With great sadness, we mourn the passing of Scott Minerd, our leader, colleague, and friend.

Today's #PMI release places US #manufacturing firmly in #recession territory. Readings below 48.5 historically indicate contraction in manufacturing activity.

Delighted to join our Macro Markets podcast for a look back and look ahead on the economy and the markets.

Latest NY Empire Manuf., Retail Sales, Philly Fed Index, and Industrial Production all confirm Fed tightening is slowing the economy. Resistance at 4100 on S&P shows downtrend in equities firmly in place. Opportunity to reduce equity exposure or establish short position.

The #Fed delivered the message that the market wanted to hear. For rates it’s bullish, for stocks it’s bearish.

Sadly, while at @URM, a young boy was stabbed just a short walk away, another reminder of how tragic a place Skid Row is. We pray for his recovery.

This may be a bear market relief rally, but I would stay fully invested at this point.

There is still room to run for rates and equities: The uptrend in rates broke today, so the 10-yr may be on its way back to 3.5%, while strong seasonals, history of positive post-midterm performance, and technicals suggest a target of 4100 for the SPX.

A divided government is a great outcome. #ElectionDay

The #jobs data trend suggests that we’re getting closer to the labor market weakness the #Fed is aiming for and should be good news for long duration assets as well as risk appetite.

“Cumulative tightening” is an artful way for the #Fed to get off the hamster wheel of doing a 75 bps hike per meeting, while “sufficiently restrictive” aims to redirect the market’s attention to the terminal rate.

With the #Fed still tightening and a #recession looming (if it’s not here already) we have to be careful with credit selection, but our risk appetite is strong right now driven by the relatively wide spreads and low dollar prices available in the market.

I wouldn’t call today’s #FOMC decision/statement a pivot, but by acknowledging the need to wait for the lagged effects of “cumulative tightening,” the Fed has opened the door to it. But they will still have to see it in the data.

SOFR-Eurodollar spread spiking to over 50 bps reinforces the message from our recent report: Investors need to understand that #SOFR will not behave like #LIBOR. Buyer beware.

Financial crisis returns as UK #Gilts collapse to preintervention levels of last week, putting pressure on US rates as risk rises for global market turmoil and increasing the probability of a coordinated global policy response.

The last time the #bond market reached these stress levels of illiquidity and volatility, the #Fed cut rates.

Over the last 25 years, September has failed to beat NFP consensus 76% of the time, the worst downside surprise track record for any month. If we come in below consensus of 250k (could possibly be negative), the Fed Pivot trade could go into overdrive.

Investors can throw out projecting an end of fed fund rate increases based upon #inflation, unemployment, or other macroeconomic factors. The end of #Fed tightening will come when something breaks, and from where I sit cracks are forming.