Equity Markets See Something They Like as the Bull Run Gathers Steam

Stocks rally, bonds wobble, and the Fed’s “insurance” spin keeps markets guessing

Key Takeaways

• Bond Market Unmoved by Fed’s Risk-Management Spin: It is hard to know what the Treasury market did not like yesterday. Maybe the bondies did not like how Powell characterized the rate cut as “insurance” and “risk management,” which, of course, makes no sense because the Fed has already done -125 basis points, and by the end of next year, the dot-plots, if they are prescient, will have meant a cumulative decline in excess of -200 basis points.