Bumpier Ride Ahead For Market As Volatility Returns | Simon White

A surprise Monday video

Sometimes a monkey wrench gets thrown into the best laid plans.

I recorded this interview with Simon 2 weeks ago. Due to several curve balls, there just wasn’t space in the schedule to publish it until now. But it’s definitely a discussion worth hearing in full.

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Stubbornly sticky inflation looks to be turning the Federal Reserve's campaign of Higher For Longer interest rates into "Higher For Even Longer"

Today's guest warns that "Markets are unprepared for price growth that is becoming entrenched".

Nor do they appear prepared for bond yields to remain at today's rates, let alone possibly march higher from here.

Remember, it was only a few short months ago that the markets were pricing in 7 rate cuts in 2024.

Now it's appearing they'll be lucky to get only 2 or 3.

And who knows? They may not get any.

Does this mean financial asset prices need to adjust downward in some material way?

And will the economy slow faster than expected from here?

Perhaps the recent weakness we saw in stocks in April was Wall Street finally awakening to these potential ramifications.

For an analyst's perspective on the matter, we turn to Simon White, Macro Strategist at Bloomberg and co-founder of the investment-advisory firm Variant Perception.

He predicts that stocks will have "a lot harder ride" as higher volatility will be a major market theme ahead.

To learn why, click here or on the image below:

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Adam’s Notes: Simon White (recorded 4.18.24)

Executive Summary:

• Simon sees the global economy and financial markets as undergoing a regime shift to higher levels of volatility. Investing strategies that worked well for the last 6—12 months will likely not over the next year or so.

• Inflation appears to be persistently sticky, forcing the Fed to keep rates higher for even longer (as evidenced by last week’s Fed guidance update). Rather than solely relying on backward-looking inflation data, Simon emphasizes the importance of identifying leading indicators that can provide insights into future inflation trends, such as the current rising supply pressures and increasing inflation expectations from both consumers and businesses.

• One factor influencing inflation that does not get discussed much is China's new national stimulus program. China is shifting from