Markets not gonna bottom til at least middle next year

That’s what the smart people are saying. I have no idea. It sounds reasonable because housing and shut. Thoughts?

Perfect timing for all the treasuries we’re buying

7.7% YoY CPI doesn’t look promising to me. Target rate increases may slow from 75 bps, but having to go higher than 4.5% to reign in inflation means a relative (compared to historic rates) squeeze on growth. I see 2 scenarios:

  1. Inflation continues to slow, rate increases top out less than 5%, markets display irrational exuberance and start popping back up at the beginning or middle of 2Q 23.

  2. Inflation picks up steam in 4Q 22, Fed presidents indicate 6-6.5% target by end of 2023, Wall Street commits suicide by autoerotic asphyxiation.

My brain tells me #2 is more likely, but the markets followed their hearts instead of their brains throughout the middle and end of the pandemic.