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Economist: Depression Will Lead To Boom
A prominent Wall Street strategist told CNBC the stock market may see a "wartime boom" next year following the US economy's "depression-like collapse." Jim Paulsen is one of a hand full of economists who have predicted US GDP could rebound strongly in the first quarter next year.
Paulson said companies have cut down on costs and increase efficiencies to survive the collapse.
"A lot of that boom will fall to the bottom line in a bigger way than people currently expect," Paulsen said.
Future tax policy, fiscal spending and budget deficit reduction plans are some of the key things Wall Street will be listening for in the first 2020 U.S. presidential debate, chief investment officer Hugh Johnson told Reuters business correspondent Conway G. Gittens.
Wall Street rallied to close sharply higher on Monday as investors sought bargains among sectors hardest-hit by the coronavirus recession, now limping toward its ninth month. This report produced by Yahaira Jacquez.
Wall Street's main indexes closed lower on Monday as concerns about new lockdowns in Europe and possible delays in fresh stimulus from Congress raised fears the U.S. economy faces a longer road to recovery than previously hoped for. Fred Katayama reports.
U.S. House Speaker Nancy Pelosi said on Tuesday she hoped to have a coronavirus aid deal with the White House this week, after speaking with Treasury Secretary Steve Mnuchin for almost an hour. Colette Luke has more.
On Tuesday, Wells Fargo said stock markets should prepare for volatility to balloon after Election Day. Wells Fargo head of rates strategy Michael Schumacher told CNBC's Trading Nation that options are showing greater volatility. "The big takeaway is three month options vol is still quite high, and it has not really come down." According to Business Insider Schumacher thinks investors will flock to US Treasuries due to greater volatility. The US-10 year yield may fall to 0.40% from around 0.68%.
In 1996, US Federal Reserve chairman Alan Greenspan famously warned of an 'irrational exuberance' in financial markets. Now, Business Insider reports Greenspan has spoken about his sense of economic foreboding once more. Greenspan told CNBC on Thursday that inflation, the coronavirus, and budget deficits are the critical issues the US is facing right now.
According to a Piper Sandler senior technical research analyst the S&P 500 will continue to gain following its record high on Tuesday. The S&P 500 was up 0.2% to 3,396.5 in Wednesday morning trading. It has gained 4.92% year-to-date through Tuesday's close. The analyst, Craig Johnson told CNBC that charts of lumber, oil, and industrial metals show that the economy is improving.