Squawk on the Street SOTS 2nd Hour: PCE Breakdown, Trump Tariffs Latest, & Moody's Chief Economist Talks GDP 9/26/25
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Sep 26, 2025 Guest Dan Greenhouse, Chief Strategist at Solis Alternative Asset Management, dives into the current market landscape, citing strong earnings and consumer spending as catalysts for a sustained rally. He also shares concerns about potential tariffs, especially in the chip and pharma sectors, discussing their disruptive effects. Furthermore, Mark Zandi, Moody's Chief Economist, provides insights on how a government shutdown could unexpectedly impact GDP growth, highlighting the risks stemming from wealth concentration and spending patterns.
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Services Are Driving Core Inflation
- The PCE inflation print matched expectations with headline 2.7% and core 2.9%, showing no major surprise.
- Services inflation, especially transportation and financial services, remains the main problem driving core inflation.
Tariff Impact Is Still Working Through
- Tariff pass-through into consumer prices is only about halfway complete according to Patrick Moorhead.
- Expect further upward pressure on prices as tariff effects continue to work through the economy.
Focus On Fundamentals Not Noise
- Focus on economic fundamentals: strong data and corporate earnings underpin the rally, not just seasonal flows.
- Avoid overreacting to short-term headlines like shutdown talk; prioritize earnings and macro trends.