Why the Recession Has Been Held at Bay (For Now)

The bull market in economic growth boils down to the heavy hand and generosity of Uncle Sam!

Highlights

• Powell joins in on the “higher for longer” narrative

• No asset class is priced for a recession

• Uncle Sam and the wealth effect are driving the economy

• The next three years will see a significant refinancing wave

While We Were Sleeping

Well, it is a mixed start to the day. U.S. equity futures are up, but just by a smidge. European markets are roughly flat here in the early going. In Asia, China’s Shanghai Composite saw a dead-cat bounce of +2.1% and Taiwan rallied +1.6%, but the good news ended there as we saw losses in Thailand (-2.3%), Japan’s once-hot Nikkei 225 (-1.3%), and Korea (-1.0%). The Nikkei 225 failed to respond positively to the news that Japan’s exports expanded for the fourth month in a row in March (the cheap yen is a tailwind) — up a healthy +7.3% on a YoY basis (consensus was +7.0%).