DoubleLine’s Sam Lau and Eric Dhall, a trader and quantitative analyst on the firm’s Cross Asset team who is subbing for Jeff Mayberry, wake up to a lot of red in the markets in this episode, recorded before end of trading on Sept. 16, 2022. Investors continued to react to Tuesday’s CPI print, with the S&P 500 tumbling (1:49) and the U.S. Treasury yield curve marking big moves higher, especially on the shorter end of the curve (3:53). The Agg was down almost a point week-to-date (5:32), underscoring that there was nowhere to hide in Fixed Income Land. There was also no love to be found in commodities (6:23) and Bitcoin (7:43). Gold’s low price, its cheapest level in some time, prompts Eric to wonder if goldbugs are being drawn to bonds’ improved yields: “Maybe they’d rather have some coupon in their pocket rather than just the pet rock to look at.”
 
In terms of Macro, the higher than expected CPI print overshadowed all other data, and Sam and Eric break down some of the concerning numbers, including those for medical care services and shelter (9:27). On the positive side, the labor market remains the U.S. economy’s one bright star (19:31). Next week will bring LEI, and manufacturing and services data, but the FOMC meeting and a possibly hefty rate hike looms large (26:17).

MMM Episode 83: Not Before I’ve Had My Coffee

Monday Morning Minutes