Kinks in the Yield Curve: Over the past 13 weeks, the bond market has gone from anticipating additional Federal Reserve rate cuts to now expecting monetary policy tightening in response to higher inflation, with the forward market calling for a full rate cut by next April. #Econ #EconSky

Global investors are becoming more hesitant to lend money to the U.S. government. Since 2022 our analytical framework of regime change in inflation & interest rates has served our forecast and economic analysis well. Inflation and rates are poised to breakout higher in the near term.

After a weekend of tone deaf inflationistas playing down rising prices don’t be surprised if global investors continues to signal displeasure and impose market discipline. #Econ #EconSky Source: The Real Economy Blog realeconomy.rsmus.com/market-minut...

Good morning. One of the more enjoyable things I get to do is to complete in the marketplace of ideas & discuss the most important developments that are changing our world. Currently there is no idea more important or interesting than AI. #Econ #EconSky www.forbes.com/sites/brando...

My discussion via @CNNConnect @CNNI on the day in financial markets and the not so good US income, inflation and spending data. #Econ #EconSky video.snapstream.net/Play/6PjfQbB...

While equity valuations have decoupled from the real economy they cannot defy gravity forever. Declining real wages, falling disposable income and the drop in spending that is in train will put a dent in Q2’26 corporate earnings.

Why are Americans so pissed off right now? Take a look at three straight monthly declines in disposable income growth and that same metric over the last year. Real wages are falling as disposable income declines and households are drawing down savings. #Econ #EconSky

Good morning. I am expecting a 3.8% increase in the topline PCE inflation index & a 3.3% advance in the core while inflation adjusted spending will slow to 0.1%. #Econ In addition, I will appear on @CNNConnect with @BeckyCNN at 9:30AM ET/14:30 PM GMT to discuss the day in global financial markets.

Summertime and the living is easy

Good morning. A look at real yields & the rising cost of capital ahead of the April PCE index in which we are forecasting a 0.5% increase on the month & a 3.8% advance in topline inflation. Source: The Real Economy Blog #Econ #EconSky realeconomy.rsmus.com/market-minut...

Inflation embedded in the fabric of our lives. Read on to see why apparel prices which are rising at a 4.2% pace are set to go higher. Source: The Real Economy Blog #Econ #EconSky realeconomy.rsmus.com/market-minut...

Important lesson here for the US as it steps into a period of rising productivity & prosperity that demands a broader distribution of equity in the economy & country. #Econ #EconSky giftarticle.ft.com/giftarticle/... The infantilism of an ‘ungovernable’ Britain

Investor expectations on the policy path ahead at the Federal Reserve on the day Kevin Warsh is sworn in. It’s rate hikes that are being priced in as the supply shock working through the economy gets further embedded inside CPI, PCE & expectations. #Econ #EconSky

For those keeping score at home here is an interesting breakdown of 1-year & 5-year inflation expectations by groups from the University of Michigan survey. One should take a look. It is quite interesting especially for those that do not follow economic and financial data on a regular basis. #Econ

US Consumer Sentiment: The UMICH topline sentiment index declined to a record low of 44.8. Discontent is the best description of the public at this time. #Econ #EconSky

A good split screen morning to all. Equity futures are up in anticipation of Nvidia’s Q1’26 earnings. Yet, the bond market is signaling an end to complacency following a historic supply shock & rising inflation. #Econ #EconSky Source: The Real Economy Blog realeconomy.rsmus.com/market-minut...

Investors are pushing yields on the 2-year which now sits at 4.11%. That implies they think the Kevin Warsh Fed will need to hike the federal funds policy rate. Perhaps as early as the June meeting. #Econ #EconSky

*US 30-Year yield at 5.18 is the highest since 2007 just prior to the Great Financial Crisis due to risk around rising inflation and an unsustainable fiscal path. This will send mortgage rates higher which will put to bed any notion of a 2026 recovery in the housing market.

US Term Premium: risk of holding US paper has resulted in investors demanding a rising risk premium. The US 10 year properly valued should be near 4.68% which drives the cost of capital higher. Inflation & an unsustainable fiscal path driving rates higher. #Eco #EconSky

Good morning. A look at sticky prices & why that may be the key to the future of Fed credibility in the Warsh era. Source: The Real Economy Blog #Econ #EconSky realeconomy.rsmus.com/market-minut...

Fuel shortages are now a significant risk across much of the global economy as supply shortages & snarled supply chains start to bite. We are all on the clock. Iran energy crisis enters new phase as peak summer season approaches via @FT giftarticle.ft.com/giftarticle/...

From the things are tough all over department. It one want to really piss off the Texans mess with price & availability of their tacos. Food inflation is going to be the other pricing narrative along with gasoline this summer.

Good morning. A new inflation regime awaits households, businesses & the new Fed Chairman. Source: The Real Economy Blog #Econ #EconSky realeconomy.rsmus.com/market-minut...

