news & insights

The Summer Melt Up… Will It Continue? | The summer rally is in full swing with a classic melt up – the euphoric flip side of a meltdown. We believe the equity market is looking past the tariffs and inflation data and focusing on economic growth and looking ahead at earnings into 2026.

Unemployment Falls to 4.1% | The job market remained strong in June, defying concerns it is poised to slow from tariffs, job cuts at government agencies, soft business and consumer confidence, and signs of aggressive enforcement of immigration.

Summer Brings New Record High | As we move deeper into the summer and the long lingering uncertainty of the “One Big Beautiful Bill” is now behind us, stocks have been charging to new highs on both the S&P 500 and Nasdaq 100. And though the Dow Jones Industrial Average (DJIA) has not yet hit its own new highs, we expect it will. Breadth and volume are confirming the ongoing rally, giving us confidence that the secular bull market is alive and well.

In the June edition of the Chartbook, Managing Director and Head of Investment and Advisor Solutions Richard Williams reviews the month’s economic data, which showed the U.S. economy contracted by 0.5% in Q1 2025, a sharper decline than the earlier estimate of 0.2%, largely due to President Trump's trade tariffs disrupting business activity.

Stocks Spark to Record Highs Amid Market Fireworks | The Bull is alive and charging ahead, with stocks closing out the holiday week at all-time highs! We have been bullish while expecting a pullback – but the stock price momentum has been so strong that a correction has not materialized. In fact, the Cumulative Advance-Decline lines for both the NYSE and S&P 500 have hit record all-time highs, confirming the Bull is charging across the full breadth of the market.

Lower Inflation Trend Intact | Two recent inflation reports -- the Consumer Price Index (CPI) and the Producer Price Index (PPI) signaled that pricing pressures are easing, at least for now. But both also confirmed that inflation remains above the Fed’s target of 2.0%, and it may take a while to get to that level.

Explosive Tariffs Give Way To The Market Fireworks Of New Record Highs What A Year So Far – From Bear To Bull In 2 Months | The year started off strong, but the tariffs announced on April 2 proved worse than expected, so stocks corrected some 20%, sending the market into bear territory – only to bottom and rally 27% – reaching record highs in just 2 months’ time. This is one of the fastest declines / recoveries in the history of the equity market. No wonder investors have been nervous. The volatility in 2025 has been extraordinary.

Summer Correction To Summer Rally | We have been highlighting for a few weeks now that the U.S. equity markets were positioned to have a pullback in the order of 5%-7%. We expect that the actions of the United States over the weekend to take out the nuclear capabilities of Iran should bring some volatility to the markets.

Unemployment Unchanged at 4.2% | The job market remained strong in May amid concerns it is poised to slow from tariffs, job cuts at government agencies, and weak business and consumer confidence. The Bureau of Labor Statistics (BLS) reported that the U.S. economy generated 139,000 nonfarm jobs in May, almost exactly matching our forecast of 140,000.

A Correction Is Here | We have been writing for the past few weeks that – after a 25% rally off its lows – the S&P 500 was overbought. Despite the strong jobs report, along with the very positive inflation data from the Consumer Price Index (CPI) and Producer Price Index (PPI), the equity market was not able to break out to new highs. When the market challenges record highs, it normally takes several attempts before finally breaking through. We are expecting a correction of about 5%.

The S&P 500 is on track for a summer rally, targeting 7200 in 12 months and 12000–13000 by 2029–2030, driven by robust economic growth, consumer resilience, and transformative technologies. Despite short-term choppiness from overbought conditions and tariff noise, we remain in a secular bull market.

In the May edition of the Chartbook, Managing Director and Head of Investment and Advisor Solutions Richard Williams digests the month’s economic data, which showed the U.S. economy contracted by 0.3% on an annualized basis in Q1 2025, marking the first decline since Q1 2022, primarily due to a 41.3% surge in imports, as businesses and consumers rushed to buy goods ahead of new Trump-era tariffs.

Jobs Report Not As Weak As Feared | Last week’s ADP report was weak, leading to the market acting worried that the job market was weakening. However, the opposite happened with the jobs report – it showed that the U.S. labor market, in fact, remains robust, with jobs still growing and the unemployment rate remaining steady at 4.2%.

Gold In Demand | When global economic conditions become, investors often flock to gold. As of this writing the yellow metal is currently trading around $3,313 per ounce, up 27% for the year and near the high end of its five-year range of $1,650-$3,363. Essentially, gold has been on an upward arc since the start of the pandemic.

Market Tug Of War: Tariffs Vs. AI | The equity market has been in a tug of war between pricing in tariffs and pricing in artificial intelligence (AI). In our view, the AI trade is back and the equity market has already priced in the tariff trade. We have often mentioned that the equity market discounts six months in advance. Well, we’re moving close to this timeframe.

Tariff Tantrums Are Back | Equity markets were marching along happily up until last week when President Trump set off a new volley of tariff tantrums, again causing volatility – but the pullback in equities was modest. It appears markets are getting used to the tariff negotiations, and they are not reacting as violently as they did following Liberation Day (April 2).

Cutting 2025 GDP Growth to 0.5% | The fact that Gross Domestic Product (GDP) fell in the first quarter at an annualized rate of 0.3% is a warning, not an epitaph. The economy’s resilience has limits amid tariffs, government job and spending cuts, and falling business and consumer confidence. While we are not calling for a recession, we are reducing our 2025 estimate for GDP growth to 0.5% from 1.3%.

A Potpourri Of Thoughts On The Economy & Markets | As we vacationed in Florida this past week, there was no sign of a consumer slowdown in spending with every hotel and restaurant fully packed. This week, we offer a potpourri of thoughts on the economy and markets. There is no sign of an economic contraction, and the bear market in stocks has now turned back to a Bull. There remain many concerns over tariffs and what they mean for the economy and investments, but currently, we don’t see any major negatives. In fact, we see the opposite.

Surfing The Tariff Shockwave | We believe the tariff shock of Liberation Day (April 2) was front-loaded. Most of the damage to the equity markets seems to have been completed after about a week, with the S&P 500 hitting a low of 4835 on April 7. Since then, the S&P 500 has not only rallied into resistance near 5600-5700 (just below its 200-day moving average), but it has broken above those levels to a modest gain year to date.

