Ed Yardeni

Beware of Wildlife

Jun 1, 2022 1 min read

On our first day at Yellowstone National Park yesterday, my wife Valerie and I spotted lots of bison, but no bears. I believe this is a bullish omen for the stock market. They were all grazing quietly. We hope to see some bears today. Hopefully, they won't pose a menacing threat to us. Of course, at Yardeni Research, our outlook for the economy and financial markets isn'

Ed Yardeni

Dr Ed's Weekly Webinar 5/31/22

May 31, 2022 1 min read paid

Valuation is in the eye of the beholder, but the economic outlook that influences it isn’t as subjective or hard to forecast, with lots of data available to help. … We think forward P/Es may be range bound this year and next and the S&P 500 may remain volatile below its January 3 high before climbing to new highs in 2023 and 2024. Below is exclusive early

Ed Yardeni

The Economic Week Ahead 5/7/22

May 30, 2022 1 min read

The week ahead is a big one for business surveys and for employment during May: (1) The last of the five regional Fed banks’ business surveys will be released on Tuesday. The four available ones showed a sharp slowdown in business activity, suggesting that Wednesday’s M-PMI will also be weak even though the flash M-PMI estimate remained strong. The regional surveys also showed that prices-paid and prices-received indexes remained

Ed Yardeni

No Recession in GDPNow Tracking Model

May 30, 2022 1 min read

There’s no recession apparent in the May 27 update of the Atlanta Fed’s GDPNow tracking model for Q2. The real GDP growth “nowcast” was revised up slightly to 1.9% (saar). Consumer spending is tracking at a solid 4.8%. Business spending on equipment was revised down sharply to only 2.8%. Weighing most on Q2 economic activity in the Atlanta Fed model is a 5.6% decline

Ed Yardeni

DEEP DIVE: Bear Spray

May 29, 2022 4 min read paid

This is an excerpt from our May 23, 2022 Morning Briefing. Next week, my wife and I will be on vacation visiting the bears (and bison) at Yellowstone National Park and Grand Teton National Park. We will be carrying some bear spray, just in case. The National Park Service offers the following advice: “Bear spray is a non-lethal deterrent designed to stop aggressive behavior in bears. Its use can reduce

Ed Yardeni

A Good Week For a Change

May 29, 2022 2 min read paid

Last week was the first good one for the stock market in quite a while. The S&P 500 rose 6.6%, with two of the index’s most depressed sectors this year outperforming for a change: Consumer Discretionary (9.2%) and Information Technology (8.1%). Nevertheless, the best-performing sector this year so far has been Energy, and it was up 8.1% last week too. Financials (8.0%

Ed Yardeni

Tech Has Had a Rough Year, but What Comes Next?

May 28, 2022 3 min read

The front cover story of the May 30 BusinessWeek is titled THE GREAT TECH ROUT (linked below). Might this be the latest contrary indicator for bullishly-inclined investors? The story was actually posted on Bloomberg on Thursday, May 26 at 12:01 AM EDT. The Nasdaq fell to the year's low of 11,264.45 on Tuesday, May 24. It was up 7.7% by Friday's close.

Ed Yardeni

Are the Economic Fundamentals Bullish or Bearish for the S&P 500?

May 28, 2022 2 min read

There is a remarkably close fit between the yearly percent change in the S&P 500 stock price index and the national manufacturing purchasing managers index (M-PMI). The latter is available only through April; the reading for May will be released next week, on Wednesday, June 1. However, the M-PMI is highly correlated with the general business indexes of the regional business surveys compiled by the Federal Reserve Banks

Ed Yardeni

Inflation May Be Peaking

May 27, 2022 2 min read paid

The headline and core PCED inflation rates both edged down in April to 6.3% and 4.9%, raising expectations that inflation is peaking. That's consistent with our view that the headline PCED inflation rate should peak between 6%-7% during H1-2022 and fall to 4%-5% during H2-2022, and 3%-4% next year. The FOMC is still likely to raise the federal funds rate by 50bps at

Ed Yardeni

Three Related Signals of a Global Economic Slowdown

May 26, 2022 1 min read

The widely followed proxy for the expected inflation rate in the 10-year TIPS market dropped in recent days from over 3.0% to 2.6%. Is that just volatility? Or, is it signaling a global economic slowdown since it is highly correlated with the nearby futures price of copper, which has also been weak lately? The expected inflation rate is also highly correlated with the Emerging Markets MSCI stock price

Ed Yardeni

How Worrisome Is April’s Drop in M2?

May 25, 2022 1 min read

How worried should we be about April’s $81.2 billion drop in M2? And what about the $91.2 billion drop in demand deposits from January through April? Furthermore, the Fed is about to start a second round of quantitative tightening (QT2) in June. Won’t that dry up liquidity, causing a recession and further stock market losses? Maybe, but: (1) M2 is still more than $3 trillion above

Ed Yardeni

GDPNow Nowcast Down, New Orders Up