Content Highlights
- The market is pricing in a series of interest rate hikes for the coming 24 months. But the Fed has backed off of a tightening schedule before (2:18);
- Bonds have been selling off, but investors will find themselves on the wrong side of this trade when Fed backs off of tapering (4:07);
Inflation is a supply-side problem that the Fed doesn’t have control of. Markets are too fragile to handle rate hikes (5:06);The latest FOMC meeting where tapering was announced “was probably the most dovish taper you could come up with” (9:20);
Deflationary forces, starting with China, are a major issue the market is overlooking. This despite the best (non-publicized) efforts by the Chinese government (10:49);
It’s not just China though; demographics and debt are part of the longer-term trend toward deflation (19:19);
Background on the guest (22:33);
What about potential headwinds, from China or elsewhere? (24:58);
Unwinding Evergrande: Where is the exposure? (29:05);
How much longer can the Fed taper before their hand is forced to back off? (31:17);
What indicators should investors keep an eye on to monitor this situation? (34:35).