Bloomberg Surveillance US Market and Economic Outlook in 2025
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Dec 31, 2024 Mark Weatherford, VP of Policy and Standards at Gretel, shares his insights on AI regulation and cybersecurity. He emphasizes the importance of ethical guidelines as AI transforms industries. Weatherford discusses the incoming administration's challenges and proposes key recommendations for enhancing cybersecurity. The conversation also touches on the fragile labor market and the necessity for legislative frameworks to responsibly manage AI's growth. These discussions frame the broader economic landscape as we head into 2025.
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2025 Market Outlook
- The U.S. equity market looks strong for 2025, driven by a robust economy and potential Fed easing.
- However, high valuations, technical chart patterns, and political uncertainty (Trump's policies) pose challenges.
Volatility Outlook
- The VIX isn't signaling excessive complacency nor an imminent volatility spike.
- Watch the MOVE index (Treasury volatility) for early signs of market anxiety related to fiscal policy and Fed response.
Fed's Real Rate View
- The Fed raised their real rate forecast without changing GDP or employment projections.
- This suggests the economy can handle higher real rates due to structural forces supporting growth and inflation.