FOMC: Two out of Three Ain’t Bad

It was a strange press conference.  As we discussed yesterday, stocks would react kindly…  …if Powell is successful in convincing investors algos that the economy is strong but there is no wage pressure and inflation poses no real threat. I think he succeeded in portraying the economy as strong.  This morning’s economic data helped bolster that narrative … continue reading →

FOMC: What Elephant?

Over the last 20 years, we’ve seen two yield curve (2s10s) inversions: essentially all of 2000 and Dec 2005-May 2007.  The inversions themselves posed no issues for equity markets.  It was the dramatic unwinding of those inversions that produced crashes.Eight months ago, we almost had another.  2s10s had fallen to a trend line connecting those … continue reading →

What’s Going on With Bonds (And, Why Doesn’t the Market Care?)

The trade dispute is officially a trade war.  You’d never know it from looking at the stock market.  The bond market, however, is a different story. Tariffs will clearly add to inflationary pressures.  But, even before the “trade wars are good, and easy to win” gaffe, the Fed and a bevy of inflationary economic reports … continue reading →