Despite a sharp market selloff, this analyst says the economy remains stable—for now.
Transcript:
ART HOGAN: Does this sell off actually indicate that we’re seeing worse fundamentals as the economy actually slowing? And that’s where I’d like to say no. Right in the here and now we haven’t seen a slowdown. Now there are a lot of people that are predicting that the economy is going to slow, but we don’t know yet because we don’t have the final results of what tariffs are going to look like. So we can’t gauge what those tariffs will likely mean to economic growth and inflation. So I think it’s more of a concern of if in fact, we started to look at some worst case scenarios on tariffs and immigration. And and we never get a better regulatory touch. And we’re not able to keep taxes where they are and they go higher. Then we certainly would say that the economy is going to run into difficult times. I think in the here and now, we’re in a wait and see mode. And I think that’s true for investors. And I think that’s that’s the right place to be. But if you look at the current economic data, we just had a good jobs report a week ago.
We just had a CPI and PPI this week, and both of those came very much in line. What you can get caught up in, though, is looking at survey data or soft data, as we like to call it. So whether it’s university of Michigan sentiment surveys or the conference board sentiment surveys, and they basically will bring out the worst in people that are willing to answer surveys. They’ll say, how do you feel about current conditions? Oh, I feel terrible. Well, everybody feels terrible. What do you think about the future? Well, that’s not great either. But then you compare that to hard data like retail sales, and then consumers aren’t confident at all. And yet, you know, over the last couple of months, they spent more money than they ever have. So I would say keep an eye on the hard data versus the soft data. Surveys don’t always give us a good a viewpoint into what the economy is really doing. And in the here and now, in today, as we talk, the economy is doing OK. The potential for it to slip up would would come if this uncertainty lasts for quarters and not for weeks. And that’s the biggest concern, I think, in the market right now.
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