What saved the economy in 2020 was the largest fiscal expansion since World War II MONETIZED by the largest Fed balance sheet expansion on record. Will it happen again?
Finally down to tech bubble peak valuations…
German retail sales drop more than expected.
Bank of Canada raises interest rate to 1.5%
Fed Balance Sheet Shrunk in May
It’s hard to tell from this pic that it shrunk, but at the beginning of May it was 8.939 trillion and now stands at 8.914 trillion.
Time to buy puts?
A recession is now a near certainty, given the history of OIL SHOCKS & Fed QT, and given that 2022 will be only the 4th year in all of history where both US stocks and bonds BOTH finish w/NEGATIVE RETURNS.
Nearly $8T of demand destruction and counting, #Goldman SPX Target 3300 pic.twitter.com/7Ylxs74lJn
— John Bullivan (@BullivanJohn) June 1, 2022