Squawk on the Street SOTS 2nd Hour: Stocks Reverse Steep Losses on Iran Headlines. Does China Have an Edge over U.S.? Private Credit Fears Persist 4/2/26
Apr 2, 2026
David Kelly, J.P. Morgan chief global strategist, outlines growth, inflation and portfolio positioning. Torsten Slok, Apollo chief economist, explains oil shocks, inflation blips and AI's early labor effects. Stephen Roach, former Morgan Stanley Asia chair, argues U.S. political moves may give China an advantage and weighs Taiwan and economic leverage. They discuss Iran Strait developments, market rebounds and private credit liquidity concerns.
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Oil Spike Is Temporary But Growth Is Structurally Slower
- David Kelly expects oil-driven disruption to be transitory and foresees slow growth for the US economy around 1.5% long-term.
- He sees temporary CPI rise midyear (3.5–4%) then back to ~2% by year-end if oil and tariff effects fade.
Shrinking Workforce Means Growth Must Come From Productivity
- David Kelly highlights that future US growth must rely heavily on productivity gains because the working-age population is shrinking.
- He warns AI productivity gains will take time to roll out and may not immediately replace employment-driven growth.
Tilt Portfolios Toward Diversified Value
- Favor diversified, reasonably valued assets and value stocks to weather shocks rather than concentrated expensive names.
- David Kelly recommends US value, international equities, and alternatives to smooth portfolios.