Yardeni Research

ECONOMIC WEEK AHEAD: March 2 - 6 Nothing upends the economic game board like a sudden war few had in their bingo cards a week ago. Granted, the coordinated US-Israel attack on Iran over the weekend wasn’t a complete surprise. But the scale of the bombardment that killed Supreme Leader Ayatollah Ali Khamenei was impressive. Tehran’

Geopolitical shocks meet key labor and retail data this week. February jobs and January sales could seal the Fed's rate outlook amid Middle East tensions.

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DEEP DIVE: The Implications Of The War In The Middle East This is an excerpt from our latest Morning Briefing, which we are sharing with our QuickTakes community. Iran's Supreme Leader Ali Khamenei was killed on Saturday along with 40 other top Iranian leaders when the US and Israel launched a military campaign against Iran’s Mullah regime. In a February

Iran's top leadership was eliminated over the weekend, yet Treasury yields fell and the Strait of Hormuz remains open. Markets are pricing in lower oil prices ahead.

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MARKET CALL: Record High For S&P 500 Equal-Weight Stock Price Index We started writing our Market Call on Friday. Saturday morning, we woke up to the news of the joint military campaign by the US and Israel against Iran's evil Mullah regime. It appears that the two allies have complete air superiority. In a video statement posted to social media, US

The S&P 500 equal-weight index just hit a record high while the market-weight index churns below 700. The rally is happening where nobody's been looking.

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GEOPOLITICS: The Clock Is Ticking In The Middle East The US has assembled its largest military presence in the Middle East since 2003, including two aircraft carriers and F-22 stealth fighters. Indirect talks in Geneva between US envoys (Steve Witkoff and Jared Kushner) and Iranian officials ended Thursday without a breakthrough. The Trump administration has warned of "drastic consequences"

The US has its largest Middle East military presence since 2003. With Trump's deadline looming and diplomacy stalled, oil markets are pricing in uncertainty.

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Will The US Economy Remain Resilient Despite AI Derangement Syndrome? If AI continues to disrupt, if not destroy, more and more business models, won't that cause a recession? It might if it triggers lots of white-collar layoffs, which in turn lead to blue-collar job losses (chart). Alternatively, it might cause a credit crunch in the private credit markets. UBS Group

UBS just raised its worst-case private credit default forecast to 15%, citing AI disruption risks. Job postings for software developers are up 11% year-over-year.

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Update On AI Derangement Syndrome & Its Consequences Last year's impressive stock market rally, which began on April 9 (when POTUS postponed his Liberation Day tariffs), was fueled by AI Optimism. It turned into AI Fatigue late last year and, in recent weeks, into AI Fear. Now it's AI Derangement Syndrome. For a while, AI was widely thought

Software stocks are cratering on fears AI will destroy their business. Yet job postings for software engineers are up 11% year over year.

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Foreigners Are Buying, Not Selling, US Securities Daily insights, focused news, clear charts, weekly video webcasts, and much more. Posted by Dr Ed Yardeni and his research team.

Foreign stocks are beating US stocks and the dollar is weakening, yet foreigners bought $1.4 trillion in US securities last year. The selling wave everyone is talking about isn't showing up in the data.

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Is AI Frankenstein? The people who've created large language models (LLMs) to power artificial intelligence (AI) are now using them to code better LLMs. If LLMs are now so good at coding that they can create their own better versions, who needs coders anymore? Are the only jobs left in the software industry

The software industry's payroll has been flat since ChatGPT launched. The AI productivity boom may be eliminating the workers who created it first.

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ECONOMIC WEEK AHEAD: February 23–27 Now that the gavel has fallen on Donald Trump’s tariffs, the question is how the US president will try to save face. President Trump’s move on Saturday to slap 15% universal levies on the globe—up from an initial 10% on Friday—dispels the notion that Trump might’

Trump's tariff drama intensifies while markets await key inflation data and Fed signals. The plot thickens on every front this week.

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MARKET CALL: A Loopy Stock Market The equal-weight S&P 500 has been rising to record highs since the beginning of the year, while the market-weight S&P 500 has been literally loopy just below 7000 over the same period (chart). This has been mostly attributable to the stock market's rotation in the type of outperforming

The equal-weight S&P 500 keeps hitting new highs while the market-weight index loops below 7000. Same stocks, completely different story.

