Jan Hatzius, the Chief Economist at Goldman Sachs, was on CNBC this morning to discuss his outlook for the economy and what the many negative economic reports in recent weeks mean.  Hatzius says the recent run-up in commodities has been largely due to economic improvement and not speculators (his firm had a contradicting opinion of the 2008 oil rally).  Hatzius is still very optimistic about the economy and believes we should see continued improvement in employment.  His primary worries are commodity prices as well as housing data.  He says we are early in the recovery cycle and the next recession is “years away”.

Fast forward to the 4:30 minute mark:

Source: CNBC



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Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.

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  • quark

    Oh yes…GS has seen the wrong of its ways and now can be viewed as a fiduciary partner of another mans wallet. How else is GS going to get out if they don’t convince a bid? At some point you just need to put a knife in the heart of an animal that continues to gnaw at the flesh of its master.

  • http://macronomy.blogspot.com Martin

    It is called pump and dump…

  • Robert

    Is it possible to eat too many magic mushrooms with your head buried in the sand?
    Mr. Hatzius needs a severe reality check, and come out of the ether of the pseudo
    cheerleading role.

  • harold hecuba

    TPC you put hatzius on your must read economists. why would anyone listen to a firm that needed a bailout

  • http://www.pragcap.com Cullen Roche

    Don’t villainize the man just because of the firm he works for. I worked for Merrill Lynch!!!! :-)

  • http://www.dasgelbeforum.de.org/board.php Sostegno

    OMg what a shame for german economics reputation…this dude made his dr at Oxford.
    These claimed elite universities are a joke either.

  • http://www.pfxiforex.net/ Marc

    I am facinated by these comments. Clearly NO ONE trusts Goldman Sachs at all any more. Seemingly (with good reason) their reputation and their credibility is all but detroyed. Well done Jan a co. You have succeeded in alienating the hand that fed you. Thats what happens when you sacrifice ethical business practice for deceit and lies. In life (even at the top) your only as good as your name. Isn’t it funny how NO ONE likes a thief and a liar???? Hmmmm…..maybe you can take that little bit of information back to your HFT desks, your CDO and CDS securities desks and your mortgage departments. Plug it into your mathematical algorithms and see what comes out? Maybe doing business “the old fashioned way” really never went out of style.
    Oh by the way Dr. Bernanke and President Obama….take note…because you are headed down the same road. It is but a matter of time before your credibility rests with Goldmans too unless you earn BACK the trust of your people. Good luck on that one.

  • http://oiltradersblog.blogspot.com/ Oil Trader`s Blog

    But the real question is not if we have a recession or not. In speculative terms the only thing that matters is if we are slowing down or growing faster. Asset prices only care about the second derivative.

    Jesse Livermore was probably the first guy to grasp this concept more than 100 years ago. He mentioned improving and deteriorating business conditions…

    Have a great day!

  • Lu

    What?? Jan Hatzius from GOLDMAN SACHS??? Yeah, right! LOL, LOL, that’s a good one. I don’t think anyone is falling for their BS anymore.

    Love all the other comments here as well.

  • http://www.thecomingdepression.blogspot.com thecomingdepression

    I’m sure he was just joking. No really, I’m positive. There will be a part 2 stating that was just a joke?

  • JR


  • apj

    clearly they are about to market a GDP-linked note….

  • jnh

    Its time to bail.

  • DJ

    To all the people bashing Hatzius, he was the most pessimistic of the street economists in 2007/2008 and he saved me some money during that time. I think he was too pessimistic last year, but I think he did a great job through the crisis. Anyway, doesn’t mean he’s going to be right going forward, but I don’t think one needs to hate the man either.

  • http://www.minyanville.com Keith Jurow

    Assuming Hatzius is not tongue-in-cheek, he is just like 98% of other economists now. Am I the only one who thinks that the housing debacle dwarfs all other economic issues? and not just because I write about it all the time.

    I know my history. How many of you know that you could buy a stock with only 10% down from 1927 to 1929. The DOW topped in October 1929 at around 400. Do you know where it bottomed. How about 33.

    Nobody has ever been able to tell me the difference between buying a stock with 10% down and buying houses during the bubble years with 0-10% down payment. Why should it end much differently for the housing market and our financial system. Scary thought, isn’t it? Better prepare for it. That’s why I launched my Housing Market Report on minyanville.

  • KB

    The guy is probably the best sell-side economist right now, so I would take his predictions seriously…. Just one thing to take into account – if we look at his research during past several years, his predictive power range is approximately 3-5 months (yet still much better than the average for sell side, which is probably negative 1-2 months). So, his current prognosis just means we will not see recession this and next quarter…. Still, not so bad.

  • walden

    KB and Oil Trader’s Blog have this right, in different ways. Yes, he is maybe the best sell-side economist (and he’s a pretty honorable guy at that–don’t treat GS as completely monolithic: he and other parts of the firm have publicly disagreed). But yes, while he may make predictions several years out, the bases for those predictions can shift rapidly as conditions change. So, he’s really talking about perceptions of the direction of the long range economy, and believing that those perceptions will last for at least the short term, subject to changing conditions.

  • InvestorX

    He is THE go to Wall Street mainstream economist, so he needs to talk their book. Maybe he is naive enough to not have to lie though.

  • InvestorX

    Actually Jan was among the first economists to up their 2011 growth prognosis at the end of 2010, after being among the more sceptical ones during 2010. Unfortunately it seems now that he needs to downgrade it back again, but refuses to do so so far.

    He still has some integrity as compared to the average sell-side analyst though.

  • RB

    Having a little memory fog? Forgot that Paulson, the former head of GS, was Bush’s Treasury Secretary.

  • http://www.spx500dailyindextracker.blogspot.com Klaus Bohm

    …agree, the next recession will be years away – anyway, like the German accent, makes things more reliable (some bias here of course)

    …in the short term, markets in recovery mode setting 17 May Low *1319 as base for another substantial rally up into upper channel resistance *1430 (+) – with risk of a sudden top increasing above current *1398

    for the daily number crunch: http://www.spx500dailyindextracker.blogspot.com