The bond market should sell off and drag stocks down on higher odds of a single-party sweep, policy uncertainty, unorthodox Trump presidency, aggressive tariffs, large tax cuts, large budget deficits, labor shortages, a fired Fed chair, and higher inflation....
In Section I, we examine some concerning signs of US economic weakness that emerged in June. We also discuss portfolio positioning in the face of falling interest rates and cross-check our recommended US equity overweight in the face of extremely optimistic expectations about AI’s impact on growth. ...
The consensus soft-landing narrative is wrong. The US will fall into a recession in late 2024 or early 2025. We were tactically bullish on stocks most of last year, turned neutral earlier this year, and are going underweight today. We conservatively expect the S&P 500 to drop to 3750 during the comi...
California and Technology are currently in a downturn but is not apparent from the performance of the NASDAQ. On its own, the job losses in the Tech sector are not significant enough to precipitate a US recession. However, when coupled with direct and indirect spill-over effects into other service s...
The end of China’s exponential credit growth will impede structural rallies in Chinese stocks and commodities, but US superstar stocks’ bubble-like valuations will impede them too. Leaving European stocks as the likely structural outperformer. Plus: copper is correcting, NVDA is consolidating....
The Indian election outcome is a positive development for the country’s long-term socio-economic outlook. Indian stocks, however, remain vulnerable in the near term due to sharply slowing nominal sales and surging real borrowing costs. Indian domestic bonds, on the other hand, are a buy....
Today’s report recaps last week’s webcast and elaborates on its themes, delving into the empirical evidence underpinning our conviction that asset allocators should underweight equities sparingly and fleetingly. We remain tactically neutral and cyclically bearish....
