DIRS.INFO The most relevant business & tech news

☆ The AI boom is screwing over Gen Z
▼ + stars: | 2023-07-17 | by ( Ed Zitron | ) www.businessinsider.com time to read: +13 min

Now, with the advent of generative AI, organizations are starting to automate many "junior" tasks — stripping away their dubious last attempt to "teach" young employees. America's young workers are headed toward a career calamity. Nobody wants to teach anymoreEven before the rise of AI, young people were facing an early-career crisis. This lack of care is clearly weighing on the young workers who need career development the most. Humans can be enhanced by AI, helped by AI, but replacing them with AI is a shortsighted decision made by myopic bean counters who can't see the value in a person.

Persons: there's, Gen, Gen Zers, it's, Gen Z, Louis, Zers, millennials, Peter Cappelli, Capelli, Paul Osterman, they'd, Osterman, they'll, ChatGPT, Qualtrics, What's, they're, Ulrich Atz, Tensie Whelan, New York University's, Atz, Whelan, —, There's, Knight, It's, Ed Zitron Organizations: Management, Federal Reserve Bank of St, National Association of Colleges, Employers, University of Pennsylvania's Wharton School of Business, US Department of Labor, MIT, Pew Research Center, National Bureau of Economic Research, Gallup, Workplace Intelligence, Amazon, Boston Consulting Group, New York, New York University's Stern Center, Sustainable Business Locations: America, New, Fortune

☆ St. Louis Fed President Bullard says he's stepping down in August
▼ + stars: | 2023-07-13 | by ( Fred Imbert | ) www.cnbc.com time to read: +1 min

James Bullard, president and chief executive officer of the Federal Reserve Bank of St. Louis, delivers a speech in London, U.K., on Tuesday, Oct. 15, 2019. The St. Louis Federal Reserve announced Thursday that Jim Bullard will step down from his post as president, effective Aug. 14. "It has been both a privilege and an honor to be part of the St. Louis Fed for the last 33 years, including serving as its president for the last 15 years," Bullard said in a statement. "I am also grateful to have worked alongside such dedicated and inspiring colleagues across the Federal Reserve System." The St. Louis Fed said it will hire a "national executive search firm" to assist in seeking Bullard's successor.

Persons: James Bullard, Louis, Jim Bullard, Purdue University's Mitchell E, Daniels, Jr, Bullard, Louis Fed Organizations: Federal Reserve Bank of St, Louis Federal Reserve, Purdue, School of Business, Federal Reserve's, Market, Federal Reserve Locations: London, The St

☆ This recession indicator flashed again as the Fed signaled more rate hikes. It hasn't been wrong for 44 years.
▼ + stars: | 2023-06-29 | by ( George Glover | ) www.businessinsider.com time to read: +2 min

Parts of the yield curve inverted deeper after the Federal Reserve Chair's comments. The yield curve has inverted before every major US recession since 1969. The widely-tracked economic indicator is a graphical representation of the spread between long- and short-term US Treasury yields. The closely-followed spread between 10-year and 2-year Treasury yields deepened to minus 100 basis points Wednesday, according to the Federal Reserve Bank of St. Louis. Meanwhile, the gap between 1-year and 30-year government bond yields reached its most inverted level since 1981, per data from Refinitiv.

Persons: Jerome Powell, —, Jerome Powell's, Powell, Louis, Read, Biden Organizations: Federal, Service, Federal Reserve, London School of Economics, Portugal Wednesday, Market Committee, Federal Reserve Bank of St Locations: Portugal, Spain, Madrid

☆ Forget about a housing market crash, Harvard researchers say. Here are the 4 reasons they say a repeat of the mid-2000s drop in home prices is unlikely.
▼ + stars: | 2023-06-24 | by ( William Edwards | ) www.businessinsider.com time to read: +5 min

They cited a strong labor market, low foreclosure rates, favorable demographics, and low supply. That was their biggest drop since the mid-2000s housing bubble, when home prices fell 27% over the course of a few years. As long as interest rates remain elevated, home price growth will likely continue to slow. First is that the labor market remains healthy. But so far this year, the labor market has continually surprised economists to the upside.

