US Economy Social Media and Updates
US Economy Social Media and Updates
"Despite political pressure and a painful recession, [Volcker] held firm to his commitment to bring inflation down. In a speech at the Economic Club of Chicago on May 19, 1982, with unemployment above 9 percent and critics calling for him to change course, Volcker acknowledged the pain of wringing out inflation through high interest rates but held out the prospect of a return to price stability, and with it a much brighter future."
1973 oil embargo: inflation went from 3.6% to 12.3%. Fed's current forecast for 2026: 2.7%. Brent is at $110. Up 54% in a month. Either this time is genuinely different, or the Fed is the most optimistic institution on earth. History doesn't care about...
It’s particularly amazing because we’ve had extensive methodological changes to CPI since the blue line ended, including a major one literally the month after it ended that make this comparison apples-to-oranges.
1/ Markets now think the Fed is more likely to raise rates than cut them this year. A rate hike is not my baseline scenario, but I see the risks rising, for the following reasons. (Link to column in next...
UST 10 Yr Notes went home 4.386 on Friday, yield about 10.3bp's higher. 20 Yr Bonds just 2bp's away from that 5% Handle.
Lost count of all the times people scoffed at a 1970s-style inflation “double top.” Not as much laughter now. 😞 https://t.co/FTwzh0yQik
🚨 INSIGHT Nearly half of Americans predict a “total economic collapse” within the next decade. https://t.co/30yqgjJkPX
Whereas the Iran war shock has barely budged inflation expectations and no more than mildly jolted expectations of monetary policy in the US, the same shock has completely transformed the outlook for many other central banks. More charts, graphs, and...
As Dave Walker, former Comptroller General of the US, and I wrote in @FortuneMagazine, Washington rejected a Swiss-style “debt brake” earlier this week. NO DEBT BRAKE = FISCAL INSANITY. https://t.co/Tw28jA4nUE
PCE, CPI & PPI were running hot even before the Iran war’s oil shock, writes @JohnFMauldin @DavidBahnsen says Feb jobs data was “surprisingly bad” Mauldin sees the familiar muddle-through story with AI capex, services & manufacturing I see an "unsurprisingly bad" macro https://t.co/EGIOgUMGxc #Inflation...
The 10-year approaching 4.4% and then we get this "drop" from the president. Another FAFO moment? This coming week will be epic.
Yields on the two-year Treasury note are up 0.516 pp since Feb. 27, the day before strikes on Iran, to 3.893%. That’s the highest close since July. The gain over the last three weeks is the largest since May 2023 (the...
That is one looong blue line. A month ago, Fed fund futures were pricing in the next cut as June. This June. Now it's October '27 https://t.co/HCElEgtrLE
Yup. Market pricing in 2-3 rate hikes for ECB and BoE How many for the Fed?!
Due to the war in Iran and the resulting inflationary effects, the market is now pricing in zero rate cuts from the Fed this year (in contrast to the previously forecast two rate cuts). Moreover, the market is now forecasting a...
Mkts expect a Fed hiking bias, instead of cuts. 10yr Treasury yields up even more today (4.38%) With long-term interest rates rising, the Hormuz shock is getting priced as more of an inflation shock than one that triggers recession (caveat: mkts aren't...
When the Fed cutting cycle started in 2024, 20Y rates quickly moved to 4%. And after 175bp of cuts, the 30Y rates is back up to 5%. The latest wiggle is obviously the Iran effect. But the divergence is arguably 2 years...
Bloomberg on the selloff in the US bond market: “Not since 2023, when the central bank was still lifting rates, has the two-year yield risen so much above the Fed’s rate ceiling. On Friday, five-year yields surpassed 4% for the first...
Putting the fiscal cost of the Iran war in context. $200 billion > $194.9 billion, which means that Trump is planning on spending more on the Iran war than he took in with his tariffs which raised tons of revenue....
$TNX Monthly. Head-fake lower last month. Surge higher this month. At apex of multi-year triangle. This is ideal bullish setup for rates on 10-Year to explode higher https://t.co/aCdWZY5Kd9
In the 2020s the US economy has survived: A pandemic Supply chain shocks 9% inflation 0% --> 5% interest rates Tariffs War Oil price spike We haven't had a credit cycle or real recession in 17 years https://t.co/eXayk77G0L
So how has the plan by @SecScottBessent to not term out the debt and keep rolling bills worked out?
Careful when core<headline. It’s a household SOS warning something is going to break as the saving rate (an AVERAGE hugely weighted towards flushest & wealthiest) fell from 5.2% in Q1 ‘25 to 4.0% in Q4, a 1-in-5 postwar event per...
Fwiw I still prefer restarting QT and solving the uneven distribution of reserves and killing inflation through term premium expansion vs hiking fed funds https://t.co/tp7owr8gxQ
Waller’s not wrong about passthrough effects. They vary over time and are likely to be stronger the longer this shock goes on That said, the wise course is to look through them. It just turns out to be really hard in...
inflation shows up on your screen much quicker than financial stability tremors and layoffs. hawk talk out of the gate is easy; hawk walk when UnE is up a percentage point and rising, not so much
"Caution is warranted," Waller tells @steveliesman on Friday after voting with the majority at the Fed this week to hold rates steady as the Iran war upends the economic outlook. "It doesn’t mean that I’m going to stay put for the...
