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Macro Monitor

May 07 2025

Anatomy Of A Major Selloff—A Cross-Asset Look

  • May 7, 2025

In exploring how cross-asset behavior differs between recessionary and non-recessionary market selloffs, a more striking conclusion emerged: The presence of a Fed put—or the absence there of—looks to be the more powerful force in shaping market dynamics across assets.

May 07 2025

Risk Aversion Index: Stayed On “Higher-Risk” Signal

  • May 7, 2025

Despite recent policy back-pedaling, volatility is liable to stay elevated for the time being.

Apr 04 2025

Slowdown Or Recession? Watch The S&P 500 Index!

  • Apr 4, 2025

Uncertainty surrounding Trump’s second term and the risk of escalating tariffs have shifted market focus from inflation to growth, raising fresh concerns about a potential recession. Our updated Recession Dashboard shows a delicate balance, with risk now slightly above 50%—driven largely by weakness in equities and full-time employment. While some indicators have improved, the market remains the most important signal to watch. A sharp selloff could tip the economy from slowdown into recession territory.

Apr 04 2025

Risk Aversion Index: Stayed On “Higher-Risk” Signal

  • Apr 4, 2025

Within fixed income, we remain defensive toward credit, especially the low quality segment.

Mar 08 2025

Germany—Sick Man Of Europe No More?

  • Mar 8, 2025

Despite volatile headlines, the German DAX index has staged a stellar double-digit rally since the start of the year—outpacing even the most “exceptional” S&P 500. In fact, over the last year or so, the DAX has now pulled ahead of the S&P 500.

Mar 08 2025

Risk Aversion Index: A New “Higher-Risk” Signal

  • Mar 8, 2025

Our Risk Aversion Index moved higher in February and triggered a new “Higher-Risk” signal. A mechanical indicator can experience a prolonged period of whipsaws as there is a much greater amount of noise in the market these days.

Feb 06 2025

Bear Steepening In An Easing Cycle—Nothing To Lose Sleep Over

  • Feb 6, 2025

Bond market reactions are consistent with the historical norm, so far, and suggest that a reversal of the current bear steepening is more likely than not.

Feb 06 2025

Risk Aversion Index: A New “Lower-Risk” Signal

  • Feb 6, 2025

Our Risk Aversion Index ticked lower again in January and triggered a new mechanical “Lower-Risk” signal.

Jan 07 2025

Top Charts Of 2024—Persistent Themes For 2025

  • Jan 7, 2025

We present our favorite charts from the past year and examine some of the key developments poised to have a significant impact in 2025.

Jan 07 2025

2025 Time Cycles—Nothing To Worry About?

  • Jan 7, 2025

Overall, most patterns suggest a decent year for global equity markets. Expectations are already very high, though, and that leaves much less room for error. We strongly caution against extrapolating U.S. equities’ 2024 performance into 2025.

Jan 07 2025

Risk Aversion Index: A New “Higher-Risk” Signal

  • Jan 7, 2025

While the policy regimes in both the U.S. and China are likely to support risky assets, today’s level of optimism doesn’t allow much of a cushion for disappointment.

Dec 05 2024

The Dollar’s Déjà Vu?—Trump’s Second Edition

  • Dec 5, 2024

The Trump rally was the dominant theme in November, with the U.S. dollar playing a big part. Over the past few weeks, the dollar has appreciated significantly. The latest surge in the DXY index, both in magnitude and velocity, bears a striking resemblance to that which followed Trump’s unexpected win in 2016.

Dec 05 2024

Risk Aversion Index: Stayed On “Lower-Risk” Signal

  • Dec 5, 2024

The Trump win, the Fed’s easing cycle, and favorable seasonality should support risky assets. However, expectations are very high and there is little room for disappointment.

Nov 07 2024

Yield Curve Steepening—Stalling But Trend Intact

  • Nov 7, 2024

Given the beginning of an easing cycle in September and the Trump Trade in October, the lack of steepening in the yield curve is intriguing. While tighter financial conditions are likely a challenge to the steepening move, policy regimes and the term premium are favorable toward further curve steepening.

Nov 07 2024

Risk Aversion Index: A New “Lower-Risk” Signal

  • Nov 7, 2024

The market keeps brushing aside the increase in geopolitical risks and we continue to believe the risk is underpriced. On the other hand, the Trump win and favorable seasonality should support risky assets at least in the near term.

Oct 05 2024

China’s “Whatever It Takes” Moment—“Believe Me, It Will Be Enough”

  • Oct 5, 2024

Market reaction to the latest flood of monetary and fiscal stimuli has been spectacular. While conviction about Beijing’s attempts to revive its flagging economy has been severely lacking, this time we should believe it. It’s certainly the right medicine China needs and the spark of confidence these actions will ignite should not be underestimated.

Oct 05 2024

U.S. Election Study Update

  • Oct 5, 2024

Our assessment shows that “who” wins the White House does not seem to matter that much to most major asset classes. Nevertheless, we believe a strong dose of caution against political and/or geopolitical risk is prudent.

Oct 05 2024

Risk Aversion Index: Maintaining Its “Higher-Risk” Signal

  • Oct 5, 2024

Our Risk Aversion Index edged lower but stayed on the “Higher-Risk” signal.

Sep 09 2024

Anatomy Of An Easing Cycle

  • Sep 9, 2024

The economy normally fades heading into a series of rate cuts, with higher unemployment and lessening CPI inflation. Risky assets (stocks and credit) do well, and bond yields move lower. Real assets also benefit (gold in particular). On the whole, an easing cycle is favorable for most assets.

Sep 09 2024

Risk Aversion Index: Maintaining Its “Higher-Risk” Signal

  • Sep 9, 2024

Election and geopolitical risks are far from being adequately priced in, while the current market pricing of Fed rate cuts is too aggressive.