IT'S FED DAY ... joy.
In this no punches pulled excerpt from The Macro Show today, Hedgeye CEO Keith McCullough explains why regardless of what the Fed says today, he still thinks we're headed for a 20% or more correction in the S&P 500.
"No matter what the Fed gives you today, they're not going to give you economic growth. They might get oil prices to $33. I'll give them a hero cookie for that.
But the bigger question here is what happens when investors realize that central planners cannot arrest economic gravity? The answer: People start to sell because profits are slowing. That's the most obvious call.
Whether you look at Boeing or Apple this morning, profits continue to slow. And if profits continue to slow -- we laid this out in our Macro themes deck -- for two consecutive quarters, the S&P 500 is most likely to be around 1700. That's a 20% correction from the highs. That's the call that I'm staying with.
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So I don't really care what the Fed says. It's not going to change the economic trajectory. It's not going to change the economic data. The U.S. economy is still going to be what it is and that's slowing.
I don't think the Fed is going to be as dovish as people are hoping. As we have continued to remind clients for a long time, you can hope all you want, but hope is not a risk management process."
