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A "recession shock" is coming, BofA warns

1srelluc

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LONDON (Reuters) - The macro-economic picture is deteriorating fast and could push the U.S. economy into recession as the Federal Reserve tightens its monetary policy to tame surging inflation, BofA strategists warned in a weekly research note.

"'Inflation shock' worsening, 'rates shock' just beginning, 'recession shock' coming", BofA chief investment strategist Michael Hartnett wrote in a note to clients, adding that in this context, cash, volatility, commodities and crypto currencies could outperform bonds and stocks.

The Federal Reserve on Wednesday signalled it will likely start culling assets from its $9 trillion balance sheet at its meeting in early May and will do so at nearly twice the pace it did in its previous "quantitative tightening" exercise as it confronts inflation running at a four-decade high.

A large majority of investors also expect the central bank to hike its key interest rate by 50 basis point.

In terms of notable weekly flows, BofA said emerging market equity funds enjoyed the biggest inflow in ten weeks at $5.3 billion in the week to Wednesday while emerging market debt vehicles attracted $2.2 billion, their best week since September.

It was also an eight week of outflows for European equities at $1.6 billion while U.S. stocks enjoyed their second week of inflows, adding $1.5 billion in the week to Wednesday.

The analysis was based on EPFR data.

A "recession shock" is coming, BofA warns

I damn sure be getting out of Muni Bonds if you haven't already. Most of the funds have lost 5-8% in the past three months.

That and states better be preparing for this shitstorm because the aftermath might be as close to "Balkanization" as we will get because there are going to be winner and loser states and given how the debt-to-GDP ratio is fucked the feds won't help you.

Oh and I'm sure 2 million illegals crossing our southern border soon won't help things a bit.

Elections have consequences.

OIP.0A3JcvLw6nOriDHJntX6AQHaDV
 

Moonglow

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:dig: Just get away from it all.
 

theHawk

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LONDON (Reuters) - The macro-economic picture is deteriorating fast and could push the U.S. economy into recession as the Federal Reserve tightens its monetary policy to tame surging inflation, BofA strategists warned in a weekly research note.

"'Inflation shock' worsening, 'rates shock' just beginning, 'recession shock' coming", BofA chief investment strategist Michael Hartnett wrote in a note to clients, adding that in this context, cash, volatility, commodities and crypto currencies could outperform bonds and stocks.

The Federal Reserve on Wednesday signalled it will likely start culling assets from its $9 trillion balance sheet at its meeting in early May and will do so at nearly twice the pace it did in its previous "quantitative tightening" exercise as it confronts inflation running at a four-decade high.

A large majority of investors also expect the central bank to hike its key interest rate by 50 basis point.

In terms of notable weekly flows, BofA said emerging market equity funds enjoyed the biggest inflow in ten weeks at $5.3 billion in the week to Wednesday while emerging market debt vehicles attracted $2.2 billion, their best week since September.

It was also an eight week of outflows for European equities at $1.6 billion while U.S. stocks enjoyed their second week of inflows, adding $1.5 billion in the week to Wednesday.

The analysis was based on EPFR data.

A "recession shock" is coming, BofA warns

I damn sure be getting out of Muni Bonds if you haven't already. Most of the funds have lost 5-8% in the past three months.

That and states better be preparing for this shitstorm because the aftermath might be as close to "Balkanization" as we will get because there are going to be winner and loser states and given how the debt-to-GDP ratio is fucked the feds won't help you.

Oh and I'm sure 2 million illegals crossing our southern border soon won't help things a bit.

Elections have consequences.

OIP.0A3JcvLw6nOriDHJntX6AQHaDV
The house of cards is about to blown apart.
 

Gracie

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I trust no bank any more. Or the government. Or the IRS or anyone else. I don't have much....not even worth robbing. But what little funds I do have on hand other than paycheck to paycheck...does NOT got in the bank. I leave enough in there to pay the auto cellphone bill and the rent. The rest is stashed away, piddly though it is. Still..at least I have access to it for gas to get the fuck outta town.
 

wamose

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Our representatives have been spending like lunatics for decades. The representatives who have been there for decades are all guilty. But these new age Democrats are rewriting the book on stupidity and irresponsibility.
 

JGalt

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The Democrats never accepted the blame for the last recession, it was pinned on GW. You can bet the next one will be attributed to whichever GOP President wins in 2024.

Lather, rinse, repeat...
 

Moonglow

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I enjoyed the Trump recession in 2020.
 
OP
1srelluc

1srelluc

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They won't be able to "stimulus" their way out of this one.....I suspect the "hail mary" will be a attempt at student loan forgiveness before 1/23.
 

Moonglow

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They won't be able to "stimulus" their way out of this one.....I suspect the "hail mary" will be a attempt at student loan forgiveness before 1/23.
I do wish they would hurry and do it before then.
 

badbob85037

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LONDON (Reuters) - The macro-economic picture is deteriorating fast and could push the U.S. economy into recession as the Federal Reserve tightens its monetary policy to tame surging inflation, BofA strategists warned in a weekly research note.

"'Inflation shock' worsening, 'rates shock' just beginning, 'recession shock' coming", BofA chief investment strategist Michael Hartnett wrote in a note to clients, adding that in this context, cash, volatility, commodities and crypto currencies could outperform bonds and stocks.

The Federal Reserve on Wednesday signalled it will likely start culling assets from its $9 trillion balance sheet at its meeting in early May and will do so at nearly twice the pace it did in its previous "quantitative tightening" exercise as it confronts inflation running at a four-decade high.

A large majority of investors also expect the central bank to hike its key interest rate by 50 basis point.

In terms of notable weekly flows, BofA said emerging market equity funds enjoyed the biggest inflow in ten weeks at $5.3 billion in the week to Wednesday while emerging market debt vehicles attracted $2.2 billion, their best week since September.

It was also an eight week of outflows for European equities at $1.6 billion while U.S. stocks enjoyed their second week of inflows, adding $1.5 billion in the week to Wednesday.

The analysis was based on EPFR data.

A "recession shock" is coming, BofA warns

I damn sure be getting out of Muni Bonds if you haven't already. Most of the funds have lost 5-8% in the past three months.

That and states better be preparing for this shitstorm because the aftermath might be as close to "Balkanization" as we will get because there are going to be winner and loser states and given how the debt-to-GDP ratio is fucked the feds won't help you.

Oh and I'm sure 2 million illegals crossing our southern border soon won't help things a bit.

Elections have consequences.

OIP.0A3JcvLw6nOriDHJntX6AQHaDV
Remember the last bail out? Banks were given billions to give out to Americas in loans to kick start the economy. It was about the same time the FRB started paying banks a higher rate if they held their money.


























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