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The Stocks Are Broken
If you're a Fed official and your "higher for longer" message is already resonating, it's not obvious why you'd go out of your way to posit a kind of worst-case scenario wherein rates need to be raised significantly higher on top of what already counts as the most aggressive rate-hiking campaign in modern history.
Public Fed pontification rarely accomplishes anything, and more often than not it's counterproductive. It wasn't obvious, to me anyway, what Neel Kashkari had in mind on Tuesday when
A sell-off into a quarter end is so inconvenient for all sorts of investment managers.
I was expecting a modest rebound into Friday and you screen watchers could see money flowing into the window-dressing favorites like NVDA, AAPL, AMD, LLY and Novo Nordisk. Given that, the price action this afternoon was a bit concerning, no?
it’s obvious, H. They’re pushing higher-for-longer to sustain dollar strength to punish the rest of the world. If that’s too strong, to punish BRICS+ for, well, BRICS+. We’re witnessing currency warfare in real-time. On the bright side, as you might’ve put it, they’re doing it outside the bunker.