Persons: Hoff, Ian Shepherdson, Desmond Lachman —, millennials, Ellen Zentner, Morgan Stanley's, Z, it's, there's, Louis Organizations: Harvard Joint Center for Housing Studies, Harvard University, Federal Reserve, Harvard Joint Center for Housing, FHFA National Mortgage Database, Federal Reserve Bank of St, JPMorgan, Mortgage, Association

☆ 'Fundamentals still matter': A portfolio manager at a firm managing $17 billion warns stocks are due to sink 15% as AI hype fuels the current rally and drowns out recession alarm bells
▼ + stars: | 2023-06-17 | by ( William Edwards | ) www.businessinsider.com time to read: +6 min

Stocks are once again in a bull market, with the S&P 500 now up more than 20% since October's lows. Nearly all of the recent rally can also be attributed to the index's top 10 stocks, he said. "During the late-90s tech bubble, over one-third of returns came from these mega-cap stocks," Wool said. "In the recent bull run, by contrast, almost the entire market return was accounted for by just ten companies' performance." A 15% decline would put the S&P 500 at 3,800.

Persons: Stocks, Rayliant's Phillip Wool, Wool, Phillip Wool, Solita, Louis, …, Lauren Goodwin, Morgan Stanley's Mike Wilson, it's, Morgan Stanley's Wilson, Piper Sandler's Michael Kantrowitz Organizations: UBS, LPL Financial, Conference, Federal Reserve Bank of St, Louis The Conference, Wool, Treasury, Federal Reserve, New York Life Investments, CME Group

☆ Just days after pausing rate hikes, Fed official calls for more increases
▼ + stars: | 2023-06-16 | by ( Bryan Mena | ) edition.cnn.com time to read: +5 min

Washington, DC CNN —The dust has barely settled on the Federal Reserve’s decision to pause its aggressive rate-hiking campaign — but in public appearances Friday, central bank officials have a clear message: Keep hiking. In one of the first speeches, Fed Governor Christopher Waller said Friday that additional rate increases are necessary to bring inflation down to the central bank’s 2% target. The Fed’s decision to restart hikes depends on what data show in the coming weeks and months. It is the job of bank leaders to deal with interest rate risk and nearly all bank leaders have done exactly that,” Waller said. A representative of the event said the conference wasn’t being recorded and that only registrants who paid a fee were able to attend.

Persons: Christopher Waller, ” Waller, ”, Gregory Daco, Ernst & Young, ” Powell, Waller, “, Michael Gapen, Gapen, they’re, Louis President James Bullard, Thomas Barkin Organizations: DC CNN, Federal, Norges Bank, International Monetary Fund, Ernst &, Bank, BofA Global Research, CNN, Federal Reserve Bank of St, Federal Reserve Bank of Richmond, Maryland Government Finance, Association Locations: Washington, Oslo, Norway, ”

☆ Karen Firestone: The long-awaited recession hasn’t arrived yet. Here’s what forecasters are getting wrong
▼ + stars: | 2023-06-14 | by ( Karen Firestone | ) www.cnbc.com time to read: +5 min

The beginning of Bank of America's 2023 outlook report, which included interviews with its top economists and strategists, highlighted "what a potential recession could mean for the markets." The bank indicated in one of its reports that the average probability among strategists predicting a 2023 recession at the end of last year was about 65%. Cynics might say economists and market strategists are often wrong. Finally, it seems as if the stock market recognized the limitations of the recession prediction back in October 2022. The recession may follow that same path if inflation, including energy, continues to slide and enough portions of the economy hold up.

