“While our corporate and consumer clients are resilient and in good financial health, the world is in a wait-and-see mode and is facing a more negative macro outlook than anyone had anticipated at the beginning of the year.” Jane Fraser, CEO Citigroup
“Right now, it’s just that pregnant pause of ‘OK, wait, let’s see.” Keith Lambert, CEO Oxidizers
“I am of the view that we are still on pause.” Ted Pick, Chairman and CEO Morgan Stanley
“When there is economic uncertainty, people generally want to pause on buying, doing a major capital purchase like a car.” Elon Musk, CEO Tesla
Welcome To The Great Pause.
Or The Great Uncertainty, as that word has also been popular on earnings calls this quarter. It’s been used 486 times by CEOs in the past 30 days versus 285 last year according to data compiled by AlphaSense. The National Association of Realtors reported last week existing home sales in March dropped to their lowest level since the subprime mortgage crisis in 2009 (which also lines up with the most recent peak of the Uncertainty Index chart). Love him or hate him, Elon said it best. People generally don’t make big purchases when there is economic uncertainty in their near-to mid-term future finances. For those buildings popular with owner-occupied buyers, there is probably a little better outlook. People do still relocate in uncertain times. Investor or second home buyer properties may have a harder time, especially given prices are still higher in many cases, along with interest rates. Let’s hope there is less uncertainty as the year progresses.