While awaiting second-quarter GDP numbers, Stifel chief equity strategist Barry Bannister suggested that growth will be strong due to a stimulus "sugar high." Although the U.S. economy likely grew at the second-fastest pace since 1983, Bannister said on FOX Business' "Mornings with Maria" Thursday that the sugar high will have to correct itself through Fed adjustments.
BARRY BANNISTER: We're going to have a strong GDP, I mean, you have the environment where you have the market in a rational response to somewhat irrational monetary and fiscal stimulus, the Biden administration has just firmly embraced Bernie-nomics. And the Fed is just providing a firehose of money, which has both inflated assets and mispriced risk.
So, of course, you're going to have a strong GDP. But one of the problems, Dagen, is that handouts are not the basis of sustainable GDP. It's a sugar high.
And when you have wage mandates, you misprice labor and we're going to have some adjustments on that.
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