Sharkey, Howes & Javer

Inside the Economy: Much Ado About Nothing

This week on “Inside the Economy”, we look at income, housing and other economic data. ISM manufacturing data ticked up a bit, while GDP estimates for Q1 came in lower. The Federal Reserve is expected to raise rates 0.25% this month as inflation numbers continue to stay above 5%. What will it take to fight inflation and avoid a recession? Tune in to learn about this and more!

Key Takeaways:

• 3-month T-Bill above 5%
• Oil drops to below $75 per barrel
• Mortgage rates still above 6.25%

Inside the Economy: The Consumer

This week on “Inside the Economy”, we take a look at the consumer and financial stress in the system. Headline inflation came down year over year in the month of March. Many of the supply side contributors seem to be returning to pre-pandemic levels, however the consumer seems to be staying strong. How will this impact the Fed’s decision making for the rest of the year?   Tune in to learn about this and more!

Key Takeaways:

• 2-year Treasury around 4%
• Oil on the rise to about $83 per barrel
• Mortgage rates still above 6.25%

Inside the Economy: Banking & Inflation

This week on “Inside the Economy”, we discuss banking and inflation. Money market funds have seen large inflows over the past 2 months following the issues in the banking industry, but with the Fed’s balance sheet growing as well, what does this mean for the economy going forward? Inflation continues to soften with lower rents and supply chain procedures getting back to pre-pandemic levels.  Tune in to learn about this and more!

Key Takeaways:

• Q4 2022 GDP estimate 2.6%
• Oil prices bump over $80
• Unemployment remains at 3.6%

Inside the Economy: The Bank Circus

This week on “Inside the Economy”, we discuss the headline news of two bank failures as well as other economic data. Silicon Valley Bank (SVB) was taken into conservatorship by the regulators and forced the FDIC and Fed to act. How will this impact monetary policy in the coming months? Unemployment was mixed and other data points to inflation continuing to trend downward in the right direction.  Tune in to learn about this and more!

Key Takeaways:

• 2-year Treasury falls to around 4%
• Unemployment up at 3.6%
• Mortgage rates still around 6.6%

Inside the Economy: The Consumer & Inflation

This week on “Inside the Economy”, we discuss the consumer and inflation. Over the past 2 years we have seen household savings decrease and shelter prices increase, yet we have seen historical wage growth and strong consumer spending. As the Federal Reserve continues its fight against inflation, what does that mean for the consumer and prices as we move further into 2023?  Tune in to learn about this and more!

Key Takeaways:

• Q4 2022 GDP estimate 2.7%
• Unemployment remains at 3.4%
• Mortgages bump up to 6.6%

Inside the Economy: Pesky Inflation

This week on “Inside the Economy”, we discuss important economic data. Inflation is trending lower, however it’s uncertain what it will take to achieve the Fed’s 2% target.  The housing market continues to soften, and corporate earnings are projected to be lower for 2023. State governments seem to have plenty of funding. Tune in to find out more!

Key Takeaways:

• 2-year treasury yield climbs higher above 4.5%
• 30-year mortgages move to 6.32%
• Oil drops to around $76 per barrel

Inside the Economy: Jobs & the Federal Reserve

This week on “Inside the Economy”, we discuss jobs and the Federal Reserve. Jobless claims continue to decrease and unemployment remains at record lows. With a slowing economy, what will that mean for employment for 2023?  The Federal Reserve continues to raise rates with their most recent 0.25% increase in January. Will the data soften enough in 2023 to cause them to pause, or will they continue to raise rates? Tune in to learn about this and more!

Key Takeaways:

• Headline inflation lowers to 6.5
• Unemployment down to 3.4
• Mortgages hover around 6%

Inside the Economy: Labor Market & Housing

This week on “Inside the Economy”, we discuss important economic data. The labor market remains strong even as the Fed raises rates. The housing market continues to soften and corporate earnings per share are projected to be lower for 2023. Will we see a recession this year? Tune in to find out more!

Key Takeaways:

• 2-year treasury yield remains above 4%
• 30-year mortgages move under 7%
• Oil drops to around $80 per barrel

Inside the Economy: The Federal Reserve

This week on “Inside the Economy”, we discuss the Federal Reserve. With inflation beginning to soften, and a Federal Reserve meeting upcoming in late January, all eyes are on the Federal Reserve to see what they do next. Will softening data in the housing, labor, and services market be enough to relax the FED, or will they continue to be aggressive with interest rates as they start the new year? Tune in to learn about this and more!

Key Takeaways:

• 2022 Q3 GDP adjusted higher
• Unemployment down to 3.5
• Mortgages get back to 6.5%

Inside the Economy: Consumer & Corporate Health

This week on “Inside the Economy”, we discuss the economic health of the consumer and corporations. For the consumer, hourly wages have leveled off and personal savings have decreased. Housing continues to be a sticking point for the consumer with the house-price index coming down and home equity withdrawal on the rise. Corporations on the other hand show strong profit margins despite sticky inflation, but what does that look like for 2023? Tune in to learn about this and more!

Key Takeaways:

• Oil drops to low $70s
• 3^rd Quarter GDP revised up to 2.9
• Mortgage rates under 6.5%