Category Interest Rates / Bonds

Markets Waking Up to Fed Reality

The market continued to work its way lower this week - waking up to the reality of the road ahead with respect to higher rates and inflation. However, some believe the Fed should pause immediately...

Fed Faces a Long Fight with Sticky Inflation

CPI and Core PCE continued to rise over August. Core PCE - the Fed's preferred measure - was more than double expectations and 3x the Fed's target rate. Rates are to remain higher for longer.

The Case for Retesting the June Lows

It would be remiss of investors to rule out a retest of the June lows. This post explains my reasons not just technically (which has served us well) -- but more so fundamentally. Have we fully priced in the impact of where rates are likely to head in addition to QT?

Powell Delivers a Blunt Message

If it wasn't already clear - it is now. Interest rates are going sharply higher and for longer. Powell's 8-minute Jackson Hole speech was carefully scripted - using words like "pain" to prepare the market for what lies ahead.

Don’t Fight the Fed

Marty Zweig's 1970 book "Winning on Wall Street" popularized the term "don't fight the fed". Today we have an environment where: (a) liquidity is contracting; and (b) rates are tightening. That's not conducive for higher prices.

Markets Big Bet on a Dovish Fed

The S&P 500 is pushing into an area of clear technical resistance. What's more - fundamentally it's no longer cheap at approx 18.5x forward earnings. My thinking is the market is not an attractive risk/reward bet at these levels... and are under-appreciating the task in front of the Fed.

Fed Speak: Doves or Hawks?

Are the Fed doves or hawks? That's a function of your own lens and what you heard. Jay Powell offered some 'stick' and 'carrot' today... but from mine... it was more hawkish (but the market wasn't listening to that)

Forget Snap… There’s a Much Bigger Picture

Next week we have the Fed (expected to raise 75 bps) and big-tech earnings. Both will move markets - but I give more weight to what we hear from Apple, Amazon, Google and Microsoft.

JP Morgan Warns of ‘Negative Consequences’

There's a very good reason why inflation is likely to come down next year... the dramatic slowing of (M2) money supply growth. However, we will have uncomfortably high inflation for at least 6-9 months yet.