US Political & Economic Landscape - The US political system is perceived to be transforming, with concerns about slavish devotion to a leader and Washington potentially turning into Pyongyang [1] - There's a sense that the US is politically not the same country it was a few years ago, impacting the entire international system [1] - Public opinion is largely negative towards current legislation, even with deliberate obfuscation of its impact [25] - The US stock market may be detached from the economic reality, potentially driven by corporate profit expectations in a favorable regime [15] International Order & Global Economy - The traditional global order is being tested, with the US potentially abdicating its leadership role [1][3] - The world may be moving towards a "world order minus one," where the US is excluded due to its current political climate [3] - There's an opportunity for other countries, like China and the EU, to take on leading roles in trade, climate action, and global governance [5][6][7] - The US dollar has fallen about 10% since the start of the year, a phenomenon typically seen in emerging markets [17] Risks & Uncertainties - There are concerns about the stability of the US system, with potential for unfair elections and the creation of a massive secret police force [2] - The US is potentially setting itself up for a financial crisis due to deregulation, irresponsible fiscal policy, and pressure on the Federal Reserve [31][33] - There's a risk of runaway inflation if the Federal Reserve becomes too politicized and attempts to goose up the economy for political gain [34]

USA: Powell Reiterates Wait-and-See Approach to Policy, Does Not Comment on July Cut BOTTOM LINE: Chair Powell said the economy was "healthy overall" and that "as long as the US economy is in solid shape, we think the prudent thing to do is to wait and learn more, and see what [the tariffs'] effects might be." When asked about whether it was too soon for the Fed to start cutting in July, Powell said he "wouldn't take any meeting off the table or put it directly on the table." Powell said that the inflation ...

Inflation & Monetary Policy - Central banks have done a good job taming the great inflation of 2022 [1] - The primary concern should be the inflation trajectory, as it dictates the direction of interest rates [3][4] - Current policy is broadly in line with a neutral stance, with analysts suggesting a 7% nominal rate indicates neutral territory [14][15] - Uncertainty about the inflation trajectory persists due to past volatility [15] Inflation Target & Policy Revision - There's an opportunity for "opportunistic disinflation," using a low inflation environment to anchor inflation expectations [5][11] - The current inflation target range is considered too wide and high compared to peers, necessitating a revision [10] - The South African Reserve Bank is undergoing a review, with recommendations to lower the inflation target to 2-3% [6][8] - Lowering the inflation target could lead to lower nominal interest rates [14] Risks & Communication - Geopolitical shocks and policy decisions (tariffs) can impact the economic outlook [2] - Scenarios are useful for policymakers to communicate potential risks and future trajectories, but require careful communication to avoid public misinterpretation [16][17]

Key takeaways from our recent client conversations around the world. June 30, 2025 04:01 AM GMT Global Economic Briefing | North America M Idea The Weekly Worldview: The Hardest Questions: From Beijing to Berlin M A good friend of mine likes to say that the main reason that he forecasts is to find out why he was wrong. Our view of a meaningful deceleration in the US and the global economy from tariffs and other policies has yet to play out. We find ourselves waiting. So, while we wait, we take stock of the ...

