Second, Jan Hatzius, the firm’s chief economist, made an equally out-of-consensus, and prescient, call in the opposite direction in 2008. This was a key reason Hatzius projected weaker growth and a higher risk of recession in 2008 than the consensus. After the recession, Hatzius again broke with the consensus in predicting, correctly, that bond yields would fall despite huge federal deficits. What’s aheadOn the current big picture, Hatzius has remained emphatic that inflation can return to 2% without higher unemployment. In the end, the supply side rebounded even more than Goldman had expected, with growth in 2023 outstripping its optimistic forecast.

Source: Wall Street Journal February 22, 2024 14:17 UTC