Darius joined Charles Payne on Fox Business last week to discuss the US economy, inflation, the Fed, and more.
If you missed the interview, here is the most important takeaway from the conversation that has significant implications for your portfolio:
Recent Economic Data Gave Conflicting Signals To Investors. A Systematic, Rules-Based Investing Approach Is The Best Method To Generate Positive Returns In Today’s Confusing Macro Environment.
- Although growth is slowing from the well-above-trend pace we saw last year, the economy remains resilient. We currently see a low probability of a developing recession in the US economy, but that may change in the coming weeks/months per the latest data.
- If inflation persists above trend, the Federal Reserve may postpone any dovish measures. Coupled with the Treasury’s policy of tighter net financing conditions, this scenario could cause a shift to a risk-off Market Regime.
- During most of the bull run that occurred since late October 2023, monetary and fiscal policies were aligned, supporting asset markets. Currently, however, monetary policy remains dovish, largely disregarding inflation data, while the Treasury’s net financing policy has become more hawkish at the margins. As we move into the third quarter, this policy shift could become burdensome for asset markets.
That’s a wrap!
If you found this blog post helpful, go to www.42macro.com to unlock actionable, hedge-fund-caliber investment insights.