UK 30-year yield up 20 basis points as it heads towards breeching 6% in the near term. This is driven not just by inflation and an unsustainable fiscal path but also by political instability and policy risk around a new labor government. The bond market remains undefeated. #Econ #EconSky

Good morning as a global bond rout is underway. The UK fairing the worst at 5.16% with the US ten-year trading at 4.56%. It's based on fears of a shift higher in inflation and interest rate regimes. Unsustainable fiscal paths in the UK & US are driving the cost of capital higher. #Econ #EconSky

US April Retail Sales: While nominal topline sales looks good one must adjust it for inflation. Once one does that solid 0.5% increase turns into a sober -0.1% decline. The control group ease back from a 0.5% to an inflation adjusted 0.3%. Outlays at gasoline stations were up 2.8%. #Econ

A good Kevin Warsh heads the Fed morning to all. And a new inflation & interest rate regime may be there to greet him. Take a look and one can see it blossoming. Source: The Real Economy Blog realeconomy.rsmus.com/market-minut...

The April CPI & PPI captures ta supply shock that has resulted in higher inflation wth plenty in the pipeline. PPI is up 6% and inflation is head towards 4.5% with risk of a move toward 5% in the near term. #Econ #EconSky www.barrons.com/articles/tru...

RSMUSLLP April PCE Inflation Forecast: 0.6% on the month & 3.9% from one year ago while the core will increase 0.4% & 3.4%. Talk about a cold cup of coffee for Kevin Warsh as his award for taking the helm of the Fed. I do not envy the Chair or the committee heading into mid-year.

Always good to be back inside the friendly confines of the New York Stock Exchange. An absolute icon of capitalism.

A good marketplace of ideas mornings to all. Front page & above the fold never gets old. Get up, get out & compete. #Econ #EconSky

My opinion editorial published by @Barrons on why It’s Not Time to Worry About Stagflation—Yet… www.barrons.com/articles/tru.... #Econ #EconSky

BRUSUELAS: “.. Stagflation Lite is the Baseline as Inflation Surges Higher” @joebrusuelas.bsky.social #CPI

My instant reaction to the April US inflation report in which prices surged and real wages declined finance.yahoo.com/video/negati...

Looking forward to appearing on @YahooFinance at 8:30 AM ET to discuss the US April Consumer Price Index and that move higher along the yield curve. #Econ #EconSky

Good morning. US and UK 30-year yields rising in line due to uncertainty around the Anglo-American fiscal paths. Each rate has embedded in it a risk premium due to both policy & political dynamics as investors act rationally to push up the price of lending to the sovereign. #Econ #EconSky

Further release of the US Strategic Petroleum Reserve to get out ahead of the traditional summer driving season. #Econ #EconSky

Tomorrow the BLS will publish the April CPI & Real Average Hourly Earnings simultaneously. Should topline CPI arrive at 3.7% or greater it implies inflation adjusted wages will enter negative terrain for the first time since April 2023. #Econ #EconSky

The market is underpricing the direction & persistence of inflation. One can observe it in inflation swaps & will get evidence in the April CPI report. Look for not just energy but housing to drive topline prices. Source: The Real Economy Blog #Econ #EconSky realeconomy.rsmus.com/market-minut...

Secret lives of economists

My discussion on the US April Jobs Report via The Brief With Jim Sciutto - Joe Brusuelas joins The Brief. @CNNI @CNN video.snapstream.net/Play/33tt6wG...

Good morning. The drawdown of oil inventories continues reducing government & industry buffers to cushion against the supply shock. As these buffers dissipate households, firms, industry & financial markets, economies are vulnerable to disruption should the Hormuz not reopen. #Econ #EconSky

My discussion on the US April Jobs Report via The Brief With Jim Sciutto - Joe Brusuelas joins The Brief. @CNNI @CNN video.snapstream.net/Play/33tt6wG...

Another week comes to a close as investors now expect no rate cuts nor rate hikes through mid 2027. This implies expectations of a Fed policy rate of between 3.5% & 3.75%. Rising inflation due to a historic supply shock will test this in coming days & weeks. #Econ #EconSky

Looking forward to speaking with @jimsciutto on @cnni @CNN tonight at 6:20 ET to discuss the April US Jobs Report.

My note on the solid US April Jobs Report. The topline looks good but once one looks beneath one can observe problems just over the horizon as inflation adjusted wages turn negative. #Econ #EconSky realeconomy.rsmus.com/in-april-job...

Real Wages vs Nominal: In April nominal wages increased 3.6%. Next week's April CPI forecast expects a 3.7% increase. I think CPI will peak near 4.5% in the near term The PCE in March posted a 3.5% increase and is poised to jump higher toward 4% in coming months. #Econ #EconSky

Inflation adjusted wages: Inside the US April Jobs Report average hourly earnings increased 3.6% on a year ago basis. That means wages, once adjusted for inflation, have likely turned negative. In coming days policymakers and the public will observe real average hourly earnings. #Econ #EconSky

Good morning. I expect a net change in total employment of 60K in the US April Jobs Report. The public should anticipate a steady stream of soft jobs reports heading into midyear which I discussed with @cnn this week. #Econ #EconSky www.cnn.com/2026/05/08/e...

Shades of Cool. @themandarin.bsky.social