Now powell and Fed will be forced to do an emergency rate cut and be late as high oil prices start slowing down economy into recession.
It'll be interesting to see how this looks over the next week, as we get more post-FOMC Fedspeak. But my proprietary measure of FOMC hawkishness climbed even further after Powell's press conference. https://t.co/lNilk5T2yz
You don’t SAY. This zero bound fails miserably too On @CNBC Waller said research suggesting that the break-even rate for employment is ~zero is another challenge for assessing labor-market strength “My brain understands the math, but I can’t get through my gut...
Warsh will be out hawkes this year; Trump might as well keep Powell as Fed chair until the inflation story changes. No point in criticizing your guy for rate cuts now.
Waller having his own personal Trichet moment: "oil can bleed through to core inflation at some point"
Fed governor Chris Waller to CNBC's Steve Liesman: I was ready to dissent for a rate cut after the February jobs report came out. But the inflation picture is looking worse and has become more of a concern because the Strait...
Since 2019, bank lending to non-bank financial institutions (NBFI) has grown by nearly 60% vs only about 20% to non-financial corporations. Divergence has widened since mid-2022 when corporate lending stagnated while NBFI lending continued to rise steadily https://t.co/QEUhoq4feU
The Weekly Quill — The Princely Scientists — The Power of Selectively Deceptive Data Sign in now to read the latest from @dimartinobooth and Jonathan Basile of #QIResearch https://t.co/r8mkpVrloi #federalreserve #powell #economy #dimartinobooth https://t.co/BJ2zstFVCj
Prices of New Single-Family Homes Drop Further, Inventory of Completed New Homes for Sale Highest since 2009. Hoping for lower mortgage rates that may not come https://t.co/xfMYbwdtVK https://t.co/ImauhfwDWA
“.. Since the President’s inauguration last year, national debt has climbed by around $2.8 trillion.” @TIME https://t.co/mLgUsjkGpd https://t.co/cCYSRTcnd9
US new home sales collapsed by a stunning 17.6% MoM in January, the most in 13 years. If that’s not bad enough, since the US-Israeli war in Iran began, mortgage rates have surged. TRUMP'S IN TROUBLE. https://t.co/He7ZCDPq2p
Also in today's newsletter. Per the WIRP function on the terminal, not only are imminent rate cuts off the table, the market-implied policy path is actually *slightly* higher over the rest of the year now. https://t.co/FRganNTPH0
2 days ago, markets were still pricing in a (diminishing) bias towards imminent rate cuts. Now we are pricing in a (small) bias towards imminent rate hikes. Folks were not paying enough attention to the rise in the Fed's own inflation...
How high does oil have to get for recession probability to top 50%? $138. That's the average answer in our latest survey of economists, who generally see an increase in inflation but little impact on growth from the Iran war....
Bond Market Gets Edgy as US Treasury Debt Hits $39 Trillion, Spiking by $2 Trillion in 7.5 Months and Not Slowing Down. But debt doesn’t exist in a vacuum: The Debt-to-GDP and Deficit-to-GDP ratios provide (ugly) context https://t.co/0XZ6rkEoI5 https://t.co/ZYPLRQgVkY
New at THE OVERSHOOT: The Fed is Misreading the Inflation Risks https://t.co/NIh6rJDQhK Inflation was getting worse *before the war* across a broad range of categories. Yet Fed officials are still blaming "one-time things". https://t.co/xbrposAsbQ
Temporary Freeze or Deeper Chill? New home sales fell sharply in January to 587K (vs. 722K expected), marking the slowest pace since Oct 2022 and the steepest monthly drop since 2013. https://t.co/W9Fwrwtvjb
Will the Fed look at the data? — #charlespayne and I break it down https://t.co/qyX222T1qM #powell #dimartinobooth #economy
The Polymarket odds of "no rate cut in 2026" continue to generally track the 2-year yield https://t.co/VY0P2eN1XO
$VIX: 27.85 on March 13. 21.51 now. A 6+ point collapse in one week while oil trades near $100, the Fed just held, and private credit is cracking. Complacency doesn't announce itself. It just shows up in the $VIX. https://t.co/QOUSwv6YZ0
The 2 year U.S. Treasury yield has risen 50 basis points in less than three weeks. It now suggests one Fed HIKE may be coming.
The Cleveland Fed is now forecasting a 3% CPI Inflation reading for March, up from 2.4% in February. There is now a higher probability of a Fed rate HIKE (8%) in April than a rate CUT (0%). https://t.co/yoWBJBbDDN
The market's implied forecasts for Fed rate forecasts through 2026 now only projects -9bps of rate cuts this year. So the market is more hawkish than the Fed's forecast - the market was more dovish than the Fed two weeks...
