Bank Failures and Narrative Whiplash
Jack Janasiewicz offers his tactical take on the macroeconomic environment in this podcast recorded on April 6, 2023.
- Markets are all about narratives – and we saw the narratives come full circle this past month. From hard landing to soft landing to no landing and then back to hard landing – the market has run the gamut.
- The soft landing narrative was in full force when we suddenly were blindsided by the Silicon Valley Bank saga which ushered in a whole new series of concerns regarding the health and safety of the banking system.
- The swift response from the Fed, Treasury and FDIC helped to short-circuit the negative feedback loop and bring some much needed calm to the markets – but the Global Financial Crisis is still fresh in many investors’ minds.
- Impressively, the S&P 500® closed March at a higher level than when the banking woes first began on March 8…
- And while inflation didn’t get any worse, it remains sticky – so the Federal Reserve’s job is still far from complete – but the balance of risks has shifted again.
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