What is the Biggest Risk Right Now for Investors?

What is the Biggest Risk Right Now for Investors? What is the Biggest Risk Right Now for Investors? The risk of a Fed policy error The probability of a Fed rate cut in July 2019 is now 84.6%. Image: Bloomberg

Decomposing the U.S. 10-Year minus 3-Month Treasury Yield Spread since 2013

Decomposing the U.S. 10-Year minus 3-Month Treasury Yield Spread since 2013 This great chart shows that the “Global Economic Data” variable has a significant impact on the U.S. 10-year minus 3-month Treasury yield spread since 2018. An R² of 0.902 means that more than 90 percent of the variance in the U.S. 10-year minus 3-month Treasury yield spread…

Is Trump Right to Criticize Powell?

Is Trump Right to Criticize Powell? We don’t think so, because: – Interest rates are still near zero in real terms and below real GDP – The rise in Fed rates has very few visible negative effects in the USA – And at full employment, GDP returns to the level of potential GDP

U.S. 10-Year Treasury Yield Since 1790

U.S. 10-Year Treasury Yield Since 1790 Factors like inflation, economic growth, and the Fed’s monetary policy can all impact the trajectory and duration of the U.S. bond bear market. Image: BofA Global Investment Strategy

Inflation – U.S. CPI Forecasts

Inflation – U.S. CPI Forecasts If the Federal Reserve is done with rate hikes, the U.S. headline CPI is expected to remain well above the Fed’s 2% inflation target. Image: BofA Global Investment Strategy

Inflation – Potential Paths for Core CPI

Inflation – Potential Paths for Core CPI Will U.S. core CPI remain well above the Fed’s 2% inflation target, if the Federal Reserve is done? Image: BofA Global Investment Strategy

Contributions to Core PCE Inflation

Contributions to Core PCE Inflation U.S. core PCE inflation forecasts suggest that the Fed’s first rate cut could take place in 2024 Q2. Image: Goldman Sachs Global Investment Research

U.S. Government Total Outlays

U.S. Government Total Outlays U.S. federal government spending is soaring. Image: BofA Global Investment Strategy

Money Market Fund Assets

Money Market Fund Assets The prior two surges in U.S. money market fund assets, in 2008 and 2020, the Fed cut interest rates. Image: BofA Global Investment Strategy

Where Do You See S&P 500 at Year End?

Where Do You See S&P 500 at Year End? Could the S&P 500 end the year higher than its current level, due to the combined effects of the Fed pausing and strong corporate earnings? Image: J.P. Morgan