In the April edition of the Chartbook, Managing Director and Head of Investment and Advisor Solutions Richard Williams breaks down the month’s economic data, which showed the U.S. economy shrank by 0.3% in the first quarter of the year, the first contraction in three years, largely due to a surge in imports as businesses rushed to beat incoming tariffs.

Monday Opens With China Trade Deal – Equities, Yields, Oil, Bitcoin Up, Gold Down | We have been of the view that the April 7th low of 4835 on the S&P 500 was the low, and we did not have to test it based on the strength of the equity market rally. We have had buy signals for weeks on the equity market and continue to get more. On Monday morning, we woke up to a temporary deal on tariffs with China for 90 days.

“Sell In May And Go Away” – Perhaps Not | There is an old Wall Street adage to “Sell In May and Go Away”* based on the idea that stock market returns are historically weaker between May and October compared to the rest of the year. The notion is to avoid the summer months – but what if we can continue to rally from May through August? Such optimism may feel wrong, what with a “final” tariff policy still not clarified and confirmed, but remember: markets discount about six months in advance.

Tariffs Raise New Home Costs by $10K | New tariffs are already raising the cost to build a new home. This could hurt margins for builders and may foreshadow trends in other industries. With housing affordability already strained, many builders are pragmatically focused on offering incentives to close sales and generate cash flow rather than on protecting margins.

Trump’s First 100 Days (The Second Go-Round) | This week marks President Trump’s first 100 days of his second presidency. Whether or not you’re a fan of his policies, you can agree that this has been a period in American history that will never be forgotten. Liberation Day on April 2 resulted in one of the fastest and sharpest declines in the equity market. It felt like a mini crash. But we did get capitulation (i.e., excessive selling that marks a bottom), and the market has since rallied sharply, up 15% off the low. Year-to-date, however, the S&P 500 is still down 6% with the Nasdaq 100 down 7.5%. Interest rates on the 10-year treasury yield did spike higher as stress and selling hit this market as well – but rates have since eased and are again falling. We believe tariffs are now priced into the markets, but volatility is likely to remain until we have a finalization of tariffs.

What to Expect in a Recession | The U.S. is not currently in a recession, but many economists are forecasting a contraction in GDP in coming quarters due to the fallout from Donald Trump’s tariff plan. The argument is that companies in just about every industry will face rising costs and, in order to protect margins, will have to either raise prices (rekindling inflation) or lay off employees (pushing the unemployment rate toward 5.0%). We have studied the six recessions that have occurred in the U.S. since 1980. Five of them are more “normal” pullbacks, while the sixth was the recent pandemic-induced decline.

The markets continue to be roiled with volatility. This is what we have been expecting. This time, however, the narrative has shifted from tariffs to President Trump’s threats to fire Federal Reserve Chair Jerome Powell.

Temporarily Interrupted | Trump’s tariffs are continuing to cause volatility in the markets, and we suspect this will continue for a few more months. The good news is that the current pullback is holding the secular bull market uptrend; the bad news is that the April 7th lows of the market will need to be tested.

Headlines Continue to Grab Investors’ Attention | It’s Tax Week – which generally drains liquidity from the markets temporarily, but then we get a recovery as April is one of the better performing months of the year. Equity markets remain extremely oversold, so good news could lead to rallies, but any negative news, particularly during the earnings season, can cause some volatility to the downside. Late last Friday, the Trump Administration gave us a little positive news on the tariff front with President Trump announcing exemptions for several products, including smartphones, computers, semiconductor chips, solar cells, flat panel TV displays, flash drives and memory cards. These exemptions looked like a win for technology companies, but over the weekend more news came out, creating confusion over these exemptions. This morning, the market and technology companies are rallying, but we need to be prepared for further updates and changes on electronics and other tariffs.

Tariff Relief Rally | On April 9th, President Trump suspended his “Liberation Day” tariffs for 90 days, while still imposing a flat tariff of 10%, except for China. There are also no tariffs right now on semiconductors, which benefits many companies, especially technology related ones. For China, Trump raised the tariff level again to 125%, effective immediately. The equity market surged on this news, having the best single-day rally since 2008. The equity market was extremely oversold, as we wrote in this week’s Week Ahead and has rallied sharply, showing just how oversold it was.

In the March edition of the Chart Book, Managing Director and Head of Investment & Advisor Solutions Richard Williams breaks down the month’s economic data, which showed the U.S. economy grew slightly faster than previously estimated in Q4 2024, with GDP rising at an annual rate of 2.4%, according to the Department of Commerce. The economy showed resilience despite high interest rates, supported by steady consumer spending and a strong job market. However, uncertainty surrounding President Trump's economic policies, particularly tariff measures, has raised concerns.

Fed Still on Pause | The Federal Reserve wrapped up its latest Open Market Committee meeting and, as expected, maintained its fed funds target rate at the 4.25-4.50% level. This was the second consecutive meeting at which the central bank held policy steady, after cutting rates three times in late 2024. The non-decision indicates that the Fed still has concerns about lingering inflation and is carefully monitoring the overall economy.

Secular Bull Intact But Cyclical Bear Still Here | On April 9th, President Trump suspended his “Liberation Day” tariffs for 90 days while still imposing a flat tariff of 10%, except for China. There are also no tariffs right now on semiconductors, which benefits many companies, especially technology-related ones. For China, Trump raised the tariff level again to 125%, effective immediately. The equity market surged on this news, having the best single-day rally since 2008. The equity market was extremely oversold, as we wrote in this week’s Week Ahead and has rallied sharply, showing just how oversold it was.

The Trump Dump | Equity markets around the world fell sharply last week after President Trump released his “Liberation Day” tariff plan – and it was much worse than expected. China has already retaliated, announcing reciprocal tariffs on the United States. Fears have emerged not only of a U.S. economic slowdown but also of a heightened risk of recession. There are also fears that inflation will rear its ugly head, driving prices of goods and services higher again. The Financial Times on April 5 summed up the situation quite well in our view: “The U.S. president’s liberation day has triggered a big market sell-off, amid fears of a return to Depression-era tariff barriers and confusion about what exactly he is trying to achieve.” Uncertainty is never the markets' friend because markets don’t know how to price uncertainty.

It's Tariff Week | The Trump Administration is set to announce its retaliatory tariffs against America’s trading partners on Wednesday, referred to as “Liberation Day” by President Trump. Amid the uncertainty surrounding these impending tariffs, the market is struggling to price in their potential impact. The equity market needs clarity.

