Marc Chandler – Weekly Wrap Up On The Macroeconomic Factors Moving The Markets
Marc Chandler, Managing Partner of Bannockburn Global Forex and Editor of the Marc To Market website, joins us for a discussion on the macroeconomic factors moving the markets. We start off discussing the Atlanta Fed’s GDP Now readings shifting throughout the month with regards to GDP in the 2nd quarter going from positive, to neutral, to now negative growth expectations. The question was poised if we have two back to back negative quarters of GDP growth, then are we officially in a recession. From Marc’s perspective it is a more nuanced answer than something that simple, and he reiterates the Fed’s stated goal of slowing growth to curve demand, but points out that almost every economic datapoint that we get has been lower than expectations.
Next we pivot over to the health of the labor markets, and balance out the companies starting to shed workers and do layoffs, with the data the central banks site showing strong labor markets, with a focus on the upcoming US jobs Non-Farm Payroll numbers next week. The caveat brought up is that US jobless claims numbers have been steadily rising since March of this year, as much as 40% off the lows, which is showing a bifurcating picture of the health of the labor markets, and starting to tip more towards a recession.
The messaging from Jerome Powell is that the Fed is most concerned with achieving price stability than it is with avoiding recession, and for this reason Marc feels the Fed will stay on course hiking rates past the September meeting and into December and possibly into the first quarter of 2023. The concern from economists is that perhaps the Fed is getting aggressive with tightening policies a bit late and at the wrong time, into slowing economic growth. We wrap up with the actions central banks in other areas are taking in EU, Canada, and Japan, and how this affecting their currencies in relation to the US dollar, pushing the greenback higher in recent months. Marc’s message is to focus on value over the latest shiny new thing when investing for the longer term.
Silver at $19.91………. is a steal…………. stock up ……… just saying……….
In 10 yrs. you will be thanking me…………… 🙂
No charts needed for this call……….. 🙂
+19.91 Great call OOTB, and yes a great buy at these levels… Cheers!
It is unbelievable that silver has a lid on it……….. well, not really, …. the perverts in office and banking cabal are trying to bankrupt the sheeple……… THEY WANT IT ALL………..
Great discussion but would be good if Marc can improve his microphone.
Thanks Pen. Yes, another good conversation with Marc. Unfortunately, he doesn’t reach out to us through a computer and the cell phone connection we had yesterday to record was not very good, so thanks for bearing with us. (actually the audio signal from his phone dropped out several times and I had to stich a few parts together, and cut out some sections where his phone was fading out). Overall though, it was great to have Marc sharing his insights once again to wrap up the week.
July 2022 Monthly
Marc Chandler – July 01, 2022
“The major central banks were slow to respond to price pressures as the economies emerged from the unprecedented depths of the Covid crisis. They have pivoted toward more aggressive rate hikes. The conversion at the Federal Reserve has been stark. In an unusual admission, Federal Reserve Chair Powell acknowledged that the high May CPI and the rise in the University of Michigan’s consumer (inflation) expectations prompted the 75 bp hike rather than the 50 bp move that had been signaled.”
“Powell pledged the Fed’s “unconditional” commitment to reining in inflation. Even though he acknowledged that a 75 bp increase is unusual, Powell indicated another one of that magnitude or 50 bp was likely this month. Given the link to the CPI and household inflation surveys that Powell drew, those reports (July 13 and July 15, respectively) may overshadow the employment report. The “expeditious” move to neutrality (and beyond) seems to mean as fast as possible without surprising the market unnecessarily. That said, we expect the economic and price data to moderate, encouraging the Fed to signal a slower pace of rate hikes after the July hike.”