Goldman se așteaptă acum la 4 creșteri ale ratelor în 2022... Și de ce nu are șanse să se întâmple asta

Marca temporală: 10 ianuarie 2022 11:18
Nodul sursă: 1576228

Pe măsură ce acțiunile scad, randamentele și dolarul cresc, iar economia încetinește cu fiecare zi care trece, deoarece în loc să-și cheltuiască stimulentele de mult dispărute, consumatorii americani merg pe un record de cheltuieli alimentate cu cardul de credit...

… the ivory tower experts on Wall Street are now trying to one-up each other on who can come up with the most ridiculous number of Fed rate hikes and balance sheet runoffs.

Case in point, over the weekend, both Goldman and Deutsche Bank decided to show how cool, hip and edgy their Fed watching teams are, when both increased their forecast for number of rate hike. Goldman now expects to see in 2022 to 4 from 3 and also now forecast the Fed to begin shrinking its balance sheet in July: According to Goldman t”he already ultra-low unemployment rate has made Fed officials more sensitive to upside inflation risks and less sensitive to downside growth risks” which is a big mistake because in a hyperfinancialized economy such as this one, consumer spending will collapse as soon as stocks tumble, even ignoring the lack of further stimmies onthe horizon.

Still, at least Goldman confirms what we said just minutes after the Omicron news broke last November, when we predicted that this variant would be much more mild and have far lesser consequences for the world. This is what Goldman’s Jan Hatzius says: “both confirmed cases and hospital admissions are now on a downward trend not only in South Africa but also in London, the first place in the Northern Hemisphere to see a major outbreak. If this pattern holds up elsewhere, the economic impact should be largely behind us by the end of Q1, at least in the advanced economies.”

Which of course is true, but the far bigger weakness in 2022 will come from that dynamo of US GDP – personal consumption – which slumps in the coming months as even Goldman economists realize that all those “pent up savings” which had been accumulated in the first half of 2021, have been spent by the middle class.

In any case, putting it all together, Goldman writes that “even with four hikes, our path for the funds rate is only modestly above market pricing for 2022, but the gap grows significantly in subsequent years. Our rates strategists recently discussed two potential explanations for why longer-dated funds rate pricing is so low: a) an extremely low market estimate of nominal r* and b) a supply-demand imbalance resembling the pre-2008 bond market conundrum (see Goldman Spots A “New Bond Market Conundrum“).”

Goldman thinks that “both play a role, but neither is likely to keep the funds rate from ultimately rising well above the 1.6% now discounted in market pricing.” And here is where the most influential bank makes another huge mistake, claiming that “nominal r* is probably higher than in the last cycle, in part because of larger long-run fiscal deficits and in part because of the Fed’s higher effective inflation target.”

Nu suntem de acord pentru simplul motiv că acum există prea multă datorie în lume, iar împingerea ratelor pentru a ajunge la stea r, oricare ar fi aceasta, va duce la un șoc pe piața obligațiunilor pe care Fed nu îl va permite niciodată și de aceea Powell este acum complet prins între urmărirea inflației fulgerătoare în timp ce este îngrozit de faptul că acțiunile sale vor prăbuși activele de risc, în ciuda oricăror asigurări pe care i-ar fi dat lui Biden în cadrul campaniei sale de realegere.

Wrong or not, Goldman’s latest hawkish pivot was echoed by Deutsche Bank’s chief economist Matthew Luzzetti who wrote that the German bank now also expects that “liftoff will occur in March and that the Fed will undertake four total rate hikes this year. As the minutes signaled, the Fed will be very nimble in responding to the incoming data, making consecutive rate hikes or even larger increments possible. Beyond 2022, we maintain our view of three rate increases in 2023 and the terminal rate (2.1%) for fed funds.”

Pe lângă majorările ratelor, DB se așteaptă acum ca înăsprirea cantitativă să înceapă în T3: 

Valoarea noastră de referință este că Comitetul publică detalii despre limitele de scurgere în jurul reuniunii FOMC din mai, iar anunțul de detaliere va veni la scurt timp după aceea (linia noastră de referință este iulie). Calculele noastre preliminare sugerează că, în timp ce scurgerea ar fi de 300-400 de miliarde de dolari în a doua jumătate a acestui an (în funcție de modul în care se structurează plafoanele), ar fi în jur de 1 miliard de dolari în 2023, reprezentând o înăsprire semnificativă a condițiilor financiare care ar echivala cu aproximativ două creșteri în total.

And while both Goldman and Deutsche Bank may be absolutely correct in estimating that to catch up to inflation the Fed will have to hike substantially in coming months, the reality is that the market is now far more “late cycle” and thus much more sensitive to even the smallest tightening in financial conditions as Matt King pointed out in his latest must read presentation (available to pro subs in the usual place) which noted that for the economy alone “ratele neutre ar putea fi mult mai mari acum"...

… but – and this is absolutely critical – “neutral rates for markets likely well below neutral for the economy”…

… la fel de “markets are much closer to late-cycle than the economy”.

Putting all of this together what are the implications? Well, the Fed may indeed hike once or twice in early/mid 2022 but once markets realize that Powell is indeed serious with correcting its “transitory inflation” mistake which dominated the Fed’s thinking for much of 2021, risk assets will simply crater.

From there, as One River CIO Eric Peters wrote in his latest note over the weekend, “for all the portfolio reshuffling and stop-loss selling, Niciun participant la piață nu s-a îndoit de faptul că Fed este pregătită să-i salveze pe toată lumea într-o prăbușire a pieței. Such conviction is well-supported by decades of repeated behavior from our accommodating central bank.”

Indeed, as we noted today, we have now entered the phase where, with the Fed still actually growing its balance sheet and rates still at zero, traders are hunting the level where the Fed’s revised put is triggered…

… and Powell has no choice but to back down, even if inflation remains red hot, leaving the Biden admin with just one option: revise the definition of inflation to make it seem much more palatable, something we stiu deja este pe drum...

… because continuing the current approach assures of a catastrophic outcome in this year’s midterms, where democrats would be facing not just surging prices but a stock market crash. And not even Joe Biden is confused enough not to realize that this spells doom for both his party and his re-election chances.

Ca de obicei, toate rapoartele menționate în această notă sunt disponibile pentru abonați pro.

Sursa: https://www.zerohedge.com/markets/goldman-deutsche-now-expect-4-rate-hikes-2022-and-why-has-no-chance-happening

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