A Switch Was Thrown This Year In The Market's Most Important Correlation

By Tony Pasquariello, Goldman head of hedge fund sales

The broad thrust of US economic data has swung from a string of positive surprises to a more mixed set, and Q4 should mark a well-narrated GDP pot hole (to put a line under it: from north of 3% in Q3 ... to south of 1% in Q4 ... link). 

To be sure, it’s not uniformly bad news -- home prices just took out the all-time highs, ISM finally bounced and jobless claims remain rock solid -- but, the core interplay is this: as the Fed takes implied cuts out of the market, economic momentum is slowing.