“Is there any evidence that the microscopic variance between 1.9% and 2.3% inflation on the PCE deflator makes any difference to the performance and prosperity of the main street economy?”
Things no one knows about.
FED KEEPS RATES UNCHANGED, SAYS INFLATION `MOVED CLOSE’ TO 2%
What’s the frequency Jay?
“Powell has got a plan, and his sticking to it so vehemently will ultimately be a mistake. “
“In that environment, convexity withdrawal creates a reinforcing loop where more turbulence in risk assets tends to cause stability in fixed income.”
Ok, well all eyes will be on the U.S. in the week ahead.
“And there is still little evidence that the committee is close to the halfway mark from this perspective.”
Listen, you people are concerned about 10Y yields, and that’s fine. After all, we blew threw the February highs this week on the way to the “dreaded” 3% “pain threshold” and while there were no swarms of locusts and no Pazuzu sightings (that I’m aware of), there are still concerns that the higher we go, the closer we get to a situation characterized by “diversification desperation” or, more simply, a scenario where bonds and stocks selloff in tandem.
Something tells us this is an underappreciated tail risk, indeed.
STRONG MAJORITY OF FED OFFICIALS SAW TRADE WAR AS DOWNSIDE RISK
FED SEES `SIGNIFICANT’ FISCAL-POLICY GROWTH BOOST NEXT FEW YRS
A NUMBER FED OFFICIALS SAW OUTLOOK WARRANTING STEEPER RATE PATH
Say your prayers.
Well, the reviews are in on the Fed decision, the SEP, the dots and on Jerome Powell’s “plain speak” presser debut.
The market’s verdict was as follows.