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Dr Ed discusses the latest earnings outlook around the world and the remarkable rotation in the global stock market. Update On Earnings & Review of The Great Rotation Of The Roaring 2020s

Europe's ambitious One Market plan aims to boost competitiveness, but can private investment seal the deal? Plus, Poland proves it's an economic force to watch.

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4724: The Year Of The Fire Horse Happy Lunar New Year! Last year was the Year of the Wood Snake, according to the Chinese Zodiac. In Chinese culture, the Snake is often seen as a symbol of wisdom, intuition, and transformation. The Horse is one of the most beloved zodiac signs. It is a powerful symbol of

The S&P 500 keeps hitting new highs while its biggest stocks are falling apart. Manufacturing is suddenly galloping after years of barely moving.

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Nirvana: Will Somebody Tell The Fed That We Have Arrived? The Fed achieved its congressional dual mandate in January. The unemployment rate fell to 4.3%, and the CPI inflation rate was down to 2.4% y/y. Those round down to what we call “Nirvana” readings, i.e., the low unemployment level of 4.0% and the Fed’s

The Fed hit its dual mandate in January: 4.3% unemployment, 2.4% inflation. Yet officials still debate whether rates need to go lower.

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The Great Valuation Rotation Of The Roaring 2020s For most of the time since the pandemic, large-cap stocks have outperformed their smaller counterparts in the US stock market. That is, the LargeCap S&P 500 index has outperformed the MidCap S&P 400 and SmallCap S&P 600, collectively the “SMidCaps.” That started to change late last year

Large-cap stocks dominated for years. Now money is rotating to mid-caps, small-caps, and foreign markets. All while the Mag-7's valuations are falling.

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ECONOMIC WEEK AHEAD: February 17–20 This holiday-shortened week could be a pivotal one for investors trying to gauge the outlook for Fed policymaking. Highlights include a first estimate of Q4-2025 real GDP (Fri), December PCED inflation (Fri), February consumer sentiment (Fri), and the minutes from the January 27-28 Federal Open Market Committee meeting (Wed), when

A pivotal week ahead with Q4 GDP, inflation data, and Fed minutes. Markets are looking for clarity as the Dow crosses 50,000 amid AI-driven uncertainty.

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Inflation: Are We There Yet? I. Overview On long car rides, the kids in the backseat often ask their parents, "Are we there yet?" That's the question investors are asking about inflation: "Are we at the Fed's 2.0% inflation target yet?" Our answer: "Not quite, but we are getting close." January's CPI report showed

Inflation is 2.4% and falling, but the only thing keeping it above 2% is shelter costs. Everything else is already there.

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MARKET CALL: AI Is Speed Skating On Ice Technological innovations tend to be disruptive and dynamic. That's especially true with AI, which has the potential to disrupt itself, as evidenced by its ability to write software code, including AI code. So it can feed on itself, with the new code eating the old, making it obsolete very quickly.

AI moves so fast it's making itself obsolete. Investors are fleeing any company that might be disrupted, even the ones building it.

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DEEP DIVE: 10 Reasons To Remain Optimistic About The US Economy The following is an excerpt from our Morning Briefing dated February 9, 2026. Roaring 2020s II: Refresher Course. There are 10 good reasons for our optimistic update of the outlooks for real GDP and S&P 500 companies’ earnings in 2026. Without further ado, here they are: (1) Roaring consumer

Personal saving rates are falling, consumer spending is accelerating, and household net worth just hit a record. Retirees are spending more while getting richer.

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Annual real GDP growth averaged 3.6% during the second half of the 1900s versus just 2.1% since 2000. Dr Ed projects a return to 3.6% or higher over the rema... 10 Roaring Reasons To Remain Optimistic

The case for a return to Roaring Twenties growth. Ten reasons why the US economy could hit 3.6% real GDP growth again, from productivity booms to onshoring trends.

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AI Immunity Trade Strikes Again I. From Digital Back To Analog The “AI Immunity Trade” has caused more casualties in the stock market. It started with selloffs in software and private credit stocks at the beginning of the year. Since then, it has hit wealth managers, insurance brokerage, tax preparation, accounting services, professional data, and

Investors are fleeing software and finance stocks for office REITs and trucking. Apparently those became the digital sectors when no one was looking.

