2024 Predictions: DeSantis Wins, Fed Funds up 50 BPS, 10-Year at 4.75%, S&P up 7%
The stock market will once again climb the wall of worry, and the S&P 500 will finish up 7%. There will be no recession, because the job market is so strong, and AI excitement counters any fear. Inflation comes down to a more manageable 3%, but the Fed is not satisfied.
So the Fed Funds Rate finishes up 50 basis points, as they try to counter the persistent but lowered level of inflation in the second half of the year. The 10-Year finishes at 4.75%. The calls for recession continue, so the yield curve remains inverted.
The cracks in the commercial real estate market start to spread beyond office into apartments and single family homes, as interest rate adjustments on loan renewals bite into net operating income.
Governor Ronald DeSantis wins Iowa and the Presidential Election against President Joe Biden. Nikki Haley comes in 2nd in Iowa, but Republicans coalesce behind DeSantis. The Haley wing lines up behind DeSantis, because they are relieved and enthusiastic to defeat President Trump. The Trump wing lines up behind DeSantis, because they find him palatable enough and want to defeat President Biden. Then, Mr. DeSantis sweeps the purple Midwestern States as suburban independent women, out of frustration with the status quo, “give DeSantis a try” and begin a new post-baby boomer presidential era.