Odd Lots
Goldman's Jan Hatzius Believes the Hard Part Is Over
Nov 27, 2023
Jan Hatzius, Chief Economist at Goldman Sachs, brings his macroeconomic expertise to explore the surprising resilience of the economy in 2023. He discusses why the anticipated recession didn't materialize and shares insights on favorable trends like disinflation and the strength of the labor market. Hatzius highlights the disconnect between rising unemployment rates and traditional recession indicators. With growing optimism about a potential soft landing, he believes we could be on the path to economic stability as 2024 approaches.
46:12
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Quick takeaways
- The conventional wisdom of a recession in 2023 was proven wrong, leading to growing optimism for a soft landing in 2024.
- Goldman Sachs economist believes the hard part of fighting inflation is over, with proof of concept demonstrated and no immediate indications for monetary policy reversal.
Deep dives
The Outlook for the Soft Landing Scenario
The podcast discusses the increasingly prevalent belief that the soft landing scenario, or at least the end of rate hikes, is becoming conventional wisdom. This optimism has solidified in recent weeks, despite initial forecasts for a recession in 2023. The COVID cycle has disrupted the traditional business cycle and challenged indicators like the inverted yield curve and the song rule. The labor market remains a critical factor in the soft landing scenario, and any weakening or softening will raise questions about the future path of the Federal Reserve and the need for potential rate cuts.
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