Services Support 2025 GDP Growth | We reduced our 2025 estimate for GDP growth to 2.0% from 2.3%. There are some headwinds, but unemployment is low at 4.1%. We expect consumer spending to grow 2.3% for the year, bolstered by 2.4% growth in the Consumer Services category (which represents 47% of GDP). The ISM Services Index showed expansion for an eighth consecutive month in February and has indicated expansion in 54 of the last 57 months.

Economic Outlook Trumped By Trump | Last week’s meeting of the FOMC (Federal Open Market Committee), which sets U.S. monetary policy, ended pretty much as expected. Fed watchers anticipated that the FOMC would leave interest rates where they were, and it did. Fed watchers anticipated that the FOMC would reduce quantitative tightening (QT), and it did. The initial reaction was that the FOMC was being “hawkish,” that is, that it was taking a hard line position on inflation. However, the subsequent press conference by Federal Reserve (Fed) Chair Powell convinced most investors that the Fed stands ready to support the markets if necessary – meaning that it is in fact “dovish,” meaning it’s more inclined to ease monetary policy. Following Powell’s comments, the equity markets rallied, having been oversold from a -10% correction.

"There is Nothing to Fear But Fear Itself" A phrase from the 1933 inaugural address of President Franklin D. Roosevelt | With all the chaos created by Musk’s DOGE (Department of Government Efficiency) and Trump’s on-again, off-again, on-again tariffs, the equity market has been falling sharply and quickly. Why is this? Wall Street thought it had a “Trump put,” meaning that he would intervene to support or stabilize the markets during significant downturns – because it was assumed (based on past comments and behavior) that he would judge his own performance by how the equity market performed.

We Interrupt This Program... | The secular equity bull market has paused for a correction. Corrections are a normal part of the investment process, and they are never fun. Corrections always happen on bad news. It is normal to have three 5.0% corrections and one 10% correction per year. With so much uncertainty hanging over… everything these days, the equity market may undercut the 10% and have a 12%-15% correction. Why? Because the Trump Administration nearly daily barrage of tariff announcement, coupled with news DOGE-driven budget cuts and layoffs, has created a significant amount of uncertainty for businesses and investors. Optimistically, we believe the markets are close to finding a bottom in prices. But the healing process will take time and lows are often tested. So, patience is the best attribute and guide for an investor.

In the February edition of the Chartbook, Managing Director and Head of Advisor Solutions Richard Williams breaks down the month’s economic data, which showed U.S. economic growth slowed in the fourth quarter of 2024, with GDP increasing at an annualized rate of 2.3%, down from 3.1% in the previous quarter, according to the Commerce Department. Consumer spending remained strong at 4.2%, but overall growth was impacted by colder weather, lower retail sales, and concerns over tariffs imposed by President Trump.

Inverted Yield Curve in Rear-View Mirror | After almost two years of inversion, the yield curve has returned to its normal upward-sloping shape. This has important implications for bond investors and for the economic outlook.

Tariff Tantrums Continue | President Trump continues to announce tariffs, some of them rather stiff, against nations he accuses of blocking American exports with tariffs and non-tariff trade barriers; he is also waging this trade war to fight against drugs coming into the U.S. We continue to believe this is a strategy to pry open foreign markets to American goods; however, there is some evidence the Trump Administration intends to use tariffs as a way to raise revenue for the federal government, which means that some tariffs would be permanent. Initial tariffs are against the U.S.’s three largest trading partners: Canada, Mexico, and China.

Tariff Threats Keep Equities In A Correction | Tariff talk by the Trump Administration is creating uncertainty, and investors have decided to take profits across the equity and crypto markets – and even in the gold market. Markets loathe uncertainty. Why? Investors tend to either hold back or sell profitable investments, and company managements freeze business development and hiring until there’s more clarity. The DOGE (Department of Government Efficiency) firings are also adding to consumer concerns. Uncertainty usually means lower equity prices, and investors retreat from equities toward the safety of cash and Treasury bonds.

Forecasting 2% GDP Growth In 2026 | With unemployment of just 4% and 4Q24 Personal Consumption posting its strongest gain of the year (up 4.2%), the U.S. economy is on a better trajectory than we expected. We are boosting our 2025 GDP forecast to 2.3% growth from 2.1% and are initiating a 2026 forecast of 2.0%.

Equity Markets Remain In A Consolidation | First, let’s remember the month of February historically is one of the weakest months of the year. But despite this, last week the S&P 500 and Nasdaq 100 both reached record all-time highs – though they failed to hold these levels as more tariff talk took hold. Also, the market did not like the new consumer confidence data showing that the consumer is becoming less confident. Then Walmart (WMT), the largest retailer in the U.S., reported better than expected earnings but had weaker than expected future guidance – which greatly disappointed Wall Street. So, the equity market remains in consolidation, which is bullish, in our view – though we should expect continued volatility. The Bucking Bull is still roaming the markets.

A Penny For Your Thoughts | Less than four weeks into his second administration (the first non-consecutive presidential administrations since Grover Cleveland won re-election in 1893), President Trump ordered Treasury Secretary Bessent to halt the production of new 1-cent coins at the U.S. Mint, stating that they cost more than 2 cents each to produce. Eliminating pennies in other countries has not disturbed their economies nor disrupted economic liquidity. It is our view that this is part of the early phase of transitioning from traditional currency in paper and coin to a digital currency world.

While February traditionally represents a seasonally weak month, we remain positive on the U.S. equity market. The Bucking Bull has carried over into 2025, but just as the five corrections last year resolved and moved markets to record highs, we expect the same this year. We maintain that we are in a secular bull market that should last until the end of this decade, driven by innovation in artificial intelligence (AI), robotics, blockchain, Web 3.0, and virtual reality. Over $300 billion is expected to be invested in AI alone in 2025.

In the January edition of the Chartbook, Managing Director and Head of Advisor Solutions Richard Williams breaks down the month’s economic data, which showed despite past fears of a recession following aggressive Federal Reserve interest rate hikes, the economy remained resilient, growing 2.8% for the year. However, uncertainty looms over the impact of new federal policies, including tax cuts, tariffs, and immigration measures, which could drive inflation higher.

GDP Grows 2.3% | According to the advance estimate released by the Bureau of Economic Analysis, U.S. Gross Domestic Product (GDP) expanded in the fourth quarter at an annualized rate of 2.3%. That’s below the 2.6% consensus and 3.1% growth in the third quarter.

