The Market Huddle The Economy Is Near Stall Speed (Guest: Peter Berezin)
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Jul 5, 2025 Peter Berezin, Chief Global Strategist at BCA Research, returns with a cautionary view on the economy, arguing it's edging closer to stall speed. He shares insights from his journey through economic research at the IMF to facing market crises at Goldman Sachs. The discussion dives into hiring trends, the complexities of budget deficits, and the impact of government policies. Berezin also highlights sector shifts within the stock market and provides a deep dive into commodities, illuminating investment strategies in a volatile landscape.
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Lehman Stock Anecdote
- Peter Berezin shared a personal story about buying Lehman stock just before its bankruptcy in 2008.
- He recounted getting a speeding ticket while distracted by the news, illustrating market unpredictability.
S&P Earnings and Recession Risks
- Peter forecasts S&P earnings falling to 250 for 2025, implying a potential 4450 S&P level in recession.
- He assigns 60% probability to recession, arguing markets aren't priced for this downside risk yet.
AI's Impact on Tech Valuations
- Tech's growth partly justifies higher P/E but non-tech valuations remain elevated compared to historical.
- AI's commoditization and high costs liken it to airlines, challenging sustained monopoly profits and margins.