The head of the US Congressional Budget Office issued a warning about US debt sustainability, suggesting an extreme parallel with the debt debacle presided over by former UK Prime Minister Truss. US debt levels are not necessarily a concern (the US could sustain a 150% or even 200% debt-to-GDP ratio if it chose). The problem is the rapid growth in debt—which raises questions about the long-term ability of the US government to service its debt.

Our conversation recaps the latest round of Primary results, along with a look at the prospects of a ‘No Labels’ Presidential campaign launch. We also update on recent developments surrounding the Israel-Hamas War, including Secretary of State Blinken’s visit to Israel. Featured is Shane Lieberman, Senior Governmental Affairs Advisor, Governmental Affairs US. Host: Daniel Cassidy

Our conversation examines positive supply-side developments that have been a boon to the US economy, along with the latest asset allocation guidance from the UBS Chief Investment Office (per the April UBS House View: The next stage). Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

After last week’s flurry of central bank decisions, we now have assorted central bankers giving more detail on their views. The Bank of England’s Mann is on the calendar today. Mann has been a fairly consistent policy hawk, and yet she switched her vote to “unchanged” last month. Details on what caused that shift will be interesting.

This week has increased certainty about interest rate reductions in the world’s main economies. That certainty was absolute in Switzerland, where rates were cut. The uber hawks of the Bank of England had their wings clipped, and the Federal Reserve may start to believe that US trend growth is higher.

We outline the recent downgrade of China to neutral by the UBS Chief Investment Office, plus touch on a performance update of Chinese equities, along with a review of preferences. Featured is Xingchen Yu, Emerging Markets Strategist Americas, UBS Chief Investment Office.

Financial markets had the right reaction for the wrong reasons to the Federal Reserve interest rate decision. Certainty about US rate cuts has increased. This should be driven by the details of inflation data, which show clear disinflationary forces. It should not be dependent on the crude, almost vulgar abuse of economics that is represented by the fabled dot plot projections.

Fresh off of the latest FOMC policy meeting and press conference, the UBS Chief Investment Office shares reflections on the outcome. Featured is Brian Rose, Senior Economist Americas. Host: Daniel Cassidy

We continue our series of thematic investing conversations by reviewing recent updates to the ‘Circular Economy’ longer-term investment theme from the Chief Investment Office. Featured is Michelle Laliberte, Thematic Investing Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

Our monthly conversation on the muni market examines the resiliency of local governments, the recent reversal of muni performance, portfolio themes to consider, and a performance outlook for the asset class. Featured is Kathleen McNamara, Senior Municipal Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

The Bank of Japan did exactly what the Nikkei said it would. The only surprise was that two members of the policy committee appear not to have read the article, and disobeyed by dissenting. The Bank of Japan has had more internal dissent than the Federal Reserve in the past 18 months. Dissent between economists is perfectly natural.

Jay Dobson and Ed Coyne drop by UBS Studios in New York for an in-depth conversation about where we are in the energy transition story, including a look at technological innovations, investment considerations, and what to expect in the years (and decades) ahead. Featured are Jay Dobson, Energy and Utilities Sector Strategist Americas, with the UBS Chief Investment Office, and Ed Coyne, Senior Managing Partner, at Sprott Asset Management. Host: Daniel Cassidy

Join us as we explore a new provision that allows excess college 529 assets to be rolled to the 529 beneficiary’s Roth IRA. Isaac Chota, UBS 529 and Donor-advised fund program manager and George Walsh, UBS IRA program manager, from the UBS Chief Investment Office, discuss the possibilities and limitations of such rollovers. Host: Daniel Cassidy

US interest rate expectations jumped about yesterday. There was a lack of either meaningful data or Federal Reserve commentary. However, there is also a lack of a medium-term policy framework, articulating the Fed’s views on the interaction between policy and economics. At a time of structural change, that lack of a framework encourages volatility.

With the next FOMC meeting a day away, Jason Draho speaks to how the Fed might interpret recent economic data, and how the data may influence the Fed’s policy decision making. We also discuss an investment outlook, and positioning recommendations. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

Shane drops by UBS Studios in New York to update us on Congressional action against TikTok, the unfolding developments within Haiti, and upcoming milestones on the 2024 campaign trail, including the potential entrance of No Labels into the race. Featured is Shane Lieberman, Senior Governmental Affairs Advisor, Governmental Affairs US. Host: Daniel Cassidy

This week marks a new phase in the battle between markets and central banks about the timing of rate cuts. We are not at the end—no one is expecting the assorted central bank meetings to produce rate cuts this week. We are not at the beginning of the end—explicit forward guidance of rate cuts also seems unlikely. But we are at the end of the beginning. Ongoing disinflation forces continue to make a forceful case for rate cuts in the second quarter.

