Sonu Varghese
The Payroll Report Highlights Both Strengths & Weaknesses in the Economy
The economy created just 143,000 jobs in January, well below expectations for a 175,000 increase, and less than half of the gain in December (which was revised up from 256,000 to 307,000). Over the last three months, job growth has averaged about 237,000 jobs, which is really strong. However, the payroll numbers are messy right …
Sonu Varghese
February 7, 2025
Will a Cutback in Government Jobs Crash the Labor Market? We Don’t Think so, and Here’s Why
There’s been a lot of chatter about cutbacks in federal government employment, including “buyout offers” (apparently even at the CIA). The deadline for accepting the buyout is February 6th, and reports suggest anywhere from 20,000-40,000 workers have accepted the offer. Irrespective of how you think about it (good, bad, ugly, or apocalyptic), there’s been some …
Sonu Varghese
February 6, 2025
The Tariff Man Cometh, but What’s the Playbook?
On February 1st, President Trump signed executive orders (EO) imposing tariffs on Canada, Mexico, and China, effective 12:01am February 4th. The orders included: 25% tariffs on Canada, apart from energy imports (tariffed at 10%) 25% tariffs on Mexico 10% tariffs on China These tariffs applied to all goods and would be over and above existing …
Sonu Varghese
February 4, 2025
The Fed Hits the Snooze Button, but That Poses Problems
The Federal Reserve’s (Fed) January 2025 meeting held no surprises. They maintained policy rates within the 4.25-4.50% range and continued to trim their bond portfolio, as expected. However, their official statement did see a small, but notable, change. They did highlight that the unemployment rate has stabilized at low levels, but inflation remains “somewhat elevated.” …
Sonu Varghese
January 30, 2025
DeepSeek: Did China Just Eat America’s AI Lunch?
DeepSeek, a small Chinese Artificial Intelligence (AI) startup, shook the AI world last weekend. In short, DeepSeek created an AI model that appears to be as powerful as the existing ones out there. And most importantly, they did it with much less money. DeepSeek’s AI chatbot also soared to the top of the Apple App …
Sonu Varghese
January 28, 2025
Outlook 2025: Diversifying Diversifiers and Using Capital Efficiency to Do It
One thing we try to do with our 2025 Outlook: Animal Spirits, which we released last week, is translate our views into portfolio actions, since that’s ultimately what matters. You won’t have to dig far to see how our Carson House Views are woven throughout, making it convenient to access advice and insights that align …
Sonu Varghese
January 21, 2025
Outlook 2025: The Fed May Be Key in 2025, And We Just Got Some Good News
Carson Investment Research released our 2025 Outlook: Animal Spirits on Tuesday. As we highlighted there, we think that economic strengths clearly outweigh areas of weakness in the year ahead, and the opportunities likely have a higher probability of coming to fruition than the threats. We believe that economic momentum, an easing Federal Reserve (Fed), and …
Sonu Varghese
January 17, 2025
Our 2025 Outlook: Animal Spirits is here!
As we look ahead to 2025, we know the scars of high inflation in 2022 and the higher interest rates that came with it are still with us. We’ve seen it in global elections, where incumbents have been rejected across the political spectrum. We’ve seen it in consumer sentiment surveys, which have improved but remain …
Sonu Varghese
January 16, 2025
The Labor Market Is Solid (for Now), But Is Good News Bad News?
There have been a few signs that risks to the labor market are tilted to the downside, but the December payroll report went a long way towards easing them. The economy created 256,000 jobs in December, blowing past expectations for a 165,000 increase. Monthly numbers can be noisy and so a 3-month average is helpful. …
Sonu Varghese
January 10, 2025
2024 Market Returns Were a Story About Profitability
The S&P 500 followed up on 2023’s 26.3% total return with a 25% return in 2024. And unlike in 2023, this was largely a story of rising profits, and expectations of profit growth continuing. The S&P 500’s forward 12-month earnings per share ended the year at $272, a 12.4% increase from its value of $242 …
Sonu Varghese
January 8, 2025