On a day when 82% of stocks were down and macro tourists lost money jumping to snap judgments, Keith McCullough generated alpha by sticking to the process.
Anyone buying narratives that the Fed was done raising rates got an education. Inflation remains a powerful factor, evidenced by the movement in bonds following Friday's jobs report.
"The Non-Farm Payroll number comes out, and the 10-year yield goes to 4.05%, then 4.08%, 4.10%, and now it's at 4.27%. It's one of the biggest two-day moves in U.S. history off that kind of setup," McCullough explains in this clip from The Macro Show. "It's absolutely crushing macro tourists."
In other words, Hedgeye’s call to go long inflation in July has paid off big.
Energy is traditionally a top-performing sector in #Quad3. That's proving true once again with XLE up +12.8% in Q3.
“All that really matters to me and should matter to you is when you put the positions on,” McCullough adds. “We did a wonderful job going all the way back to the lows of inflation and the lows of commodities for that matter, in Q2 of 2020 of getting long commodities as an asset class for two years, getting you out at the peak of the cycle, which was last year, and getting you back in in July.”
“We got long inflation a month and a half ago. We’re going to stay with that until the signal tells us not to," Hedgeye's CEO concludes.
Click above to watch the full clip.
