The US economy is likely headed for another 'roaring '20s' of rapid growth, per Ed Yardeni.
During a recent episode of Bloomberg's "Merryn Talks Money" podcast, Yardeni Research president shared his optimistic forecast for the coming decade, anticipating a surge in growth fueled by a combination of relaxed post-pandemic monetary policies and rapid technological advancements.
Reflecting on historical parallels, he drew comparisons to the 1920s, a period initially overshadowed by World War I, the Spanish flu pandemic, and an economic downturn in 1923. Despite these challenges, the decade unfolded as the "roaring 1920s" marked by significant technological innovations such as plumbing and more efficient methods in auto manufacturing, leading to a remarkable productivity boom.
Yardeni emphasized parallels to the present day, noting the impact of the COVID-19 pandemic and the ongoing technology revolution that began in the 1990s. He underscored the importance of technology in today's business landscape, stating that every company must either adopt or utilize technology to remain competitive.
Expressing his belief in an impending productivity growth boom, Yardeni highlighted existing data indicating its emergence.
His optimistic outlook coincided with recent Bureau of Economic Analysis data revealing a better-than-expected 3.3% expansion of the US Gross Domestic Product in the final quarter of 2023. Additionally, the benchmark S&P 500 stock-market index has been reaching record highs.
Yardeni's sentiments align with those of Swiss bank UBS, which in November suggested that last year's stronger-than-anticipated growth figures could pave the way for a "new macro regime," potentially leading to a "Roaring '20s outcome" for the US economy.
