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Markets In ‘Sweet Spot.’ Enjoy It While It Lasts
"Enjoy the sweet spot but also be wary of it," Deutsche Bank's Jim Reid said Tuesday.
He was referr
H-Man, Great article. So maybe 2023 is not a doomsday year? Or at least not the entire year. The DB comments make a lot of sense and I like the data they used.
I wouldnt be surprised if we end the year at around the same level (which I understand seems to be something of a consensus call).
On one hand, the pace of rate hikes is somewhat unprecedented, which all else being equal (it never is) argues for a shorter lead time to recession. On the other hand, if we assume that a recession cannot occur without the unemployment rate going up meaningfully, the current labor market imbalance may argue for a longer lead time than average. Which of these two will prevail, only time will tell. I’m mostly holed up in 6m treasuries at the moment.