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Wanted: Plausible Bull Case
"The pause is likely to come too late," Morgan Stanley's Mike Wilson said Monday.
He was referring
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Plausible bull case- modest and fairly short term economic slowdown, earnings drop but not as much as feared, inflation moderates faster than market anticipates and FOMC stops raising rates earlier with a lower terminal rate than the hawks anticipate. Not my base case, but it is plausible and cannot be discounted.
I’m completely with you, Ria. I really like your take. The Fed is locked and loaded for the meeting. But if all goes well, I’ve had the conviction, spoken via my share purchases, that the short-term horizon will not be harsh, and the recession will not be prolonged.
What gives me greater pause is international. The war with Russia is upending fuel markets. And the rising economic chaos from the Chinese banking/property fiasco is showing the CCP’s cards. For now, Taiwan remains in the background. But China is taking actions that express growing value for the CCP and diminishing value for capital markets. I believe they are slowly and more overtly turning their backs to the west. Just my opinion, but they seem to think they can dominate, and they’re anxious to express it.