REPLAY| DE | Quarterly | GDP Conference Call | “The Economy” Waiting for Shoe(s) to Drop—Which Way Will They Fall? – 10/29/20

Posted October 29, 2020 by rvillareal

“The Economy”

Waiting for Shoe(s) to Drop—Which Way Will They Fall?

• First Shoe—Third Quarter Real GDP (Adv.)—Economy
  • Rebound from Q2 “Collapse”: Big or Little?
  • Recovery In-Train (Monthly Data, May ff)—2 Qtrs. of Plus Real GDP?
  • Start “Engine”: Shutdowns—Reopenings
  • The Consumer
  • Fed Ultra Ease and Housing—3 Main Levers
  • Inventory Cycle a Plus
  • Fiscal Policy Support Q3 “Bridge” Support
• DE Basic Prospect—Still “ ‘L’ With an Uptilt” (Odds 65%) or Nike “Swoosh”—The GDP Path
  • Dampened Growth Ahead But Sustainable
  • Reasons—Pluses and Minuses
  • Second Shoe—Macro Risks—Pandemic (Virus) A Big Deal in Business Cycle
    • “V” (Odds 10%)
    • “W”, “Double-Dip” (Odds 15%)
    • Other (Odds 10%)
  • The Fed and Fiscal Policies—Recovery Fundamental Support
    • “Ultra” Ultra Easy Monetary Policy—Three Components and New Forward Guidance 2% Average Price Inflation
    • Fiscal Policy Stimulus—How Much, When, Needed?
  • Third Shoe—Election ’20 and After Scenarios
• Fourth Shoe—Global Economy—China and Asia Upturns But Now the Virus Resurgence
• Fifth Shoe—Policies Post-Election ‘20
• Financial Markets Prospects—Equity Bull Market Longer-Run; Range Bound Consolidations Near-Term; Interest Rates Stable with Upward Tilt on Longer Duration; Dollar Prospect Uncertain, Chinese Currency Positive