Remember when the top economic news was a softening in demand for consumer goods? Recent data from the markets suggest there’s been a sea change in the economy. “After two decades of concerns primarily about changes in demand, the stock-bond correlation recently flipped,” reports an economic newsletter published on August 10, 2026. The source of risk to the economy has shifted from demand shocks to supply shocks. The newsletter was co-authored by Thomas M. Mertens, senior vice-president and associate director of research, Economic Research Department of the Federal Reserve Bank of San Francisco (FRBSF), and Wesley Wasserburger, research associate, also […]