Latest news with #SGHMacroAdvisors
Bloomberg
3 days ago
- Business
- Bloomberg
Bloomberg Surveillance: Trade Talks and Tariffs
Watch Tom and Paul LIVE every day on YouTube: Bloomberg Surveillance hosted by Tom Keene & Paul Sweeney June 4th, 2025 Featuring: 1) Robert Kaplan, Vice Chairman of Goldman Sachs, joins to discuss the Fed, interest rates, and resiliency of the US economy. US stock futures hold onto two days of gains as investors await labor market data, which has so far held up better than expected amid the Trump administration's trade war. 2) Ernie Tedeschi, Director of Economics at the Yale Budget Lab, discusses his recent findings on the impact of tariffs on US companies and the US economy. Investors will follow services data and ADP's report on private-sector employment for updated information on the strength of the US economy, ahead of Friday's nonfarm payrolls report, as the market continues to climb on healthy eco data and in spite of tariffs. 3) Sassan Ghahramani, President and CEO at SGH Macro Advisors, joins to discuss President Trump's social media post upending US-China trade sentiment. President Trump called Xi Jinping "VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH" in a late-night social media post, raising questions about the fragile economic truce between the US and China. Tensions between the two countries are increasing, with the US recently barring the shipping of critical jet engine parts to China and seeking to slap fresh curbs on Huawei= chips, among other measures. 4) Sheila Kahyaoglu, Managing Director: Equity Research at Jeffries, talks about the air traffic controller concern for airlines and offers her analyst recommendations for US airlines. 5) Eric Rosen, author at The Rosen Report and former head of credit trading at UBS, talks about the dollar's position on the globe and how deficits and debt could weigh on it. While some economists fear a notable weakening in US employment in coming months under the weight of tariffs, that hasn't shown up in the data yet.
CBS News
21-04-2025
- Business
- CBS News
Dow drops 1,000 points as Trump renews criticism of Federal Reserve Chair Jerome Powell
Stocks fell sharply on Monday as Wall Street returned from a shortened trading week and President Trump renewed his criticism of Federal Reserve Chair Jerome Powell, branding him as a "major loser." The S&P 500 fell 152 points, or 2.9%, to 5,130 in early trading, while the Dow Jones Industrial Average tumbled 1,071 points, or 2.7%. The tech-heavy Nasdaq Composite sank even more sharply, dropping 3.2%. Stocks were down as investors grapple with ongoing tariff uncertainty and await the release of U.S. tech companies earnings this week. Global activity remained light heading into Monday as a good portion of markets around the world – including Europe along with Hong Kong and Australia – remain closed for Easter Monday. The shaky start in the U.S. stock market on Monday follows another volatile week in the stock market as investors weigh how the Trump administration's tariffs and a potential Fed shakeup might impact economic activity. "Notwithstanding the recent relief for electronic goods, the tariffs on China are leading to a standstill in some trade activity," said Tim Duy, chief economist at SGH Macro Advisors, in a research note. Stocks also took a hit last Wednesday after Fed chief Powell warned that tariffs could drive up U.S. inflation and stymie growth. President Trump and his team have floated the idea of firing Powell, who Mr. Trump tapped to lead the central bank during his first term in 2017. Although many legal experts — and Powell himself — say the president lacks authority to fire a Fed chief, Mr. Trump's fierce criticism has fueled investor concerns that the White House could defy norms and seek to replace the central bank chief. Referring to Powell, Mr. Trump said on Truth Social on Monday that the economy could slow down "unless Mr. Too Late, a major loser, lowers interest rates, NOW." Mr. Trump has put increasing pressure on Powell to lower the Fed's benchmark interest rate, which would spur economic growth but also risk boosting inflation. "The problem is that Powell's term still has more than a year to go while Trump's tariffs haven't even shown up in the data, which means the battle between the Fed and White House could get a lot worse in the coming months," Adam Crisafulli, head of Vital Knowledge, said in a report. A landmark Supreme Court Ruling from 1935 upholds the independent authority of the Fed and would make it difficult to fire Powell before his term concludes on May 15, 2026. But that hasn't stopped Mr. Trump from taking aim at Powell, who has stood firm against cutting interest rates until the Fed has more economic data on how tariffs will affect the economy. "I strongly hope that we do not move ourselves into an environment where monetary independence is questioned," Chicago Fed president Austan Goolsbee told CBS News' senior White House correspondent Weijia Jiang on Face the Nation yesterday. "Because that would undermine the credibility of the Fed." Investors this week will also focus on corporate earnings from major technology players. Those companies, known informally as the "Magnificent Seven," include Amazon, Google-parent Alphabet, Apple, Facebook-parent Meta Platforms, Microsoft, Nvidia and Tesla. The big tech group's stocks whipsawed in recent weeks after the Trump administration imposed reciprocal tariffs and then backtracked, later announcing office high-tech products would be exempt, if only temporarily. Since Mr. Trump's inauguration on January 20, the Magnificent Seven's combined market value has dropped by $3.8 trillion, or 22%, as of April 20. The Associated Press contributed to this report.
Axios
01-03-2025
- Business
- Axios
How DOGE cuts might show up in the data
Efforts by the Trump administration and Elon Musk's Department of Government Efficiency to cut vast numbers of federal jobs will surely show up in national economic data — but don't expect the impact to be massive, or immediate. Why it matters: In a $30 trillion economy with 159 million jobs, it takes a lot to meaningfully move the dial. The types of cuts to federal employment and government contracts that have been enacted thus far by the DOGE crew are comparatively small scale. That could change if President Trump and congressional Republicans enact a bigger agenda of austerity. State of play: The administration is seeking to lay off probationary federal employees (those who've been on the job for less than a year), of which there are about 220,000, assuming they overcome pending legal challenges. Another 77,000 federal workers have accepted DOGE's buyout, which keeps them on the payroll through September. An open question is how many of those workers find new jobs, how many experience prolonged unemployment, and how many exit the workforce entirely. By the numbers: SGH Macro Advisors estimates that a third of laid-off workers find a new job within three weeks, 50%-55% remain unemployed for a longer period of time and around 15% leave the workforce. That's based on the Labor Department's Displaced Worker Survey, which tracks what happens to laid-off workers. Using that arithmetic, it implies 220,000 federal layoffs would only raise the national unemployment rate by 0.07%, not the kind of move that makes economists — or central bankers — panic. Yes, but: With so many federal workers entering the job market at once, it could prove a more challenging job market for displaced federal workers than the historical experience would suggest. Of note: February jobs data due out Friday is unlikely to show much impact. The "reference week" for that payrolls report is the week that included Feb. 12, when the cutbacks were just getting started. If you squint, you can start to see evidence of cutbacks in the weekly initial jobless claims data. Over the last two weeks, there have been an average of 1,654 new claims for unemployment benefits in the District of Columbia, which is about three times the 2024 average. There were 613 claims to the unemployment insurance program for federal workers in the week ended Feb. 8, up from 382 a year ago. That number is released with a two-week delay and will presumably rise further. Reality check: The potential labor market effects are larger if the Trump administration and Congress enact major reductions to federal spending — in the hundreds of billions, not the comparatively small programs DOGE has targeted so far. House leadership is planning a vote on a path forward for a tax bill that includes $2 trillion in spending cuts over the next decade, concentrated in Medicaid, food assistance and clean energy subsidies. The bottom line: "The Federal Reserve is unlikely to react to a 0.1% rise in unemployment, particularly one that is easily identifiable and more of a one-off change in policy," wrote Tim Duy and Josh Lehner, of SGH Macro, in a note. "However, any broader impact hinges on federal spending," they added.
