NZAC - Weekly Market Pulse: TANSTAAFL

• The rising rate, rising dollar environment continues with the dollar index hitting a 20-year high last week. That rising dollar is having an impact on the rest of the global economy but so far it has been manageable.
• There are a lot of companies out there that have come public over the last two years, particularly through the SPAC channel, that are not profitable, and will need to raise cash at some point.
• Meanwhile, inflation break-evens (expectations as derived from the TIPS market) are falling pretty rapidly.
• Stocks closed down last week despite a big rally on Friday. Real estate was the big loser on the week but if rates really are peaking here, that will likely change.
• I expect a correction as the economy slows this year and so our current positioning is half our strategic allocation. I don’t think that will be the end of the commodity bull market though.

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