Persons: Goldman Sachs, It's, Louis, Karen Firestone Organizations: Boston Celtics, Boston Bruins, Bank of, Federal, Treasury, Street, U.S . Bureau of Labor Statistics, Institute for Supply Management, Capital Markets, Federal Reserve Bank of St, Investors, Celtics, Bruins, Asset Management Locations: U.S

☆ The rich often misjudge the potency of their retirement savings, report finds
▼ + stars: | 2023-06-12 | by ( Greg Iacurci | ) www.cnbc.com time to read: +5 min

Thirty-two percent of high-income households are "not worried enough" about their retirement risk, a larger share than the 26% of low- and middle-income earners. The Center for Retirement Research uses the survey data to construct a National Retirement Risk Index. The index models retirement preparedness according to a range of assets like Social Security, pensions, home equity and employer-sponsored retirement plans, such as a 401(k). Anqi Chen assistant director of savings research, Center for Retirement Research at Boston CollegeIn 2019, 47% of American households were at risk of not being able to maintain their standard of living in retirement, according to the index. Why the rich are more likely to underestimate riskWestend61 | Westend61 | Getty ImagesNineteen percent of U.S. households correctly identify as being at risk of falling short in retirement, according to the center's report.

Persons: Anqi Chen, Chen, they're, David Blanchett, Louis Organizations: Getty, Center for Retirement Research, Boston College, Finance, GOP, Federal Reserve's Survey, Consumer Finances, Retirement Research, Social Security, for Retirement Research, Westend61, Prudential Financial, Federal Reserve Bank of St, Center for Locations: U.S, PGIM

☆ 'This is typical late cycle behavior': New York Life Investments warns a recession is still barreling toward the US economy despite strong jobs data — threatening to sink stocks by 15-20%
▼ + stars: | 2023-06-10 | by ( William Edwards | ) www.businessinsider.com time to read: +5 min

Historically, a median pullback in earnings would mean a 15-20% drop in the S&P 500. The Bureau of Labor Statistics announced on June 2 that the US labor market added 339,000 jobs in May — more than economists had expected. Historically, the Fed tightening cycle takes 18 – 24 months to impact the labor market." Madison Hoff/InsiderHistory shows a recession would mean a rough ride ahead for the stock market, Goodwin said. The median S&P 500 price target among major Wall Street strategists is 4,000, which is 7% lower than current levels.

Persons: Lauren Goodwin, Goodwin, Madison Hoff, Michael Kantrowitz, Piper Sandler, Piper Sandler Piper Sandler, it's, Kantrowitz, Morgan Stanley's Mike Wilson, David Rosenberg, —, Louis Organizations: York Life Investments, Labor Statistics, New York Life Investments, Rosenberg Research, Federal Reserve Bank of St

☆ A top Wall Street investment strategist breaks down why stocks are setting up for a 22% drop in the second half of the year — and shares 2 signs that show a recession is likely
▼ + stars: | 2023-06-03 | by ( William Edwards | ) www.businessinsider.com time to read: +6 min

Piper Sandler's Michael Kantrowitz says a recession is hurtling toward the US economy. He pointed to stocks falling in lockstep with rising unemployment claims in 2007, 2000, 1990, 1981, 1973, and 1969. Today, investors are again doing a poor job of forecasting rising unemployment claims in the months ahead, Kantrowitz believes. Underpinning Wilson's call is an earnings recession this year that investors aren't pricing in. "We first started talking about the coming earnings recession a year ago and received very strong pushback, just like today.

Persons: Piper Sandler's Michael Kantrowitz, Kantrowitz, Michael Kantrowitz doesn't, Piper Sandler, it's, Louis, Greg Boutle, Cantor Fitzgerald's Eric Johnston, Venu Krishna, Morgan Stanley's Mike Wilson, Wilson, Albert Edwards Organizations: Energy, Survey, Federal Reserve Bank of St, BNP, Barclays, Conference, Board, National Federal, Independent, of Labor Statistics, Generale's Locations: lockstep

☆ The job market held up in May. But the Fed may have already decided to pause
▼ + stars: | 2023-06-02 | by ( Bryan Mena | ) edition.cnn.com time to read: +8 min

Washington, DC CNN —The US labor market picked up momentum in May, once again defying expectations of a slowdown. Many economists, including those at the Fed, still expect a recession later in the year. The labor market and signs of future disinflationThe May jobs report mostly showed that the labor market held up. Some top economists have argued that the strong labor market has had a minor, albeit growing, impact on inflation. Hawkish Fed officials still think the Fed’s job isn’t done.

