Sigma Signals

Week of November 21, 2022

Now that it has been confirmed that Republicans will control the US House, we contemplate the downside of divided government, which is an inability to compromise. In that regard, the US debt limit must be raised by the end of the year, and in the recent past this resulted in a left-right showdown and federal government shutdowns. We are therefore changing fiscal policy from green to yellow to recognize this encroaching risk. Furthermore, does October’s inflation data signal a change in the trend?

Happy Thanksgiving to all.

Bob Bilkie, CFA