Stephen Parker, JPMorgan Private Bank head of specialized strategies, says if we do get a modest recession and the Federal Reserve starts to ease on raising rates, you could see a big pop in the markets no one is prepared for.
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Steve what about the fact that we have seen a decent chunk of cash making its way into tech stocks what’s been your observation there yeah well one I think there was a lot of pessimism uh in general coming into this year there’s a lot of cash on the sidelines and people
Were positioned pretty cautiously last year was obviously an incredible and difficult year for anything in the growth space Tech in particular I think the outperformance that you’re seeing in Tech you know NASDAQ up almost 20 percent is a reflection that one markets are telling you that interest rates have
Likely peaked the FED is probably going to be easing by the end of the year and that would probably be returning to a lower growth environment where the growth premium that you’re getting out of tech returns so is growth back to being is growth a growth play or is
Growth of safety play then I think for now it’s a safety play we’re we think that it’s better to have a balanced approach in terms of your allocations obviously last year anyone with that growth tilt got burned a lot of people shifted to more cyclical sectors and we’re seeing those sectors whether it’s
Financials or energy underperforming our base case is so that we’re going to get a mild recession in the second half of this year so we’ve been pulling back a little bit on some of that cyclical exposure and advocating a more balanced approach in our Equity portfolios Steve let’s let’s dive into the bank
Stocks themselves I mean the fact that yes we’re obviously when you see signs of confidence seeing names rally but I guess the broader concern seems to be based on some of those recessionary factors you you cite is whether or not companies can deliver on the bottom line
The earnings picture I mean when you think of sectors where earnings might have to be revised do the financials play into that in your opinion well yeah I think you’re going to see that obviously there’s a big expectation that loan growth is likely to slow lending
Standards are going to move higher so so that earnings growth in the space is probably going to be under a bit of pressure although some of the larger Banks where you’re seeing a lot of the the assets flowing may actually be beneficiaries of that I think the earnings expectation for this year for
The broad Market are still probably a little too high they’re not necessarily reflecting that recession that we expect but I also think this has been the most well telegraphed and anticipated recession in my career and that investors are going to be a lot more focused on the earnings trajectory for
Next year rather than what we get for the back half of this year I guess we’re all looking for a recession but we don’t know where like the cracks uh are going to be in in essence why not just put your money in Money Market fun and hang
Out for a little bit well I think that a lot of clients are doing that obviously there’s some pretty compelling yields that you can get today the problem is that the upside can happen so quickly and we saw this in the fourth quarter of last year we actually think that there’s
Compelling opportunity in both traditional fixed income as well as equities we’re taking a more balanced approach but I have such a you have you have to think about the fact that there is a lot of pessimism in markets today I haven’t talked to anyone who’s painting a really bullish case fund managers are
Cautiously positioned sitting on a lot of cash and so if we do get that modest recession we finally get that get through that and accept it and the FED starts to ease you could see a big pop in the back half of this year that I don’t think anyone’s prepared for if
You’re sitting in Money Market funds you have to remember the time to put that cash back to work is really when things feel really bad and that’s hard to do
more qe coming. more h for the junkies
haha. modest recession. Great
Everything is collapsing. The talking heads: "I hope you're ready for a bull market"
Get real Saudis and Iran just agreed to trade for oil in yuan the US is toast against BRICS+IS.
NVDA PE at all time high going into huge recession not mild. Banking system failing. Commercial estate loans will bring them down. Wake up. The house of cards is falling.
Based on what?
When the dollar is crashing, Bitcoin and tech preserves your wealth.
The 200 and 50 days are converging. I think we go to 4300
The bow tie on this guy should tell you everything you need to know about what he has to say
only thing this guy is missing is his clown nose
That is not the big problem.. running market is the peak moment and it will be rebalanced in the cycle , because of the change of the behavior of the market policy and the users of the market portfolio…
For every 30 seconds of fed tightening, bloomberg brings on 30 talking heads talking the market up.
Pop in 2nd half? To where? 5% above where we are? After a 15% draw down? So stupid
Please don’t listen to these snakes
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