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The Fed is talking tough on inflation by projecting a large and rapid increase in rates, but we think it won’t fully deliver and be forced to live with inflation. The S&P 500 scored its biggest weekly gain since 2020, and bond yields rose. Chinese shares rebounded sharply a...
The Fed raised the Fed Funds and the Discount rate, and promised six more rate increases in 2022. While the stock market put a positive spin on the possibility of six rate increases by the end of 2022, the bond market is expecting a recession. A rise in VIX signals that put option...
According to a recent report released by the OECD, the Russian invasion of Ukraine, if prolonged, could knock 1.1 percentage points off the global GDP for 2021, while increasing global inflation by 2.5 percentage points over an already lofty inflation level. The damage won’t be...
The difference between the current correction and a bear market is the presence of a recession. If you think the economy will avoid a recession, you should “BTFD.” If not, you should “STFR” and reduce your risk exposure. there are many reasons to suspec...
Based on new hopes for a peaceful Ukrainian/Russian resolution to their nearly month-long war, the world is cautiously optimistic. Although China has been trying to help Russia avoid economic sanctions, China is struggling with its own debt problems from Evergrande, slowing economic g...
The Federal Reserve Put is a well-known phenomenon where falling equity prices convert hawks into doves. The recent language has been decisively hawkish despite falling stock prices. We tell you why the Fed Put strike is now far lower and growth stocks will go through another...
Gold is inherently a stronger currency than the US dollar. The most recent peak in the SPX/gold ratio occurred at the beginning of December-2021. Even if the decline over the past three months of the SPX/gold ratio was the first leg of a new major downward trend, it would not be o...
Jerome Powell, Fed chair, attempted to put the stock market straight today by announcing that the Fed would do whatever was necessary to stop inflation. This was a catch-up speech trying to turn around the feeling coming out of the FOMC meeting last week that the Fed was not really ve...
As 2022 progresses, elevated inflation is likely to take a toll on the pace of economic growth and job creation. With a strong labor market, the amount of dollars spent by consumers can keep growing, but with inflation, the quantity of goods and services received may decline. Neve...
Volatility persists - but it is accompanied by a shift back to market patterns associated with pre-war concerns about inflation and rising rates. Grain and fertilizer shortages could become an issue later this year, but energy prices remain the major immediate transmission mechanism t...