원문 보기
you surprised at how quickly the market has bounced back from last Monday selloff I am I'm like Rick um there was reason to bounce back but the speed and the extent to which we we've bounced back did surprise me we still have a 35% probability of recession and we had another corporate earnings report today from Home Depot reminding us of the weakness of the consumer policy I think the market is expecting Too Much from the Fed and finally the technicals are still vulnerable there's still some care trade out there so I'm not surprised we bounce back I'm just surprised how fast and by how much we bounce back so the the fed's going to go in September yes yes absolutely and if they don't much they'll go by 25 what what raises it to 50 do do you think because I mean you you've made the argument that they're already too late that they should have started cutting already so I'm sure in in your mind you'd like to see them go more than 25 wouldn't you I would but I don't think they will so there's two parts Scot as you know there's a journey and a destination I would have rather they started the journey earlier and they should have cut in July but there's also the question of the destination where do they end up they've been ambiguous about that I think the market is expecting 200 basis points in the next 12 plus months that would be too much the market should be more looking for 150 basis points of cut you think they've done a good job um I think they did a terrible job in 2021 yeah I know but it's 2024 yeah they've gotten a lot better that communication is still all over the place they've got to be more consistent um champ PO is going to have a golden opportunity in 10 days time in Jackson Hall to do three things one is be clear on what the N neutral rate is that's really important two tell us what sort of Journey would he like to get there how he would like to get there and then three be clearer on what he expects for the economy if he does that they can regain control of the policy narrative and that will help enormously in terms of the next phase you think we'll get all of that I don't I think this is a very cautious fed it's a fed that's excessively data dependent they got such a beating back in 2021 that they've been very shy about telling us strategically how they see the economy so no I think they're going to be a risk averse fed and because of that we're going to continue having volatility do do you think there's any risk of cutting too soon or by too much at this point and reaccelerating inflation Rick reer I'm not sure if you heard his commentary or not think thinks that that's a a false premise yeah I think that the inflation risk is much lower than the unemployment RIS risk so to the extent they make a mistake i' hope they don't I'd rather they make a mistake by cutting too much than by cutting too little um if you look at what's happening to this economy we have lost most of our buffers we no longer have high pandemic Savings credit cards have been maxed out for the lower income segments the last thing you need is the labor market to come under pressure because that's the sole thing keeping the keeping consumption going which is why the FED share continues to talk about it in the manner that he does right I mean are you do you take any comfort in the fact that if you listen to anything that he said of of late the focus obviously appears to be more on the labor market than it does the inflation picture because they feel certainly seems he does that inflation's on its way back to Target yeah if you listen to them carefully there's more focus on the employment part of the Mandate but he says they are balanced now the inflation part and the employment part are balanced I don't think they are I think the employment part is more important right now than the inflation part that's why as as you noted I argue that they should have cut last July they view them as balanced I don't think they are balanced I think the employment part is very vulnerable right now
Comments 0