Manage episode 295572585 series 2562185
This week’s Alpha Trader podcast features hosts Aaron Task and Stephen Alpher talking first with Jim Iuorio, director at TJM Institutional Services, and then with Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management.
Among the topics covered:
- Why Iuorio believes China’s crackdown on Bitcoin (and Beijing seems to mean it this time) makes the long-term thesis even more compelling, even as the bulls are likely to experience more pain in the near-term.
- Last week’s modest hawkish surprise from the Fed was probably not that big of a deal, says Iuorio, but it caught a lot of inflation trade longs too far out over their skis. Hence, we saw big reversals in bond prices, gold, commodities, and the dollar, not to mention the banks.
- It wouldn’t surprise Iuorio if Fed Chair Jay Powell - speaking later this week - pushes back against any ideas that he’ considering tighter policy anytime soon.
- “Investment success in this expansion is likely to be the result of ignoring recent history,” says Brent Schutte, as a combination of fiscal and monetary policies will shift concern about deflation and sluggish economic growth to inflation and speedier growth.
- Schutte also believes that markets are making a bit too much about the FOMC meeting last week. The “dots” may have been shuffled around a bit, but there’s been no hint of any imminent policy change.
- Whether one agrees with it or not, markets are de facto part of the Fed’s mandate these days, says Schutte. Ultimately, that’s going to have the central bank well behind the curve on inflation, and that’s going to be good for stocks - particularly the cyclicals, value names, and small caps.
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