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UBS On-Air: Market Moves brings you beyond the highs and lows of the ticker, with conversations that can broaden your thinking about market behavior
UBS On-Air: Paul Donovan Daily Audio 'Farmers and food'
A drone attack on a Russian ship over the weekend caused concerns about commodity supplies. Wheat prices have increased, but only very slightly (compared to last year’s spike). Higher wheat prices may not impact developed economy food consumer prices. Farmers only get a small fraction of what consumers pay for food, and consumers are much less willing to believe the “commodity prices made us do it” narratives of retailers, after the recent profit-led inflation episode.
04:0707/08/2023
Top of the Morning: ‘July Jobs Report, Fitch downgrade, and week ahead’
Our conversation recaps the July employment report, while also touches on the implications of Fitch’s downgrade of the long-term foreign currency rating of the United States. We also cover other notable macro data releases from this past week and preview the week ahead. Featured is Brian Rose, Senior Economist Americas, UBS Chief Investment Office. Host: Shiavon Chatman
12:1704/08/2023
UBS On-Air: Paul Donovan Daily Audio 'The Bank of England three-way'
The Bank of England policy decision offers a valuable international lesson. Yesterday’s decision had votes for unchanged rates, a 0.25% hike, and a 0.50% hike. One of the unfortunate realities of modern life is that structural change and the aftershocks of the pandemic means we have less understanding of how any economy is performing in real time, widening the spectrum of opinion about what has to happen next.
05:2704/08/2023
UBS On-Air: Paul Donovan Daily Audio 'Less is probably more (not that I was asked)'
The Bank of England meets, and may deliver a split decision. UK data can be spun any number of ways. Mortgage lending is resilient, house prices are falling, inflation is slow to slow, and inflation is mainly held up by quirks the bank can do little to control. I would suggest the merits of “less is more”, not that the bank has asked for my views.
05:2903/08/2023
UBS On-Air: Paul Donovan Daily Audio 'Things which do not matter'
One of the credit rating agencies (it does not matter which) downgraded the US government from something (it does not matter what) to something else. Markets care about the fiscal position of the US, and the repeated farce of the debt ceiling debacle. They do not care what credit rating agencies think about the matter.
04:1502/08/2023
Top of the Morning: Muni Market Guide - Built by bonds
Our conversation explains how one can invest in public infrastructure projects across the US, along with the factors behind muni market performance year-to-date, and what the balance of the year might have in store for the asset class. Featured is Kathleen McNamara, Senior Municipal Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy
07:1201/08/2023
UBS On-Air: Paul Donovan Daily Audio 'Profit-led inflation in retreat?'
Korean export data for the first twenty days of July was weaker, reflecting modest international demand for goods. Some of this is the legacy of negative real wage growth across developed economies, but there is also the ongoing favoring of service sector spending. The bias to service spending may be less about a post-pandemic boom, and may instead reflect a more structural change.
06:1301/08/2023
Top of the Morning: CIO Strategy Snapshot - Where to from here (for the markets)?
We take a pulse on the Fed, Q2 corporate earnings, and recent economic data, and how these factors have been reflected in recent market performance. We also discuss how conditions might evolve from here, including the risks that could dampen expectations for a ‘soft landing’ to be achieved. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy
16:4631/07/2023
Summer of Artificial Intelligence - Part 3
We turn our attention to the impact of AI on jobs, education, and the economy. Paul Donovan, Chief Economist, UBS, and Dr. Bruce Lenthall, Executive Director at the Center for Teaching and Learning at the University of Pennsylvania.
35:2431/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Front loading good news'
Financial markets are focusing on a soft economic landing. Friday’s US data demonstrated the relentless hedonism of the US consumer and ongoing disinflation. Some caution is warranted. Especially in the US, some of the strength of middle-income consumers is due to experienced inflation being lower than reported inflation. As reported inflation converges with reality, the disinflation will offer less additional support to consumers than might be supposed.
