“I think in the US if we look back and think ‘what a wasted recovery,’ the Europeans are going to do it doubly. And that’s partly because there’s just a whole bunch of institutional architecture that still needs to happen in the Eurozone in order for the Euro to really be a sustainable project.”
I was invited onto BBC Radio 4’s Today Programme to discuss recent market volatility and where the US-China trade war is leading. Listen here:
The US equity and bond markets are telling completely different stories about the outlook for the country’s economy. In the first seven months of 2019, the S&P 500 index rose by 10.2 per cent, suggesting firms could continue producing strong corporate earnings off the back of decent economic growth. Over the same time period, borrowing costs on 10-year Treasuries fell from 2.68 per cent to 1.89 per cent, sign-posting lower rates and inflation, and the likelihood of recession ahead. This economic recovery in the United States is the longest on record, and analysts are on the lookout for signs it is ending. Who has it right—equity or bond investors?
Here’s my overview for the US economy in Prospect Magazine: https://bit.ly/2OJbSZJ
Here’s an interview I did this morning on Bloomberg Surveillance on whether the US is going into recession, what designating China a currency manipulator means and what the US’s options are going forward in the trade (currency?) war against China.
Some thoughts on how much a 10% tariff on the remaining $300bn of imported goods from China will hit the Chinese economy, how Chinese authorities can counteract it to reflate growth and what tactics China can employ to retaliate: https://www.bloomberg.com/news/videos/2019-08-02/what-are-china-s-tariff-retaliation-options-video
Here’s everything you need to know about the July jobs data, with analysis from Michael McKee, Subadra Rajappa and myself on Bloomberg TV: https://www.bloomberg.com/news/articles/2019-08-02/-chugging-along-at-a-slower-pace-traders-on-employment-data
The US manufacturing sector has now contracted for two consecutive quarters, according to the Federal Reserve, raising concerns a general recession is drawing near. But those fears remind me of a triathlon I recently completed. With burning lungs and a pounding heart, I’d really flagged during the swimming section. Then I recovered and finished fine. So does a limping manufacturing sector really mean the American expansion will end? https://www.ft.com/content/9382e6a8-b2b2-11e9-b2c2-1e116952691a