Once again, credit leads equities - high yield has been leaking (wider spreads, higher yields, risk off) for weeks while stocks marched higher - listen to credit.
youtube.com/watch?v=nmoC_3
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So - we have just one 25bp rate hike from the Fed and high yield (above) is through the Q4 2018 wides (lower bond prices - elevated yields). Powell and company are accomplishing a lot of financial conditions tightening with simple - hot air - liberally applied.
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Large CMBS - commercial real estate stress today - financial conditions are tightening at the fastest pace EVER Mr. Powell - must watch video above.
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Academics who have never managed professional risk - now sitting $7T of risk - US central banking in 2022.
#AColossalFailureOfCommononSense
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In Q4 2018, the Fed accomplished 9 hikes in FOUR years and $650B of balance sheet reduction after promises of 14 and $2T, credit risk stopped them. Today - they are promising 12 hikes and $1T of balance sheet reduction in ONE year. Don´t believe the bs. Must see the video above.
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Wouldn’t be surprised to see stocks climb a wall of worry. We are living in exponential times.
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The trend is clearly established. It's only a matter of time before fear spreads.
Been hearing about property developers already imploding and declaring bankruptcy. We've only see one hike so far, hard to fathom what happens next.
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No so sure Larry, we were at cycle tights right as the market topped in 2018 and 2020.
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I'm listening to you. It has outperformed the treasury market, but the question is when will the 2 part ways. 🤔
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Does that mean that they will pivot back to more accommodative policy? And thus risk-on is actually the trade to take now!?