Here with me now at the Goldman Sachs trading floor in a CNBC exclusive is Goldman's co-head of global markets and banking Ashook Verdon. It's become a little bit of a tradition to do this at the end of the year. >> Yeah, welcome back to the trading floor call.>> Thanks for having us Ashook. So the Hasset view is kind of rhymes with what you what you what you believe will happen in 26 and that is growth can accelerate and we'll we can get back to target. >> Absolutely.uh you know maybe for a little bit diff ...

Core Viewpoint - The state of the labor market is critical for determining the Federal Reserve's future actions, with expectations of a weaker labor market leading to a more dovish Fed stance than currently anticipated [2][3]. Economic Outlook - The expectation is for one more rate cut from the Fed, while the market is pricing in two or more cuts [4]. - Growth is expected to hold up better, and inflation is anticipated to improve, which will lead the Fed to adopt an accommodative policy [5]. - The fixed income market is projected to be less volatile in the coming year compared to the previous year, with a return to a carry trade keeping long-term rates stable [6]. Monetary Policy Divergence - There is a divergence in monetary policy globally, with some countries tightening while the US and China are expected to maintain accommodative policies [7]. - Recent Fed votes showed significant divergence among members regarding rate cuts, highlighting the importance of upcoming economic data [8]. Equity Market Expectations - The equity market outlook for 2026 is constructive, with expectations of increased nominal growth and strong earnings supported by fiscal stimulus and deregulation [8][9]. - Fiscal stimulus is expected to be front-loaded in the first half of 2026, which includes tax refunds and incentives for capital expenditures [10]. Fed Chair Impact - The credibility of the Fed chair is crucial for maintaining bond market stability, and the leadership of the new chair will significantly influence this credibility [12][14]. - All candidates for the Fed chair position are viewed as credible, and the independence of the Fed is seen as a gradual process rather than a binary state [13].

Policy Analysis - A second Trump term presents both constructive policies like tax reform and deregulation, and damaging policies such as tariffs and mass deportation raids [1] - The President's order to liberate companies from the proxy advisory duopoly is considered a positive move [1]

The US government wants to supercharge GDP growth.They will need artificial intelligence, easy monetary policy, and significant deregulation to get it done. https://t.co/vjdVx9f6dI ...

Our next guest is pretty bullish on the regionals for 2026. Erica Ngerian, UBS senior equity research analyst focusing on the large cap banks joins us this morning. Erica, happy Friday.Good to see you. >> Good to see you. >> I was going to ask you whether or not the environment can get any better, but I think you probably think it can.>> Look, I mean, especially for the regional banks, right. They have really suffered from all of the market share loss and direct lending to the non-banks. And last Friday, th ...

Core Perspective - The article discusses the political strategy of Democrats focusing on the concept of "affordability" to critique the economic performance under President Trump, highlighting a disconnect between political messaging and the economic realities faced by many Americans [1][5][6]. Economic Sentiment - Affordability is defined as the ability to meet basic needs without financial fear, such as paying bills and providing for children, which resonates with a significant portion of the population currently struggling economically [4][5]. - The perception of economic hardship is prevalent, with about one-third of the population feeling economically insecure, leading to increased reliance on credit cards for essential purchases [5][11]. Political Messaging - The article emphasizes that political leaders, including President Trump, may be out of touch with the public's economic feelings, as they attempt to portray the economy positively despite widespread concerns [6][7]. - The discussion highlights the challenge for Republicans in addressing economic issues without appearing disconnected from the realities faced by voters [7][10]. Policy Implications - The article suggests that the current administration needs to implement effective policies, such as deregulation and healthcare reforms, to improve economic conditions for average Americans [8][12]. - There is a call for Republicans to propose tangible solutions, such as direct payments or subsidies, to address the economic challenges and counter the favorable perception of existing healthcare policies [9][10].

What is FSOC. >> FSOC is the abbreviation for the Financial Stability Oversight Council. It was a council created in the wake of the financial crisis to make sure the financial system didn't blow up again.It's composed of top regulators. The Treasury Secretary is the chairman. The head of the Federal Reserve is on it.Top financial regulators from the federal and the state level are all part of the group. They're supposed to monitor the financial system. Over the years, what they have generally done is they' ...

We got some uh breaking news I want to get to right now from the Treasury. Some big changes coming to the Financial Stability Oversight Council. Our own Steve [music] Leeman, economics, senior economics reporter joins us with that exclusive story.What you got. >> Hey Andrew, CNBC has obtained exclusively the contents of a letter written by Treasury Secretary Scott Besson, proposing a pretty radical rethink of how the government will promote financial stability and prevent systemic risk. Rather than addition ...

Core Viewpoint - The Federal Reserve has reduced its target rate by 175 basis points over the past year, currently standing at 3.5% to 3.75% [1] Group 1: Federal Reserve Actions - In the latest meeting, there were three dissenting votes regarding the rate cut, with one member advocating for a half-point cut and another opposing any cut [2] - Following the Fed's decision, stock markets surged, with the Dow increasing by nearly 500 points and the S&P 500 approaching a new high, while bond yields, including the 10-year yield, fell by 3.5 basis points [2] Group 2: Economic Projections - The Fed's economic projections for the next year have been adjusted to a modest 2.3%, declining to 1.8% in subsequent years, while inflation is expected to gradually approach 2% [4] - Current GDP growth estimates are considered inadequate, with a suggested potential growth rate of 3% to 4% instead of the projected 1.8% [4] Group 3: Impact of AI and Energy Prices - Combining productivity growth of 2.1% and labor force growth of 1.3% suggests a real GDP growth of 3.4%, with the potential for AI advancements to further enhance these figures [5] - The drop in oil prices from $80 to $60 this year (a 25% decrease) has not yet significantly impacted the Consumer Price Index (CPI), but it is anticipated to contribute to lower inflation, which could support higher real GDP growth [6]

Core Viewpoint - The market is anticipating a 25 basis point cut from the Federal Reserve, with discussions around the implications of this decision for the financial sector being crucial [1][2][3]. Federal Reserve Expectations - The market expects the Fed to potentially go on hold for the January meeting and resume cuts in March, influenced by economic data [5]. - The upcoming Summary of Economic Projections (SCP) is expected to indicate one or two cuts next year and the following year [4]. Banking Sector Insights - The larger banks are benefiting from a resurgence in capital markets activity, including M&A and deregulation themes, leading to a constructive outlook on bank stocks [6]. - Factors contributing to the positive performance of bank stocks include loan growth, higher fee income, and positive operating leverage, which are projected to continue through 2026 [7]. Regional Banks and Competition - Regional banks are facing challenges due to a lack of economies of scale and a deteriorating regulatory environment, which may hinder their performance compared to larger banks [8]. - The banking industry is seen as needing consolidation, with some mergers expected to proceed more smoothly than others [9]. Fintech Impact - The competitive landscape is intensifying with the presence of fintech companies, which are forcing traditional banks to adapt and invest significantly in technology [11]. - Major banks are projected to spend around $80 billion on technology this year to keep pace with evolving market demands [11]. M&A Activity - There is ongoing M&A activity within the banking sector, with banks expanding their financial services offerings and forming strategic partnerships [12].