Guests including Bloomberg's political news director and opinion columnist analyze Biden's debate fallout, US PCE data, mid-year report for US stocks, tight labor markets, and market close. Topics cover post-debate poll results, potential presidential candidates, economic indicators, Fed's actions, immigration impact on labor supply, AI's influence on companies, and asset allocation considerations post-debate and pre-election.
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Quick takeaways
Long-term economic focus noted post debate, with potential implications for fiscal stimulus and Fed policy.
Immigration policies and trade changes could impact prices and economic growth, emphasizing the need for monitoring developments.
Expectations of fiscal stimulus and central bank policies under discussion, anticipating tax cuts, moderate inflation, and trade policy shifts.
Deep dives
The Market Reaction To the Presidential Debate and Its Impact on Asset Allocation
The debate did not significantly alter asset allocation strategies considering the expected election outcome. Long-term focus on economic issues noted. Short-term trades may be influenced, for instance, healthcare and credit card company stocks saw gains. Fiscal stimulus and potential changes in the Fed chair were highlighted as key considerations for traders.
Implications of Policy Changes on Tariffs and Immigration for the US Economy
Potential policy changes on tariffs and immigration may lead to increased prices of goods and services, affecting economic growth. Immigration plays a vital role in addressing labor supply shortages. Uncertainty surrounding potential policy changes underscores the importance of monitoring these developments for economic implications.
Market Perception of Policies Under Different Administrations
Expectations of fiscal stimulus and more predictable central bank policies under either administration discussed. Tax cut extensions and new spending anticipated. Potential implications include slightly higher prices, moderate inflation, and changes in trade policies. Investor focus on fiscal stimulus and central bank leadership transitions.
Bond Market Response to Fiscal and Economic Conditions
The bond market is affected by slowing economic growth and perpetual fiscal stimulus. Concerns regarding the US government's debt and budget deficit persist, influencing yields. Uncertainty over the sustainability of current economic conditions and market preferences for US currency pose challenges.
Labor Market Concerns and Potential Risks for the US Economy
Mixed data on the labor market raises concerns about future economic conditions. Market reactions already reflect potential labor market weakness. Long-term effects from recent rate hikes and delayed policy impacts may contribute to shifts in market behavior and economic outcomes.
Watch Carol and Tim LIVE every day on YouTube: http://bit.ly/3vTiACF. Bloomberg Radio and TV Political News Director Jodi Schneider and Bloomberg Opinion Columnist Erika D. Smith break down the fallout from last night's Presidential Debate. Bloomberg News Economics Editor Molly Smith and Bloomberg News Rates Reporter Michael Mackenzie discuss US PCE data and the outlook for Fed policy. Kristine Aquino, Managing Editor for Bloomberg’s Market Live Blog, shares her team's mid-year report for US stocks. McKinsey Global Institute Director Olivia White talks about the firm's report Help wanted: Charting the challenge of tight labor markets in advanced economies. And we Drive to the Close with Alan Zafran, Co-CEO at IEQ Capital. Hosts: Carol Massar and Tim Stenovec. Producer: Paul Brennan.