Trump Moves Fast, Markets Hold Steady—For Now | There’s been a lot thrown at the markets over the past three weeks since Donald Trump returned to the White House. The equity and bond markets have had to digest lots of news—from threatened tariffs and headline-grabbing executive orders to the regular parade of corporate earnings and highly anticipated economic releases. Yet, the markets appear to be holding strong (so far) in a seasonally weak month. They’ve sometimes whipsawed back and forth as investors have watched how formerly “normal” ways of doing things have been upended. One publication we follow described Trump’s rapid series of executive actions as “shock and awe.” Another accurate term for his political artistry seems to be “flood the zone,” a phrase coined by Trump ally Steve Bannon in 2017.

Stocks Sputter On “Sputnik” Surprise | Last week began with a surprise when Chinese startup DeepSeek demonstrated that its new artificial intelligence (AI) system could perform as well as expensive American systems – and apparently 100x cheaper and by using domestic Chinese technology. This generated immediate fear that America’s dominance in AI would rapidly diminish, and that AI investment to-date might be “sunk capital.”

The New Administration Hits The Ground Running | Last week saw the beginning of the second Trump Administration with a flurry of executive orders and new initiatives. As we anticipated in our 2025 Year Ahead report, Trump’s “America First” policy is drawing investment capital into the U.S. from abroad. The U.S. has the nicest house on the global block of ugly economies, which has allowed for the country to enjoy significant equity outperformance vs. other stock markets and economies around the world. The policies of the new administration, with their lighter regulatory touch, are perceived as business-friendly and are therefore luring investors from abroad.

The Economy Is Healthy And Growing | The U.S. economy is strong as we start 2025. We expect to see that 4Q GDP rose 2.8% and 2024 GDP grew approximately 2.6%. At the beginning of 2024, we expected 1.7% growth for the year. We expected Personal Consumption Expenditures to average about 1.2%. The final tally could be 3%.

Equity Markets Positioned To Rally If More Good News Comes | Last week, we wrote that equity markets were oversold, and we had several buy signals – and if we received some good news, markets could rally. Well, inflation data in the form of the Producer Price Index (PPI) and Consumer Price Index (CPI) came in for December better than expected and this stemmed the sell-off. We’ve been in a correction since mid-December when the Federal Reserve (Fed) announced its a hawkish rate cut at the Federal Open Market Committee (FOMC) meeting – and now it could be coming to an end, possibly.

In the December edition of the Chartbook, Managing Director and Head of Advisor Solutions Richard Williams reviews the month’s economic data, which showed the economy grew at a healthy 3.1% annual clip in 3Q 2024, propelled by vigorous consumer spending and an uptick in exports, according to the Commerce Department.

Scrooge Is Hanging Around - Jobs Look Just Fine | Last week, the ISM (Institute for Supply Management) services data showed a significant rise in prices paid, which unsettled the fixed income markets as inflation concerns percolated again. Then later in the week, the December labor market report came in very strong and significantly above expectations with the unemployment rate ticking down to 4.1% from 4.2%. Wage growth was stable (which is a good sign for the Fed regarding inflation). Many are calling this a blowout report. The U.S. is clearly showing exceptionalism with the strength of the economy and jobs market translating into a strong equity market. So, what’s wrong with this picture? Well, this changes what the Federal Reserve (Fed) is likely to do with interest rates.

Argus S&P 500 Forecast For 2025 Is 6,700 | The year 2024 was another winner, as stocks extended a bull market that started in October 2022. The rally was ignited by falling inflation and has been fueled by lower interest rates, consistent economic growth, and rising corporate profit growth rates. But despite the historical trends, there’s no guarantee that 2025 will be a bell-ringer as well.

The Grinch Stole The Santa Claus Rally, But The Month Of January Is The Key To The Year | We wish everyone a very Happy New Year, but the equity market did not end or open on a happy note. A correction began in December, as the market had gotten very overbought after rallying nearly 25%. So, the Santa Claus Rally (last 5 trading days of December and the first 2 trading days of January) never materialized. But this is not a bad omen. Historically, when the Santa rally does not happen, the equity market still rallies in the new year (on average) nearly 6%. What holds more weight, however, is how the month of January performs.

Inflation Stays Stubborn | Two important inflation reports were released recently. Both indicated that overall pricing pressures remain well below the peak rates in 2022. But both also confirmed that inflation remains above the Fed’s target of 2.0%.

We Have All Been Here Before | The Federal Open Market Committee (FOMC) meeting last week resulted in a 25 basis point cut as expected. The Dot Plot showed only two interest rate cuts for next year, a change from the original expectation for four cuts. But none of this was a big surprise to the markets. However, what caught the markets off guard – and markets don’t like surprises – was that the FOMC slightly raised its outlook for inflation over the next two years (see accompanying table). Some in the industry believe the Federal Reserve (Fed) is preparing for the possible inflationary impact of the Trump Administration.

The Bureau of Labor Statistics (BLS) reported that the U.S. economy generated 227,000 new jobs in November, slightly above the consensus of 200,000. The report confirmed our expectation for a rebound from October’s damaging hurricanes and strike developments. With the print relatively close to consensus, expectations rose for a rate cut this month. October’s payrolls were revised higher by 24,000 to 36,000.

'Tis The Season To Be Merry | Despite inflation remaining sticky, shoppers have been doing what they do best: shopping. Case in point: between Black Friday and Cyber Monday, a new record was set for online sales. With the labor market still at full employment, the consumer is spending merrily – helped by all the promotional sales designed to entice the consumer to spend on holiday gifts. Remember that 70% of the economic growth in this country comes from the consumer!

Visions of Sugar Plums and Other Holiday Treats: “Santa Bull” Delivers | We believe the effect of artificial intelligence (AI) on the economy and the markets is similar to that of computers and the internet in the 1990s and of radio and the railroad during the 1920s. As we reach the end of 2024 and look ahead to 2025, the equity market is enjoying five major drivers: AI, liquidity, rising earnings expectations, consumer spending, and seasonal effects. In this edition of the Sanctuary Corner, we’ll examine each of these drivers—and then some. Overall, we remain positive on the market through the end of 2024 and into 2025. We believe we are in a secular bull market that, despite occasional interruptions by cyclical bear markets, should last until nearly the end of this decade. Bulls always buck, but this one is charging forward—and upward.

In the November edition of the Chartbook, Managing Director and Head of Advisor Solutions Richard Williams reviews the month’s economic data, which showed consumer confidence continued to improve in November thanks in part to more positive consumer assessments of the present situation, particularly regarding the labor market, according to The Conference Board.

