With what promises to be an eventful 2024 now underway, Shane Lieberman updates us on a range of negotiations taking place within Congress as it relates to government funding, the US Southern border, and foreign aid packages. We also touch on the road to the White House by previewing Monday's Iowa caucuses and recapping President Biden's recent campaign appearances. Featured is Shane Lieberman, Senior Governmental Affairs Advisors, Governmental Affairs US. Host: Daniel Cassidy

The Gulf region will be a focus in the aftermath of Western attacks on Houthi positions. Economically this does not change much in the short term. Shipping has diverted away from the Red Sea, and it seems unlikely that trade flows will adjust just because of one defensive measure. China’s trade data officially suggests some export growth, with toys and autos improving.

US December consumer price inflation is due. Are investors are focused on the Federal Reserve’s policy response, or economic realities? If the former, then headline numbers and Fed comments likely matter the most (the Powell Fed is more about spin than substance). If the latter, then the headlines matter less than the signals buried in the detail.

As a new year begins, Ainsely Carbone and Justin Waring join the podcast to outline what’s new in 2024 as it relates to Medicare and Social Security benefits. We also cover provisions taking effect as it relates to SECURE 2.0, as well as how one can manage taxes on retirement assets. Featured are Ainsley Carbone, Retirement Strategist Americas, and Justin Waring, Senior Total Wealth Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

The World Bank’s Global Economic Prospects offered gloomy forecasts for GDP growth in the coming five years. If we suspend disbelief and accept the forecasts as accurate, global living standards should do better than the World Bank forecasts imply. Swathes of the world economy have declining populations, meaning headline GDP does a poor job of reflecting living standards. Structural change increases efficiency, and those efficiency gains may go to improving impact economy standards (the environment, work-life balance, etc.) rather than the crude output metrics of GDP.

Join us for a conversation with Nadia Lovell, Senior US Equity Strategist with the UBS Chief Investment Office (CIO), and Melinda Hightower, Head of the UBS Multicultural Client Segment. Nadia discuses highlights from the UBS CIO Global Wealth Management’s Year Ahead 2024 publication and what investors should expect.

US November consumer credit jumped higher. Middle income consumers may borrow while still having savings to smooth consumption. Lower income consumers are more likely to borrow involuntarily (buying essentials on credit card, without having enough money to pay the bill at the end of the month). The increased dependence on credit supports consumer spending for now, but is a reminder that there are limits to spending—a soft economic landing is still an economic landing.

A lot has developed within the markets since the UBS Chief Investment Office published its 2024 outlook a couple of months ago - to kick-off the CIO Strategy Snapshot series for the new year, Jason Draho outlines the updates to the 2024 scenarios, along with positioning considerations and what to expect in the months ahead across the markets, the economy, and more. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

In the US, the official leaders of Congress have agreed to a spending limit. This reduces the risk of a government shutdown although no legislation has been passed and details still need to be agreed. The spending limit has been denounced by the hard right Freedom Caucus, which presents a challenge for House Speaker Johnson. When another Republican leaves the House on 21 January, the Republicans will hold 219 seats to the Democrats’ 213.

As we conclude the first trading week of 2024, Leslie Falconio reflects on the movement of treasury yields and the Fed’s December meeting minutes. We also discuss the prospects for rate cuts in the months ahead and expectations for fixed income total return in 2024. Featured is Leslie Falconio, Head of Taxable Fixed Income Strategy Americas. Host: Daniel Cassidy

Fresh off the release of the December Employment Report, Brian Rose offers his take on the data and outlook for the US Labor Market. We also recap some recent data-points and preview next week’s inflation readings. Featured is Brian Rose, Senior Economist Americas, UBS Chief Investment Office. Host: Shiavon Chatman

German, French, and Dutch December consumer price inflation was as expected, with a very subtle downside surprise. While energy base effects are raising headline inflation rates a little in Europe, the implication is that Eurozone flash consumer price data could surprise in a very unsurprising way by being marginally less than consensus.

The Federal Reserve minutes of the December FOMC meeting suggested rate cuts were self-congratulatory about the decline in US inflation (though this was only partly due to the Fed). They signaled rate cuts this year. They also signalled no rush to cut rates, and interestingly mentioned that activity may be stronger than reported. Economic indicators designed in the 1920s struggle to accurately measure modern ways of working in the 2020s.

The Federal Reserve will publish the minutes of its December meeting—which is when Fed Chair Powell had a Damascene conversion to dovishness, and fueled a rally across asset classes. The Fed minutes were written and agreed after that, and the nuance may reflect other Fed members’ concerns with the dovish flip-flop.

