Will We Sacrifice Growth on the Altar of Inflation?

Real Vision: Finance & Investing

Real Vision

Business News, News, Investing, Business

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🗓️ 14 March 2022

⏱️ 38 minutes

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Summary

Sellers took control of the major U.S. equity indexes after lunchtime Monday and bond yields continued to climb, as investors await the Federal Reserve’s first move to boost its federal funds rate target later this week. Crude oil has sold off by nearly 25% from near-term highs, though inflationary pressures remain the central bank’s primary concern, even as the war in Eastern Europe shows no signs of ending anytime soon. The Fed must be mindful, however, that the economy was already slowing before Russia invaded Ukraine, notes Daniel Lacalle, chief economist at Tressis. And Josh Lipsky, director of the Atlantic Council’s GeoEconomics center, points out that Russia’s economic contraction in a matter of weeks is comparable to the Great Depression, which took place over a number of years. China is another wild card, as its tech sector continues to sell off and officials are announcing new COVID-19 lockdowns. The Middle Kingdom’s role in the Russia-Ukraine war is also generating heated speculation. Lacalle and Lipsky join Real Vision’s Maggie Lake for today’s Daily Briefing, where they’ll discuss geopolitics, monetary policy, and markets. Want to submit questions? Drop them right here on the Exchange: https://rvtv.io/3KLveFJ Learn more about your ad choices. Visit podcastchoices.com/adchoices

Transcript

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0:00.0	Welcome aboard this Air France podcast message. Air France and its crew invite you to discover
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0:23.4	Air France book your business class tickets now at france.co.uk Hello, welcome to the real vision
0:36.7	daily briefing. It's Monday, March 14th, 2022. I'm Maggie Lake. And here with me today is
0:42.4	Josh Lipsky, director at the Atlantic Council and Daniel Lecaye, Chief Economist at Trusses.
0:48.0	Gentlemen, welcome. Thank you very much. Thank you for having me.
0:52.6	Yeah, thanks for being here. You know, we continue to see the Russian invasion of Ukraine upending
0:57.3	global markets. We saw some volatility today. Perhaps not as bad as we saw in the previous week,
1:03.6	but at one point stocks, bonds, oil, gold, all moving lower, although it looks like as we close
1:08.8	out the US session for equities, they're trying to come back to just about break even. We also
1:14.8	interestingly saw really heavy telling selling rather in Chinese tech shares that knocked the
1:20.2	hang sang down really sharply. I think it's a great place to start just getting an assessment from
1:26.3	both of you and Josh. You know, part of what hurt the the Asian shares were reports that Russia
1:32.2	asked China for military help, unconfirmed reports. There's been some back and forth on that. Today,
1:37.0	we learned President Biden is considering a trip to Europe. I mean, on the surface does this
1:42.0	does not appear to be a situation that is deescalating. You know, what what's your assessment of where
1:47.2	we are? I would agree. There are no signs right now of deescalation. There were some rumblings
1:52.4	over the weekend about talks, but all that seems to unfortunately have faded away. And you're right.
1:57.6	I think China is as much the big story this week as Russia, one because of the report about the
2:03.2	ask for Chinese military assistance, and two, because of the lockdowns that now will be happening
2:08.2	in China and other cities in China. So all of this is weighing on sentiment. The idea, and this is
	...

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