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Our Chris low chief economist at T and financials here with us in the studio lot you saw the numbers and I'm Matthew pretty much on board or what do make of it.
Well yeah I think actually Wall Street's a little more optimistic about the growth outlook next year and that's mostly because it looks like we're not going to have a budget deal which means.
We probably don't have tax increases and budget cuts to worry about next year.
And and you know that they're behind on the unemployment rate right were already essentially at seven and a half percent by the end of this year will probably be at seven you're you're in seven on the unemployment absolutely and by the end of next year six and a half -- so little bit more.
Optimistic we've been having this debate and it plays into what -- in the guards talking about and others about.
Hey what about spending like -- -- Brian -- came on he's he's an optimist about the economy -- a few days ago saying that.
Things would even be -- -- though if we get spending under control we're spending less obvious to somebody like.
Christine -- guard says -- and now we need to be.
Spending more at least not cutting spending like the sequester calls welcome guys I think there's a little bit of her politics showing in that too if you if you look at fiscal policy and its impact on the economy this year the tax hike.
Took about 1% away from growth.
They're spending cuts took away maybe half a percentage its interest -- she's focusing on the smaller piece.
And I think that that's partly because she she'd like to see more government involvement in the economy yes I'm one of those people who -- -- private sector does a better job of allocating capital net interest and to get her comments again was a lot more on the interview next hour attack at a time when the global.
Only economy -- global markets been just crazy here to look at.
One thing we've focused a lot on interest rates and as we can start there and kind of work it out to other markets but what do you make the -- go to the pick up here we've seen rates.
Well you got it actually it starts to you can look at a five minute ticker of ten year bond yields Andy it -- -- During that testimony -- the joint economic committee on May 22 Bernanke suggested they might taper.
In the next few meetings and -- sparked this sell off which is gone global.
The rise in interest rates is is large here in the US it's even bigger in Japan it's bigger in emerging market doesn't continue.
I I think he's going to try and put a stop to it next week but it's going to be tough because has also been tremendous market fallout yeah.
EE you know there's been spillover and equity markets in the currency markets.
We estimate the losses trading losses could be upwards of 101000000000010.
Trillion not ten trillion dollars since may 22 and -- you know that's -- kind of damage they can do economic harm.
But it can also affect how markets trade from here forward those are other markets by the way mostly -- -- narrowly over -- where OK if I mean relatively speaking well yes and now if you think about the three most popular trades for speculators here in the US the hedge funds for a long decade which is the -- down 20% since that speech and depending praising him right the other thing they -- they were borrowing short yen.
To invest long US treasuries that trade is down about 18%.
Because of the currency loss combined with the bond lost.
And then the third most popular -- traders long emerging markets -- for got a look take currency risk in their and that's down 20% dark dress bill could see you nonetheless some Lott had to back against him have talked in a while -- slope of -- appreciate it good to be here thanks thanks --
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