Talking Markets with Franklin Templeton

In this episode of Talking Markets, Jeff Schulze, Head Investment Strategist at the Franklin Templeton Institute, walks us through the latest Recession Risk Dashboard reading. Eleven of 12 indicators are currently green, putting recession odds at a modest 15%. He also covers September's softer jobs report, why the Fed may take a patient approach with potentially one final hike in December, and the 130-basis-point rise in the 10-year Treasury yield, which he believes are driven by real yields, not inflation fears. Jeff also touches opportunities in non-US equities and emerging market bonds after a Fed hiking cycle begins, plus a potential seasonal tailwind following the midterm elections.

Chris Galipeau, Head Market Strategist at the Franklin Templeton Institute, recounts his 2025 thesis that equity leadership would broaden beyond the Magnificent Seven. With the thesis now delivered, he unpacks the earnings-driven case for small caps, equal-weight indices, and international markets—and cautions that a more volatile, demanding phase lies ahead. He also explains why investors should prepare for near-term volatility but stay ready to put capital to work on pullbacks.

Jeff Schulze, Head of Economic and Market Strategy at ClearBridge Investments, tells us that the US economy is holding firm, with recession risk at just 20%, a strengthening labor market, and resilient consumer spending. He goes on to discuss stronger-than-expected earnings, the AI capex surge, a genuine industrial cycle, and what a new Fed Chair means for markets.

Description (used on blogs & websites):
In this episode of Talking Markets with Franklin Templeton, host John Przygocki sits down with Chris Galipeau, Head Market Strategist at the Franklin Templeton Institute, and Putnam Investments portfolio managers Andy O'Brien and Bobby Gray to explore artificial intelligence through the lens of professional investors. What's driving the urgency behind unprecedented AI capital spending? Will hyperscalers earn a return on their massive investments? How is the infrastructure buildout broadening beyond Nvidia GPUs? The guests also examine emerging use cases across enterprise and consumer markets and debate how early we are in this technological cycle.

Jeff Schulze of ClearBridge Investments explains to host John Przygocki why he maintains a constructive outlook for the US economy, putting the odds of recession in the next 12 months at just 20%. Touching on the potential inflation implications of June's jobs report and falling oil prices, Schulze also examines shifting stock-bond correlations and argues that current S&P 500 valuations, while elevated, are supported by strong earnings. He believes that, while we may see volatility this midterm election year, the fundamental backdrop remains supportive for equities in the second half of 2026.