Persons: That’s, Joe Biden’s, ”, Philip Jefferson, Patrick Harker, “, ” Harker, It’s, ” Julia Pollak, ZipRecruiter’s, you’ve, you’d, Dave Gilbertson, hasn’t, Ben Bernanke, ” Jack Macdowell, Louis President James Bullard, Bullard, Louis Fed’s, Louis, Jerome Powell, there’s, Ian Shepherdson, Eugenio Alemán, Raymond James Organizations: DC CNN, Federal, Fed, Federal Reserve Bank of Philadelphia, National Association for Business Economics, CNN, Employers, of Labor Statistics, BLS, UKG, The Palisades Group, Hawkish Fed, Federal Reserve Bank of St, Louis Fed, Pantheon Locations: Washington, Washington ,

☆ A 31-year market vet who called the current bear market warns an impending credit crunch and recession will sink stocks by 45% as valuations remain higher than dot-com bubble levels
▼ + stars: | 2023-05-13 | by ( William Edwards | ) www.businessinsider.com time to read: +7 min

Indicators like initial and continuing unemployment claims and loan demand show weakness. A recession paired with high valuations spells trouble for stocks, he said. For example, the number of initial unemployment claims is starting to jump at a recessionary pace, Wolfenbarger said. The four-week moving average of initial unemployment claims has risen 29% over the last eight months. Hussman FundsWhat others are sayingMany market onlookers have highlighted high stock market valuations in recent weeks.

☆ 'Recession is a done deal': A renowned market bear who called the dot-com bubble warns a deep and long downturn will destroy corporate profit margins — setting stocks up for disaster
▼ + stars: | 2023-05-06 | by ( William Edwards | ) www.businessinsider.com time to read: +7 min

But as data continues to come out in the months ahead, Edwards says to pay attention to details beneath the headline numbers. Sure enough, revisions to February and March numbers reported on Friday paint a picture of a weakening labor market. "I think the recession will lead to a collapse in margins and profits and do a lot of damage." In terms of his view on the labor market, Edwards has company in Ian Shepherdson, the chief economist at Pantheon Macroeconomics. But bulls do remain, and they're betting on a scenario where inflation continues to come down — it hit 5% in March, down from its 9.1% peak last year — and the labor market remains intact.

☆ 'I think they're overdoing it': A chief economist who called the 2008 recession says the Fed is 'making a huge mistake' by continuing their rate hikes — and warns the economy is likely to unravel in s
▼ + stars: | 2023-05-04 | by ( William Edwards | ) www.businessinsider.com time to read: +4 min

He's now warning a recession is on the US economy's doorstep amid a credit crunch. One is the fact that the Fed's rate hikes haven't completely worked their way into the economy yet. A credit crunch means consumers are less able to spend and businesses are more likely to fail, heightening recession risks. Well no, it means everything was fine, but it doesn't guarantee that things will remain fine," Shepherdson said. "The credit crunch plus just the lag effect of the interest rate increases I think means it is not going to be fine."

