Nominal GDI Growth at 3.7% Is the Lowest Since 2020Q4

You can see why there are some out there who believe the recession may have already started

Highlights

• There are many reasons we have a bond bullish view, but can add one more to that list — 10- year T-note yields are diverging from the direction of nominal growth, against the historical norm 

• The S&P 500 has to correct to around 3,300 and the 10-year yield has to fall to around 3% to re-establish an ERP that is in sync with historical averages 

• There is an unusually consistent signal of growing economic slack across Eurozone countries and indicators, implying that the bloc is more likely headed for recession

• The proliferation of Buy Now Pay Later (BNPL) financing, where the biggest users are the ones in financial distress, is just another sign of how the U.S. consumer remains under pressure