Milton friedman comes with a lag
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Dear David,
How will you decipher the CPI report today?
Cheers,
James
Dear David,
it looks like market just erased the correction between mid May to mid June which is due to recession risk.
Here are some questions:
(a) How much should S&P 500 correct if market adjust their rate pricing close to Fed's projection?
(b) Can we say the coming months might go range bound between 3630-4150 first (Fed tightening and strong economy offset each other) instead of breaking new low?
(c) When do you see market might change their curve projection for 2023?
(d) Do you see highly likely US can manage a soft landing? Why? If yes, SPX might bottom around 3630? If not, there will be further to go.
Cheers,
James
One play on inflation and higher rates, and stronger jobs is debt collectors and used car and white goods, etc financiers. Could be a rug pull for their lower income demographic customers coming.
Dear John,
Can you please give me some ideas that under 3Q22 scheme (GDP positive and inflation pressure remain/accelerate), which 1-2 sectors you would prefer most and why? (For the sector you like least is utility?)
Cheers,
James
Hi David, thank you and John for addressing some concerns around your thesis. I was wondering, why would Big Tech support democrats? You mention how they are trying to avoid the ire of Republicans, but my understanding is that democrats have been much harsher on big tech and have that kind of grassroots support to fight them. Also, who are the employees working at those firms that would push that kind of narrative? Would it be the lobbyists, or the marketers?