Ed Yardeni

Market Call: The Next Surprise

Sep 22, 2024 3 min read

So far, September isn't living up to its bad reputation for the stock market now that the S&P 500 and the DJIA are at record highs. At the start of the month, on September 2, we asked, "What Could Possibly Go Wrong?" We wrote: "We are hard pressed to find what could possibly go wrong in September. So perhaps, the path of least

Ed Yardeni

The Economic Week Ahead: September 23-27

Sep 22, 2024 3 min read paid

This week's economic indicators should confirm our view that the Fed cut the federal funds rate (FFR) by 50bps (rather than 25bs) last week just as the economy is rebounding from its recent soft patch. Fed Governor Chris Waller's Friday comments on CNBC suggest even previously hawkish FOMC members are now onboard Chair Jerome Powell's easing train. Meanwhile, regional manufacturing surveys (Tue & Thu)

Ed Yardeni

Raising Odds Of A Meltup

Sep 19, 2024 4 min read paid

We've focused on three scenarios since the start of the decade: a 1920s-style Roaring 2020s, a reprise of the 1990s stock market meltup, and a rerun of That '70s Show with geopolitical shocks causing oil prices and inflation to spike. We haven't had to change our subjective probabilities of 60/20/20 for these three alternative outlooks. However, Fed Chair Jerome Powell is forcing us

Ed Yardeni

Powell & Co. Slams The Pedal To The Metal

Sep 19, 2024 3 min read

Wow, the Fed lowered the federal funds rate (FFR) by 50bps yesterday and the economy is already responding. Jobless claims fell and two regional business surveys strengthened in September, while the Coincident Economic Index rose to a new record high, though in August! We are kidding, of course. But perhaps the economy didn't need to be stimulated so much. It appears Fed officials got their soft landing but

Ed Yardeni

Powell Declares Mission Accomplished

Sep 18, 2024 3 min read

The Fed cut the federal funds rate (FFR) by 50bps today. This marks the end of the Fed’s monetary policy tightening cycle that started during March 2022, which was aimed at bringing inflation back down to 2.0% even if that caused a recession. Inflation isn't quite there yet, but it is close enough. So today, in his presser, Fed Chair Jerome Powell reiterated that the Fed&

Ed Yardeni

Fed Playing With An Economy On Fire?

Sep 17, 2024 2 min read paid

Today, the Atlanta Fed's GDPNow tracking model raised Q3's real GDP growth rate to 3.0% (saar) from 2.5% following the release of solid retail sales and industrial production reports for August (chart). Leading the way was an upward revision in real consumer spending growth to a whopping 3.7% from 3.5%. The increase in real spending on capital equipment was raised to 11.

Ed Yardeni

Fed Easing Monetary Policy Into An Economic Boom?

Sep 16, 2024 2 min read paid

Ed Yardeni

Market Call: The Worst & The Best Of Times

Sep 15, 2024 2 min read

A Tale of Two Cities by Charles Dickens famously begins, ''It was the best of times, it was the worst of times.'' Two weeks ago was the worst week for the stock market so far this year. Last week was the best week for the stock market so far this year. In the July 28 Quicktakes, we wrote: "Our hunch is that the stock market

Ed Yardeni

The Economic Week Ahead: September 16-20

Sep 15, 2024 3 min read paid

The main event this week is the FOMC meeting (Wed). The Fed is widely expected to cut the federal funds rate (FFR), but with a heated debate over whether it will be 25bps or 50bps. Perhaps more important than the size of the first cut will be the Summary of Economic Projections (SEP), which will provide Fed officials' updated forecasts for real GDP growth, the unemployment rate, inflation, and

Ed Yardeni

DEEP DIVE: What Will The Fed Do?

Sep 13, 2024 4 min read paid

The financial markets have been expecting more cuts in the federal funds rate (FFR) than Eric and I have all year so far. At the start of this year, the markets anticipated six to seven rate cuts in 2024 (Fig. 1 below). We expected two to three at most. The markets were more dovish on the rate outlook than we were because of investors’ widespread belief that the Fed would

Ed Yardeni

Zettascale Computing Is Coming Using Nvidia's Blackwell Chips!

Sep 12, 2024 2 min read paid

Yesterday, stock prices initially fell sharply following August's CPI report, but AI fever quickly turned the S&P 500 around to a 1% gain. Yesterday, Oracle announced it is taking orders for the first "zettascale" AI supercomputer, which will be powered by up to 131,072 Nvidia Blackwell chips. Nvidia CEO Jensen Huang also told a Goldman Sachs conference that demand for their Blackwell chips

Ed Yardeni

CPI Triggered Stock Market Hissy Fit

Sep 11, 2024 3 min read

This morning's CPI report showed inflation continues to moderate. Nevertheless, stock prices initially fell sharply on the news. While the headline CPI was up 0.2% m/m as expected, the core rose 0.3% instead of the expected 0.2%. That minor difference convinced lots of traders that the Fed would cut the federal funds rate (FFR) by 25bps rather than 50bps on September 18. Nevertheless, the

Ed Yardeni

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