Squawk on the Street SOTS 2nd Hour: Shutdown Day 3 - JPM Asset Management's Top Strategist, Goldman's Chief Economist Talk Impact + A Rare Apple Downgrade 10/3/25
Oct 3, 2025
Jan Hatzius, Chief Economist at Goldman Sachs, dives into labor market dynamics, highlighting a loosening trend and the essential role of BLS jobs data amid the ongoing government shutdown. He speculates on upcoming Fed rate cuts influenced by economic signals. Meanwhile, Rick Santelli details the ISM services data, showcasing slower orders and rising prices. They also explore the implications of a rare downgrade of Apple by analyst Edison Lee, driven by a structural smartphone slowdown and cautious expectations regarding foldable models.
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Market Euphoria Versus Weakening Fundamentals
- Markets are rising despite weakening fundamentals and a lack of government data, creating a disconnect between prices and economic reality.
- David Kelly warns that this disconnect could break only with a real economic shock, so investors should be cautious.
Fiscal 'Sugar Rush' Can Boost Growth Short Term
- Fiscal measures like rebate or refund checks can quickly lift consumption but also stoke inflation and hurt bond markets.
- David Kelly calls such measures a short-term 'sugar rush' that won't deliver sustained growth without lasting reforms.
Diversify Beyond Mega‑Cap Concentration
- Diversify away from concentrated mega-cap U.S. equities and across asset classes to reduce single‑point risk.
- Check valuations and seek cheaper opportunities globally instead of piling into the top performers.