Veteran economist drops surprise 8-word verdict on economy
Piper Sandler’s Nancy Lazar, in a recent Fox Business appearance, argued that the U.S. is entering a more robust economic phase.
She offered a curt eight-word take on the economy.
However, if you’ve been following the economy lately, you’d know that, for the most part, it has been a doom-and-gloom scenario.
One of the most viral recent warnings came from Citrini Research’s Alap Shah, who foreshadowed a “ghost GDP” scenario fueled by AI-driven layoffs.
It’s worth noting that stock market pundit Jim Cramer pushed back on that notion emphatically, calling it a work of “science fiction.”
Moreover, the last deep-dive piece I wrote on the economy focused on Moody’s Chief Economist Mark Zandi and his warning about the economy’s fragility.
Zandi talked at length about the growing imbalance in the economy, saying productivity might rise to 2.5% as AI continues to grow, and that if demand doesn’t keep up, unemployment will rise.
Lazar, on the other hand, feels labor-market dynamics are actually improving, spearheaded by a resurgence in small-business activity and a livelier manufacturing cycle.
Layer that onto the delayed effects of lower interest-rate numbers and stronger capital spending, and she feels the conditions point toward more durable numbers.
That cuts against the grain and suggests the economy is setting up for a stronger stretch than many anticipate.
Who is Nancy Lazar?
Nancy Lazar is a veteran economist who’s been doing this for over three decades.
Currently, she serves as Piper Sandler’s chief global economist, spearheading its economics research bench, which delves into the nitty-gritty macro details on which Mr. Market trades.
Moreover, Lazar’s known for co-founding institutional research outlet ISI Group back in 1991, serving as vice chairman for more than 20 years, and helping launch Cornerstone Macro before joining Piper Sandler.
MoreEconomic Analysis:
- Ernst & Young drops blunt reality check on the economy
- Federal Reserve official blasts latest interest-rate pause
- IMF drops blunt warning on US economy
On top of that, she has consistently been ranked among the top economists by Institutional Investor magazine since 2001, hitting the top spot in 2015 and again in 2025.
A big reason for her solid reputation is the prescience of her calls.
For perspective, Lazar was remarkably early in the piece with the “manufacturing renaissance” theme, arguing back in 2009 that U.S. industry was set up for a major comeback.
Moreover, in 2015, she sounded the alarm on emerging markets, urging investors to revisit their portfolios. Consequently, per Reuters, the MSCI’s main emerging markets index dropped nearly 17% in 2015, led by sluggishness in global growth, a robust U.S. dollar, and falling commodities.
U.S. real GDP growth by year (2020-2025)
- 2020: -2.1%
- 2021: 6.2%
- 2022: 2.5%
- 2023: 2.9%
- 2024: 2.8%
- 2025: 2.2%
Source: U.S. Bureau of Economic Analysis (BEA) real GDP, annual percent change, via Federal Reserve Bank of St. Louis (FRED).
Confidence and hiring signals point to a sturdier economy
Lazar’s optimism is driven primarily by improved consumer confidence signals.
Two streams are moving in the right direction.
The first is that Piper Sandler’s own daily consumer confidence trend has continued climbing since October. More importantly, the latest Conference Board Consumer Confidence Index numbers also backed up those claims.
Related: Bank of America revamps Amazon stock price target
The headline number jumped 2.2 points to 91.2 from an upwardly revised figure of 89.0 in January. Even more pertinent, the Expectations Index jumped 4.8 points to 72.0, a sizeable bump in how consumers view the next few months ahead.
Then there’s the labor market.
Lazar cites initial jobless claims, which for context came in at 212,000 for the week ending Feb. 21, 2026 (historical lows).
On top of that, the four-week average sits at 220,250, which suggests that layoffs remain mostly contained. Also, continuing claims are around 1.83 million, Reuters reported, which means that fewer people are staying on benefits.
Lazar also talked about how it has gotten “a little bit easier to get a job,” and that has everything to do with small businesses.
On the flip side, Zandi painted a more somber picture of the job market, citing sluggish job growth and hiring rates driven by AI.
Lazar acknowledged the tech layoffs but said they were being overblown.
Manufacturing momentum and policy tailwinds could extend the cycle
Lazar believes the “K-shaped” economy, where we’ve seen only the top 20% drive spending, is also beginning to fade.
For perspective, Bank of America Institute data also showed that higher-income households in December 2025 ran at 2.4% year over year compared to just 0.4% for lower-income consumers.
That gap widened for the bulk of last year.
However, Lazar believes that the improving non-investor confidence and stabilizing labor conditions will help narrow that divide this year. To speed things up on that front, hiring numbers need to stabilize further, and wage growth needs to broaden.
Also, she feels GDP numbers could run much stronger than last year’s pace of 2.5% on the back of the policy lag.
The impact of lower interest rates takes time to show up and work through the system. Throw in stronger fiscal support and capital spending, and you create a powerful backdrop for expansion.
Also, there’s manufacturing.
For perspective, ISM’s Manufacturing PMI got back up to 52.6 in January, back firmly in the expansion territory.
Also, the S&P Global’s U.S. Manufacturing PMI printed 52.4, underscoring encouraging growth, though far from booming.
