Single Best Idea with Tom Keene: Jordan Rochester & Nancy Lazar
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Single best idea. Really interesting day. Great equity market coverage. Gino Martin Adams was really quite sophisticated about the linkage between technical analysis, fundamental, and even economics. David Rosenberg joined us from Canada. Thank you to his comments on King Charles' speech. He said the Canadian public really wasn't grabbed by the speech. It was much more about the elites and economics.

and the politicians and all that. Katie Kaminski on trend out of Elf Simplex in Boston was really quite good saying there is beginning to be elements of a trend.

in the equity market. We spoke on foreign exchange with Jordan Rochester of Missoula. And what's so great about the shop is they have Dominic Constam, Steve Rusciuto and Jordan Rochester. I asked Jordan Rochester, how do you piece those three minds together? - What we think is there's gonna be no Fed cuts this year.

Steve's got 1.5% GDP forecast, but a 3.5% inflation. So, your nominal is at 5%. And the Fed's going to be looking at 3.5% inflation. That's not an environment where you're cutting rates. You need to have really big weakness in the labor market to do so. However, what Konstan would point out, and what I point out too, is that this market is very much inclined to say that there's a very high bar to get this market to think hikes are the next move by the Fed.

the market will continue to think that cuts the next move. But we are of the view, it won't happen this year. So, what that means for trades is we like front-end flatteners. So, price out the

the rate cuts for this year, pricing more cuts for next year, because that's how this market is biased. So we have a steep, we're going to have a flattening of the curve, more cuts priced for 2026, less for 25. Jordan Rochester with Mizzou there. And the summary is, as he says, no Fed rate cuts this year. Boring. We'll have to see on that. But also then he gives Euro out to 120. Stronger Euro. Not immediately, but a stronger Euro through 2020.

Nancy Lazar was with us with Piper Sandler. She's definitive in the business, and she was absolutely blistering about capital spending. Here, Nancy Lazar.

First, what's given is nominal GDP. That's what's created by both monetary and fiscal policy. And nominal GDP growth has been about 5%. Next year, could it move up to something a little bit more than that? Yes. I've got to make some news. Stop. Are you saying 6% nominal GDP? Well, that's historically what the peak growth rate had been prior to the GFC. That's not out of the question going forward as you put in place tax reform, as you put in place

full depreciation on CapEx manufacturing structures and also manufacturing equipment. Capital spending is just underappreciated as the driver of growth. Without businesses reinvesting in a country, you end up with stagnation, which is what happened to us after China joined WTO.

I can't say how unusual that conversation is. If the core equation is our nation's output, our GDP, however you measure it, is consumption 70%.

Investment, 11%, maybe 13%. Then you've got government spending and all the uproar over the debt and the deficit. And you bolt on the back end, export, imports and all. How little within financial media we speak about the I, investment. And that's where Nancy Lazar is completely focused, is the idea you can't create jobs in any nation unless you have capital investment investment.

capital spending just brilliant Nancy Lazar with Piper Sandler across the nation on your commute don't forget Sirius XM channel 121 old school technology on YouTube subscribe to Bloomberg podcast and out at you YouTube podcast it's a single best idea

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