☆ The economist who discovered the inverted yield curve as a recession indicator now says his model will prove correct again as the Fed continues to hike rates — and that a downturn will strike anytime
▼ + stars: | 2023-04-20 | by ( William Edwards | ) www.businessinsider.com time to read: +4 min

Harvey discovered the inverted yield curve as a recession indicator. Back in December, Cam Harvey made an eyebrow-raising call: the inverted yield curve, the famous recession indicator he discovered in the 1980s, would produce its first false reading since the 1960s. Harvey's yield curve looks at yields on three-month bills and 10-year notes; the latter are normally higher. Another reason Harvey's view has dimmed is that short-term inflation expectations have come down, meaning the real-yield curve (which is adjusted for inflation expectations) has now inverted. In December, Harvey said that much higher short-term inflation expectations relative to long-term expectations meant that real yields weren't inverted.

☆ Rob Arnott says there's now an 80% chance of a recession amid a credit crunch. Here are his top recommendations on where to park your money — including one trade he believes will deliver 15% yearly re
▼ + stars: | 2023-04-14 | by ( William Edwards | ) www.businessinsider.com time to read: +4 min

He said US value stocks and developed economy non-US stocks offer the best returns. But there are still opportunities for big returns in US value stocks, he said. But an even bigger opportunity lies in non-US stocks in developed economies, which Arnott believes will return 15% on a yearly basis over the next decade. The iShares MSCI EAFE ETF (EFA) is one way to gain exposure to non-US stocks, while the Vanguard Value ETF (VTV) offers exposure to US value stocks. Arnott made the same calls on non-US stocks and US value stocks back in December.

☆ A 31-year market vet who called the current bear market says the S&P 500 has another 45% downside as investors remain blind to signs that a recession is hurtling toward the US economy
▼ + stars: | 2023-04-08 | by ( William Edwards | ) www.businessinsider.com time to read: +5 min

Yet, stock market investors remain bullish, he said. He's been warning of a significant stock market decline since late 2021,"People are ignoring all the lessons of history," Wolfenbarger told Insider on Friday. His bearish outlook stems from how high stock valuations are relative to 10-year Treasury yields. Wolfenbarger also has company in thinking that stock market investors aren't heeding the warnings of a coming downturn. Yet, the stock market doesn't seem to reflect this uncertainty, he said.

☆ OPEC’s surprise production cut complicates the Fed’s fight against inflation
▼ + stars: | 2023-04-08 | by ( Bryan Mena | ) edition.cnn.com time to read: +3 min

Energy prices across the globe surged last year when Russia invaded Ukraine, fueling global inflation just as the world’s major economies were beginning to rebalance after the pandemic. Now, with oil prices surging once again, headline inflation could remain elevated for longer or even rise. Even core inflation could be affectedWhile Fed officials consider multiple economic metrics in order to inform their decision making, one of their main points of focus is core inflation, which strips out volatile food and energy prices. However, higher oil prices can eventually push up core prices if they remain elevated for long enough. However, he acknowledged the eventual impact of higher prices.

The slew of soft economic data has added to fears of an impending recession in the world's largest economy, putting a lid on risk appetite and sending traders in search of some safe haven assets. The U.S. dollar index was up 0.1% at 101.95, having slid to a two-month trough of 101.40 in the previous session. The Japanese yen also found some support from safe haven bids and was last roughly 0.2% higher at 131.01 per dollar. "Weak economic data continues to weigh in on investor sentiment, triggering a flight-to-safety bid," analysts at Westpac said in a note to clients. The soft data sent U.S. shares lower on Wednesday STX/ while Treasuries advanced, which saw the benchmark 10-year yield falling to its lowest since September .

☆ Morning Bid: And it was all going so well
▼ + stars: | 2023-04-06 | by ( ) www.reuters.com time to read: +3 min

LONDON, April 6 (Reuters) - A look at the day ahead in U.S. and global markets from Amanda Cooper. The prospect of a sustained string of interest rate rises last year led to an epic sell-off in bonds and battered sectors of the stock market, such as tech. As 2023 dawned, data showed the economy was holding up, the consumer was resilient, and, just as importantly, so were corporate profits. But this week's data releases have served as a reminder that policy transmission - the effect of changes in interest rates on the real world - is alive and well. Twelve months and nearly 500 basis points of rate rises will eventually take their toll.

