Sonu Varghese
11 Charts on the State of the Labor Market
We finally got more timely data on the labor market and since it’s been a while, I thought I’d put together 11 charts showing what’s happening in the labor market. The big picture is that the labor market continues to cool, with weak hiring but also relatively low firings. Job Growth Cools, A Lot …
Sonu Varghese
December 18, 2025
The Fed Comes Bearing Gifts
The Federal Reserve cut rates once again, taking policy rates down to the 3.50-3.75% range. This was as expected, but the chatter before the meeting was that this would be a “hawkish cut”. On the contrary, as I’ll discuss below. But even otherwise, it’s hard to say a cut is hawkish when it comes on …
Sonu Varghese
December 11, 2025
Inflation Eases Enough, Giving the Fed Room to Cut
It’s been a while since we got any macroeconomic data thanks to the government shutdown. The most recent official payroll report for September was released a couple of weeks ago, and it showed that the unemployment rate continues to move higher, hitting 4.44% in September. While other data, like initial claims for unemployment benefits, points …
Sonu Varghese
December 8, 2025
A Strong Year Driven by Profits, More Than Overcoming Any Drag From Tariffs
The S&P 500 gained 17.8% over the last 11 months, including dividends. The November return of 0.1% was its 7th straight month of gains, and the index is now just 1% off its all-time highs. While the index was near flat for the month of November, next 12-month earnings rose another 2%, which meant earnings …
Sonu Varghese
December 3, 2025
Surfing the AI Wave, and Avoiding a Wipeout
Two years ago, when we were writing our 2024 Outlook, we decided to call it Seeing Eye to Eye, with bit of a pun on “AI to AI.” We knew then that the AI impact was coming but also knew we were in early days. In fact, we expected relatively little direct impact on the economy …
Sonu Varghese
November 17, 2025
5 Tailwinds for Markets
It’s now Day 43 of the shutdown and a resolution seems imminent. We know that the shutdown has been very challenging for a lot of people, but one small way it has impacted us is we haven’t received any official economic data for over five weeks, including payrolls, consumer spending, income, and production data. A …
Sonu Varghese
November 12, 2025
Powell Refuses To Be Pinned Down to a Dovish Outlook
The Federal Reserve (Fed) cut rates by 0.25%-points at their October meeting, as expected. The target federal funds rate is now in the 3.75–4.50% range, 1.5%-points below the peak of this cycle, and the second cut in consecutive meetings. The chart below shows the upper end of their target. This is now the largest set …
Sonu Varghese
October 30, 2025
Inflations Remains Hot, But the Fed Will Keep Cutting—That’s Bullish
Three weeks can feel like eons when you don’t get any official macroeconomic data (thanks to the shutdown), and so this morning’s release of the September Consumer Price Index (CPI) was more than welcome. The shutdown continues but this was a “special” release because the government needs this data to make cost of living adjustments …
Sonu Varghese
October 24, 2025
Five Drivers of Slower Job Growth
Because of the government shutdown, government data on the labor market has been absent lately but the trend in job growth has been clear. Labor force growth has been slowing, and today we’ll take a look at some of the pieces contributing to that. But be careful with that sentence—slower growth is not the same …
Sonu Varghese
October 24, 2025
Why Is Gold Surging?
Gold has now rallied a whopping 61% year-to-date (as of October 15th, 2025) and has rallied 25.7% since August 25th. That makes 2025 the metal’s second-best year since 1975—surpassed only by 1979’s 127% surge—and it follows strong gains in 2023 (+13%) and 2024 (+27%). We first added gold to our portfolios in March 2023 as …
Sonu Varghese
October 16, 2025