Economic Review
Wading Through Financial Stability Risks: An Action Plan
Submitted by Flynn Zito Capital Management on March 21st, 2023The Federal Reserve (Fed) has a history of raising short-term interest rates until something “breaks.” Considering the Fed has raised rates from a near-zero level to 4.75% (upper bound) over the course of only one year, it was almost a near certainty this time would be no different. Recent bank failures suggest things are indeed starting to break.
No Landing = No Sense
Submitted by Flynn Zito Capital Management on March 7th, 2023Suggesting an economy makes “no landing” makes no sense. Analogies eventually break down, especially this one. Economic activity does not stop like an airplane eventually does, but rather the economy will settle into a steady state where growth is consistent with factors such as population and productivity.
2023 Market Outlook
Submitted by Flynn Zito Capital Management on January 3rd, 2023December Is Down But Not Out
Submitted by Flynn Zito Capital Management on December 12th, 2022Despite the S&P 500 Index starting December with five consecutive days of losses, we think December is down but not out. December often starts slow but historically has been a strong month. There are also some potentially supportive seasonal patterns ahead, such as the Santa Claus Rally, the outlook for January following down years, and the third year of the presidential cycle.
High Inflation and Rising Rates Supported Value in 2022
Submitted by Flynn Zito Capital Management on November 15th, 2022The growth vs. value debate has been pretty one-sided in 2022, with value outperforming growth for a sustained period for the first time in almost 15 years. However, the debate is heating up as investors begin to consider whether the pendulum will swing back to growth if inflation and interest rates decline in 2023.
How Midterm Elections May Move Markets
Submitted by Flynn Zito Capital Management on November 9th, 2022Looking Ahead
Submitted by Flynn Zito Capital Management on November 3rd, 2022October is now behind us and it has delivered on its track record as a historically favorable month for stocks, offering some respite for investors as major equity indices rose for the month. The downside pressure on equities had gotten a bit overdone after investor pessimism during September reached lows not witnessed in quite a few years.
Federal Reserve Preview: Trick or Treat?
Submitted by Flynn Zito Capital Management on October 31st, 2022With a series of important economic indicators suggesting the economy is declining and inflation is finally decelerating, albeit very slowly, markets are beginning to factor in that the Fed may soon transition to a less aggressive stance in early 2023. Here we preview this week’s Fed meeting and discuss whether investors will get a trick or a treat.