• US Policy
Tue February 21

Tomorrow will be a big day for Fed watchers as the minutes of the February meeting are released.  As I have written in the past when Chair Powell meets with the press after the Federal Open Markets Committee (FOMC) meetings, his remarks are fact checked...

Texas team creates effective COVID-19 vaccine costing $1-$1.50 per dose.  Nasdaq held at a key level, encouraging the market is respecting technicals
  • US Policy
Mon January 9

Speaker Decided but Portending Trouble Ahead

After 15 ballots the US House finally elected Kevin McCarthy to be the 55th Speaker. It was the most ballots to determine a Speaker in over 100 years. Why is the Republican disunity of such concern to analysts like me who follow DC? The vote for Speaker is one of...

  • First Word
Fri December 23, 2022

Nov's PCE inflation release will highlight why 2023 is more opportunities, and less crisis. We see downside surprises to PCE inflation = less hawkish path forward for Fed

Equities are struggling in December, capping what has proven to be a horrible year for equities. In our view, US core inflation has apexed (mid-2022) and now running at closer to 2%. But due to lags in how price-level series works (inflation is a price level), inflation will not be...

  • First Word
Mon December 19, 2022

Did the Haver "ransomware" attack inadvertently impact FOMC decision for "higher for longer"? Dec 2022 "dot plots"? Explains why 2-yr see fewer Fed hikes in 2023. Surge in Earnings Yield past year supports strong gains in 2023.

Equities sold off sharply in the days following the December FOMC. Investors told us they were disappointed:Despite visible progress on inflation (2 consecutive very soft inflation prints)Fed increased the inflation forecasts for 2022 and 2023 by +30bp and +40bp in their SEP (summary economic projections)And as a result, Fed decided...

  • First Word
Fri December 16, 2022

The bond market called inflation right in 2022 and now says Fed will be dovish in 2023... even if Fed doesn't know it yet

We hosted our 2023 Outlook webinar Wednesday and a replay is available (see banner above). The bottom line is we see the highest probability for double-digit gains since 2020. This call is fundamental (falling inflation) and Fed-based (Fed gets dovish). _THE BOND MARKET CALLED FED RIGHT IN 2022 AND NOW...

  • Intraday First Word
Tue December 13, 2022

"Lagged" CPI finally reality of rapidly falling inflation = less pressure on Fed = YE rally

Today's CPI was a major downside read coming in at:Nov CPIHeadline CPI +0.1% vs Street 0.3%Core CPI 0.2% vs Street 0.3%Details show that the downside "soft" Nov CPI repeatableLast month, our analysis showed "soft" Oct CPI was repeatable, and it was Source: Bloomberg Look below, the trend is obvious:Food is...

  • First Word
Wed November 30, 2022

Investors more "bearish" in front of Wed Fed Chair Powell at Brookings Institution, but other key macro offsets this...

In the first two trading days of this week, equities have been soft. Ostensibly, there are 3 near-term factors that are weighing on equities:Concerns about China protests turmoil and impact on US cos ($AAPL, etc)Fed Chair Powell is set to speak at Brookings Institution Wed and investors expect him to...

  • First Word
Wed November 23, 2022

88% of Americans eat turkey tomo... less "consensus" than % who see recession in 2023. Markets are not "fighting the Fed" if inflation is set to cool.

The conviction that the US is hurtling towards/or already in a recession is ubiquitous. Many can cite a litany of statistics such as:inverted curve,Fed hikes so fast and so high, it is going to break something,plunge in PMIs,collapse in CEO sentiment,commodity price movementsinflation will take "years to control"earnings estimates will...

  • US Policy
Mon November 21, 2022

Fed Minutes and Lame Duck Congress

While Wednesday may be a slow news day as investors and everyone else make final preparations for putting turkeys in the oven, for financial markets it is a big day as the Federal Reserve releases the minutes from the November Federal Open Markets Committee (FOMC) meeting.  As I have written...

  • Your Weekly Roadmap
Fri November 18, 2022

Markets Down for The Week on Tough Talk From Fed But Bounce on Friday

“Whenever you find yourself on the side of the majority, it is time to pause and reflect.”- Mark Twain There’s a lot of complex jargon and intimidating math associated with markets, as there should be. When someone’s managing many billions of dollars, obviously you’re going to attempt to get the...

  • US Policy
Mon October 31, 2022

Fed Day Wednesday and Elections one week to go

After a month of discussion about the next move by the Fed’s Federal Open Markets Committee (FOMC), decision day comes this week. The FOMC starts to meet on Tuesday and around 2:00 PM on Wednesday the Fed will announce the rate move. A 75pbs increase is widely anticipated. In my...

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