Fed
- First Word
- First Word
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
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...
First Word
S&P 500 ~30% loss in "real terms" staggering, leaving room for rally. Not priced for perfection. Since 1930, median P/E when 10Y 3.5% to 4.5% is 19X, and 18.5X when Fed tightening.
Stocks have continued to strengthen, and in our view, this is more than just a "dead cat bounce" (aka bear rally) as we have outlined...
First Word
Inflation less of a "blackhole of pain" and Fed sees that = why risk assets YE rally could exceed June +23 days/+16% meaningfully.
In the past week, risk assets staged one of the best gains in 2022. Over that same time frame, there was little "hard" economic data...
Your Weekly Roadmap
Markets Rally on Hopes for Fed Pause, Earnings Have Been Mixed
Markets had their best day since June in a furious rally that was led by Materials, Financials and Technology. This was the third positive week...
- First Word
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...
First Word
A subtle shift in Fed reaction function? ...when bond less CPI "reactive" and equities see extreme negative positioning
There was a lot of macro chatter, commentary and analysis over the weekend following the extreme market moves post the "very hot" Sept CPI. But...
First Word
JOLTs instance "hard" converging towards improving "soft" data. At this pace, Fed gets 1.0 openings/worker ratio by Oct/Nov. Nasdaq 100 became "100% bid". Since 1996, 6 of 6 times, saw further gains.
After a tumultuous decline in the final weeks of September, market technicals were awful and sentiment and positioning bearish. But in each of the past...
First Word
HY not making new wides, despite S&P 500 making new lows = divergence. HWOL data suggests JOLTS job opening ratio could fall to 1.85 for August (reported 10/4)
This week is even uglier than last week. Financial markets have become even more wary this week, with markets concerned about a plethora of factors...
First Word
Fed losing patience with inflation progress, near peak "hawkish" vs futures. Retail looks to be near capitulation
Investors appear to have given up all hope for any soft landing post the Sept FOMC (9/21). Looking at market reactions, post-FOMC:Fed Funds futures now...
