Thoughts on ’22 with 5 ChartsThis post looks at what I think will be the most important (or influential) charts for this year. Spoiler alert: much of this centers on crude oil, inflation, rates and of course the Fed...
Hits & Misses for 2021At the end of every calendar year, I like to look back at what worked and what didn't. I'm mostly interested in reviewing my mistakes... versus trades that worked well. Let's take a look...
2021 – A Torrent of BuyingWhen stock indices double their average rate of return in any one year (typically around 10%)... you need to ask why. Two catalysts which come to mind: (i) negative real rates; and (ii) central bank liquidity.
Will We See a Santa Rally?The S&P 500 dropped ~3% over the past three days - marking the worst decline over a three-day span since September. I feel we are working through the early stages of a decent (buyable) correction.
When Will the Next Recession Hit?The market is afflicting the comfortable... and discomforting the afflicted. What felt like a relief rally Wednesday abruptly turned negative to end the week....
Relief Rally on ‘Expected’ Fed MoveThe Fed's $1.44T QE program is going to end in a few months. Great news... but I would argue 6-9 months too late. They caused a bubble in speculative assets (which will bust) - not to mention stoking dangerous levels of unwanted inflation.
It’s All About the Fed… Nothing has a greater impact on financial risk assets than the availability of liquidity and its price. Rate hikes are coming - it's just how many and how fast?
Hot CPI Priced In… But are 3 Rate Hikes for ’22?Friday we learned US CPI hit 6.8% year-on-year for the month of November. Here's the thing: there is an entire generation of people have never experienced 'sticker shock' like this in their adult lives.
Reaction in Bond Yields to Tell CPI Story…Ready for higher rates? They are coming. Higher rates will equal a stronger dollar -- which will pressure global markets and particularly emerging market debt.
Stocks Rebound… With “Big Tech” UpgradedAre the lows in before Christmas That's hard to know. Stocks have rallied strongly to start the week after last week's ~5.2% pullback. It's been 'higher-risk' names leading the rebound... with the Russell 2000 and tech surging.
Turbulent Times AheadCPI is expected to jump above the annual pace of 6.2%... the hottest in 30 years. Makes sense to me - the Fed has expanding its balance sheet to $9T and real rates remain negative - why wouldn't we see inflation? It's going higher.
Powell’s Pivot… As Market Frets over OmicronHow quickly things can change. From the Fed pivoting on its dovish sentiment... to the 'Omicron' variant arriving in California. This has seen the market turn on a dime.
