Stocks & Bonds Slammed As Dimon Warns "Brace For Economic Hurricane"
US equity and bond markets just lurched lower (in price) and the dollar spiked higher as a combination of headlines hit.
Stagflationary signals from manufacturing surveys - inflation is sticky and degrowth is not slowing it
Bank of Canada hike - CAD yields spike knocking into USTs
JOLTS printed super strong - Fed has more work to do
JPMorgan's Jamie Dimon warned on the economy, "It's a hurricane, you'd better brace yourself."
oh and Fed QT started today.
Put all that together and equities tumbled...
Treasury yields spiked...
With the short-end getting hammered, flattening the yield curve...
And the dollar surged...
For now most desks are focusing on Dimon's comments and the potential 'worsening' of them in the last week:
"You better brace yourself,” Dimon told the roomful of analysts and investors.
“JPMorgan is bracing ourselves and we’re going to be very conservative with our balance sheet.“
At a previous conference, he called those risks "storm clouds," now he's saying
"It's a hurricane. That hurricane is right there, down the road, and coming our way. We don't know if it's a minor storm or if it's a Superstorm Sandy."
Dimon's comments follow Wells Fargo’s CEO warning this morning that higher interest rates mean the economy has to slow, and that a soft-landing scenario was hard to achieve.
Finally, we also note that Fed's Bostic walked back his September "pause" comments, clarifying that this is in no way meant to be a "Fed Put".