Shoppers Are In The Holiday Spirit With Strong Spending | Reports indicate that Black Friday sales were around $10 billion, driven by online sales, which rose about 10% year over year; in-store traffic declined compared to last year. Adobe has reported that Cyber Monday spending exceeded $13 billion. Holiday sales so far are above the spending levels from last year. This should not come as a surprise as the labor market remains strong. Last week’s November employment data indicated job growth is still strong. Strong jobs are leading to strong consumer spending, leading to the U.S. economy estimated grow rate just above 3% for 4Q24.

The U.S. dollar has strengthened in 2024, this as the U.S. economy has grown at a somewhat surprisingly solid pace and the high level of interest rates has attracted global investors into dollar-denominated securities. The greenback has climbed 2.5% on a trade-weighted basis in 2024 and is 17% above its average value since 2000.

Ho Ho Ho! Santa Already Delivering Presents | It’s not Christmas yet, but Santa’s sleigh is full of gifts for investors. Third quarter earnings have come in strong with fourth quarter earnings expected to come in even stronger, inflation remains sticky but is coming in as expected, and President elect Donald Trump has announced his pick for Treasury Secretary: Scott Bessent, a hedge fund veteran – a move celebrated by the bond market with interest rates coming down.

Stocks Celebrate Our Holidays, Too! | Thanksgiving was traditionally a time to come together and celebrate the harvest and the blessings of the year. Today, it is primarily a joyful opportunity to come together and be with family – and still count our blessings. Well, as we kick off this holiday season, the blessings of the equity market can be counted in its continued strong return with the S&P 500 up over 20% so far this year – and that’s on top of the 24% gain of 2023. The equity market has a pattern of rallying going into a holiday, so this should be a good week. And looking forward into 2025, we expect the Bull to keep on charging ahead.

All That's New Is Old | Heading into 2025, we are embarking on a new era of innovation as technologies like blockchain, artificial intelligence (AI), quantum computing, Internet of things (IoT) in smart cities, and augmented reality represent just a few of the advancements that stand to transform how we live our lives and revolutionize the way we do business. What sets these innovations apart is that they are all developed in the United States, making the U.S. the leader of these industries. Yet, what stands out as truly exceptional is that we have been here before. This cycle of growth is not new; it is old, and this is a trend that has repeated itself throughout history.

Jingle Bells Are Ringing For A Jolly Holiday Season | In January of this year, most investors neither expected nor believed that the equity market could rally by 20% or more. Well, here we are, with stocks up over 20%. Remember: the consensus is often wrong. As Sir John Templeton famously said, “Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria.” Consensus is still in the skepticism phase. The economy has been growing by over 2%, earnings have come in better than expected, and the Federal Reserve (Fed) has begun a cycle of cutting interest rates. The equity markets have celebrated this goldilocks environment by rallying strongly despite five corrections throughout the year.

In the October edition of the Chartbook, Managing Director and Head of Advisor Solutions Richard Williams reviews the month’s economic data, which showed consumer confidence recorded the strongest monthly gain since March 2021 but still did not break free of the narrow range that has prevailed over the past two years, and the U.S. labor market added far fewer jobs than expected in October amid weather disruptions and worker strikes.

Americans Voted Their Wallet - Trump Wins Big | History has shown that the money in Americans’ wallet can predict the outcome of a presidential election – and it happened again. Americans continue to feel the pain of inflation in their buying power despite the economic measures of inflation falling, specifically the CPI (Consumer Price Index). The average American has been complaining about the cost of goods and food for over a year – they have not felt it in their wallets that inflation has in fact dropped. And because Americans did not feel better off under the Biden/Harris Administration, they voted for change – and in a big way. Trump won last week’s election by a landslide, winning both the popular vote and the electoral vote. The Senate will be Republican, and while the House of Representatives has not been finalized yet, it is expected that the Republicans will take the House as well.

GDP Grows 2.8% | According to the advance estimate released by the Bureau of Economic Analysis, U.S. Gross Domestic Product expanded in the third quarter at an annualized rate of 2.8%. That’s just below the 3.0% consensus and 3.0% growth in the second quarter. Solid growth with easing inflation is good news.

Spooky October Ends On A Scary Note – What’s Next? | Last week, the equity and bond markets were spooked by earnings, inflation, higher interest rates and concerns over tomorrow’s presidential election. On the last day of trading for October (a Halloween shocker!), stocks declined sharply, with the S&P 500 down 1.9% and the Nasdaq 100 down nearly 2.5%. What happened? As earnings continued to come in, the Core PCE (Personal Consumption Expenditures) Index – which measures inflation – came in slightly above what the market expected (2.7% vs 2.6%). However, the equity market was very overbought, so the correction was not surprising.

It’s A Tight Race: What Is The Market Saying? | With less than two weeks to go until the presidential election, the market has flipped from a Harris win and is now pricing in a Trump win. Current polling has been changing very quickly over the past weeks, and early voting has Republicans closing the gap in key swing states.

Raising 3Q GDP Growth Forecast | We are raising our third-quarter 2024 forecast for GDP growth to 3.0% from 1.6%. The most-significant changes to our model are increases in our estimates for the big services category and increases to investments in equipment and intellectual property. We still expect 3Q core PCE inflation of 2.2%.

Stocks March Higher Powered by Earnings | We have argued that the most important factor to drive stocks prices is corporate earnings. We are early in the 3Q24 earnings season and, so far, earnings are beating expectations. Companies that are surprising to the upside are rallying, especially when their corporate outlook for the future is positive. Importantly, when we look at projected earnings of the next 12 months globally, the U.S. is forecast to have the best earnings in the world! Strong earnings growth and the best earnings in the world are powering stocks higher, driving the S&P 500 and Dow Jones Industrial Average to record highs.

Election Inertia & 3Q Earnings Drive Markets Over Coming Weeks | We are officially in 3Q earnings season with the banks kicking off earnings and many of the large banks are surprising to the upside, breaking out the bank index. As of this writing, we are twenty-two days away from the Presidential election, which we believe will bring investment inertia – at least until we have the results of who won this apparently neck-and-neck race. Earnings are expected to continue to grow into 3Q24. Yet, with the anticipated inertia and earnings season just getting underway, the equity markets can be choppy. The Bull will buck in October! But we like the behavior of cyclicals stocks, particularly Tech and Tech-related as well the Industrials. These are the leaders of the market and remain favored.

