IJT News and Press, IJTiShares S&P Small-Cap 600 Growth ETF From 12/11/22

Summary The Fed needs to deliver a hawkish message for 2023 at the December FOMC meeting. It seems highly probable the Fed will signal a 5% or higher terminal rate for 2023. If the Fed fails, it risks losing control of the market. The FOMC meeting on Wednesday, December 14...

Summary A liability is money that the Fed owes some other entity - in this case, money that the Fed owes the US Treasury Department. if the average combined balances in 2023 of reserves and overnight RRPs is $4.5 trillion, and if the Fed pays an average of 5% on these balances, it will ...

Summary Recent levels for the equity put/call ratio suggest investors are exhibiting extreme equity market bearishness. A cluster of readings above 1.0 have occurred since November. P/C ratios above 1.0 signal overly bearish sentiment from the individual investor, as put volume outpaces...

Summary Year-over-year CPI is backing off its June highs of 9.1%, prompting the Fed to slow its pace of rate hikes. Currently at 3.78%, Morgan Stanley forecasts a peak Fed Funds rate of 4.5-4.75%. Though a soft landing may be possible with a continued tight labor market and an early...

Summary A 50bp hike is widely expected, given high inflation and a tight jobs market, but the market is pricing in a recession, and falling Treasury yields and a weakening dollar are undermining the Fed’s efforts to dampen price pressures. A hawkish Fed message will likely fall o...

Summary The current anti-business backdrop will continue to be an overhang for the U.S. economy. Market participants are facing a complex scene, and I repeat "we have never been here before". A "mild" recession doesn't necessarily mean a short-duration BEAR market. Consumer sent...

Summary Monetary tightening is aimed at slowing demand growth relative to aggregate supply, which will require a sustained period of below-trend US economic growth. The stakes are split between those who think FOMC rates will go up to 5% or more before a break. It is in the labor ma...

Summary Recession likely but shortlived. Inflation higher for longer. 3-year T bond rate of 7% in the cards. But real GDP should grow 2% year over year and S&P 500 revenues will match. Companies will maintain profit margins by cutting staff. As I write, the S&a...

Summary The strong dollar rally was something I suggested could be a problem for stocks, given what happened in 2020. In 2021, the dollar decline provided a tailwind to stocks. 2022 was an excellent example of when correlations fail. Will a dollar decline be good for stock...

Summary The market rallied ~18% in 12 months following midterm election. The Jobs Report was stronger than expected (more jobs and higher wage growth but lower hours). Those calling for a recession may be right, but with a 25% peak-to-trough move in the S&P, much of the pain (to...