Turning an economic corner?
So let us test at that premise. Shall we my vague sense. That maybe possibly kinda. Somehow we hope fingers crossed. We are on the men economically genus. Malik is it. The new york times during the holman is a bloomberg everybody. I got so Gina we're gonna save the prognostication thing for the end of our segment here. But i do feel like we have to spend some time on reserve jay powell and inflation. Mr powell spent most of his press conference on wednesday. I guess it was trying to deflect or beat back questions about inflation where the federal open market committee thinks. It's going how worried he is about it. He spent a lot of time saying in essence. We're not worried about it and if it happens we got it. The bond market on the other hand in the form of rising yields on the ten year treasury note said. Yeah no. i don't actually think that's right jay. We're a little worried What is going on. So i think that there is a real gap in timing here so i think what we're seeing in the ten year treasury note is that investors are both becoming confident that we're gonna see a little bit more inflation but also becoming confident that we're gonna see more growth. And so that's really what's moving that up but when you look at inflation expectations in the market. They moved up but they've really moved up sharply for term and then they're a little bit less pronounced in the longer term. And i think that's what people like to talking about when they say that we're not so worried about inflation in the longer term. You know there's a big difference from the fed's perspective between a jump up prices this year which they broadly expect and lasting inflation that becomes a problem down the road which they do not expect at this point. George let me ask you this though. Is it possible. And we heard a lot of this. You know back in the beginning of the pandemic and and when the recession was actually at its worst yourself into recession. Consumer expectations are a key thing. Can you talk yourself into consumers expecting inflation. Is that a thing. Do you think possibly what you can't talk yourself into is that consumers will want to spend at a certain time. So that's what a lot of retail chiefs are just hoping that even though what this week with retail sales is that they were down in the month of february a lot of the speculation was that we just have bad weather across the us. That is more of a blip compared to what the reality is going forward is more so thinking that that surge that we january will keep going. That consumers really will spin on that pent-up demand that everyone's kind of talking about in the retail world and then that will help Lift the economy less thing on on a routine yields gina. And then we'll move on the thing about it is that money will get more expensive right and then that could have conceivably a dampening effect win. Everybody's so ready to spend and go and travel and just do you know right and that absolutely something that fed is paying attention to and they've been very clear that if they see rates move up so much that they caused disorderly trading conditions in the treasury market so basically things get messy or be. They actually move up high enough to actually way against the feds goals and keep the economy from recovering than the feds gonna do something about that. But for the near term you know as long as they stay contained and sort of move up but not irrationally. I think what we're gonna see is a steady impatient fed. That just kind of you know watches. It talks about it a little bit but doesn't get to panicked values the new going. Yeah you know what we'll say. Okay anyway. sorry so jordan. Let us get to the retail. Chief you've been doing a bunch of reporting on what retail ceos are thinking once this you know trillion and a half perhaps a little bit more of of money that's on the sidelines gets going. How are they thinking about the after times in terms of how they're gonna handle that so when it comes to the time line the after times they expect happening in the second half of two thousand twenty one. So we're talking about the summertime that vaccinations were really be widespread and a lot of the ceo's. I'm speaking to operate the stores in the mall. So their idea is that the so called revenge spending will take place the fact that the ideas that customers revenge pending prevent spending. Yes something we saw accion. china ones. That government started lifting some restrictions last spring idea that people are tired of just you know shopping online in their want to go back out into the mall in like social gatherings in they're going to spend all the money that they've been saving up and so this kind of ideal yeah the revenge ending you hear it from ceo's of jack's which owns on to j. maxx marshalls on some other retail chiefs of use this phrase but the ideas like we have to wait and see. That's still something that don't know is going to occur but it's something that stores like kohl's forecasted for the second half that sales would definitely be stronger later this year.