Editor’s Note: Below is an abridged commentary culled from various tweets posted by Hedgeye CEO Keith McCullough shortly after today’s Fed announcement.
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Anyone who understands cyclical growth slowing and deflation understands that the Fed made the right move. If they were to hike into a slowdown, they would be the catalyst for the next US recession.
Hedgeye reiterates the Slower (and Lower) for longer view
For those of you who were calling for the SEP hike = #wrong
"hike appropriate when we have labor and INFLATION improvement" July = #Deflation
We are just one more bad jobs report away from no DEC hike either.
USD and Rates should probably stay higher into what the manic media will read as a "good" GDP. Don't trade the headline - look for the next catalyst.
I guess the Fed thinks Oil crashing (-22% in the last month) is "stability." Here's a chart of Oil instability (OVX = 30-40, sustained!)
Newsflash: the "pace of job gains" always peaks at the end of an economic cycle. Non-farm payroll "pace" of gains stopped accelerating in FEB.
In other news, Biotech $IBB -1.9% on an up day - hyper growth expectations finally slowing too.
Where the real action is at today is on the "easy money" trade - Housing $ITB ripping +1.6%
This is the joke that has become Wall St selling "bullish economic" research- stocks only fly on slowing economic news!
