Blog Archives

Banking on Cuts

Banking on Cuts

In the short run, the Fed chose to keep up the inflation fight despite deteriorating financial stability emanating from a wounded banking sector. There is now a lot of market data corroborating that the Fed will have no choice but to start cutting rates soon.

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Who's Afraid of Treasuries? When Stability Breeds Instability

Who's Afraid of Treasuries_ When Stability Breeds Instability

I’m going to breeze through a number of tweets and charts as I’m headed to watch the semi-finals and finals of the tennis matches at Indian Wells. The weather is going to be outstanding, and the matches have a similar promise.

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Only Time Will Tell: Hedging Ahead in the Expectations of a Shifting Fed

Only Time Will Tell_ Hedging Ahead in the Expectations of a Shifting Fed

I hope everyone had a wonderful Thanksgiving. I’ll pivot back to Jay Powell and the Fed from Pete Townshend and The Who. Two of my favorite subjects 🙂

The minutes of the Fed meetings that took place November 1-2 were released last week.

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All Roads Lead to the Fed

All roads lead to the Fed

I was traveling internationally last week for some meetings in London as well as a side visit to Paris prior to Chunneling it to London. While I was hoping to discuss Paris this week, given limited time and the market’s reaction to last week’s CPI report,

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Powell's Conundrum: Demand and Supply

Jay Powell Conundrum

In my 35 years working at CWS and the years before that in college, when I first started taking economics classes, the most common term to find the equilibrium to determine optimal price has been “supply and demand.” I have also come to learn that words matter,

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In Search of Goldilocks

Goldilocks economy

Last week the Fed raised short-term interest rates by 0.75%. This was entirely expected by the market. Given that this was already priced in, it stands to reason that the only source of new information would be what the Fed would communicate in its statement that’s released in conjunction with announcing the interest rate hike along with Chairman Jay Powell’s press conference.

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Monetary Squeeze and Industrial Disease

Monetary Squeeze and Industrial Disease

Yeah, now the workforce is disgusted, downs tools, walks

Innocence is injured, experience just talks

Everyone seeks damages, everyone agrees that

These are classic symptoms of a monetary squeeze

On ITV and BBC they talk about the curse

Philosophy is useless,

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Sorry Joe

recession sorry joe

I feel for Joe Biden. I really do. No President is solely responsible for economic ills or gains as there’s a continuum that carries over from previous administrations and policies. There are too many forces and variables in play to ascribe blame or credit entirely to an administration.

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Stocks Drop and Jobs Contract

Stocks Drop and Jobs Contract

One can see from the following charts from Sentimentrader.com that the last 100 trading days have been one of the worst periods in terms of stock returns in modern history. 

Stock History 12-31-1946 12-31-2001

And while the jury is still out as to whether we will have a recession over the next year,

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Off Target

manufacturers the Fed inflation off target Jay Powell

Last week was brutal for retailers as major earnings announcements showed how they have been hit very hard by huge cost increases. Wal-Mart started the week off shocking the market with its very weak earnings outlook and then there was Target.

Target shares sink 25% after company says high costs, inventory woes hit profits

Its stock price got absolutely crushed in the wake of its results being released.

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