SPXT - The Fed Blinks On Taper Bulls Buy The Dip Again

• We believe the Fed is setting the table to begin the process of taper sooner than later. Employment is improving, jobless claims are dropping, and inflationary pressures are rising, particularly housing rents.
• There is a not-so-subtle impact on asset prices when the Fed begins to taper assets. So while market participants may be ignoring the Fed short-term, the risk of a “taper” is rising.
• Elevated inflation and falling economic growth are not a good story for corporate margins or earnings. As such, we continue to suggest investors pay close attention to the message bonds are sending.

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