Bond Spreads Widen a Bit | Yields on Treasury bonds have been declining as concerns over inflation have eased. Meanwhile, corporate bond yields have declined as well, but not as rapidly as have Treasury yields -- this as fixed-income investors are now more concerned about a slowing economy and rising bond default rates. As a consequence, spreads between corporate and Treasury bond yields have widened in recent months.

In the September edition of the Chart Book, Managing Director and Head of Advisor Solutions Richard Williams digests the economic data for the month, which revealed consumer confidence pulled back in June but remained within the same narrow range held throughout the past two years as strength in current labor market views continued to outweigh concerns about the future, according to the Conference Board.

On September 18th, the Federal Reserve (Fed) decided to lower interest rates for the first time in two years by 50 basis points (bps). Historically, the Fed begins an easing cycle (lowering interest rates) by 25 bps and lowers by 50 bps only when there are stresses in the economy or banking system. So, a 50 bps cut while the economy is still growing by 2% and the labor market is still at full employment was an extraordinary move. The Fed also positioned markets to expect continued rate cuts into the end of this year and into next year as well. This is a highly unusual action and, in our view, a game changer for markets. Why? This will provide additional liquidity to the markets and should provide confidence to the consumer to keep spending. The move should also stimulate the housing market.

It's A Goldilocks Economy | The September jobs report was significantly stronger than expected. This report alone simply takes the possibility of a 50-basis point rate cut by the Federal Reserve (Fed) in November off the table! But a 25-basis point cut is likely to be served up as the Fed itself said it is recalibrating monetary policy. The Fed is looking to remove the tightness of its policy in favor of moving to what it considers a more neutral rate also known as r* (“r-star”). We still have one more jobs report before the next Fed meeting in November. There is concern now that the recent devastation from Hurricane Helene can impact the jobs data.

Micron & China Ignite the Markets | Last week, we saw the release of a string of key economic data – including the all-important Core PCE (Personal Consumption Expenditures Price Index) – and the data is all supportive of higher equities and lower yields. But what really impacted stocks around the world was the earnings report and outlook for memory chips from Micron (MU), which ignited the semiconductor stocks and Technology overall. Then, in a highly uncharacteristic move, China came out publicly with a bazooka plan to stimulate the economy – and that drove its equity market significantly higher since many are underweight or even short the market.

Tech giants and beyond are set to spend over $1tn on AI capex in coming years, with so far little to show for it. So, will this large spend ever pay off?

It’s that time again! Every four years, Americans take a few minutes out of their day to choose the next President of the United States. Under normal circumstances, voting is a simple, uncomplicated act — but the months preceding it are anything but.

The "Fed Put" Is Alive and Well | After 1½ years of a tightening monetary policy, last Wednesday, the Federal Reserve (Fed) pivoted to a path of easing – and ongoing easing – by lowering the benchmark Fed Funds rate by 50 basis points (0.50%). This was a highly unusual move by the Fed to cut so aggressively with an economy that is still growing strongly at 2% and a labor force at full employment (though, admittedly, it is slowing). Traditionally, a 50 bps cut is done when an economy is under stress or if there is financial stress within the system. The typical (and expected) pace would have been to cut by 25 bps only. What we’re seeing is basically a “Fed put."

Fed's First Cut is 50 Basis Points | The Federal Reserve wrapped up its recent Open Market Committee meeting and, as expected, lowered the current federal funds rate for the first time since 2020. But the central bank surprised some by taking the rather extraordinary step of reducing the rate by 50 basis points (bps), as opposed to the normal 25-basis-point move. Why the big cut? In our opinion, the Federal Reserve is clearly shifting its focus from fighting inflation to protecting the employment environment.

In the August edition of the Chart Book, Sanctuary Wealth Managing Director and Head of Advisor Solutions Richard Williams breaks down the month’s key economic data, highlighting that U.S. consumer prices rose slightly in the month, but underlying inflation showed some stickiness amid higher costs for housing and other services.

Rate Cycle To Shift This Week - Stocks Positioned To Rally | The Federal Reserve (Fed) is meeting this week to determine the state of the economy and inflation. The cross-market expectation is that the Fed will begin a rate cutting cycle – but there is a debate as to whether it will start with a cut of 25 basis points (bps) or 50 bps. We believe that, because the economy is relatively robust, the Fed will begin with 25 bps only. The market is also expecting that rate cuts will continue with 25 bps cuts in November and December as well. The market has already priced in the change in direction in interest rates with 2-Year Treasury yields falling sharply after the August employment report. Technically, 2-Year Treasury yields can fall to 2.0%-1.5% – which is likely what we’ll see next year. If you have not locked in a 5% rate at the short end of the curve, your time is running out.

Weak Payrolls Set A Bearish Tone For Stocks and Bullish Tone For Short Rates | Last week, both the ADP and JOLTS reports showed a weaker employment picture, setting up concerns for the August employment report on Friday. Well, the August employment payrolls data was weaker than expected – across the board. Adding to market concerns were the sharp downward revisions to the July employment data – which reinforces the slowdown in the labor market. This all but assures the Federal Reserve (Fed) will be cutting interest rates this month. (We’re still thinking 25 basis points). This also had the 2-year Treasury yield breaking down – an action that points to short interest rates continuing their decline.

The 10-Year To The Rescue | The movements of the 10-Year Treasury could be much more important to the economy than the fed funds rate -- three-times as important, according to a Fed “rule of thumb” that Nobel Prize winner and former Fed Chairman Ben Bernanke mentions in his 2022 book titled “21st Century Monetary Policy.”

Moving in the Right Direction | Have we reached the Goldilocks “just right” world with the economy growing but not too strong (2Q24 GDP at 3%), the labor market balanced, inflation coming down, S&P 500 earnings growth strong (2Q24 up 11%) and interest rates expected to come down later this month? Well, it appears that these factors should lead to the equity market maintaining a strong return for the year.

More Progress on Inflation | Two important inflation reports were released recently and both indicated that overall pricing pressures have retreated from peaks. Let’s first take a deeper dive into the Consumer Price Index. According to the latest CPI report, the overall inflation rate in July of 2.9% was lower than the prior month’s rate of 3.0%. That good news was supported by a low reading in the monthly core CPI rate, which excludes the impact of food and energy and rose 0.2% from June to July, consistent with subdued readings for the past quarter.