04:5631/07/2023
Washington Weekly Podcast: Chip concerns, Congressional Stock Trading, Summer recess
Our conversation outlines recent concerns over advanced technology sales to China and implications to the chips industry, a recent initiative to ban members of Congress from trading stocks, contempt proceedings against Mark Zuckerberg, and what to expect in Washington DC during Congress’s summer recess. Featured is Shane Lieberman, Federal Affairs Manager, UBS US Office of Public Policy. Host: Daniel Cassidy
12:1528/07/2023
Thoughts on the US Economy with Brian Rose
Is a soft landing possible? Following a busy macro week, we provide some key highlights, including takeaways from the FOMC meeting and press conference, Q2 GDP, along with readings on Consumer Confidence, Personal Income and Spending. Plus, a look at what’s on the data calendar in the week ahead. Featured is Brian Rose, Senior Economist Americas, UBS Chief Investment Office.
12:5128/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Central banks keep doing things'
The autopilot light is burning brightly at the European Central Bank. The gargantuan governing council “decided” to raise rates again (whether 22 people meeting for 2 hours can decide anything is a moot point). Tightening continues until economic data provides convincing leadership.
05:3728/07/2023
Private Placement Strategies 101
We discuss how for families with substantial wealth, private placement life insurance and private placement variable annuities can help to improve tax efficiency for alternative investments, and provide potential asset protection and wealth planning benefits. Featured is Justin Waring, Senior Total Wealth Strategist, UBS Chief Investment Office. Host: Daniel Cassidy
09:4527/07/2023
UBS On-Air: Paul Donovan Daily Audio 'When will the Fed cut?'
The Federal Reserve unnecessarily raised rates, as expected. Fed Chair Powell was attempting to be coy in the press conference, not committing to future policy action. Investors have no reason to pay attention to forward guidance (which Powell was instrumental in trashing last year), and instead are assuming the next move will be a rate cut.
05:1327/07/2023
Let’s talk cash with UBS Asset Management
Where is your cash invested right now? What is it invested in? What is the yield on your current investment? What are your overall liquidity needs? In this conversation with UBS Asset Management’s liquidity team, we learn about the fundamentals of investing in cash.
15:0326/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Three ways the Fed messed up'
Today is hopefully the final rate hike from the Federal Reserve this cycle. Looking back, there are three ways the Fed messed up since 2021. First, Fed policy spin has been terrible. The Fed was right about transitory inflation in 2021 (it was transitory), but when inflation shifted to the wartime energy shock, the Fed failed to communicate the changes properly and its reputation suffered.
05:3626/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Applying filters to reality'
We get another wave of surveys today-the German ifo, the UK CBI trends, and the US Richmond Fed manufacturing and Conference Board consumer surveys. Surveys are a bit like social media filters-they do not show reality, but the version of reality the survey respondent wants you to see.
04:5825/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Problems with polls and predictions'
Markets have been reminded of the unreliability of surveys and the unpredictability of politics. Polls suggested Spain’s general election would be won by the right, but these parties failed to get a majority. Socialist Prime Minister Sanchez stays in office for the time being unless a coalition gets enough votes to elect an alternative. Markets are likely to position for new elections late this year.
04:2424/07/2023
Top of the Morning: Q2 earnings checkup and the week ahead
With the first big week of corporate earnings behind us, we reflect on the results and outline overall expectations for the Q2 reporting season. We also take a pulse on equity market performance and preview what you can expect in the week ahead. Featured is Matt Tormey, Equity Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy
12:5021/07/2023
Washington Weekly Podcast: Russia-Ukraine War, Israel state visit, National Defense Bill
Our conversation updates on a range of developments associated with the Russia-Ukraine War, including the potential path for Ukraine’s NATO membership. We also provide some takeaways from Israeli President Isaac Herzog’s Congressional address, and update on the status of the National Defense Bill. Featured is Shane Lieberman, Federal Affairs Manager, UBS US Office of Public Policy. Host: Daniel Cassidy
11:5421/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Why politics is becoming a real pain'
Japan’s June consumer price inflation was not very exciting. Electricity prices (a local peculiarity of pricing) pushed the headline up 0.1 percentage point. The international core measure slowed to 2.6% y/y.
