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Editor’s note: Markets and government offices will be closed Thursday in observance of Thanksgiving Day. Consequently, Pro Farmer will not issue any updates. On Friday, markets will operate on an abbreviated schedule, closing early at 12:05 p.m. CT. Due to the shortened trading day, Pro Farmer will provide two essential reports:
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We will resume our normal publishing schedule on Monday. The team at Pro Farmer extends warm wishes for a Happy Thanksgiving.
There’s no sign of a let-up in overall consumer demand for beef despite high prices that have drawn the ire of the White House.
Beef volume sales at U.S. stores in the 52 weeks ending in early November were up about 5% year over year, Bloomberg reported, citing data from Circana. That was stronger than growth in demand for other proteins. It’s also in stark contrast to the demand destruction fostered by high prices for other products, such as eggs and cocoa, the report noted.
While there inevitably is a limit to what consumers will pay, beef hasn’t hit it yet, the report said, noting that consumers in October said they would be willing to pay $9.47 a pound for ground beef, according to Kansas State Universtiy’s Meat Demand Monitor, above the $6.64 average they saw in stores in September.
Bloomberg tied the strength in part to changes in consumer behavior, including a protein craze tied to the popularity of obesity medications that have boosted demand across the meat and dairy aisle. That said, some consumers are seen switching to cheaper options like chicken, while those sticking with beef have shown signs of trading down from expensive cuts to more budget-friendly options, the report said.
No gloom from ‘Dr. Doom’
Economist Nouriel Roubini rose to fame with his prescient warnings ahead of the 2007-2009 global financial crisis, which also earned him the nickname “Dr. Doom.” But the New York University economist was anything but gloomy in a guest column in Wednesday’s Financial Times, where he dismissed fears that the “U.S. exceptionalism” trade was over and done.
He was referring to fears that the U.S. stock market was headed for a slump, the economy for stagflation and that the U.S. dollar would crater as the nation lost the “exorbitant privilege” that comes with owning the world’s reserve currency due to growing debt and economic damage from President Donald Trump’s tariff policies. Roubini argued that, instead, “market discipline, reasonable advisers and Fed independence” blunted those threats, with markets soon correcting after the initial “liberation day” shock as Trump blinked and negotiated more reasonable trade deals.
As a result, the U.S. economy is experiencing a few quarters of below-trend growth and a modest rise in inflation rather than a stagflationary episode, he said, predicting the economy will pick up steam in 2026 due to a combination of looser fiscal and monetary policy, as well as continued tailwinds from capital spending on artificial intelligence.
Meanwhile, “American exceptionalism will continue as the U.S. (along with China) is ahead in the most important industries of the future, including AI and machine learning, robotics, quantum computing, space commercialization and defense technology,” he wrote.
Handicapping a Hassett Fed
Speaking of Fed independence…Expectations that White House economic adviser Kevin Hassett will get the nod from Trump to succeed Jerome Powell as chair of the Federal Reserve surged after a Bloomberg report Tuesday declared him the frontrunner. The dollar weakened, Treasury yields fell and stocks extended a rally partly on the idea that Hassett would be the most eager of the potential candidates to carry out Trump’s calls to significantly lower interest rates.
Peter Boockvar, chief investment officer at OnePoint BFG Wealth Partners, said Hassett has been anointed “Easy Money Man” by Wall Street, but warned that investors, politicians and policymakers should remember that low interest rates haven’t proven to be a cure-all. After all, rates hovered near zero for seven years following the financial crisis, accompanied by tepid economic growth, while cheap money has done little to supercharge growth in Europe or Japan, either, Boockvar noted in his popular “Boock Report” newsletter.
More important, he says, is that “everyone needs to read the economic room.”
That room, he writes, “is filled with people that are angry about 5 years of much higher inflation, the challenging cost of living and cost pressure issues for small and medium sized businesses. If easier money ends up re-stoking inflation, not only will that be bad for the economy, the long end of the U.S. yield curve will have its say as well and same with the value of the U.S. dollar by weakening.”