The last month of 2023 was marked by equity and bond rallies. The economic outlook did not really change, but the language of Federal Reserve Chair Powell did. Because Powell’s past policy errors comprehensively trashed forward guidance, investors can choose which guidance they wish to follow. Other Fed members trying to dilute the reaction to Powell have been ignored.

Hear the latest thinking and investment recommendations from the UBS Chief Investment Office with Leslie Falconio, Head of Taxable Fixed Income Strategy, and Nadia Lovell, Senior US Equity Strategist.

Korean export data for early December strengthened. Exports to the US grew quickly (exports to Europe slowed), hinting at restructuring supply chains within Asia. This implies less economic impact from the attacks in the Red Sea, with fewer sailings from Asia to Europe. The Wall Street Journal reported the Biden administration is considering taxing US consumers of Chinese electric vehicles (adding to the Trump administration’s extensive consumer taxes).

Our series of year ahead conversations continues as we focus on an outlook for munis and where opportunity can be found. Featured is Kathleen McNamara, Senior Municipal Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

Hear from top investment professionals from the UBS Asset Management’s Multi-Asset Team, this month featuring Evan Brown, Portfolio Manager and Head of Multi-Asset Strategy, and Tom Digenan, Head of Americas Investment Solutions Specialists.

UK consumer price disinflation was more than expected. This is a global trend. As consumers rebel against profit-led inflation, retailers scramble to shore up customer loyalty by means of price discounts. UK inflation is probably still overstating reality, as price discounts under supermarkets’ two-tier pricing structures are not currently captured in the data.

As the annual United Nations Climate Change Conference ‘COP28’ has come to a close, Glen and Amantia spend time reflecting on what this year’s conference delivered and what to expect in the months and years ahead in the way of progress. Featured are Amantia Muhedini, Sustainable & Impact Investing Strategist Americas, UBS Chief Investment Office, and Glen Yelton, Global Head of ESG at Invesco. Host: Daniel Cassidy

The Bank of Japan, well known for its masterful inactivity on policy, was masterfully inactive on policy today. A change to yield curve control in the first quarter is possible if wage data supports such a move—it is wise never to get too excited about Bank of Japan action.

In our final episode of 2023, Jason outlines his prediction for the 2024 ‘financial word of the year’. We also reflect on the 2023 word prediction, ‘disinflation’, as well as recap the December FOMC meeting, and explain CIO’s rationale for an allocation to US small-cap equities. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

Federal Reserve Chair Powell sparked an “everything” rally last week. This prompted the others on the FOMC to dampen the more extreme speculation. New York Fed President Williams (an economist, so deserving of considerable respect) suggested a March cut was not feasible. Markets have retreated in response.

As we make our way through the 2023 holiday shopping season, we take a pulse on the health of the US consumer and what the year ahead might have in store for consumer spend. We also highlight what consumers are spending on and what retailers are reporting. Featured is Sunny Mehra, Consumer Discretionary Analyst Americas, UBS Chief Investment Office. Host: Daniel Cassidy

Clearing aside the meaningless noise of sentiment surveys, the data calendar offers insights into global supply and demand for goods.

As 2023 winds down, we look ahead to the policy and legislative priorities of Washington DC in the year ahead, along with update on developments surrounding potential changes to US immigration policy and the scope of recent sanctions announcements by the US government. Featured is Shane Lieberman, Senior Governmental Affairs Advisor, Governmental Affairs US. Host: Daniel Cassidy

Hear from members of the UBS Chief Investment Office, including Mark Haefele, Leslie Falconio, Themis Themistocleous, and Daniel Kalt, as they outline their New Year’s portfolio resolutions for 2024.

Our series of year ahead conversations continues as we focus on an outlook for Investment Grade Corporate Bonds and where opportunity can be found. Featured is Barry McAlinden, Senior Fixed Income Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

The Federal Reserve left rates unchanged, but three rate cuts are forecast for 2024. It is as if Fed members finally read the UBS Year Ahead report. This is not really an easing of policy, however. Real interest rates will be kept more or less stable as US inflation falls, quantitative policy continues to tighten, and regulatory policy may also constrain activity.

Steve Chiavarone stops by the 1285 podcast studio to outline his macro and market expectations for 2024. We also spend time discussing the risks and headwinds facing markets in the new year and where to locate opportunity across multiple asset classes. Steve Chiavarone is the Head of Multi-Asset Solutions, an Equity Strategist, and a Senior Portfolio Manager with Federated Hermes. Host: Daniel Cassidy

The Federal Reserve should leave policy unchanged. The meeting will be followed by Fed Chair Powell delivering the full benefit of his economic insight at the press briefing (this should not take long). Powell will try to prevent markets from expecting earlier rate reductions. This task would be a lot easier had Powell not trashed the Fed’s reputation for forward guidance.

