Fear of economic growth has concerned concerns in the stacy in inflation, in fact, the ugly situation they have not seen in 50 years has been recreated.
“Stagflation” fears come as presidents Donald Trump seems to be determined Slap fares almost anything This is at the same time that various indicators enter the countries that point to a pullback in an activity.
The double threat of high prices and slower growth affects Angst among consumers, business managers and politicians, not to mention Investors that are spilling stocks And the links are recently collected.
“The direction, it is stagflation,” Mark Zandi, Moody’s main economists of Analytics. “Higher inflation and weaker economic growth is the result of policy – fare policy and immigration policy.”
In the 1970s and early 80s, the phenomenon seen in high blood pressure and the highest growth in the early 1980s.
At least among consumers, long-term inflation expectations are usually over 30 years while general feelings are being seen by the minimum number of years. Consumer expenditure fell in January For almost four years, despite significantly increased income, according to a trading department on Friday.
On Monday, The Institute for the supply of purchasing managers The factory activity was barely spread in February, when new demands fell almost five years and prices jumped the highest monthly margin for more than a year.
Following the ISM report, Atlanta Federal Reserve Gdpwow The meter of economic data fell by its projection of the economic growth of the first quarter annually by 2.8%. If this rests, it would be the first negative growth in the first quarter of 2022 and the worst dive since the beginning of 2020 shutdown.
“The expectations of the inflation is nervous and there is no sure growth,” he said. “We are moving towards stagflation, but we were now in the 70s and from stagflation in the 80s. Fed does not support. “
In fact, the prices in a greater choice of markets will start cutting interest rates in June and this year they can emphasize the key loan rate this year as a way to start any economically.
Zandi believes that the Fed reaction can take the opposite – inflation shutdown fee, the veins of former President Paul Volcker, rushed in the early 80s and was taken to the economy recession. “If it looks true stagflion with slow growth, they will sacrifice the economy,” he said.
Sales in stocks
Converging factors are causing waves in Wall Street, where stocks have been in sales this month, eliminating earnings made after making earnings in November.
Although the Dow Jones Industry has fallen on Tuesday, at about 4.5% disappearing in early March, the sale is not particularly in a hurry and felt the CBOE Flying indexMeasurement of market fear, 23 Tuesday was only evening, above the long-term average. Markets were Well off in the session in the afternoon negotiation.
“This is certainly not the moment to go to the Panic button,” Mark Hackett said, the main national market strategist. “At this point, I’m in the camp that is a healthy reset to expectations.”
However, there is no stocks that show signs of fear.
Treasury benefits have been tumbling after the last few days after September. The 10-year note performance fell by about 4.2%, below the summit of his January and below the 3-month note, the second world II. A reliable indicator of delay. It is the opposite of the price, so the profit that falls indicate a larger investor for fixed income values.
Hackett said it is afraid of a “cunning circle” produced by swooning feelings that can become a whole crisis crisis. Economists and business directors see rates that hit the prices of food, vehicles, electricity and other items.
Stagflation “Certainly something is something, more than a short time,” he said. “We need to see. It is a collapse like this in feeling and the change in the way people to see things and the level of emotion is so high in the behavior he plays right now.”
The White House sees “the biggest america”
For their side, the White House officials will bring the long-term advantages that expire short-term pain. Trump has given roles in the way of creating a stronger manufacturing base in the US, which is a service-based economy.
The commercial secretary recognized Howard Lutnick CNBC in a conversation on Tuesday “Maybe that may be short-term price movements. In the long run, however, it will be completely different.” The expectations of the market-based inflation matches that feeling. A metric, to what extent Against inflation extended between the 5-year-old nominal treasuryIt is almost two years in two years.
“It will be the greatest america. We will be balanced. The interest rates break and I mean 100 points points, 150 points lower points,” Lutnick added. “This president will deliver all these things and will deliver manufacturing here.”
Also, the Secretary of Finance Scott Bessent said that Fox News will be “the transition period” and pointed out that the Administration’s view is on the main street over the Wall Street.
“Wall Street made it great. Wall Street can continue well, but we pay attention to small businesses and consumer,” he said. “We will repeat the economy, we will bring home manufacturing work.”
The important traces of the economy should come from Friday Nomortail Report. If the jobs count is good, the hard data can strengthen the notion that has remained strong, as the feeling has changed.
But if the report shows that he smooth the labor market while keeping the salaries above, Stagflation can add chat.
“We need to look at it. There’s a talking of the terms of the stagflation, talking about it, some of them can appear,” Hackett said national strategist. “I’m not at the time of time at the time, but that’s the stage of disaster.”
2025-03-04 21:16:00
