Good day, money watchers and economic brainiacs from coast to coast. This is the popular Money Examiners feature we call The Economic Week That Is. Here, we discuss the breaking news of the current week with an eye to its effect on you and your personal budget. We talk about what was and is, as that will give us a leg up on what will be. There aren’t four minutes the rest of your day more important to your financial future. Let’s get right to the Economic Week That Is: June 4-8, 2018.
Monday, June 4: Tariffs having a Chilling Effect on Global Economic Growth. There hasn’t been a war in human history that is fought without casualties. One casualty of the trade war raging between the United States and its worldwide trading partners is the rate of global growth. The U.S., Europe, and China are pulling back on the economic reins like there is a baby on the track during the Belmont Stakes. The European Central Bank predicts a universal loss of 1% GDP because of the posturing and tit for tat tariffs going on among the major powers.
Tuesday, June 5: Outgoing Starbucks Head Howard Schultz Goes Public With Opinions on the Economy as Speculation Mounts About His Political Future. Starbucks coffee is known for its good smells, worldwide reach, and a certain amount of pretension (grande’ and venti when medium and large would suffice). Who made Starbucks what it is? Howard Schultz is that man. Known for his coffee empire (and for losing the Seattle Supersonics to Oklahoma City) Schultz is leaving his post atop the empire. In the face of speculation he might run for office, Schultz named the $21 trillion national debt as the greatest economic threat to this country. Schultz, considered a moderate, also took some shots at the Democratic Party for its left-leaning politics. Schultz differs with the Democrats on single-payer health coverage.
Wednesday, June 6: Bridgewater Associates Releases “Bear” Forecast for 2019. Citing its skepticism about the current “state of calm” in the stock market, leading hedge fund manager Bridgewater Associates predicted dire things for 2019. As a consequence, it’s bearish on almost all financial asset classes. Bridgewater believes interest rate pressure from the Fed will mean trouble.
Thursday, June 7: Warren Buffet Expresses a Strong Belief That the Economy is Headed for a Hot Streak. His personal fortune has taken a dreadful hit since the first of the year. Nevertheless, Warren Buffet remains confident during the week of June 4-8. Using a baseball team as a metaphor, Buffet said, “If we’re in the sixth inning, our sluggers are coming up. Right now, business is good. There’s no question about that.” J.P. Morgan CEO Jamie Dimon echoed Buffet’s sentiments in a rare joint press conference. “There is nothing that is a real pothole. Markets are wide open. Housing is in short supply. Mortgage credit will expand a little bit. So, Dimon concluded, “It looks pretty good.”
That’s it for June 4-8, 2018. In the weeks to come, Money Examiners will keep an eye on the G-7 summit in Canada. Also, of course, the process that may, or may not, lead to a Korean summit in Singapore. But, whatever happens in the week to come, Money Examiners is all over it. It’s who we are. It’s what we do.