Investment Rating - The report maintains a bearish stance on the USD and anticipates the S&P 500 to close near 6,000 by year-end, driven by accelerated earnings growth [10][25]. Core Insights - The interplay of policy uncertainty and business cycle dynamics is crucial, with US trade and fiscal policies being significant drivers of the global business cycle [7][8]. - A substantial shift in US trade policy, with an over 10%-point rise in the effective tariff rate, is expected to generate a broad-based downshift in global growth and a rotation in inflation pressures toward the US [18][45]. - The report places recession risk at an elevated 40%, reflecting concerns around building growth drags and recent declines in global business sentiment [18][54]. Economic Outlook - Global growth is expected to dip to 1.4% in 2H25, down from a potential of 2.2%, marking the weakest performance in over three years [25][52]. - US GDP growth outlook has been lowered from 2.0% to 1.3% for the year, with a one in three chance of slipping into contraction in the coming four quarters [18][59]. - China’s GDP growth forecast stands at 4.8%, reflecting external uncertainties and domestic housing market weaknesses [18]. Market Outlook - The report anticipates a continued rotation into international markets, with USD weakness benefiting international equities [18][21]. - US equities are expected to experience narrow leadership and high market concentration, similar to the 2023-2024 playbook [10][18]. - High-grade credit is viewed positively due to attractive yields, declining net supply, and solid corporate results [10][20]. Commodity Outlook - Oil prices are projected to trade in the low-to-mid $60 range for the remainder of 2025, with a forecasted settlement at $60 in 2026 [24]. - Gold prices are expected to reach an average of $3,675/oz by 4Q25, supported by geopolitical tensions and economic growth concerns [24]. Risk Scenarios - The report outlines three potential scenarios: a higher for longer/incomplete cutting cycle, a sharper slowdown or recession, and a Goldilocks scenario where growth quickly returns to trend [33][35][37]. - The baseline scenario suggests that a moderate macro shock from tariffs could lead to upward pressure on risk assets, while a downside scenario anticipates wider credit spreads and underperformance in low-quality assets [33][35].

Joining us now is Evercore chairman emeritus and black rockck co-founder Ralph Schlaststein right here on set. It's great to have you. Welcome.It's great to be here. Let's start right there. Uh because what what an incredible second quarter we had.Uh tariff tantrum. Is it over. Is is the fear about peak tariffs behind us.Well, I I think you can never say it's completely behind us because I don't think we have a absolutely certain path as to where the president and his team are going to take the tariff discu ...

report. Dom Chu has today's ETF edge for us. Hey, Dom.All right, so Scott, with the markets on track to close out the second quarter at record highs, one fund that's riding the wave also now holds the record just 6 months of the fastest to reach a billion dollars in assets in more than 20 years. But its biggest holdings might not be what you expect. Why.How does it work. Joining us now is a familiar face, Tom Lee, CIO at Fundstrap Global Adviserss to take us inside the Granny Shots ETF. And for a lot of fol ...

Investment Rating - The report does not explicitly provide an investment rating for the industry or sector discussed Core Insights - The Federal Reserve is in a "wait-and-see" mode, with Chair Powell indicating that the economy is "solid" and the policy is moderately restrictive, allowing the Fed to remain patient [1][4] - Inflation is projected to rise to 3.0-3.3% for both headline and core PCE by year-end, influenced by tariffs and a tight labor market [3][8] - The Fed's future actions will depend on economic data, particularly regarding inflation and labor market conditions, with potential interest rate cuts forecasted to begin in March 2026 [3][8] Summary by Sections Economic Outlook - The Fed anticipates that tariffs will increase prices over the summer, aligning with the report's view [1] - Chair Powell noted that the impact of tariffs on inflation could be either short-lived or more persistent, depending on various factors [5][10] Labor Market - Immigration controls are expected to keep labor force growth low, contributing to a tight labor market [3][11] - The Fed is monitoring per-capita economic health due to slowing population growth, which may present a different picture than aggregate data [12] Monetary Policy - The Fed is not expected to make preemptive cuts, with most committee members believing that conditions for cuts will be met by year-end [8] - Chair Powell emphasized the uncertainty surrounding tariff pass-through to consumers and the need for caution in policy adjustments [10]

It does seem as if there are some risk positive stories at the margin. Then you can look at the 899 news from the United States as an example of that. And even some of the weakness in the data at the United States has been fed through into the lower rates narrative.So I suppose from that perspective, the the push higher in stocks makes sense. Is that too much complacency, though, in your view. I'm struggling with this market at the moment.Every input would seem bullish at the margin. As you say, yields are ...

Monetary Policy - The Bank of Thailand's decision to maintain borrowing costs provides a "monetary lifeline" to address various challenges [1] Economic Challenges - Challenges include US tariffs, geopolitical tensions, and domestic politics [1]