Articles authored by Sonu Varghese

Last week was all about the Federal Reserve (Fed) jump-starting the rate cut cycle with a 0.5%-point cut. But amidst all the commentary around that, it’s easy to forget about what ultimately drives equities: profits. Note that what the Fed did was important even from this perspective. A Fed that is looking to cap the …

Stocks reacted in a fairly neutral way after the Federal Reserve’s historically significant decision to jumpstart the rate cutting cycle with a 0.5%-point cut. But the real follow-through came on the day after the Fed meeting, perhaps after everyone slept on it. The S&P 500 surged 1.7% to close at a new record high on …

Say goodbye to those 5.5% rates! The Federal Reserve (Fed) jump-started their policy pivot by going big at their September meeting, cutting interest rates by 0.50%-points, taking the federal funds rate to the 4.75-5.50% range. This was not entirely unexpected. Traders put the probability of a 0.5%-point move at 63% just prior to the meeting, …

Last week I argued that the Federal Reserve (Fed) needs to “go big” sooner rather than later by starting their rate cut cycle in September with a 0.5%-point cut. Labor market risks are rising, and the August payroll data wasn’t really comforting from that standpoint. At the same time, the latest inflation data showed that …

We’ve consistently said for several months now that inflation was last year’s problem. The latest consumer price index (CPI) data confirms this. Headline CPI is up 2.5% year over year (y/y) through August, which is the slowest pace in three and half years. Here’s some perspective on how far we’ve come: A year ago (August …

The August payroll report was kind of ok on the face of it. Payrolls grew by 142,000 in August, below expectations for a 165,000 increase but these things are noisy. The unemployment rate also declined from 4.3% to 4.2%, which is welcome. However, read one step beyond headlines and it’s fairly clear the labor market …

The Federal Reserve (Fed) is poised to start the rate cut cycle in September. In his Jackson Hole speech, Fed Chair Powell explicitly said that the “time has come for policy to adjust.” In fact, minutes from the last Fed meeting in July indicated that some members thought the committee should have actually reduced rates …

With both the Republican and Democratic party conventions over, it’s safe to say we’re in the home stretch of the Presidential election. In fact, early voting starts in 7 days in North Carolina, a key swing state. That also means campaign rhetoric is heating up, and promises are being made—some wild ones, too, but this …

I just wrapped up four weeks of a sabbatical leave, which Carson allows after five years on the job. Strange as it may sound, taking four weeks off is not easy, but summer is usually a fairly quiet time (or so I thought). My family and I headed to Europe for a couple of weeks. …

President Joe Biden withdrew from the 2024 presidential race and has endorsed Vice President Kamala Harris as the Democratic nominee, although the endorsement does not necessarily mean she will win the nomination. The change in the Democratic ticket does not change our fundamental view of the election, which we discussed at length in our recently …