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Bank Of America’s CEO Channels FDR

(Bloomberg) – Bank of America Corp. Chief Executive Officer Brian Moynihan said this week’s bond-market turmoil has been driven by issues outside the U.S., and that recession risks are low in the country as consumer spending remains strong.

“We have nothing to fear about a recession right now except for the fear of recession,”

I have heard that before, Brian. “The only thing we have to fear is fear itself.” Franklin D. Roosevelt

 

Bond markets have been signaling rising recession risks, with a closely watched portion of the Treasury yield curve inverting this week for the first time since 2007. Questions about the state of the economy and trade tensions have put pressure on bank stocks this month, with the KBW Bank Index falling 12% since the end of July through Thursday.

Although channeling FDR is not that great (see Amity Shlaes “The Forgotten Man: A New History of the Great Depression”), Moynihan has a point. Consumer spending is still strong and the Atlanta Fed’s GDPNow GDP forecast is 2.228% for the current quarter.

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With the rest of the globe slowing, how long can the US remain “the last man standing”?

On a personal note, Jerry Ayon sent me this story on the outsourcing of surfboards to China, Thailand, etc and how the tariff war is hurting surfboard importers. While it is difficult to compete with China’s labor costs, I will still a big fan of supporting US made “artisan” surfboards like Greek Surfboards, Harbour Surfboards, Gordon and Smith Surfboards, Dewey Weber Surfboards and Hansen Surfboards.

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And who is it in Morenci Arizona that reads my online course notes?

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