260 Fed meetings will occur between the issuance and maturity of a 30-year Treasury bond. There will be 260 times when the Fed raises, lowers, or does nothing with Fed Funds. In that perspective, why should a bondholder care what the Fed does or doesn’t do at the next few meetings? We ask the question […]
The market bottomed last October despite ongoing concerns about inflation, higher rates, recessionary risks, and a banking crisis. While the media headlines and youtube podcasts are filled with “crisis” headlines, as noted in “Analysts Raise Estimates,” expectations for growth and earnings are rising. “If there is ‘no recession in 2023,’ then such would suggest the decline in […]
As the Fed tightens monetary policy, a banking crisis is historically the first evidence that something was breaking. As noted recently in “Not QE,” “Last week, amid a rash of bank insolvencies, government agencies took action to stem a potential banking crisis. The FDIC, the Treasury, and the Fed issued a Bank Term Lending Program […]
An old saying cautions one to be careful of what one wishes for. Stock investors wishing for the Federal Reserve to pivot may want to rethink their logic and review the charts. The second largest U.S. bank failure and the deeply discounted emergency sale of Credit Suisse have investors betting the Federal Reserve will pivot. […]
Despite an ongoing “banking crisis,” investors continue to chase stocks triggering several bullish buy signals. As noted in this past weekend’s newsletter, two primary reasons exist for this current dichotomy. The first is psychological, and the second is purely technical. The psychological component of the recent disregard of underlying financial and economic risk is the […]
Recession indicators are ringing loudly. Yet, the Fed remains focused on its inflation fight, as repeatedly noted by Jerome Powell following this week’s FOMC meeting. During his press conference, he specifically made two critical comments. The first was that inflation remains too high and is well above the Fed’s two-percent goal. The second was that […]
“QE” or “Quantitative Easing” has been the bull’s “siren song” of the last decade, but will “Not QE” be the same? Last week, amid a rash of bank insolvencies, government agencies took action to stem a potential banking crisis. The FDIC, the Treasury, and the Fed issued a Bank Term Lending Program with a $25 […]
Bear Stearns’s failure occurred 15 years ago last week. Six months later, Lehman Brothers would fail on September 15, 2008. Fast forward to the present day, and we recently had the largest bank failure since 2008 when Silicon Valley Bank failed on March 10, 2023. We will explore some interesting parallels between 2008 and 2023 […]
Could the consensus view of a “no recession” scenario be wrong? As portfolio managers, this is the question we ask ourselves daily. Since the lows of last October, the technical backdrop has improved markedly, as discussed last week in “Bear Trap.” To wit: “Our most critical bullish signals are the short- and intermediate-term Moving Average […]