolitical crisis causes oil prices to soar; or 3) speculative asset bubbles burst. All three have caused recessions in the past. Consider the following relevant points: (1/6) The most common reason recessions have occurred in the past is the tightening of monetary policy, usually as the Fed became

Ed Yardeni
Eric Wallerstein

The Recession Claim

May 9, 2024 2 min read

One of our competitors claims that we are in a recession. Another claims that we will soon be in a recession. The most widely anticipated recession of all times is turning into the longest widely anticipated recession of all times. One day, the diehard hard-landers will be right. Was today the day? We're sure that their heartbeats quickened on today's jobless claims report. Consider the following:

Ed Yardeni
Eric Wallerstein

Tight Fed Fueling Foreign Stock Market Rallies?

May 8, 2024 3 min read paid

In the past, the major foreign central banks often followed the Fed's lead. This time, they aren't waiting for the Fed to ease before doing so themselves. That's boosting the foreign exchange value of the dollar as well as many overseas stock markets. Consider the following: (1) The Swedish Riksbank cut its official rate by a quarter-point today, to 3.75% from 4.00%

Ed Yardeni
Eric Wallerstein

Dr Ed's Video Webcast 5/8/24

May 8, 2024 1 min read paid

Investors in both stock and bond markets are suddenly blooming with optimism. Both markets rallied on Friday’s (mostly) positive employment report, including yet another sub-4.0% jobless rate and despite some negatives in the report. Stoking the optimism, perversely, has been economic news suggesting weakening: Cheery investors have focused not on that but on the potential ramification of it, that interest rates won’t be kept higher for longer

Ed Yardeni

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