Atlanta Fed

“I thought by now you’d realize, there ain’t no way to hide your lyin’ eyes.”

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Stagflation reigns. Slow growth (2.5%) with rising inflation (4%) — driven by the rising cost of labor (+5%) — is the very definition of a stagflating economy. This forecast remains the dominant theme for the economy, markets, and investors. Stagflation has been the Perry International Capital Partners (PICP) forecast for two years, and we continue to be more worried about rising inflation than we are about slower growth.

“I thought by now you’d realize, there ain’t no way to hide your lyin’ eyes.” Read More »

“Equity fund managers always tell you what’s going to go right, but what risk managers want to know…

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The Perry Capital Portfolio remains unchanged (75% cash.) 50% of the portfolio is in the money market. The
T-Bill position remains at 25% of portfolio assets. Long Treasuries represent 10% of the portfolio. The
S&P 500 is also a 10% position. So far, everything is up. My small Silver and Bitcoin positions have been good
performers for the start of the year. Lower long-term funding rates are the key to the whole puzzle. We’ll
know more about that on February 1st.

“Equity fund managers always tell you what’s going to go right, but what risk managers want to know… Read More »

“What comes next is weak economies and tough policy choices.”

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The battle at hand is to reduce inflation. The Fed has been aggressively raising Interest rates while
reducing its balance sheet by $95bn/month, liquidity is being drained from both the financial system and
the economy, and market volatility is rising. The ramifications will be significant. Therefore, I remain
defensive and have maintained the status quo in my portfolio.

“What comes next is weak economies and tough policy choices.” Read More »