Energizing the Future: Primers and Projections for Energy Use | With this month’s Sanctuary Corner, we’re doing a deep dive into the Energy Sector, with a focus on finding the potential pinnacles amid the pitfalls. As we have reported throughout the year, it’s a sector with a bright future – but one that still needs to overcome many challenges, both near- and long-term.

In the July edition of the Chart Book, Managing Director and Head of Advisor Solutions Richard Williams analyzes the economic data for the month, which showed the U.S. economy powered through the second quarter, growing more than expected even as inflation resumed its path back to the Federal Reserve’s 2% target. Also, the LEI for the U.S. declined in June, fueled by gloomy consumer expectations, weak new orders, negative interest rate spread, and an increased number of initial claims for unemployment.

Fed Inches Closer to Rate Cut | The Federal Reserve wrapped up its Open Market Committee meeting and, as expected, held the current federal funds rate steady at 5.25%-5.50%. The rate remains at its highest level since 2000 and above the long-term average of 4.4%. This is the Fed’s plan: keep rates high to push inflation lower.

Equity Markets Recover But Will It Last? | The global equity markets were pummeled last Monday as the Japanese yen strengthened significantly, forcing leveraged investors in the yen carry trade out of their positions. How much more of the yen carry trade needs to unwind? Given that this is a global trade, we may never know the exact amount. But we can look at the Commitments of Traders report and examine the positions of fast money traders. First, the most important thing to note is that the short position or borrowing in yen was at a record – and it was just above the size of shorting seen during the Great Financial Crisis in 2008-2009. Most of the yen short positions have been covered (see accompanying chart). This should allow for reduced volatility in the markets over the coming weeks.

The World is Yenning for a Bottom in the Markets | The Yen carry-trade has been a position in markets for many decades. Money was cheap in Japan, which essentially had a zero-interest rate policy. The carry-trade is borrowing money in Yen and buying other assets. The Bank of Japan’s (BOJ) benchmark rate moved from -0.1 to 0.1 on March 18, 2024, and last Wednesday, the BOJ raised this rate to 0.25. Now that the BOJ has begun raising rates, the carry trade has started to unwind (to undo the trade, you need to sell the asset that is long and buy yen to cover the debt), causing the Yen to Dollar to start appreciating sharply (it’s up 14% since late July!). But Monday morning in Japan (Sunday night in the U.S.), the Yen appreciated 5%, resulting in the Japanese equity market to crash -12.5%. This cascaded into a worldwide sell-off in equities. U.S. Treasuries were a safe haven with interest rates falling sharply.

Too Early, Too Late Or Will It Be Just Right? | Investors have been debating all year whether the economy was slowing – and if so, by how much – and most importantly, what should the Federal Reserve (Fed) be doing with interest rates? The Fed has been claiming to be data dependent, and recent economic data suggests inflation is indeed slowing, but the economy itself is slowing more.

More Progress on Inflation | Two important inflation reports recently indicated that overall pricing pressures have retreated from peaks in 2022. But both also confirmed that inflation remains above the Fed’s target of 2.0% and progress to that level may be hard to achieve. With the Consumer Price Index (CPI) report, there were some positive results. The overall inflation rate in June was 3.0%, lower than the prior month’s 3.3%.

Core PCE Reassures Expectations of a Fed Rate Cut in September | The Core Personal Consumption Expenditures Price Index (PCE) came in 0.1 higher than expected on a year-to-year basis, but this should not stop the Federal Reserve (Fed) from cutting interest rates by 25 basis points in September. Consumers have been slowing down their spending, manufacturing is showing weakness – and so are durable capital goods. And let’s not forget that the unemployment rate has been rising. GDP for 2Q24 came in stronger than expected with a healthy print of 2.8%, but we are seeing a bit of a slowing here as well. So, net-net, the economy is in good enough shape for earnings this year.

From the Trump Bump to the Trump Dump...And Now No Biden Stump | After the first debate between President Joe Biden and former President Donald Trump, the equity market began to price in a win for Trump. This trade got a bump after the assassination attempt on Trump as the betting odds on his win rose sharply. But at the Republican National Convention (RNC) last week, Trump made remarks about Taiwan that cascaded into a sharp sell-off of semiconductor stocks. The move hit the large cap Technology stocks, particularly the Magnificent 7. The market averages also fell, with the Nasdaq 100 down sharply. As we wrote last week, a correction was expected with sentiment very bullish and markets very overbought.

Fireworks to Spark the Bucking Bull | The first half of the year saw the S&P 500 rally 15% while the Nasdaq 100 was up 17%. As we entered July, stocks continued their march higher, reaching the low end of our target range of 5600-5800. We remain comfortable with this target range, but the Bucking Bull will start to shake things up a bit. Still, we maintain that the U.S. equity market is likely to have at least a 20% gain at year-end – on top of the 24% gain in 2023. This would be a top 10 all-time performance for the S&P 500 in two consecutive years.

In the June edition of the Chart Book, Managing Director and Head of Advisor Solutions Richard Williams analyzes the economic data for the month, which revealed consumer confidence pulled back in June but remained within the same narrow range held throughout the past two years, as strength in current labor market views continued to outweigh concerns about the future, according to the Conference Board.

Trump Assassination Attempt Brings More Focus to RNC & VP Nominee | Saturday’s assassination attempt on former President Trump appears to have bolstered his presidential campaign. Trump's survival and defiant response, symbolized by a triumphant fist pump, have energized the Republican Party and improved the betting odds on Trump winning the election in November. This momentum is expected to carry into the Republican National Convention this week in Milwaukee, as we all await the announcement of Trump's vice presidential running mate. So, how will stocks react? The equity market had already begun to price in a Trump victory, which is bullish for stocks. We don’t see anything changing.

Rate Cut Looks More Likely | The Bureau of Labor Statistics (BLS) reported that the U.S. economy generated 206,000 new jobs in June. June’s increase in payrolls and revisions lower to results from May and April took the three-month average to 177,000, below the 12-month average of 220,000 and signaling a cooling job market that -- when combined with unemployment that is creeping higher -- should allow the Fed to reduce interest rates this year.

The Drama of the Election Continues | In an attempt to recover from his disastrous performance against Donald Trump in the June 27th CNN Presidential debate, President Biden sat for a 22-minute taped interview last Friday night with ABC’s George Stephanopoulos. While the goal may have been to alleviate concerns about Biden’s health and cognition, many found the President to be underwhelming in the interview, leaving various questions still open for the Democratic Party. This is leading to more political drama going into November. It will prove to be a long election process – with the ultimate outcome as the top-of-mind concern for most investors.