☆ 5 must-see charts that show why the economy is barreling toward disaster — putting stocks at risk for massive declines
▼ + stars: | 2023-04-01 | by ( William Edwards | ) www.businessinsider.com time to read: +7 min

Reducing inflation is likely to require a period of below-trend growth and some softening in labor market conditions," Powell said. "Restoring price stability is essential to set the stage for achieving maximum employment and stable prices over the longer run." A large enough pullback in lending will send the economy into a downward spiral, he said. "If you get a credit crunch, you could have an immediate downturn in the economy, a very quick downturn," he said. Credit spreads are the gap between high-risk bond yields and yields on risk-free bonds.

☆ A senior economist at Interactive Brokers shares why home prices across the country will fall another 11% over the next year — and why a 2008-size crash he had expected won't come after all
▼ + stars: | 2023-03-29 | by ( William Edwards | ) www.businessinsider.com time to read: +5 min

Interactive Brokers Senior Economist José Torres says home prices will drop 15% peak-to-trough. The weakening in the housing market will continue into Q4 of this year or Q1 of 2024, according to José Torres, a senior economist at Interactive Brokers. Affordability is measured by home prices and mortgage rates relative to incomes. Yardeni ResearchTorres thinks affordability will stay at relatively depressed levels in the months ahead because he sees mortgage rates staying high. As for mortgage rates, consensus among firms like Goldman Sachs, the Mortgage Bankers Association, Moody's, and others is that 30-year rates will remain above 5%.

☆ How First Republic's courtship of the wealthy led to meltdown
▼ + stars: | 2023-03-27 | by ( Lawrence Delevingne | ) www.reuters.com time to read: +6 min

March 27 (Reuters) - First Republic Bank (FRC.N) became the epicenter of the U.S. regional banking crisis after the wealthy clients it courted to fuel its breakneck growth started withdrawing deposits and left the bank reeling. Reuters GraphicsFor years, First Republic lured high net-worth customers with preferential rates on mortgages and loans. Morgan Stanley analysts estimated a deposit outflow of nearly half of total deposits according to a March 20 note. First Republic's loan book and investment portfolio also became less valuable as interest rates rose, which is hampering a capital raise. "Wealthy customers were drawn to First Republic in part because they could get large mortgages at rock-bottom interest rates," said McCoy.

☆ The Fed's rate hike policy doesn't have many fans — but abandoning the inflation target would be a 'disaster' that brings the economy back to the 1970s, a Fed official says
▼ + stars: | 2023-03-27 | by ( Huileng Tan | ) www.businessinsider.com time to read: +5 min

The president of the St. Louis Fed said it would be a disaster for the Fed to abandon its inflation target. The Fed has been hiking interest rates aggressively to get inflation down to 2%. The Fed then targeted inflation aggressively and adopted the 2% inflation target in the 1990s. Ethan Harris, a Bank of America economist, wrote in a December note there's little evidence that the 2% inflation target is the "optimal target," per Fortune. Higher interest rates make borrowing — like mortgages to credit cards more expensive.

☆ Morning Bid: Banks queue round the block at Fed discount window
▼ + stars: | 2023-03-24 | by ( ) www.reuters.com time to read: +3 min

A look at the day ahead in European and global markets from Wayne ColeIt's been a slow day in Asian markets, no doubt with everyone tired and emotional after another rough week. The whole yield curve from one month to 30 years is now below the overnight Fed rate, which is something you see only once in a very blue moon. Rather, history shows the curve steepens like this just before recession arrives, as short-term yields dive in anticipation of rate cuts. Fed futures are currently 65% for no hike in May and 85% for a rate cut in July, a U-turn that the Fed is surely hoping to avoid. Yet the strains are showing in the Fed books as borrowing at its discount window as of Wednesday was a hefty $110.2 billion.

Search resuls for: "Federal Reserve Bank of St"

25 mentions found