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"Markets Are Overlooking How Much Worse This Can Get, How Inflationary It Could Prove"

By Michael Every of Rabobank

Waller Way to Behave

Points of order today. First, we need to underline the major disconnect between market pricing for aggressive 2024 Fed rate cuts -- including new hedges that the Fed cuts by 50bp in March-- and how the actual economy is still performing. Second, we have to ponder what drove the Fed to make the dovish statements in late 2023 that drove, and still drive, that kind of wild pricing. Third, we have to deal with the Fed, and others, walking it all back just weeks later.

Full Article: https://www.zerohedge.com/markets/markets-are-overlooking-how-much-worse-can-get-how-inflationary-it-could-prove