Good Thursday AM,
Stocks flat to a little weaker with a lot of talk about equities being overvalued and due for a pull back. A pull back would help bonds and rates. Crypto is losing and treasury bonds are flat. Mortgage bonds are outperforming, which we like. Unemployment claims out this a.m. show a tick up by a bit. Markets were looking for fewer claims but this doesn’t really surprise anyone. The next hammer to drop is likely the one with the new Fed Chairman on it. Powell has done a great job (really great) navigating the economy through some very difficult periods (and a new administration). He should and has earned the right to keep his job. That said, as I digest it more in my head, Lael Brainard would be a more likely choice for this administration. The Fed Chair has the most power of all (despite there being a committee) and she (Ms. Brainard) is more dovish and is optically a better fit for this administration. If Ms. Brainard does get the nod, rates will likely improve.
Please remain safe and healthy, make today great!