In today's Webcast: May’s CPI report showed scant signs of inflation peaking, though we still expect peaking soon. The report also suggests a more hawkish Fed and higher recession risk. We’re raising our odds of a mild recession to 45% from 40%.
Investor and consumer sentiment both have soured. But this time, pervasive bearishness may not be as useful a contrarian bullish signal as in the past. There may not be much upside for stocks until the Fed is done tightening later this year. Also we revisit the question of the decade: Will the 2020s resemble the Great Inflation of the 1970s or the Roaring 1920s?