Sponsored Content - The talk increasingly in ever-exuberant markets is that The Federal Reserve is all but finished with its nearly year-and-a-half long regimen of hiking interest rates, says Chris Temple, editor and publisher, National Investor Publishing.
Inflation has been drifting downward by most measures; and while still not close to where “Fire Marshall Jay” and his comrades want to see things, the landscape is certainly better than it was at this time last year!
The prospect of the Fed being done with rate hikes—coupled with robust markets for most risk assets and a still-decent level of economic growth (including a very strong jobs market still)—has many now wondering if Powell and Company are going to pull off that ever-elusive “soft landing” for the economy after all.
Yet even notable perma-bulls such as The Wharton School’s Dr. Jeremy Siegel are warning that the surprisingly resilience of the US consumer is about to end; perhaps dramatically. Punctuated by the last hurrah of a busy summer travel season, we may see more measures of the consumption-led economy weaken considerably as we move toward 2023’s end.
That dynamic of consumers being tapped out yet again—and now, saddled with still-record debt (and that at the highest carrying costs in a few decades)—will combine with the other lagging effects of the Fed’s overdue tightening and at best give us what I have termed “a slow, dull ache” for, perhaps, a few years or more ahead.
Needless to say, markets as I write this—as far as equities generally and corporate debt, at least—are not remotely priced for this.
In my mid-year commentary posted to my YouTube channel (I urge you to watch that RIGHT HERE) I discuss all this…and give you specific ideas as to how to position your portfolio for the eventual resumption of the bear market as well as to take advantage of those legitimately cheap areas/sectors out there.
If you are not already a member, visit Chris Temple at NationalInvestor.com.