September 2024 Market Strategy
Betting against recession fears is possibly the easiest way to generate alpha in the fall of 2024.
Disclaimer: The information contained in this article is not and should not be construed as investment advice. This is my investing journey and I simply share what I do and why I do that for educational and entertainment purposes.
In my August 2024 market strategy, I had concluded that my macro base case continues to play out, namely that falling deficits and unproblematic CPI data will enable rate cuts which will then support the economy by reviving industries that have suffered from high interest rates.
The Yen positioning imbalance had been cleared which was encouraging as well. In principle, this scenario would benefit both stocks and bonds. However, recession fears had made the bond market crowded again which would likely have to cause pain on bond investors again similar to what we have seen in the last year.
Let’s check how the picture has evolved since then.