Bloomberg Surveillance Single Best Idea with Tom Keene: Nancy Lazar & Doug Irwin
Jul 9, 2025
Tom Keene chats with Nancy Lazar and Doug Irwin about the evolving realm of government spending and its effects on the economy. They delve into tight federal budgets and changing employment trends, offering insights into what that means for the private sector. Historical parallels are drawn with the Reagan era's economic difficulties, spotlighting strategies employed by the Federal Reserve. Finally, the discussion shifts to current market trends and practical advice for investors navigating today’s economic landscape.
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Nancy Lazar's Investment Shift
- Nancy Lazar vividly recalled discussing America’s private sector underinvestment 90 days ago.
- She now sees upcoming legislation potentially driving Reagan-like investment despite a government spending slowdown.
Signs of Fiscal Restraint Emerging
- Government spending is showing signs of incremental restraint, especially in federal employment which has declined for five months.
- This could lead to a better-than-expected deficit outcome next year, signaling a shift similar to the Reagan era fiscal discipline.
Fed's Tariff-Conundrum Explained
- The Fed faces a dilemma balancing higher prices and lower growth driven by tariffs.
- Tightening monetary policy curbs inflation but risks slowing the economy, while loosening supports growth but risks more inflation.
