The economy is getting more powerful, not weaker, and “we are in the profession of economics need to look at ourselves in the mirror,” says senior analysts.

“The consensus has been on a mistake since January,” Släk said in a memorandum distributed to customers on Wednesday morning, adding that the average economists’ expectations that the American economy will slow down for nine months in a row: “But the reality is that it simply did not happen … We are in the profession of economics need to look at ourselves in the mirror.”

Growth challenges expectations

The second quarter of GDP An annual rate of 3.8 %A strong pace is remarkable given the continuous effort of the federal reserve to relieve inflation. The GDP in Atlanta Virus indicates that growth may be stronger in the third quarter, which predicts 3.9 %. Many economists expected the late effect of high interest rates, the most strict credit conditions, and the shock of the “Liberation Day” market in April to withdraw growth useful now.

Instead, the data tells a different story. Consumer spending continued to prove flexibilityAnd commercial investment, away from retreat, may be strengthened in sectors associated with artificial intelligence, energy infrastructure, and manufacturing reformulation. Housing, which is often sensitive to interest rates, showed sudden stability in the main regional markets. SLUNG did not dive into these details in the Wednesday edition of the daily spark, except for the process of slowing the growth of job growth. “This is the result of slowing migration,” he wrote, not economic weakness.

“The bottom line is that the American economy is still noticeably flexible,” Släk. “It has become increasingly difficult to say that we are still awaiting delay in the late negative effects of what happened six months ago,” in reference to the day of the liberation of President Trump and the imposition of a sweeping mutual tariff. One of the leading analysts was arguing for years that most Wall Street was wrong, and that the liberation day represented the end of the beginning, instead of the beginning of the end.

Current trading recovery?

Mike Wilson, the chief American stock strategy in Morgan Stanley, formulated a phrase to describe what is happening in the economy for about three years: “a”Recession“The economy has been quietly wandering in stagnation -like conditions since 2022, and Wilson has argued all the time, with no traditional measurements, but rolled through various segments of the economy, including 80 % of the homogeneous.

Although he did not notice that he was nor wireless how their readings intersect the economy, Wilson believes that the economy last spring – with the suppression of the White House liberation day on customs duties. He pointed out that federal workers are the one field that was not affected by the stagnation circulating The Duj Elon Musk initiative has been treated somewhat greatly.

In early September, Wilson argued that the report of the weak jobs for the month of August, which was just released, provided “additional evidence of our thesis that we are now moving from the recession circulating to circulating recovery.”

“In short, we enter an environment in the early cycle, and the FBI will be a key to the next station of the new bull market that started in April,” Wilson wrote.

The job report has not yet come out in September at this time of publication, but on Wednesday, ADP special salary report He showed the loss of jobs for the month of September and a review in a negative area for August. Bill Adams, chief economist Comeka The bank, was observed in a statement to luck This result was worse than expected, as ADP has now reached a decrease in three of the past four months. Comment on the other news on Wednesday, that The government closed againFor the third time in the era of President Trump, Adams pointed out: “The AdP report usually plays a second violin to report government jobs, but it is more important while the closure delays government data.” In other words, the recovery circulating in the prosperous stock market appears, but not in the labor market. Federal Reserve Chairman Jerome Powell noted in September that “”Low rental, low heat” environment.

What does it mean to investors

For markets, SLonal diagnosis carries important effects. If the economy is not weakening, but reinforcement, the expectations of inflation may tend up. The basic inflation has declined from its highest level in 2022, however Släk warns of strong growth along with the easiest monetary policy position that may revive price pressures.

“The upper risk of inflation is increasing, especially if the federal reserve continues to reduce prices,” Släk wrote on Wednesday.

In September, the Central Bank continued its first years in years, indicating confidence that inflation was returning towards the target. Since then market prices are in additional discounts in the next quarter. In fact, on September 30, Släk argued “strong economy, inflation is high”, pointing to 12 different databases (including tourism levels and a large number of visits of the Freedom statue). Then he issued a possible bold call in the light of ADP data the next day, under the pretext of consensus from the next job report, which includes 50,000 salary statements that were “very pessimistic”.

However, SLUNG’s sharp statements have not been directed to policymakers or markets, but in the same prediction society. By frequently predicting the weakness that has never reached, economists undermined their credibility.

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