Don't think bonds are the answer for investors worried about inflation: Wharton's Jeremy Siegel
Jeremy Siegel, professor emeritus of finance at University of Pennsylvania's Wharton School of Business and Wisdom Tree chief economist, joins 'Squawk Box' to discuss the latest market trends, impact of the administration's tariff policy, why he remains bullish on equities, and more.
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Yahoo
2 hours ago
- Yahoo
U.S.-China trade war on hold as talks reboot in London
Top trade officials from the U.S. and China were meeting in London on Monday, the second such meeting in the past month and one aiming to quell rising tensions between the two superpowers over tariffs and other trade policies. The meeting kicked off just days after President Donald Trump and Chinese President Xi Jinping engaged in an extended phone conversation, after which Trump offered an upbeat download on the conversation. 'I just concluded a very good phone call with President Xi, of China, discussing some of the intricacies of our recently made, and agreed to, Trade Deal,' Trump said on Truth Social last Friday. 'The call lasted approximately one and a half hours, and resulted in a very positive conclusion for both Countries. There should no longer be any questions respecting the complexity of Rare Earth products. Our respective teams will be meeting shortly at a location to be determined.' U.S. Treasury Secretary Scott Bessent, Secretary of Commerce Howard Lutnick and U.S. Trade Representative, Ambassador Jamieson Greer are leading the U.S. delegation and early reports on the talks were optimistic. National Economic Council Director Kevin Hassett on Monday told CNBC's 'Squawk Box' that the U.S. was seeking confirmation China would restore the flows of critical minerals. 'The purpose of the meeting today is to make sure that they're serious, but to literally get handshakes ... and get this thing behind us,' Hassett said. He added that he expected it 'to be a short meeting with a big, strong handshake.' While White House officials were signaling expectations for a positive outcome from the latest round of talks, some trade experts predicted the road to a new U.S.-China agreement could be a long one. Zhiwei Zhang, president and chief economist of Pinpoint Asset Management, told CNBC that it could take months for trade tensions to be resolved. 'I don't really have very high expectations for these trade talks ... I doubt they will reach an agreement very soon,' he told CNBC on Monday. 'There could be some resolution on specific issues, like a rare earths, for instance, China already announced that they will give some permits to foreign firms applying for imports. Now, those kind of a temporary solution, we might see some of that come out. But I doubt we will have a complete solution coming from this dialogue in the U.K.,' Zhang added. In spite of a temporary U.S.-China trade agreement coming out of talks held on May 12 in Geneva, Switzerland, tensions arose earlier this month after Trump accused China of breaching terms of the deal. 'The bad news is that China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr. NICE GUY!' Trump wrote on Truth Social. Last week, ahead of the call between Trump and Xi, China hit back on Trump's claims the Asian country was in breach of a new trade agreement, countering that the U.S. itself was undermining the deal with new sanctions. A statement from China's Ministry of Commerce released last Monday said Trump administration actions 'seriously undermine the existing consensus reached at the Geneva economic and trade talks, and seriously damage China's legitimate rights and interests.' Chinese officials also pointed to recent signaling from the U.S. about potential new regulations for advanced microchips and the revocation of U.S. visas for Chinese students, per CBS News, as evidence that the U.S. was acting in bad faith following the trade deal. Trump's complaint stemmed from his concerns over China's export rules on rare earth minerals. China controls 90% of the world's rare earth elements production capacity and, according to the U.S. Department of Energy, the minerals play a critical role in U.S. national security, energy independence and economic growth. Many advanced technologies have components made from rare earth materials such as magnets, batteries, phosphors and catalysts.
CNBC
6 hours ago
- CNBC
Fed Chair Powell has room to lower rates, says Wharton's Jeremy Siegel
Jeremy Siegel, professor emeritus of finance at University of Pennsylvania's Wharton School of Business and Wisdom Tree chief economist, joins 'Squawk Box' to discuss the latest market trends, state of the economy, impact of President Trump's tariff policy, the Fed's rate path outlook, and more.
CNBC
6 hours ago
- CNBC
Inflation fears receded in May as Trump eased some tariff threats, New York Fed survey shows
Americans grew less fearful about inflation in May as President Donald Trump backed off the most severe of his tariff proposals, according to a New York Federal Reserve survey Monday. The central bank's Survey of Consumer Expectations showed that the one-year inflation outlook took a substantial dip, down to 3.2% — a 0.4 percentage point decrease from April. At the three-year horizon, the outlook fell 0.2 percentage point to 3%, while the five-year forecast edged down to 2.6% from 2.7%. While all three are still above the Fed's 2% annual target, they represent progress and a change in a fearful attitude that coincided with Trump's saber-rattling on tariffs, culminating with the April 2 "liberation day" announcement. Trump initially slapped universal 10% tariffs on all U.S. imports and a menu of so-called reciprocal duties on dozens of nations. However, he soon backed off the latter measures, opting for a 90-day negotiating window that expires in July. The New York Fed survey, which is less volatile than others such as the University of Michigan and Conference Board measures, provides some good news for the White House at a time when administration officials are trying to tamp down worries about tariff-induced inflation. "By every measure of inflation, it's down by more than it's been in more than four years," National Economic Council Director Kevin Hassett said Monday morning on CNBC's "Squawk Box." "While the tariff revenue has been going up, inflation has been coming down, which is contrary to the story that everybody else has been saying, but very consistent with what we've been saying." Inflation as measured by the Fed's preferred personal consumption expenditures price index was at 2.1% in April, matching lowest its been since February 2021. Excluding food and energy, core PCE stood at 2.5%, a gauge Fed officials believes is a better measure of longer-term trends. The Fed survey showed expectations dipping across most price groups, though respondents did see food prices rising by 5.5% over the next year, a 0.4 percentage point increase from May and the most since October 2023. Elsewhere, respondents saw gas price increases easing to 2.7%, down 0.8 percentage point. The outlook for medical care, college education and rent increases also were lower on a monthly basis. There also was a positive move in employment, with those expecting to lose their job over the next 12 months dipping to 14.8%, down half a percentage point. Other areas showed optimism as well: The probability of missing a minimum debt payment over the next three months fell half a point to 13.4%, its lowest since January. Respondents also had more confidence in stocks, with 36.3% expecting the market to be higher a year from now, up 0.6 percentage point.
