What Can the Sahm Rule Tell Us About the Economy?

In this episode, 's Chief Fixed Income Strategist Kathy Jones interviews previous Fed economic expert Claudia Sahm. And 's Chief Investment Strategist Liz Ann Sonders discusses the December tasks report with Kevin Gordon. Liz Ann and Kevin look at the distinctions in between the numbers in the household survey and the establishment study– and how this data will affect the battle versus inflation, to name a few topics. You can see the charts they point out in this article: Mixed Signals: December's Jobs Report ().

Kathy and Claudia go over the Sahm guideline, which is an indication of a recession, and its purpose in supplying policymakers with direction for supplying relief during financial recessions. The discussion then shifts to the labor market, with Claudia highlighting its durability and the requirement for a sustainable expansion. The conversation carries on to inflation, with Claudia explaining that recent inflation has been driven by supply-side shocks instead of demand. She reveals confidence in the Fed's ability to reach its 2% inflation target. Their discussion also discuss the argument within the Fed and the potential impact of the Fed's interaction on monetary markets..

You can follow Claudia Sahm's newsletter, Stay-at-Home Macro, at.

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What Can the Sahm Rule Tell Us About the Economy?

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