Ed Yardeni, Yardeni Research president, joins ‘Squawk Box’ to discuss the latest market trends, state of the economy, labor market, impact of AI, and more.

Source: cnbc.com

New data from the Arizona Office of Tourism showed a 22% drop in Canadian tourism to Arizona. Why it happened and what it means for the economy.

Source: azcentral.com

A new poll finds that younger Americans are more pessimistic than older ones about the state of the job market

Source: washingtonpost.com

CEO comments point to a slowdown among lower-income consumers.

Source: axios.com

Modi appealed to Indians to cut fuel use, overseas travel and gold purchases as the Middle East conflict exposes India’s heavy reliance on imported energy.

Source: cnbc.com

Bank of America expects the World Cup to add $41 billion to global GDP, and create 800,000 jobs.

Source: businessinsider.com

It was a big week for Republicans, especially President Trump.

Source: axios.com

The Iran war has degraded Iran’s military strength, but the conflict has imposed high economic costs on the U.S., where consumers are feeling squeezed.

Source: csmonitor.com

Beijing is signaling that it is ready for a trade showdown, and it is building up a legal arsenal in preparation.

Source: nytimes.com

The first US presidential visit to China in almost 10 years will test a fragile tariff truce.

Source: bbc.com

Factory-gate prices increased 2.8 per cent last month and consumer prices were up 1.2 per cent, surpassing expectations as fuel costs rise.

Source: scmp.com

Former intelligence official warns China and Russia can inflict devastating economic chaos by targeting undersea cables carrying 99% of global data.

Source: foxnews.com

Open your favorite business paper or news site right now and you will be confronted with a scene of spectacular cognitive dissonance. We have a historic disruption to energy supplies and profound uncertainty about the future of the order in the Middle East. Brent crude is hovering around $100 and there are real fears about the supply of diesel and jet fuel, with worse to come. And yet the S&P 500 is reaching new records. The complacent view peddled by the Trump administration is that the dissonance is false. The Straits of Hormuz are a passing storm. America’s economy is going strong. The AI boom is real. In their “heart of hearts” American consumers actually feel great. Another source of complacency is the talk of the TACO trade – “Trump Always Chickens Out”. As bad as things look, there will be some way out of the looming energy crisis. By contrast, harsher critics conclude that America’s elite just don’t care how things actually are. They care only about the bottom line and, right now, AI makes that look good. As if echoing David Dayan in the American Prospect, the FT’s report from this year’s Milken Institute conference was titled, “Blissful ignorance”: Milken elite bask in glow of roaring markets Financiers at the Beverly Hills gathering brush aside concerns over Iran conflict and private market strains … Despite war and tariffs driving worries about US affordability, attendees at this year’s Milken Institute conference were notably untroubled — gliding between Spago dinners, a speech by Tom Brady and parties at billionaires’ Bel Air homes. Many of the investors, bankers and corporate chieftains who took over the Waldorf and Beverly Hilton this week have become desensitised to President Donald Trump’s whims. … Financiers largely brushed off concerns that have dominated conversations on Wall Street in recent months, including the war with Iran, which has driven up petrol prices across the US and is now dividing policymakers at the Federal Reserve over whether they can eventually cut interest rates. “Does anyone really care if the Strait of Hormuz is open?” one high-powered banker posited. … The mood at the Milken conference remained relatively buoyant even as the tectonic plates of geopolitics continued to shift thousands of miles away … “They might not like a lot of what’s happening in Washington, but at the end of the day, everyone’s focused on their own investment portfolios, especially here,” said Ted Koenig, chief executive of Monroe Capital. … “People are glossing over the war with Iran,” the head of one private credit firm said. “They’ve become desensitised to it. …. The outward-facing optimism was belied by private comments from financial executives and investors who described the “weird” schism between the record-setting stock market and broader consumer sentiment. “The stock market doesn’t care about the war,” said one executive based in the Middle East. … One London-based hedge fund manager said the conference had crystallised how relatively removed the US has been from the conflict’s effects, despite being an active participant in the war. “No one in Europe has this level of optimism,” he said. “There is enthusiasm based on the greater adoption of AI and positivity about the economy. In Europe, the tone is at best cautious optimism or healthy scepticism.” … “The room was half empty most of the time,” the person said. “People were only tuning into Jensen Huang or Tom Brady.” The next question is whether this fecklessness is ultimately down to cynicism or foolishness. Of course, the looming market debuts for SpaceX, Anthropic and OpenAI are exciting. But you might think that even on the basis of narrow self interest, a boom sustained by only a handful of stocks ought to be worrying. Private equity boss Marc Rowan likes to quip that America has levered its entire retirement system to the performance of Nvidia. With the chipmaker sporting a market capitalisation of more than $5tn, the Apollo Global Management chief executive is not entirely wrong. What’s more, Big Tech’s heft is obscuring emerging weaknesses elsewhere. According to a recent UBS analysis, 42 stocks are driving the bulk of the S&P 500’s returns; typically, around 100 do. The index is up 12 per cent since the end of March on the back of AI-fuelled tech blue-chips, which also include Alphabet, Microsoft, Apple, Meta Platforms and Broadcom Of course a boom is nice. But can a K-shaped economy be sustainable? As we discussed on Ones and Tooze this week, America’s economy and society are increasingly divided (the Thatcher segment is good too!): Consumer staples like Planet Fitness, Shake Shack and Whirlpool are all ailing. And, if the predictions of the AI boosters come true, the polarization is only set to intensify. AI will make a few rich but the majority will face unprecedented adjustment shocks. The graph of the moment, which has now appeared in numerous outlets, was, to my knowledge, first published by the Dallas Fed in the summer of 2025. It shows the US economy either spiraling to infinity or collapsing to extinction. We go to the moon (or to Mars) or we collapse to the stone age. It could be one or the other, and no one even flinches. It is as though we were living through the Cuban missile crisis and no one even notices. Is it not time to wake up? At this point even OpenAI is calling for a new industrial policy to meet the challenge. And can the predictions of giant AI-driven transformation possibly be real? Lift the lid on the black box of the AI boom and the cognitive dissonance only deepens. As Robin Wigglesworth points out, the entire big tech-AI nexus is self-feeding to an extraordinary degree. It does not take rocket science to figure out that the balance sheets of players like Alphabet and Amazon, newly stressed by the hundred-billion demands of hyperscaling, are being propped up by the inflated valuations of AI players, who are in turn the biggest customers of their sponsors’ cloud......

China’s government is pouring money into AI, electric cars and military power, while consumer confidence sags and job market grows bleak.

Source: wsj.com

After acquiring Hawaiian Airlines last year and launching its first European service last week, there is a lot of positive change on the horizon for Alaska.

Source: thepointsguy.com