A strong labor market report could prompt a Fed pause, says Wharton's Jeremy Siegel

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강한 노동시장·GDP(3%대)로 경기 견조, 금리 인하 속도는 둔화 예상. 장기금리는 상승 추세 지속 전망, 기술·대형주에 우호적이고 소형·가치주엔 부담. 11월 대선·하원 결과에 따라 장기금리 변동 가능성 언급.

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01. it does take us to our talk of the tape a pivotal two weeks coming for stocks the tech earnings the election oh yeah fed meeting too for what's at stake let's welcome in Professor Jeremy seagull of the Wharton School welcome back it is nice to see you and have you with us as always thank you Scott happy to be here yep how's this market look to you it looks strong uh to me uh I mean uh I don't see any really drop in the momentum I mean I think it surprised everyone it's only surprised me it surprised the FED it uh GDP is going to be reported next uh week and looks to be over 3% uh we're moving into the fourth quarter I think at uh two and a half to 3% rate um and by the way what what that means I I think long-term interest rates are going to continue their uptrend uh I still think the FED is going to lower them but certainly not as much as they said or as many of us felt um but uh you know it could be a quarter point or it might even be a pause if we get a strong labor market report a week from today okay so let's let's there's a there's a lot in there and I want to take it sort of Step by Step the backup in yields has obviously made the market a bit uneasy um how much more do you think they could back up and as long as yields are going up for quote unquote the right reason of the strong economy that you mentioned is that okay for stocks yeah that's okay for stocks it's actually better better okay for the tech stocks and the big cap stocks uh than it is for the value stocks and the small stocks uh which rely more on on on the short-term borrowing so the realization that the FED is not probably going to go certainly as low as we thought a month ago I think is 1 that has been keeping a lid on on those stocks uh over the last uh month okay so you expect two to three pauses and three to four rate Cuts over the next six meetings are correct are you are you suggesting in any way that we could get a pause before this calendar year is is over because how strong the economy is yes I I I definitely uh do think so and uh you know Bowman you know finally uh you know objected in the last meeting to uh the 50 basis points so you know pal had a record of no descent so now people might descent it could if we get a strong labor market report uh for the month of October there's going to be a lot of people a lot of those fomc members that are going to say you know maybe we should pause at this particular uh juncture so it's it's it's between a pause and 25 if I had to go I would say 25 but I'm looking at next uh Friday and of course probably even more important looking at the following Tuesday we haven't yet talked about uh the biggest uh event in November uh and that would be the election of course what do you make of the positioning that's that been around the election I mean some would also suggest that the reason why yields are rising is because of a more inflationary agenda maybe from both parties but particularly if you're talking about a whole slew of tariffs and the attempt let's put the attempt to reup a bunch of tax cuts if not Institute new ones obviously depending on what Congress looks like after November 5th well you know long rates can rise because of inflation but they also will rise if there's strong economic growth there's also will rise if there's fear of a big bump in the deficits of what really uh you know as important as the president uh selection is going to be a week from Tuesday what's going to happen in the House of Representatives we pretty pretty well know the Senate is going to turn Republican the house looks very very close uh if there's a sweep by let's say the Republicans I think there could be uh a spike in in long-term yields because then they'll say hey the Christmas tree is open uh whatever tax cuts uh the Republicans want they could get if the house uh flips to democratic and by the way we may not know that for two three four days but if it does that's a check and balance and I think the the bond market would be take that more calmly than they would be a sweep by any party