We have consumer inflation expectations surveys from the US and UK today. These will probably generate media excitement, but economically they are meaningless noise. Consumers’ inflation expectations are shaped by high-frequency purchases like food and fuel—most UK and US deflation is focused on low frequency purchases like durable goods. Inflation perceptions have more to do with the daily cost of buying a Snickers bar than the actual cost of living—although slower US food price inflation and UK supermarkets’ two-tier pricing may help lower perceptions.

As we near the end of 1Q24, we reflect on fixed income performance and CIO’s current positioning recommendations within the asset class. We also outline the investment case for investment grade corporates and review considerations when it comes to investment grade portfolio construction. Featured are Leslie Falconio, Head of Taxable Fixed Income Strategy Americas, and Barry McAlinden, Senior Fixed Income Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

US producer price data is mercifully free of problematic used-car prices and fantasy owners’ equivalent rent. It is also less susceptible to profit-led inflation, covering prices further up the supply chain. The final demand measure has been below 2% y/y for almost a year now, and the overall picture should be of benign inflation pressures.

Following the upgrade of the US Healthcare sector to most preferred, Eric Potoker explains the allocation shift and sub-sector views within the broader group. We also spend time discussing healthcare-related investment themes, along with the investment risks to be mindful of. Featured is Eric Potoker, Healthcare Sector Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

Following this morning's release of the February CPI print, Senior Economist Americas with the UBS Chief Investment Office, Brian Rose, drops by to share his thoughts on the data release and the broader US economy.

US consumer price inflation was largely as expected, but the detail shows a narrower number of prices that are contributing to inflation. Excluding shelter the figure remains below 2% inflation, and durable goods had their fifteenth consecutive month of deflation. Economists exclude items from the headline not to fiddle the figures, but to better understand disinflationary forces. Food price inflation slows (though most prices are not falling, and chocolate and vending machine inflation is still high). This may be politically relevant in impacting inflation perceptions.

Mike Contopoulos rejoins Leslie Falconio for a discussion around asset class performance, the potential course for monetary policy from here, positioning, and more. Featuring Mike Contopoulos, Director of Fixed Income for Richard Bernstein Advisors, as well as Leslie Falconio, Head of Taxable Fixed Income Strategy Americas with the UBS Chief Investment Office. Host: Daniel Cassidy

US February consumer price data are due. It is the detail that will tell us about the strength of disinflation forces. The January number had less headline disinflation than anticipated, but this owed much to the fairy tale of owners’ equivalent rent—a price no one pays. The inflation experience of homeowners is a lot less than headline consumer prices, which means their spending power is better.

We begin the trading week by recapping last week’s macro developments, including the latest US jobs report, and Fed Chairman Jerome Powell’s semi-annual testimony to Congress. We also preview this week’s inflation data and discuss the potential implications to the course for monetary policy and markets. Plus, we share current views when it comes to positioning. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

We conclude the week by reflecting on the February Jobs Report, Fed Chairman Jerome Powell’s Congressional testimony, and discuss the investment implications of these macro events. Plus, we preview what you can expect in the week ahead. Featured are Brian Rose, Senior Economist Americas, David Lefkowitz, Head of Equities Americas, and Leslie Falconio, Head of Taxable Fixed Income Strategy Americas. Host: Shiavon Chatman

Japan offered a timely reminder of the unreliability of economic data. Fourth quarter GDP was revised from -0.4% to +0.4%. Admittedly, this is an annualized number, which sensationalizes and exaggerates changes, but it is still a notable revision. The revision was mainly due to stronger investment spending—Japanese consumer spending was revised somewhat weaker.

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

We reflect on President Biden’s third State of the Union address, including a look at the key themes and messaging. We also update on Decision 2024 and the road ahead. Featured is Shane Lieberman, Senior Governmental Affairs Advisors, Governmental Affairs US. Host: Daniel Cassidy

The US employment report looms—for all its flaws (which are many), it still evokes excitement. Investors have two questions. Is the economy slowing? Will wage pressures create a fourth inflation wave? Payrolls data hints at the former—if the economy is not slowing the Federal Reserve might feel justified in allowing real interest rates to rise. The answer to the wage question is “no,” and average hourly earnings do not measure wages. Every time you use a self-service checkout, you push up average hourly earnings; your voluntary unreported labor replaces a low-paid worker.

Federal Reserve Chair Powell testifies to the Senate today. Yesterday’s remarks were consistent with three or four rate cuts this year, but there was surprise suggestion that a proposed tightening of bank regulation may be rethought. Fed President Kashkari hinted at support for a drastic tightening of monetary policy (suggesting only one rate cut this year, generating soaring real rates).

The US “Super Tuesday” primaries offered no real surprises for markets as to the outcome. However, opinion polls seem to be the clear loser. The Republican primaries were the main contested votes, and there notable errors in predictions of former US President Trump’s victory margin.