05:5821/07/2023
Top of the Morning: Emerging Markets - Taking it easier
Our conversation focuses on the implications of easing monetary policy conditions by central banks across the emerging markets. We also touch on how you should consider positioning within the asset class, along with the risks to be mindful of. Featured is Alejo Czerwonko, Chief Investment Officer for Emerging Markets Americas, UBS Chief Investment Office. Host: Daniel Cassidy
12:0320/07/2023
Top of the Morning: Why hasn’t there been a recession?
We summarize a range of factors that explain why the US economy has held up better than what was expected at the start of 2023, and provide an outlook for how conditions might evolve over the balance of the year. Featured is Brian Rose, Senior Economist Americas, UBS Chief Investment Office. Host: Daniel Cassidy
11:5319/07/2023
CIO Global Livestream: Into the second half
As we entered 2023, the broad consensus was for the US economy to slow, inflation to fall, and China’s growth to accelerate. Six months on, the US economy has proven surprisingly resilient to recession, headline inflation has fallen steadily while core inflation has been slower to decline, and China’s post-COVID recovery has disappointed. Why has all of this happened and what does it mean for the investment outlook?
28:1219/07/2023
UBS On-Air: Paul Donovan Daily Audio 'UK inflation slows (more than reported)'
UK June consumer price inflation slowed more than expected. The pattern was similar to recent months. Beyoncé concert tickets did not add to inflation this month, but Harry Styles concert tickets probably did. Consumers are still paying to have fun-holiday, restaurant, and hotel prices are slowing, but slowing slowly. Mobile phone charges rise using an automatic formula, pushing up inflation.
04:4419/07/2023
Top of the Morning: Fixed Income Strategist - Anticipation (Mid-Year Outlook)
Our conversation focuses on what the second half of 2023 might have in store for fixed income investors, including the tailwinds and headwinds to be mindful. We also discuss an outlook for rates and how fixed income investors should think about positioning. Featured is Leslie Falconio, Head of Taxable Fixed Income Strategy Americas, UBS Chief Investment Office. Host: Daniel Cassidy
13:5518/07/2023
Sustainable Investing Perspectives with Mitch Reznick (Federated Hermes) and Amantia Muhedini (UBS CIO)
We explain what’s behind increased traction in anti-ESG legislation, how countries and companies are leveraging technology to achieve net-zero targets, as well as the economic and societal implications of extreme weather events. Plus, our guests share their favorite sustainability-related summer reads. Featured are Amantia Muhedini, Sustainable and Impact Investing Strategist Americas, UBS Chief Investment Office, and Mitch Reznick, Head of Sustainable Fixed Income at Federated Hermes. Host: Daniel Cassidy Recorded on July 11, 2023.
32:3418/07/2023
UBS On-Air: Paul Donovan Daily Audio 'US middle-income hedonism'
US June retail sales data gives insight into the hedonism of the US consumer. The data is nominal, including price rises. Many goods prices are now falling, but areas like food sales still have lingering effects from the profit-led inflation episode. Tighter credit conditions may constrain the national pastime of US consumers spending money they do not have on things they do not need.
04:4518/07/2023
Top of the Morning: ‘CIO Strategy Snapshot - Into the second half (UBS House View)’
We explain why hopes of a soft landing for the US economy are on the rise and the risks to be mindful of as we make our way through the second half of the year. We also assess how the Fed might be interpreting recent rounds of economic data and what that might mean for monetary policy from here, along with outline the latest positioning guidance from the Chief Investment Office. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy
18:1217/07/2023
Summer of Artificial Intelligence (AI): Investment implications and opportunities
Our second webinar will focus on the investment implications of AI, diving into the near and long-term market impact, key opportunities, and risks.
