In this month's issue:
Are We There Yet?
The title of this monthly submission is a common refrain heard by those familiar with driving a long distance with young children in the car. In some ways, the widely held (and likely accurate in our estimation) view that the U.S. will encounter a recession in the next 12 months is similarly frustrating for investors in the stock market.
Complications in Policy
Federal Reserve policy is supposed to be simple: the FOMC, led by the Fed Chair (currently Jay Powell) tries to set monetary policy to achieve maximum employment and stable prices. These qualitative metrics have slowly grown into semiquantitative goals—the Fed’s estimate of maximum employment is about a 4% unemployment rate and its explicit inflation target is 2%—through which policymakers raise and lower interest rates to try and hit.
The Other Six Months
Gregory M. Drahuschak
May begins with the hope that the equity market successfully can navigate the traditionally lackluster May-through-October period. Depending on negotiations in Washington D.C., however, the debt-ceiling debate and other factors could make this six-month period more difficult than usual.
You can read the full Investment Perspectives here.
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