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Goldilocks Euphoria Masks Lingering Tail Risks
With the "soft landing" / "Goldilocks" macro theme gathering adherents in the US seemingly every week, it's worth reiterating that there are still tails.
Yes, the June CPI report looked like real evidence of broad-based disinflation. Yes, the incorrigible American consumer is feeling much better about things, or at least according to a two-year high on a key gauge of confidence. And finally, yes, the US labor market remains resilient (or "robust" or whatever tired jobs adjective you prefer).
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All pointing towards another hawkish speech at Jackson Hole, which then may be followed by a growth scare as the lags effects finally manifest this fall, two tails for the price of one, should give us at least a 10% decilne.
How hawkish can “data dependent and not giving forward guidance” be?
reminds me of my thoughts on the June “pause,” … the Fed trying to inject nuance to a world that seems incapable of digesting it…