33:2517/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Does a weaker China matter much?'
China’s second quarter GDP growth was mixed-it slowed as expected, compared to the first quarter, but was quite a bit weaker than expected, compared to the second quarter last year. Does this matter globally? A weaker China may impact the global growth aggregate, but the global growth aggregate is a meaningless statistic. Because China’s domestic demand has been quite service-sector focused, fluctuations in that demand have limited spillover to other economies.
04:1217/07/2023
UBS On-Air: Paul Donovan Daily Audio 'More (minor) disinflation and deflation signals'
After the overhyped US consumer price inflation release earlier this week, we have some minor price data. German wholesale prices moved deeper into deflation. This data is higher up the supply chain than the consumer, and so is less exposed to the profit-led inflation narrative. It does hint at the fact that the transitory demand shock inflation wave and the energy supply shock inflation wave are over.
04:4314/07/2023
Bloomberg Intelligence: Insights from Solita Marcelli
In this podcast, host Audrey Childe-Freeman, Bloomberg Intelligence Chief G10 FX Strategist, talks US and global macroeconomic outlook and currencies implications with Solita Marcelli, Chief Investment Officer Americas, UBS Global Wealth Management.
19:5713/07/2023
Top of the Morning: US Banks - Q2 earnings and Stress test results
We check in on the US Financials as we recap the results of the Fed’s annual stress test results of the banks, discuss the implications of higher-for-longer rates to the sector, preview the Q2 corporate reporting season, and outline positioning within the group. Featured is Brad Ball, Financials Analyst Americas, UBS Chief Investment Office. Host: Daniel Cassidy
17:1913/07/2023
UBS On-Air: Paul Donovan Daily Audio 'The beginning of the end of profit-led inflation?'
US consumer price data showed inflation slowing more than nominal wages, especially for middle-income consumers whose inflation experience is less than the headlines suggest. It is unclear how much credit the Federal Reserve can take for this-the 2021 transitory inflation turned to deflation without the Fed’s help, and Fed Chair Powell has little authority over energy prices.
05:0413/07/2023
UBS On-Air: Paul Donovan Daily Audio 'The monument to Powell’s policy errors'
Today’s US consumer price inflation report for June stands as a monument to Federal Reserve Chair Powell’s policy errors. No single statistic should matter so much to markets. Coherent central bank communication should leave investors interested in consumer price inflation-but as part of a survey of trends across a wide range of indicators. Obsessing over a single statistic is wrong, and a result of Powell’s policy approach.
04:4712/07/2023
Top of the Morning: State of the US Consumer
Our conversation focuses on the health of the US consumer as we dive into the recent US Consumer Discretionary sector launch by the UBS Chief Investment Office. We discuss an outlook for the sector, the risks to be mindful of and how to think about positioning within. Featured is Sunny Mehra, Consumer Discretionary Analyst Americas, UBS Chief Investment Office. Host: Daniel Cassidy
07:4111/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Real wages, real spending'
UK Chancellor Hunt used a key speech to urge wage restraint in the UK. Data today confirmed real average earnings (not the same thing as wages) are still negative—even if one adjusts inflation to take account of supermarkets’ two-tier pricing structure.
04:5011/07/2023
Washington Weekly Podcast: Bidenomics, Health care, US-China relations
We break down recent initiatives by the Biden administration to lower heath care costs and generate jobs, along with recap a recent visit to China by Treasury Secretary Janet Yellen. Featured is Shane Lieberman, Federal Affairs Manager, UBS US Office of Public Policy. Host: Daniel Cassidy
11:5610/07/2023
Top of the Morning: CIO Strategy Snapshot - Fork in the road
With the second half of the year underway, we take stock of the US economy (which has evolved differently than what was forecasted at the start of the year), as well as discuss the investment implications. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy
16:5610/07/2023
UBS On-Air: Paul Donovan Daily Audio 'The US Dickensian dilemma'
China’s producer price inflation rate moved further into deflation, and consumer prices were unchanged on the year. Food prices are rising, but goods prices kept falling. There is little direct read-through to global inflation. There are two indirect effects. The consumer price data is consistent with China’s consumers spending on services rather than goods, limiting China’s global growth impact. The data also emphasizes there is no global inevitability to inflation stickiness.
