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May 02

Fed Nearly Finished With Rate Hikes

Tomorrow brings the latest Federal Reserve decision, with another quarter-point hike viewed as a slam dunk – current market pricing shows a 93% probability of that outcome.  That would bring the Fed Funds rate up to a range of 5-5.25%, which is what their “dot plot” projection from the March... read more →
Apr 28

So what happens when we get this well telegraphed recession?

The Fed has been aggressively hiking rates since March 2022, the yield curve has been inverted since last fall, and overall financial conditions have tightened dramatically.  We think we’re headed towards recession; the market thinks we’re heading towards recession, everyone thinks we’re headed towards recession.  The question isn’t “if, it’s... read more →
Apr 26
Apr 25

Recessionary Evidence Keeps Building

More and more evidence is now pointing to the much-anticipated recession beginning to materialize over the next few months. Last Thursday, the Philadelphia Fed released its Philly Fed Manufacturing Index, a survey which measures changes in manufacturing activity covering the Pennsylvania, New Jersey, and Delaware region. While this is only... read more →
Apr 19

Will We Revisit The Stock Market Lows?

We hear this question a lot; and most of the time it is a foregone conclusion that we will revisit the 2022 stock market lows. War, recession, the Fed, regional banks, commercial real estate… there are so many pessimistic investors out there waiting for large declines to happen. So, a... read more →
Apr 13

You can’t have an economic boom with lending gloom

The combination of tighter financial conditions, higher interest rates, a slowing economy AND shrinking deposits due to a banking crisis (SVB, Signature Bank, FRC next ?) is now manifesting itself in materially lower loan growth.  Lending growth hasn’t been this bad since just after COVID hit in 2Q20.  Lower-er.  Not... read more →
Apr 12

Shelter Inflation Starting to Crack

This morning brought the latest read on inflation with the release of the Consumer Price Index (CPI) for March.  Overall, it was mostly in-line with expectations with further signs of disinflation, and a potentially significant development looking ahead.  The good news is that the headline CPI slowed to 5%, down... read more →
Apr 11
Apr 05

Q1 Earnings Season is Upon Us

Q1 2023 earnings reporting season is officially starting next week. As usual, financials will be the first to take center stage, with none other than First Republic kicking things off on Thursday, and the big banks following over the next few days. Bank reports always get a good deal of... read more →
Apr 04