National Economic Council Director Kevin Hassett offered a split-screen view of the American economy this weekend, balancing record-breaking market gains against the reality of rising costs at the pump.
Appearing on Sunday Morning Futures, Hassett told host Maria Bartiromo that while the stock market is riding a historic wave of profitability, consumers should expect to deal with “higher costs” in the immediate future.
The economic backdrop remains dominated by the ongoing conflict involving Iran, which has sent national gas prices climbing by roughly $2 a gallon since the start of the war.
Despite this, both Hassett and Bartiromo highlighted April’s stronger-than-expected jobs report and significant upticks in the Nasdaq, S&P 500, and Dow Jones Industrial Average as evidence of underlying resilience.
Hassett attributed the current market surge to a fundamental shift in how businesses operate, rather than speculative trading. “There’s a huge difference between what we’re seeing in the market right now and what we saw back in the ’90s during the dot.com bubble,” Hassett said.
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He noted that the integration of AI into corporate operations has caused revenues and employment to “skyrocket,” leading to several consecutive quarters where earnings surpassed expectations by record margins. “In the end, it’s the earnings that describe what the price should be,” he added. “And there’s an earnings boom going on something unlike anything we’ve ever seen.”
However, the conversation turned to the “short-term” pain facing Corporate America and average households due to the spike in oil and gas prices. Hassett acknowledged the burden but suggested relief is on the horizon, citing analysis from figures like Scott Bessent regarding futures markets.
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According to Hassett, the logistical bottleneck at the Strait of Hormuz is the primary factor keeping prices elevated. “Once we get the Strait open… there’s going to be a gusher of oil released from the Gulf, and that’s going to put prices down relatively quickly,” he explained.
He cautioned that a “time lag” remains as tankers move from the Persian Gulf to global markets, specifically Asia, which could take a month or two.
Despite the delay, Hassett expressed confidence that the “gusher” would lead to a price drop “certainly ahead of the election.”
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