Sonu Varghese
Is It Time to Worry About Inflation Again?
Short answer: likely not. Make no mistake, inflation ran hot in the first quarter, especially relative to the fourth quarter of 2023. The March Consumer Price Index (CPI) report was an unwelcome surprise. Both headline and core inflation (excluding food and energy) came in above expectations. Headline inflation is up 3.5% from last year, and …
Sonu Varghese
April 11, 2024
A Blockbuster Payroll Report Suggests the Economy Is Far From Recession
We’ve been getting good news about the labor market in recent months – job growth has been strong, and the unemployment rate has been below 4% for 26 straight months (the longest streak since the late 1960s). However, there were some concerns at the edges if you looked hard enough. The March payroll report set …
Sonu Varghese
April 5, 2024
A Dovish Fed Signals Rate Cuts Amid Strong Economy – That’s Bullish
The Federal Reserve (Fed) left rates unchanged at their March meeting, but the headline was that the median official continues to project three interest rate cuts in 2024, each worth 0.25%-points. Going into this meeting, a big question was whether Fed members would lower that projection to just two cuts in their summary of economic …
Sonu Varghese
March 21, 2024
The Inflation Report Was Actually Better Than It Looked
The latest consumer price index (CPI) inflation data for February came in slightly ahead of expectations, which led the commentariat to worry about “sticky” inflation that doesn’t go away. However, I had a different sentiment after spending some time under the hood with the data. But first, the numbers. Headline CPI rose 0.4% in February, …
Sonu Varghese
March 13, 2024
It’s Simple: The Economy Is Strong Because the Labor Market Is Strong
While it seems like most people are waiting for the proverbial other shoe to drop, the economy keeps coming up with surprises. To the upside. I think that’s really been a theme over the last year, and something Ryan Detrick, Chief Market Strategist and I chatted about with Neil Dutta, about on our Facts vs …
Sonu Varghese
March 8, 2024
5 Things that Are Unlikely to Change Irrespective of Who Wins The 2024 Election
The 2024 Presidential Election is looking like a toss-up, as is control of Congress, although Republicans are solidly favored to flip the Senate. At the same time, the candidates haven’t really discussed their post-election policy preferences in any detail beyond just broad statements. There’re clearly a lot of things that will depend on who wins …
Sonu Varghese
March 5, 2024
Here’s Why We Believe the Economy is Doing Fine
Happy March 1st! Yesterday was Leap Day and we threw an extra special Facts vs Feelings event to celebrate: a 4 hour live stream with some of the top experts in the world of investing and finance, including Dan Ives (Managing Director and Senior Equity Research Analyst at Wedbush Securities), Cathie Wood (Chief Executive Officer …
Sonu Varghese
March 1, 2024
Warren Buffett Once Again Shows Why We Think He’s the Best Investor Ever
Warren Buffett just released his 2023 shareholder letter, and as always, it was a masterclass in explaining corporate finance concepts in simple English (something all of us can aspire to). Buffett also had a nice tribute to his long-time business partner/friend, Charlie Munger, who passed a few months ago. One thing in that tribute caught …
Sonu Varghese
February 28, 2024
This Economy Is Also Working Well for Lower Income Workers
We’re starting to see a bounce in consumer confidence as Americans increasingly recognize the strength of the economy. Keep in mind that the economy grew 3.1% in inflation-adjusted terms last year, well above the 2010-2019 trend of around 2.5%. So, it’s welcome news that the soft sentiment data is catching up to the strong hard …
Sonu Varghese
February 21, 2024
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 …
Sonu Varghese
February 14, 2024