As 2024 quickly approaches, our conversation offers perspective on the current market and macro environment heading into year end, as well as what 2024 might have in store for investors. We also spend time discussing asset allocation preferences and positioning ideas. Featured are Jason Draho, Head of Asset Allocation Americas with the UBS Chief Investment Office, and Russ Koesterich, Managing Director, Portfolio Manager, and member of the Global Allocation Team with BlackRock. Host: Daniel Cassidy

US November consumer price inflation is expected to be stable. Economists must act as second-hand car salespeople; used car prices are a volatile (probably declining) component. Record numbers of people were travelling for fun over Thanksgiving (assuming seeing family constitutes fun), which may have raised leisure travel prices. The fantasy of owners’ equivalent rent adds a lot to consumer prices but not to the cost of living.

As we reflect on the year that was, we take inventory of how the ‘year of inflections’ unfolded relative to expectations at the start of 2023, along with examine the inflections that will carry over into 2024. We also preview this week’s central bank meetings and inflation prints. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

We recap the final GOP debate ahead of the Iowa caucus in January and reflect on developments up on Capitol Hill as it relates to Congressional testimony of US Bank CEOs and aid for Ukraine. Featured is Shane Lieberman, Senior Governmental Affairs Advisor with Governmental Affairs US. Host: Daniel Cassidy

Friday’s US employment report was stronger than expected, but the surprises could be revised away in the coming months (US data quality has deteriorated, meaning more revisions). However, Federal Reserve Chair Powell’s failure to articulate an economic thought process and consequent mantra of “data dependency” has left markets at the mercy of high frequency data releases of dubious quality.

We close out a busy week by analyzing the November employment report and previewing next week’s Fed policy meeting. Brian provides his take on the health of the US labor market and what the course for monetary policy looks like as we head into 1Q24. Featured is Brian Rose, Senior Economist Americas, UBS Chief Investment Office. Host: Shiavon Chatman

US employment report Friday means it is time for the monthly reminder that average hourly earnings are not wages, and are definitely not wage costs. If wages are stable and the number of low-paid workers in the economy increases, average earnings fall. At a time of structural upheaval, the composition of the workforce is likely to change. The distinction is important because (real) wages matter to consumer spending power, and wage costs matter to profit margins and potentially inflation.

Our series of year ahead conversations continues as we focus on an outlook for preferreds and where opportunity can be found. Featured is Frank Sileo, Senior Fixed Income Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

China’s November trade data showed stronger exports and weaker imports—an outcome which will help the government to meet this year’s official growth target (always something of an overriding concern in China). The data is difficult to interpret with shifts around friend-shoring and localization. Export growth to the EU remain weak, but exports to the US rose compared to last year. In contrast, US data shows import growth from China falling every month to October.

Our series of year ahead conversations continues as we focus on an outlook for fixed income and where opportunity can be found. Featured is Leslie Falconio, Head of Taxable Fixed Income Strategy Americas, UBS Chief Investment Office. Host: Daniel Cassidy

German October factory orders were weaker—although (being Germany) earlier data was revised stronger. Switching from spending on goods to spending on fun continues. Germany has a strong reputation as an exporter of goods. It has a relatively less strong reputation as an exporter of fun.

Our series of year ahead conversations continues as we focus on an outlook for equities and where opportunity can be found. Featured is David Lefkowitz, Head of Equities Americas, UBS Chief Investment Office. Host: Daniel Cassidy

There is a day of rather dubious data ahead. The US job vacancy numbers are based on a survey with a response rate so low it should not really be published. The data also only records a subset of job vacancies, and the collective mid-life crisis experienced by US workers in recent years has distorted the reporting of the numbers.

Our conversation breaks down the factors that matter for the market outlook over the near-term, namely the Fed’s policy course, and explains the drivers behind the recent November ‘everything rally’. We also cover considerations when it comes to positioning over the near-term. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

There are reports of missile and drone attacks against commercial shipping in the Red Sea. There may be a tendency to regard this as an escalation of the Israel-Hamas war, but the attacks seem to be quite small scale and markets are not inclined to price in much additional risk. Oil trade and thus the oil price will be the focus. While container ships were among those targeted, trade in goods continues to slow and is less of a market concern.

With the temporary ceasefire ended, we discuss how the Israel-Hamas War might evolve from here. We also cover some recent developments up on Capitol Hill and reflect on the legacy of late Secretary of State Henry Kissinger. Featured is Shane Lieberman, Senior Governmental Affairs Advisor, Governmental Affairs US. Host: Daniel Cassidy