The Outthinking Investor with Daleep Singh The Old Normal: Macro Shocks Amid War, AI, and Economic Rivalries
Apr 7, 2026
Marc Sumerlin, Managing Partner at Evenflow Macro and former White House NEC deputy, brings macroeconomic and geopolitical expertise. He discusses macro shocks from the Iran war and energy disruptions. He explores how budget deficits shape policy rates and the monetary-fiscal relationship. He also examines AI, tariffs, labor-market shifts, and the evolving U.S.-China trade dynamic.
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Wealth Not Wages Powering Today's Expansion
- The current U.S. expansion is narrow: high nominal GDP growth with little job creation.
- Marc Sumerlin attributes this to a large wealth effect (roughly $10T wealth → $400B consumption) rather than broad income gains driving demand.
Big Stock Drops Could Trigger A Recession
- A sizable sustained equity correction (around 20%) poses recession risk by reversing the wealth effect.
- Sumerlin notes strong corporate profits could allow growth to justify valuations, but winner-take-all AI dynamics raise valuation concentration risks.
Productivity Gains Are Likely Temporary
- Recent productivity gains look elastic and are likely a short-term effect from flat hiring rather than true AI-driven efficiency.
- CEOs froze hiring after tariff uncertainty then delayed hiring further while assessing AI's future staffing needs.