Steve Leeman. Now, no change in the Federal Reserve funds rate, staying at a net level of four and a quarter to four and a half percent. Some really interesting stuff in the forecast.Let me tell you about the assessment of the economy. First, they're saying the economy continues to expand at a solid pace. Unemployment remains low.Inflation is somewhat elevated. And they talk about the idea that swings in net exports, all that front running is affecting the data. Now, the Fed forecast increase the inflation ...

It could be a pressure cooker of a summer for the US economy, and not because of the warmer weather. Tariffs from the Trump administration don’t appear to be going anywhere anytime soon, forcing businesses to raise prices on consumers and delay key projects. At the same time, the Federal Reserve is in no hurry to cut interest rates amid stagflation fears. Economic data has also begun to weaken, with the latest evidence being the employment readings from the last three months. Yahoo Finance executive editor ...

Economic Outlook - The most recent data suggests a continuation of a soft landing, which is good news for the economy [2] - The economy was in a good position to absorb the stagflationary shock from tariffs, and the Fed was in a restrictive position [3] - Concerns exist regarding oil prices potentially offsetting disinflation in other parts of the economy [5] Tariffs and Inflation - Evidence of tariffs impacting inflation is present in recent reports, with appliances and commodity goods prices increasing [4] - $70 billion of tariffs have been collected, indicating that someone is bearing the cost [4] - The impact of tariffs on inflation is uncertain, with a divided outlook on whether it will be a one-off event or cause broader inflation [6] Federal Reserve Policy - The Fed is likely to lower rates in the coming months [1] - The Fed should wait and see before cutting rates, despite pressure, to avoid cutting into a bigger inflation problem [6] - The Fed is being cautious, and the downside of waiting is small [7] - Financial markets will likely price in easing before the Fed delivers it if stagnation worsens [8] - The Fed's transparency provides a release valve against being behind the curve, as markets will front-run easing [9]

Let's turn now to today's market action. Stocks closing near session lows. Only two Dow stocks and one sector energy again closing higher with the broadbased selling.Joining me now is Bob Elliot, CEO and CIO at Unlimited Funds and Krishna Guha, Everore ISI vice chairman. Guys, welcome. Bob, oil moved dramatically today off a pretty low base.Stocks moved modestly. I guess this is more about what are we set up for given the run that stocks have been on. We're pretty near all-time highs on the S&P.Yeah, I thin ...

Inflation & Stagflation - One-year inflation dropped significantly from 66% to 51% [1] - Middle East tensions may lead to stagflationary pressures, raising concerns about the extent of this impact [1][2] US Treasury Market - The world is losing confidence in the sovereign side of the US, impacting safe-haven flows into the Treasury market [2] - Investors are distinguishing between the sovereign side and the corporate side of the US, leading to a less pronounced equity sell-off [3] - Investors are gradually reducing US bond exposure, with central banks increasing gold reserves as an alternative [4][5] - Treasury yields have become less predictable, decoupling from traditional correlations [7] Global Economic Order - The global order, which relied on the US, is experiencing a gradual fragmentation [8] - The US is facing policy-induced volatility, which is unusual for the world's most predictable player [9][10] - Market implied probability of recession in the US has fluctuated significantly, from below 10% to over 70% and back below 30%, raising concerns about economic stability [10]

Well, Torson, let's focus on the US side of things and then we can get to a more global dimension. Let's focus on the US with the tariffs in mind. Is it too early to expect those tariffs to show up in the data this morning.No, it's not. What really is the key issue here is that there is indeed going to be some upside pressure on inflation. And what's most critical about this is that it's all about the behavior among companies.How do they respond to tariffs. Do they pass on 100%. Will they pass on 50%. Or wi ...

Core Viewpoint - Lululemon has cut its profit forecast for the year due to higher costs from US tariffs and weak demand for its new products, leading to a significant drop in its stock price [1][6]. Group 1: Financial Performance - The company now expects annual profit between $14.58 and $14.78 per share, down from previous expectations of $14.95 to $15.15 [6]. - Lululemon's revenue forecast for the second quarter is between $2.54 billion and $2.56 billion, which aligns with market expectations [8]. Group 2: Market Challenges - The company is facing lower store traffic in the Americas, attributed to economic uncertainty, inflation, lower consumer confidence, and changes in discretionary spending [1][3]. - Competitors like Alo Yoga and Vuori are gaining traction, making it difficult for Lululemon to boost sales despite new product offerings [3][8]. Group 3: Strategic Responses - Lululemon plans to implement modest price increases on a small portion of its product assortment and will negotiate with vendors to cut costs [4]. - In 2024, 40% of Lululemon's products were manufactured in Vietnam, and 28% of its fabrics were sourced from mainland China, indicating a diversification strategy in sourcing [4].

Investment Rating - The report maintains an "Overweight" (OW) position on cash, equities, credit, and bonds, while being "Underweight" (UW) on commodities for the next three months [3][21]. Core Insights - Emerging Market (EM) equities have shown resilience despite tariff uncertainties, with a projected earnings growth of 10% to 11% for CY 2025/26, which is 2-3 percentage points higher than previous forecasts [2][6]. - The S&P 500 had its best May performance since 1990, outperforming EM equities year-to-date, although EM equities have generally outperformed US equities in the same period [2][7]. - A weaker US Dollar is expected to support EM outperformance, as EM equities have historically benefited from a weaker Dollar [2][14]. Summary by Sections Economic Outlook - The report highlights the importance of upcoming economic data and decisions from G4 central banks, with expectations of a 25 basis point rate cut by the ECB and stable unemployment rates in the US [1][2]. Market Performance - The S&P 500's performance in May 2025 was notably strong, while EM equities have shown positive macro surprises, contrasting with muted US macro surprises [2][9]. Asset Allocation - The report suggests a diversified approach, advocating for international diversification in equities and bonds, and highlights the potential benefits of EM equity and local rates [3][6][21]. Correlation Analysis - The correlation between MSCI EM and the US Dollar has turned more positive, indicating a decoupling of EM rates from US rates, which may provide investment opportunities [16][18].

Core Viewpoint - JPMorgan CEO Jamie Dimon stated that his retirement is "several years away," emphasizing his commitment to the bank and its future leadership planning [1][3]. Leadership and Succession - Dimon has been in his role for nearly two decades, and there has been increased scrutiny regarding succession planning as he approaches retirement age [1][5]. - Potential successors include Marianne Lake, Doug Petno, Troy Rohrbaugh, and Mary Erdoes, with Dimon indicating he may remain involved as chairman or executive chairman for a couple more years [3][10]. - Dimon previously hinted that his succession timeline was not as immediate as previously thought, which negatively impacted the bank's stock price [5]. Economic and Defense Views - Dimon has voiced strong opinions on national security, advocating for the U.S. to prioritize defense spending over cryptocurrency investments [4]. - He has been consulted by both Democratic and Republican administrations on economic policies, indicating his influence in political and economic discussions [8]. Company Developments - JPMorgan is investing in a new $3 billion headquarters in Manhattan, which reflects the bank's commitment to its future and operational strategy [12]. - Dimon is pushing for a return to in-office work, believing that remote work policies have led to decreased productivity [12].

Group 1 - KKR's Co-CEO Scott Nuttall participated in the Bernstein 41st Annual Strategic Decisions Conference, discussing the current economic landscape and inflation concerns [1][2]. - The company acknowledges the recent volatility in the market, highlighting concerns about persistent inflation, prolonged high interest rates, and potential economic slowdown or stagflation [4]. - KKR's internal view suggests that inflation rates are expected to remain elevated for a longer period, which aligns with the company's historical perspective over its 49 years of operation [5].