Articles authored by Sonu Varghese
January Inflation Came in Hot, But Let’s Calm Down Here
Ouch! That was my reaction to the hotter-than-expected January Consumer Price Index (CPI) report, though that was mild compared to what happened in markets. The S&P 500 fell 1.4% on Tuesday. Bond prices fell as well, with 2-year and 10-year Treasury yields jumping 0.14%-points to 4.63% and 4.31%, respectively. This was on the back of …
There’re Reasons to Be Optimistic About Productivity
Productivity growth surged at an annual rate of 3.9% over the last three quarters of 2023, which is the largest non-recessionary gain we’ve seen since the late 1990s, and more than double the pace of productivity growth between 2005 and 2019. As we wrote in our 2024 Outlook, “Seeing Eye to Eye” (download here), productivity …
Ignore the Doomers…This Is a Strong Economy!
It’s not like we needed a lot more proof that the economy is strong. If you listen to the doomsayers, it always seems like the economy is hanging on the edge of a precipice. Never mind the latest GDP report card, which showed the economy grew 3.1% in inflation-adjusted terms in 2023. Of course, it’s …
Taylor Swift Isn’t the Only One Feeling Good, More Americans Are Too
Consumer confidence has been rising recently. Maybe it’s Taylor Swift, and her weekly Sunday appearances. Or maybe it’s rising stock prices, rising home prices, and falling gas prices. Ultimately, perhaps the best signal to draw from rising confidence is that the labor market is strong. Keep in mind that the close to 70% of the …
The US Economy: This Time Was Different, and That’s a Big Deal
We got a rollicking GDP report on Thursday, showing the economy expanded at an annual pace of 3.3% after adjusting for inflation. That was well above forecasts of 1.8%. Yet again, the economy continues to be underestimated – a topic we’ve discussed on these pages time and time again. By now we were supposed to …
Please Don’t Stress Yourself About “M2”
If you’re wondering what I’m talking about, read on, but maybe grab a cup of coffee or your favorite beverage. M2 is a measure of money in the economy, and right now it’s falling, which has led to any number of overhyped worries, including a deflationary recession and/or a stock market crash, as people are …
Outlook ’24: Leading Economic Indicators Point to Continued Growth
Last year, the Carson Investment Research team did not see eye to eye on leading economic indicators compared to the widely used Conference Board Leading Economic Index. For 2024, our proprietary leading economic index (LEI) for the U.S. points to on-trend economic growth and remains far from a recession signal. Our index includes more than …
Rate Cuts Are Now on the Horizon, But There’s Uncertainty Over Timing
We just released our 2024 Market Outlook, “Seeing Eye to Eye”. We took an unpopular contrarian stance in 2023, calling for the economic expansion to continue and stocks to post solid gains. This was based on what we saw in the data, and since then consensus opinion has moved toward our view in 2024. Still, …
Outlook ’24: Productivity Growth Will Drive Economic Opportunity in 2024
While the Carson Investment Research team’s economic views for 2024 are more aligned with the consensus than in 2023, we take a different view on what the drivers of economic growth will be, emphasizing the upside from productivity growth that may differentiate the current central bank-tightening cycle from typical cases in the past. That view …
We See No Signs of a Recession in 2024
We’re releasing our 2024 outlook this week, and a big part of our investment process involves understanding the economic backdrop. To that end, Carson Investment Research produces a Leading Economic Indicator (LEI) for the US and 29 other countries, each one custom built to capture the dynamics of those economies. The individual country LEIs are …