NDR Fixed Income Allocation Strategy March 2021 Update
The NDR Fixed Income Allocation Strategy entered the month with aggressive positioning. Both Emerging Markets and U.S. High Yield received large overweight allocations. Only one of EM's macro, fundamental, technical, or behavioral indicators was bearish at the start of the month. Click the link below to read more about the strategy's positioning.
NDR Fixed Income Allocation Strategy January 2023 Update
BY BRIAN SANBORN
The NDR Fixed Income Allocation Strategy, Positioning Update
Read more →
Thoughts From The Divide: Is it safe?
BY JON WEBB
We were very sad to see that Warren Mosler has decided to take an extended break from posting on X. Mr Mosler has helped inform our views about the overall policy stance. Most of all, Mosler was right: tight monetary policy did not stop the economy, and those who bet on that lost. Fiscal was certainly a factor, although reasonable people might debate how much of a factor. But with Fed officials mostly of like mind in thinking it is time to cut rates (see quote above), the question we find ourselves asking is whether it is finally safe to bet against Mosler. Or, to put it another way, “Is the U.S. consumer tapped out?”.
Read more →
Thoughts From The Divide: Adjustments
BY JON WEBB
Last week’s excitement in bond markets came courtesy of Governor Waller offering a mechanical rationale for rate cuts. Simply, “If inflation goes down, you would lower the policy rate.” This came, of course, in the context of warnings about financial conditions and other caveats, but as is so often the case, what the markets heard was “so you’re telling me there’s a chance?”. That doesn’t mean that we disagree with the market’s read of where the Fed’s head is. Fed Governors don’t make too many boo-boos with their messaging, and when they do, it’s often an error of timing rather than content. The market has now priced cuts down to “around 4% by the end of 2024” and while that seems perhaps overdoing the enthusiasm a tad, we suspect that the market has gotten the gist about right.
Read more →