Jack Janasiewicz presents his take on the capital markets in this podcast recorded on April 11, 2022.
- The S&P 500® gained just over 3.7% for March and has remained up strongly since the start of the Russia/Ukraine conflict. Not surprisingly, US equity markets have been outperforming on a relative basis.
- Inflation expectations appear to be drifting higher as rising oil prices affect so many aspects of the economy, from transportation and manufacturing to power generation and materials.
- A key question is whether the Federal Reserve will need to raise the benchmark rate above their predicted neutral rate of 2.4% to help slow down growth.
- While the inverted yield curve has had a pretty good track record at predicting recessions, there is more than one yield curve to consider beyond the 2-year versus 10-year – and the others are not inverted.
- Other indicators are needed to predict a recession, especially when the job market is strong, corporate balance sheets are robust, and aggregate incomes are still quite elevated.
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