And a good Friday AM to ya,

Most asset classes in the green today on the heels of a bit weaker dollar (weaker dollar means outside investors spend less on US denominated assets, which can allow prices to go up).  Zero economic data today and being in the first third of the month doesn’t get too many forced trades. There is some Fed-speak today but it is nothing we haven’t heard before. The commitment to fight inflation could not be stronger and there is no expectation for a Fed pivot in the near term until the Fed is convinced that inflation has moderated. Yes, that is all true but things can change quickly. Next week we will get the last set of inflation data before the Fed meeting the following week. I expect inflation has moderated even more but if not, buckle up, we may be looking at extra innings in this game.

Assuming inflation has and continues to moderate, the Fed faces a tough decision.

How much pain to inflict on the economy? We feel very toppy right now. Forget about equities, which are likely to pull back a bunch more as the economy continues to slow, but focus on the consumer, we have more maxed out credit debt now than any time before and the savings rate, which was strong when being supported by government subsidies, is now anemic and is trending to negative. Raising short term rates will only compound the pain. The Fed knows this better than I can write about it.

The Fed won’t pivot until it does but it will have to.    

Realtor.com this week cut an undisclosed number of regular and contracted employees across most of its departments, it revealed Thursday. The prominent listing service, based in Santa Clara, California, made the move in response to slowing sales volume, according to a Wednesday email to employees from CEO David Doctorow.

Buy the dip. This is a window of opportunity.

Please remain safe and healthy, enjoy the weekend and first, make today great!