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Desperately Seeking AI Immunity ... January's Pleasant Jobs Surprise I. AI Immunity Is The New AI Trade After ChatGPT was released on November 30, 2022, investors scrambled to overweight the AI trade, mostly by overweighting the Magnificent-7 (chart). That worked out great until the DeepSeek surprise on January 20, 2025. The AI trade made a big comeback on April

Investors spent two years chasing AI stocks. Now they're hunting for companies AI can't touch. Software and wealth managers are getting crushed in the rotation.

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AI Disrupts Financials. Bad Data Misleads On Economy. AI is an extremely disruptive technology. It has already turned on its masters: The software stocks have been pounded by fears that AI will make coders redundant (chart). Now it is turning on the financial industry. The most direct hit today comes from news that Altruist, a wealth management startup,

Retail sales supposedly flat in December while Redbook shows 6% growth. ADP just revised away 2.3 million jobs. The preliminary data bears almost no relationship to revisions.

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Emerging Markets Continuing To Emerge The US MSCI continues to underperform in the global stock market derby as it did last year (chart). Does this mean that American exceptionalism, which was touted as recently as 2024, is kaput? Is this another sign of de-dollarization? We don't think so. America remains exceptional, and foreigners continue to

US stocks dominated global markets for 15 years. That ratio peaked in January and has been falling ever since.

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ECONOMIC WEEK AHEAD: February 9-13 As the polar vortex generates arctic blasts around the US, things are about to heat up on the economic data front. The week ahead includes arguably the two most consequential releases with respect to the outlook for Federal Reserve policy—January's employment and CPI reports. Thanks to recent government shutdowns,

Jobs and inflation data hit this week, with potential employment revisions that could reshape the Fed's March meeting. Markets are watching closely.

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MARKET CALL: Dow At 70,000 By 2029 "Through the roof." That's how Nvidia's CEO Jensen Huang described AI infrastructure spending in his excellent interview with Scott Wapner on CNBC this past Friday, February 6. Huang described the current landscape as a "once-in-a-generation infrastructure buildout," specifically highlighting that demand for Nvidia's Blackwell chips and the upcoming Vera Rubin

The Dow just hit 50,000 for the first time. Four of the Mag-7 stocks in the index are underperforming this year.

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DEEP DIVE: Meet Kevin Warsh Excerpt from the February 2 Morning Briefing of Yardeni Research. The Fed I: Direct From Central Casting I spent the weekend reading up on Kevin Warsh, who will replace Jerome Powell as Fed chair in May. My friends at the Financial Times asked me to write an 800-word op-ed on

Kevin Warsh once feared rate cuts would spark inflation. Now he's pushing for lower rates while inflation sits at 3%, above the Fed's target.

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Mini Tech Wreck Or Repeat Of The Big One? Is the sharp selloff in technology stocks this week the beginning of a Tech Wreck comparable to what happened from 2020 through 2022, when the tech bubble of the late 1990s burst and caused a recession (chart)? We doubt it because this time, the industry has many more profitable companies

Tech stocks are crashing while hyperscalers plan to spend $650 billion on AI infrastructure. The Dow just hit a record high.

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Today, Dr Ed examines the world according to Kevin Warsh, President Trump’s pick for the next Fed chair. Warsh believes that the US is undergoing a productiv... Meet Kevin Warsh

Kevin Warsh sees a productivity boom ahead and believes inflation is a choice, not inevitable. His vision for the Fed rejects old models in favor of pro-growth policy.

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AI Is Both Blessing & Curse … And: Is Bitcoin Biting The Dust? Our December 11, 2025, QT was titled "AI CALL: The TIME Curse & The Game of Thrones." The TIME Cover Curse hit AI in mid-December when the magazine featured "The Architects of AI" as the 2025 TIME Person of the Year. We wrote: The AI trade is turning into a Game

Alphabet just reported fabulous revenues and earnings. The stock market sold off anyway.

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Too Many Bulls Getting Shocked As AI Turns On Humans Last Thursday, we noted that the Investors Intelligence Bull/Bear Ratio of 3.99 suggested the market was vulnerable to a selloff. So far, so bad. What's worse is that the BBR rose to 4.13 this week (chart).There are still too many bulls from a contrarian perspective. But

Bull sentiment hit 4.13 this week. The market's selling off anyway. Energy and industrials are making new highs while tech craters.

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