China announced a growth target of around 5%. China’s officials are strongly motivated to ensure official numbers meet the target, but do investors care? China’s domestic growth rate is more important to global companies (who make goods in China to sell in China) than to the global economy. China’s imports for domestic use are limited in volume. The quality of growth also matters. Were growth to come from increasing the consumer share of the economy, it might have more of a global impact.

Following what has been a busy week in Washington DC, Tom McLoughlin join us to update on government funding negotiations, preview this week’s Super Tuesday events, and the State of the Union address. Plus, we touch on what early polls are pointing to for the Presidential election, as well as the top issues on the minds of voters. Featured is Tom McLoughlin, Head of Fixed Income Americas, UBS Chief Investment Office. Host: Daniel Cassidy

With the S&P 500 having closed higher 16 of the past 18 weeks, Jason Draho outlines the factors that could determine whether the momentum will continue, including upcoming data releases, and the next FOMC meeting. We also cover positioning considerations for the current environment. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Daniel Cassidy

It’s a quiet start to a busy week. The ECB makes a policy decision later this week—no one is expecting a change, but it allows for an official statement and ECB President Lagarde will speak. While Lagarde speaking might lack a certain scarcity value, the tone of recent comments from ECB members has tended towards rate cuts being later.

The US personal consumer expenditure deflator remains in disinflation. Durable goods prices sank ever deeper into deflation. Market-based prices showed disinflation, as did services excluding financial service (financial service prices often follow market valuation). There was an intensely technical clarification about calculating owners’ equivalent rent—price no real person pays or cares about, but which excites economists. The clarification makes it unlikely OER will add more to inflation this year.

Our conversation provides a performance update and outlook for hedge funds, along with a look at the investment case for hedge fund investing in the current environment. We also cover considerations when it comes to participating in the asset class. Featured is Sean Sanborn, Hedge Fund Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

Hear from members of the UBS Chief Investment Office, including Mark Haefele, David Lefkowitz, Rolf Ganter, and Crystal Zhao, as they share an economic and market outlook.

Yesterday’s US GDP revisions did not add much to investors’ stock of knowledge. The US consumer proved stronger than initially thought, as US consumers so often are. The market-based personal consumer expenditure deflator has slowed quite notably over recent quarters. What good old fashioned supply and demand is doing is creating a quite powerful disinflation story.

Our conversation outlines considerations when it comes to earmarking assets for tax-efficient retirement spending, along with those for inheritance and philanthropy. Featured are Ainsley Carbone, Retirement Strategist Americas, and Justin Waring, Senior Total Wealth Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

US fourth quarter GDP data is revised today. This does not give us a slightly less ill-informed picture of economic activity at the end of last year, but it is still likely to miss quite a lot that is going on in the economy. Economies are changing faster than statisticians, and things like home working and self-employment are challenges—to say nothing of recording the economic value of the latest TikTok meme. Early GDP numbers are inclined to underreport activity, although today’s data is unlikely to correct all of that underreporting.

Brian Levitt is a Global Market Strategist at Invesco. Brian shares is economic outlook (including a look at the US inflation picture), reflects on the Q4 reporting season, and outlines his preferences when it comes to asset allocation. We also spend time examining the Fed’s course for monetary policy, namely the timing for rate cuts in 2024. Host: Daniel Cassidy

We discuss the cataylsts behind the stall in the muni rally, examine the results of CIO’s annual review of widely held New York credits, and look at some muni-related portfolio themes. Featured is Kathleen McNamara, Senior Municipal Strategist Americas, UBS Chief Investment Office. Host: Daniel Cassidy

As officials in Washington DC meet to negotiate an aid package for Ukraine and avert a partial shutdown of the US government, Shane discusses what’s at stake and how negotiations might progress from here. We also recap the South Carolina primary and preview upcoming milestones on the campaign trail, along with recap last week’s Governor’s Summitt at the White House. Featured is Shane Lieberman, Senior Governmental Affairs Advisors, Governmental Affairs US. Host: Daniel Cassidy

In this episode, we’re rejoined by Katherine Kroll of Brown Advisory for a discussion around the decarbonization of the shipping industry, and how this intersects with artificial intelligence. Featured are Amantia Muhedini, Sustainable and Impact Investing Strategist Americas with the UBS Chief Investment Office, and Katherine Kroll, Director of Equity Research, Sustainable Investing with Brown Advisory. Host: Daniel Cassidy

Japan’s January consumer price inflation data slowed, but the slowdown was less marked in services. This was because of foreign holiday prices—Japanese consumers are following the developed economy trend of prioritizing fun. The drivers of inflation numbers are relatively few, making a sudden rate increase by the Bank of Japan unlikely, but the modest nature of the inflation slowdown keeps alive prospects for a later rate increase.