Macro: It’s all about elections and keeping status quo
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
Global Macro Strategist
Summary: Macro Dragon = Cross-Asset Quasi-Daily Views that could cover anything from tactical positioning, to long-term thematic investments, key events & inflection points in the markets, all with the objective of consistent wealth creation overtime.
US NFP, this Fri 4 Jun: if you recall we had a fabulous miss in last month’s numbers, where c. 1m was expected & 266K came in, a -734K miss – one of the biggest on record. We are still ‘short’ c. 8m jobs since pre-Covid lvls.
US CPI, Thu 10 Jun: Last months inflation figures were completely the opposite of the NFP in regards to direction, as they came in at a sizzling +4.2%a vs. 3.6%e YoY. On Core CPI side it was 3.0%a 2.3%e 1.6%p.
FED, Wed 16 Jun: For now this one seems extra opaque for KVP – really given the big miss on NFP’s last month & the big beat on Inflation, they can play it anyway. Hard to see the actual FOMC statement being a banger, its likely to fall to the Powell Q&A press conference, & even more likely the FOMC minutes on Jul 7th may be more potent (i.e. if there is a lot of discussion there around tapering or lack thereof).
US Fiscal: Whilst it seems to KVP the Administration has until Sep (before new fiscal budget year) to get a deal done either through unison with the Reps or through a full court press with the Dems – one gets the feeling the goal posts are being moved backward in regards to potential spending plans as we highlighted in last wk’s Macro Dragon: Crypto's Freefall & Biden Infra-Bill Downgraded to $1.7trn from $2.25trn...
Re-opening: Over the course of the next 2-3m we will get a clearer picture of what is priced correctly or not, in regards to the economies of the US & EU opening up to more normality.
Still think works on the likes of ABNB, BYND could prove fruitful & some of the names we’ve been talking about for quite a spell like energy, insurers & UK Equities should continue to do well.
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Start<>End = Gratitude + Integrity + Vision + Tenacity | Process > Outcome | Sizing > Position.
This is The Way
Namaste,
KVP