05:2710/07/2023
Top of the Morning: June Jobs Report, Fed minutes and week ahead
We provide some takeaways from the latest employment report and discuss the state of the US labor market, as well as reflect on the June Fed meeting minutes and preview the week ahead. Featured is Brian Rose, Senior Economist Americas, UBS Chief Investment Office. Host: Shiavon Chatman
10:1707/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Surveying the weird'
It is US employment report Friday. US non-farm payrolls data are derived from a survey. Fewer than 43% of companies answer the survey-normal companies cannot be bothered. Markets are salivating about a survey of the weird. It is also doubtful whether employment data fully reflects the explosion of side hustles and business startups. Nowhere in the employment report does “TikTok content creator” appear as a job. In the US and elsewhere, there are three major labor market trends that matter to markets.
04:4507/07/2023
What you have always wanted to know about Artificial Intelligence with Bryan Kelly (AQR)
Bryan Kelly is the Head of Machine Learning at AQR Capital Management, a Professor of Finance at the Yale School of Management, a Research Fellow at the National Bureau of Economic Research, and author of numerous published works. Bryan breaks down the basics of Artificial Intelligence (AI) and explains how this rapidly evolving technology is intersecting with the world of finance. Host: Daniel Cassidy
22:2206/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Threads to follow'
The Federal Reserve minutes did what was expected, demonstrating the extent of division within the Fed, and keeping expectations of a July rate increase. The purpose of minutes is not to record what was said but to protect people-but even so, a more intelligent summary of the labor market would have been nice. After years of catastrophically bad real wage growth, it seems peculiar to describe the labor market as “tight” without any qualifying comment.
04:4106/07/2023
UBS On-Air: Paul Donovan Daily Audio 'The greatest disinflation story ever told?'
Anyone worried about inflation “stickiness” should look at Eurozone producer price inflation over the past 40 years. May Euro producer price inflation likely fell into deflation, having plunged some 45 percentage points in a year. Energy is a big part of this, but the collapse of inflation pressure is nonetheless astonishing. Most profit-led inflation is not in producer price data - it is generally a consumer price issue.
05:3905/07/2023
US Real Estate: Update and Outlook with Todd Henderson (DWS) and Jon Woloshin (UBS CIO)
Our conversation focuses on the US real estate sector as we dive into the challenges facing office properties, as well as where opportunities can be located across the broader sector. Featured are Jon Woloshin, Real Estate and Lodging Analyst Americas, UBS Chief Investment Office, and Todd Henderson, Head of Real Estate Americas with DWS Group.
21:1505/07/2023
UBS On-Air: Paul Donovan Daily Audio 'United?'
The US is marking independence, at a time when political partisanship has become more extreme. This matters economically. Partisanship already distorts sentiment-based data, making the results questionable. Partisanship potentially limits internal labor mobility—at a time when being able to have the right person, in the right job, at the right time is increasingly important. Partisanship also encourages prejudice, which is extremely economically damaging. Hopefully, today will be an opportunity to reflect on what unites the United States although that may be optimistic.
04:5204/07/2023
UBS On-Air: Paul Donovan Daily Audio 'Sentiment, rather than reality'
With the US subdued ahead of tomorrow’s holiday, markets have little to do but contemplate sentiment surveys. Japan’s Tankan survey already showed improving sentiment from manufacturers and non-manufacturers, with expectations of slightly lower inflation.
04:0203/07/2023