TSLA - Powell And The Fed Are More Dovish Than You Think: The Soft Landing Is Here
2024-06-13 08:55:31 ET
Summary
- The Federal Reserve, Jerome Powell in particular, seems to want a Goldilocks soft landing scenario and is trying to get things just right.
- Fed got a two year stock market round trip that allowed valuations to come down a bit.
- The risk to the economy is not lower rates and inflation, but higher rates allowing things to soften too much.
- A higher stock market means more tax revenue for the debt laden government.
- Market breadth does not support a decline in stocks yet, I'm sticking with my 5700 S&P 500 call for the year.
Jerome Powell's post FOMC meeting press conference was full of some great snippets. I thought they spoke for themselves. But then, I read a piece from Logan Kane here on Seeking Alpha titled "Powell And The Fed Are More Hawkish Than You Think: Expect Economic Weakness Ahead."
Logan's central thesis was that to prevent an asset bubble and reignition of inflation, the Fed was acting more hawkish than he thought they would. Well, I have two thoughts about that I will cover below....
Powell And The Fed Are More Dovish Than You Think: The Soft Landing Is Here