Are Investors and The Fed Out of Sync?

There seems to be a disconnect between the Fed’s expectations and those of investors.  The Fed appears to continue to expect that the economy will grow at rate above 2% during 2019, which, when viewed in the context of very low unemployment, could lead to an inflation rate above the Fed’s 2% target.

Investors by contrast, are looking at recent weakness in a wide range of asset classes, including the U.S. stock market, commodities, interest-rate futures and corporate bonds.  Moreover, the economies of a major portion of the rest of the world appear to be under increasing stress.

All comments and suggestions are welcome.

Walter J. Kirchberger, CFA