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Before we rush into the weekend, let's check in with the slowing pace of the housing market, and what that means for the rest of the year's outlook. Another sign pointing to a softer housing market is lumber. But that's going to reverse in the decade ahead as Boomers age out of the housing market and post-Millennial generations shrink. What are you seeing in the housing market in your part of the country? In other news:A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 9, 2020.
David Rosenberg sees a near-term recession, a 20% hit to stocks, and a damaging credit crunch. The economist panned the Fed for hiking interest rates and said they could hit zero again. (Rosenberg suggested S&P 500 earnings could drop by one-fifth in a recession, to about 3,200 points.) Now we have not just the cost of credit being a problem for the economy, but the availability of credit is going to compound that. Read more: We put 7 burning questions to top economist David Rosenberg.
CNN —Heading into the NFL Draft, there’s always one prospect coming out of college who everyone becomes infatuated with, despite not being the finished article. This year’s golden boy is Anthony Richardson and, in his unique case, he’s impressed at every stage of the process. Richardson ran the fastest 40-yard dash time of all quarterbacks, as well as jumping the highest and furthest at the Combine. With potentially nine picks in the opening 12 being held by quarterback-needy teams, Richardson could be finding a new home anywhere across the league. David Rosenblum/Icon Sportswire/Getty ImagesIt means that Richardson has just 13 career college starts to his name entering the draft.
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailWatch CNBC's full interview with Rosenberg Research's David RosenbergDavid Rosenberg, Rosenberg Research founder and president, joins 'Squawk on the Street' to discuss why it would be a mistake for the Federal Reserve to hike rates again, why he believes inflation is falling, and more.
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailIrrespective of what the Fed does inflation will plummet: Rosenberg Research's David RosenbergDavid Rosenberg, Rosenberg Research founder and president, joins 'Squawk on the Street' to discuss why it would be a mistake for the Federal Reserve to hike rates again, why he believes inflation will be falling, and more.
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.
The US housing market has slowed dramatically over the past year, RH CEO Gary Friedman said. Soaring interest rates have hit housing demand, and the banking fiasco is a fresh blow, he said. Friedman said the outlook is less clear now than in 2008, and he urged the Fed not to tank the economy. "The fact is, we've been in a massive housing recession for the past year," Friedman continued, adding that "accelerating weakness" in the sector could weigh on his company's revenue and profits for several quarters. Several experts have sounded the alarm on the housing market and economy.
Jeremy Grantham warned the S&P 500 could tank by up to 50% as the "everything bubble" bursts. Grantham advised against holding US stocks for now, and slammed the Fed for inflating asset bubbles. Grantham blasted the Federal Reserve for inflating asset bubbles time and again, and warned investors against holding US stocks in the short run. And yet, the Nasdaq went down 82%, Amazon went down 92%, and the S&P went down 50%. (Grantham was discussing how the the biggest asset bubbles form.)
Stephanie Pomboy expects US stocks to plunge 30% and a broad economic downturn to take hold. Consumers, businesses, and real estate developers are being hit by soaring interest rates, she said. The stock market could plunge 30%, and the current pressure on banks could spread to commercial real estate, corporate credit, municipal bonds, and other markets, Pomboy said. The upshot is that consumers are struggling to afford their car loans and credit cards, and many companies and real estate developers are feeling the squeeze, she continued. Here's what he said about the outlook for stocks and house prices, and the threat of a recession.
The Federal Reserve should weigh up another big interest-rate increase because of recent "speculative lunacy", according to David Rosenberg. "I am starting to wonder if 50 basis points shouldn't be back on the table," the top economist said. "After this recent round of speculative lunacy, I am starting to wonder if 50 basis points tomorrow shouldn't be back on the table," the Rosenberg Research president said on Twitter Tuesday. None of the investors surveyed by CME Group expected the 50-basis-point hike that Rosenberg said the Fed should be considering. The economist didn't elaborate on what he meant by "speculative lunacy" – but he was likely referring to an early-year rally for growth stocks, cryptocurrencies, and meme stocks.
US stocks slipped Wednesday before the Federal Reserve's March rate decision. The Fed's decision is the first since SVB's collapse set off distress in regional banks. The policy decision is due at 2:00 p.m. Eastern and Fed Chairman Jerome Powell will speak at 2:30 p.m. Eastern. Cathie Wood says the Fed's rate hikes hit Ark's strategy like an 'earthquake' as the fund logs a $2 billion loss. Top economist David Rosenberg said the Fed should put bigger rate hikes back on the table after bouts of 'speculative lunacy'.
Financial stress stemming from Silicon Valley Bank's collapse could spread, a top fund manager said. But that in itself is becoming an under-the-radar issue, he noted, as large banks' strength is now coming at the expense of regional banks — even those without issues. Since most regional banks aren't classified as "systemically important," their clients would be out of luck in the event of a bank failure, Hatfield noted. Unless the FDIC insures all deposits at all banks, Hatfield said that there will be no reason to put money in a non-protected regional bank. So they'll have a negative interest margin, they'll lose money, they'll get downgraded, and they'll go out of business."