Transition Theme for 1H24 into Rest of Year: An Object in Motion Stays in Motion | Part of Isaac Newton’s first law of motion is that an object in motion stays in motion. Well, the stock market has had strong motion so far this year, up 14.5% for the first half. We remain bullish and believe the motion of the market stays up. And we still believe that any pullbacks represent a buying opportunity.

More Progress on Inflation | Two important inflation reports recently indicated that overall pricing pressures have retreated from peaks in 2022. But inflation remains above the Fed’s target of 2.0%.

The Investment Council Report (ICR) provides a brief overview of the Council's perspectives of the economy and the major asset classes: equities, fixed income, and alternatives.

In the May edition of the Chart Book, Managing Director and Head of Advisor Solutions Richard Williams reviews the month’s economic data which showed consumer confidence improved in May after three consecutive months of decline, as reported by the Conference Board.

July Can Be A Fizzle | We are now concerned about near-term prospects because Wall Street analysts have (finally) caught up to us with their own market outlook. Over the past few weeks – and especially last week – many analysts raised their targets on the S&P 500 to 5600. [We had raised our target range to 5400-5600 back in February!] Plus, everyone is now talking about the seasonality of a summer rally, highlighting that both July and August during an election year have been, historically, good performing months. Unfortunately, when the market view is in consensus, the opposite usually happens.

June Is Bustin' Out All Over | As we have been saying: “Buy In May and Sell By Labor Day” because the market and select stocks are breaking to record all-time highs! The moves are primarily in Technology and Tech-related companies connected to artificial intelligence (AI) – but not only in these areas. So, what’s driving the breakouts? Inflation data last week from the Consumer Price Index (CPI) and Producer Price Index (PPI) was much better than feared.

Artificial intelligence (AI) is the elephant in the room that everyone DOES want to talk about. And they should… because it’s still a challenge for investors to get their heads wrapped around the extent of AI’s impact. AI is the catalyst for an enormous paradigm shift in… everything.

Very Strong Jobs Report | What’s wrong with strong job growth? Absolutely nothing! It’s great that the U.S. economy remains strong, with more jobs getting added and wages getting better (even if only slightly). But this latest flex from the jobs markets puts into question the ability of the Federal Reserve (Fed) to cut interest rates anytime soon.

Inflation Data Keeps the Bull Running | Following four months of higher than expected inflation data, last Friday’s Core PCE (Personal Consumption Expenditures Price Index) for April came in as expected at 2.7%. This provides much relief to both the bond and equity markets. Year-to-year PCE is still declining – this is a key move. Note that there have been bumps along the way, but the overall trend has been consistent. In our view, this data allows the Fed to possibly cut rates 25 basis points before November’s presidential election. It also allows risk assets to have only minor corrections.

Yield Curve Headed Toward Upward Slope | The yield curve has been inverted for months now. But what has changed over the past year is that the inversion isn’t so steep.

Supercharged: Nvidia EPS Skyrockets, While Economic Growth Continues to Surprise to the Upside | Nvidia (NVDA) might very well be the greatest corporate success story of all time. Hyperbole? Not when you think about how it started, what it has accomplished so far, and what it is poised to do – especially as a company with no immediate competition.

The Investment Council Report (ICR) provides a brief overview of the Council's perspectives of the economy and the major asset classes: equities, fixed income, and alternatives.

Dow Hits 40,000 Milestone As Inflation Fears Ebb | Equity and bond markets are telling us that inflation is not a major concern as interest rates fall sharply and the Dow Jones Industrial Average (DJIA) closes above the 40,000 milestone, putting the Dow in new record territory, alongside the S&P 500 and Nasdaq 100. Last week, producer prices came in higher than expected – but revisions were sharply down – and consumer prices came in soft enough that all this inflation data was good enough to pick equities up and push rates down. Inflation fears are definitely ebbing, if not disappearing. Also fueling the equity market’s rally is the continued parade of corporate earnings coming in significantly higher than expectations. With profit margins stable to improving and interest rates falling, we see the valuations of the price-earnings multiple expanding.

Vigilant Fed Focused on Inflation | The Federal Reserve wrapped up its latest Open Market Committee meeting and, as expected, held the current federal funds rate steady at 5.25%-5.50%. The rate remains at its highest level since 2000 and is above the long-term average of 4.4%. This is the Fed’s plan, of course: keep rates high to push inflation lower.

Don't Sell in May - Summers Are Strong the Bull Bucked by it's Running Again | There is an old Wall Street adage that says, “Sell in May and go away!” But we believe differently! We say, “Buy in May and sell by Labor Day!” Seasonally, the summer months are strong with equity markets generally peaking in the month of August. When we review the price momentum indicators Moving Average Convergence/Divergence (MACD) and Relative Strength Index (RSI), they remain strong and point to a continued improvement in stock prices. But volatility measured by the VIX index has fallen sharply, which indicates that equities can have intermittent periods of pullbacks. However, we continue to believe that the S&P 500 and Nasdaq 100 can reach new records, and the summer months are likely to get us to these highs.

Historically, April has proven to be a down month, so the 5% correction the market experienced during the month is not out of line. (We typically see 5% corrections three times a year.) But following the April rains (and occasional downpours), we can expect stocks to rally in May – and in fact, there’s been an early start as markets have thus far rallied. Why? There are three keys to the market blossoming right now: the Federal Reserve has taken the possibility of hiking interest rates this year off the table completely; fears about inflation are clearly ebbing; and corporate earnings continue to roll in significantly above expectations.

The Bull Bucked But It's Running Again | As expected, last week was a barrage of datapoints that caused our Bull to buck. But by the time the dust settled, the Bull was off to the races again, just in time for the Derby. Here are the highpoints: Federal Reserve Chairman Jerome Powell removed any concern that the Fed might be on a path of raising interest rates again. One less thing to worry about. The Fed has also surprised on its approach to ongoing Quantitative tightening: the market was expecting the Fed to cut the amount it’s running off of its balance sheet from $60 billion a month down to $30 billion – it’s actually dropping down to $25 billion a month. This slowing the pace of run-off is a form of easing by the Fed. So, no threat of raising rates plus such a greatly reduced run-off equals a double bullish message from the Fed.