Downtown downturn and Fed, economy, and equities pull back

By Blu Putnam, Chief Economist & Erik Norland, Senior Economist, CME Group

The Pandemic’s Downtown Downturn

• NYC weekday commuter traffic is down 75% from pre-pandemic levels.
• Losses mount for downtown businesses that depend on office workers.
• Businesses likely to shrink their office footprints, cut travel budgets.
• Structural changes to the economy make a V-shaped recovery unlikely.

Fed and the pullback in equities

• Consumer spending in August was 7% below a year ago level.
• Equities near record levels, seem to diverge from real economy.
• Did central bank quantitative easing rally tech stocks, gold, and silver?
• Tech stocks, gold pulled back in early September as Fed paused QE.