David Rosenberg has warned the US economy is headed for a "crash landing" or major downturn. Rosenberg told Insider in February that the S&P 500 could plunge 25% from its current level. "Philly Fed at a level that is 8 for 8 on the recession call and with no head fakes," Rosenberg said. He was commenting on the fact that stocks didn't rally, despite mounting expectations that the Fed won't hike interest rates this month. Moreover, they can put pressure on banks' bond holdings, as bond prices move inversely to interest rates.
In this videoShare Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailMore rate hikes a 'serious policy error': David Rosenberg on the Fed's next moveDavid Rosenberg of Rosenberg Research on what's next for the markets. With CNBC's Melissa Lee and the Fast Money traders, Carter Worth, Karen Finerman, Guy Adami and Tim Seymour.
US stocks could plummet as much as 30% over the next two months, Larry McDonald said. "The Bear Trap Report" founder sees higher interest rates choking demand and hammering the economy. McDonald also predicts investors will swap stocks for bonds to earn higher yields. McDonald estimated that every 1% increase in rates translates into a $50 billion rise in costs for middle-class Americans. He noted that interest rates on US auto loans are approaching 14%, and nearly 20% of those loans cost over $1,000 each month.
Falling lumber and natural gas prices are reasons not to fret over inflation, according to David Rosenberg. the veteran economist asked in a Monday tweet, saying it's maybe a problem in the services sector of the US economy. Rosenberg has repeatedly shrugged off inflation concerns as price pressures decline from their mid-2022 highs. US natural gas prices plunged 13% on Monday as a streak of mild winter weather hurt demand. That has seen price pressures ease somewhat in recent months, with the latest reading coming in at 6.4% through January.
In this videoShare Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailExpect stocks to struggle amid surging rates, says David RosenbergDavid Rosenberg of Rosenberg Research digs in on the impact of rising rates. With CNBC's Melissa Lee and the Fast Money traders, Karen Finerman, Dan Nathan, Guy Adami and Jeff Mills.
Stocks could slide 10% back to October lows over the next three to six months, according to Evercore's Julian Emanuel. The Fed will keep raising interest rates, Emanuel warned, lowering the odds of a soft landing. But that's unlikely as central bankers will keep on tightening interest rates, Emanuel said, which could mean more downside for stocks. Fed officials raised interest rates 425 basis-points last year to tackle rising inflation, a move that caused the S&P 500 to lose 20%. "The Fed's going to just keep going until something either softens, or invariably, as it has through most of history, breaks," Emanuel warned.
Here's what five Wall Street experts are saying about the fate of the economy this year. Here's what five Wall Street experts are saying about the fate of the economy this year. Jamie Dimon, JPMorgan CEOJamie Dimon REUTERS/ Larry DowningA soft landing is possible, but markets are facing some "scary stuff" ahead, according to the JPMorgan boss. Kevin O'Leary, "Shark Tank" investorKevin O'Leary Mark Davis / Staff / Getty Images"Shark Tank" investor Kevin O'Leary remained optimistic on the market in 2023, and made the case for a soft landing. "We may actually get what people keep saying is impossible … a soft landing.
US stocks slid on Friday after key inflation data came in hotter than expected. Core PCE, the central bank's preferred inflation measure, rose 0.6% in January, higher than economists' estimates. Core Personal Consumption Expenditure data, the central bank's preferred inflation measure, increased 0.6% from a month earlier, higher than economists' estimates and the most since June. Treasury yields jumped, with the two-year yield hitting 4.79%, its highest level since 2007. Tesla boss Elon Musk reiterated his view that the central bank's tightening could crush the value of the entire stock market.
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailRosenberg Research's David Rosenberg explains why the no landing narrative is a hoaxDavid Rosenberg, Rosenberg Research founder and president, joins 'Squawk on the Street' to discuss his thoughts on what to expect from Fed rate hikes and the market in 2023.
Watch CNBC's interview with Rosenberg Research's David Rosenberg
  + stars: | 2023-02-24 | by ( ) www.cnbc.com   time to read: 1 min
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailWatch CNBC's interview with Rosenberg Research's David RosenbergDavid Rosenberg, Rosenberg Research founder and president, joins 'Squawk on the Street' to discuss his thoughts on what to expect from rate hikes and the market in 2023.
Raheel Siddiqui, senior research analyst at Neuberger Berman, told CNBC Make It a recession in 2023 "will be more severe than expected." The labor market is strong, too, with a tiny unemployment rate of 3.4%. "In a plain-vanilla recession, earnings go down 20%. And when economic downturns occur at the same time as deflation, you can expect a larger-than-normal drop in earnings, Siddiqui said. The bottom quartile is entering a recession," Siddiqui said.
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailRosenberg Research's David Rosenberg calls 'no landing' a nice fairy taleDavid Rosenberg, Rosenberg Research founder, joins 'The Exchange' to discuss the latest inflation data and how he believes the Fed will react.
Michael Burry built new stakes in Alibaba, JD.com, and MGM Resorts last quarter. The investor of "The Big Short" fame may have spied value in beaten-down Chinese tech stocks. The investor of "The Big Short" fame bought 50,000 American Depositary Shares (ADS) of Alibaba, valued at $4.4 million on December 31. He also scooped up 75,000 American Depositary Receipts (ADR) of JD.com, worth $4.2 million at the end of last year. Burry's Scion Asset Management also purchased 100,000 shares of MGM, a position worth $3.4 million at last quarter's close.
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