Closing Thoughts for the Week

From an economic standpoint, we got two big numbers this week that pretty much tell us what we already know. The impacts are being felt from a macro perspective even though they aren’t showing up in the GDP numbers. That doesn’t mean that we should ignore the risks that currently exist in the housing market, manufacturing or elsewhere globally, but it could give market bulls a reason to believe that risk asset prices can continue pushing higher here.

From a global macro perspective, the most consequential events likely came from overseas. Europe looks like it might be in big trouble here with growth already non-existent and inflation still spiraling out of control. The U.S. markets showed us that the mega-cap trade still hasn’t unraveled yet. This remains an environment where the data is telling one story and the market averages are telling another.

It’s tough for me to see what came out of this past week’s Fed meeting and not think that there’s some kind of ulterior motive at play. The fact that no one in the FOMC sees a recession happening is both confusing and overly optimistic. The bulls sure still seem to think everything is fine and dandy.