Advertise on podcast: Economic Take

A sluggish recovery from economic crises worsens outcomes for the government, disrupts people’s lives and erodes wealth. After a century of dealing with economic cycles, American leaders implicitly now understand the costs and benefits of policy activism.    

Though it’s generating buzz, the May CPI report reflects the same patterns we’ve seen for months: that our inflation issues are supply-side problems and not a result of too much demand.  

In the big picture, there are no signs the economy is overheated. But the evidence plain to see in certain sectors, likely a result of consumer shifts away from services and toward goods during the pandemic. Added together, the odds of a Fed-triggered recession are pretty slim.  

Among a shifting market landscape, the interplay between monetary and financial conditions can be likened to that of conductors and musicians—one sets the tone while the other responds.

Stock market valuations have been high by historic norms, but is the standard way of valuing the stock market still applicable?    

Today’s Federal Reserve has a few tools at its disposal it didn’t have during the inflationary era of the 1970s: a game plan, time and flexibility.  

Despite the talk of inflation, bond investors still seem to agree with the Fed’s initial instinct that many of the current price pressures will prove to be transitory. Also: Why globalism is still kicking.

The Fed worked hard to prop up the economy during the pandemic. There’s no reason to assume its leaders are now willing to risk pushing the economy into a recession when long-term inflation expectations are still below 2%.

Many of us remember the price shocks of the 1970s, but there are not many parallels with that era in terms of the forces that currently drive inflation. Find more market, economic and business insights at jpmorgan.com/CB.  

There’s a widespread notion that the current spike in prices signals an overheated economy. But under close inspection, those details don’t add up.  Find more market, economic and business insights at jpmorgan.com/CB.

The Fed’s activity now is a hallmark of its modern approach: Set investors’ expectations for steady, predictable long-term inflation — and avoid the temptation to hit the brakes. Find more market, economic and business insights at jpmorgan.com/CB.

Employment has grown by 887,000 monthly on average since April 2020 as the economy got back on its feet. Now that we’re back to pre-pandemic employment conditions, the pace of hiring will grind down very quickly. Find more market, economic and business insights at jpmorgan.com/CB.