Macro Report/Insights: Comprehensive Macro Report
Macro Report/Insights: Comprehensive Macro Report
Recession Timing and YC Trade
Hey everyone,
We are moving full force ahead with the new upgraded version of the Substack. If you are curious about it, you can check out the announcement articles here: Link and Link
The Discord has been launched and we just finished the first macro webinar with almost an half hour of Q&A (Link). I will be publishing some additional asset class reports (see previous here: Link, Link, Link, Link, Link, Link) this week along with an economic data model so be on the lookout for that.
If you have any questions or issues, message me directly and we will work through it so there are ZERO issues.
Below is the monthly Comprehensive Macro Report with analysis of growth, inflation, liquidity, and how they impact each major asset class.
Enjoy!
Macro Report:
Report Summary: There is a key tension in markets right now. Growth remains resilient but is decelerating from its extreme as the effects of tight monetary policy exert themselves. However, we have yet to see a pronounced shift in the economic data or impulse in markets to indicate a recession is the primary driver in markets. As 2024 approaches, there is a compressing of the tails where either a recession or reacceleration in inflation is likely to occur.
Big Picture:
When we look at where we are in the economic cycle, we continue to be at a place between stagflation and reflation as expressed in the visual below. This is reflected in growth, inflation, and liquidity dynamics. Growth is decelerating from its extreme but showing resilience in specific sectors. Inflation is decelerating from its high and the market is pricing a reasonable path forward. Liquidity is normalizing as the supply of duration issuance by the treasury is normalizing and the FED is pausing. The collocation of growth, inflation and liquidity being at a point where they aren’t making a pronounced impulse in a single direction is likely compressing both economic and market volatility as we approach an inflection point in 2024. Managing the timing and signals of this inflection point is critical for having a strategic advantage in 2024.
