Monetary Matters with Jack Farley Waiting For The Fat Pitch | “Recession Denier” Jonny Matthews on Real Slowdown In U.S. Economic Data
Aug 8, 2025
Jonny Matthews, a former portfolio manager at Brevan Howard and founder of the research service SuperMacro, discusses his evolving perspective on the U.S. economy. Initially a 'recession denier,' he is now noting signs of a slowdown that might resemble stagflation. The conversation delves into stagnant job growth, consumer spending challenges, and the Federal Reserve's cautious stance on interest rates. Matthews shares his bearish outlook on stocks and bonds, emphasizing the difficulty of timely trading decisions in an unpredictable market.
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Tariffs Will Create A Stagflation-Like Look
- Tariff uncertainty has dented hiring, capex, and consumer confidence, slowing growth to ~1% annualized.
- Tariffs will feed gradually into prices, making inflation creep up and giving a stagflation-like appearance.
Payroll Revisions Reveal Hidden Weakness
- Huge negative payroll revisions suggest initial survey responses miss struggling firms that report later.
- Net monthly NFPs near 30–70k are below workforce replacement, so income growth is slowing.
Consumption Has Flatlined Since March
- Real PCE has been flat since March, so Q3 consumption may be near zero.
- Personal spending is ~70% of GDP, so this flattens growth and hurts earnings.