Market Performance & Fed Policy Expectations - The market has already priced in a significant amount of exuberance, with the S&P 500 up almost 10% and the NASDAQ up almost 12% following a V-shaped recovery [1] - Markets have priced in more Fed easing than is currently reflected in Fed fund futures, which could be a cause for concern [4] - The market is questioning whether it is pricing in too much Fed easing, considering inflation numbers [5] Inflation & Economic Concerns - CPI data indicates persistent goods inflation and sticky services inflation, suggesting a higher inflation paradigm than the Fed desires [3] - A weakening jobs market coupled with rising inflation creates a challenging environment for consumers already facing increased prices due to tariffs and trade war uncertainty [6] - Jobless claims have reached a four-year high, the worst since October 2021 [8] - The current Fed policy of maintaining rates may be contributing to higher prices, particularly in shelter costs, which constitute a third of the CPI [9][10] Impact of Rate Cuts & Capex - A rate-cutting cycle could weaken the dollar and provide a tailwind for the stock market [7] - Significant capital expenditure (capex) has matched the consumer's contribution to two-thirds of GDP, acting as a substantial tailwind [7] - A pullback in capex and a weakening consumer could lead to a recession [8]

Federal Reserve Policy & Interest Rates - The market has fully priced in a 100% probability of the Federal Reserve cutting rates by 25 basis points at each of the next three meetings this year, totaling a 75 basis points reduction [2] - The market may be slightly disappointed if the Fed does not cut by 50 basis points [2] - The Fed is implicitly accepting a 3% inflation rate, despite aiming for 2%, and is prioritizing jobs data, which is currently weak, as the reason for cutting rates [3] - The expectation is that the Fed funds rate will eventually be brought down to 3% with cuts in every successive meeting [4] Economic Outlook - There is very little to no risk of recession or stagflation, with a 3% GDP print expected for the current quarter, following a 33% print last quarter [3][4] - Equity markets and credit spreads, currently at 300 in the high yield market, indicate growth and negate the possibility of recession or stagflation [5] - A significant stimulus package, along with productivity gains from AI, is expected to further boost the economy [6] - One trillion is expected to be spent in data centers [7] Credit Market Opportunities - Public market spreads have tightened, and rates have come down, but new issuance provides opportunities to gain alpha [8] - Direct lending is experiencing its most prolific period, with seven deals approved through the investment committee in the last week [9] - Lower interest rates are expected to spur more transactions, refinancings, and new issue activity for private equity [10] - Asset-based lending, particularly in financing property, plant, and equipment in the AI sector, offers attractive risk-adjusted returns with 60% LTVs and potential returns in the low to mid-teens [12][13] - Private credit offers a 500 basis point incremental spread pickup compared to public credit [13]

🇺🇸 FED: Polymarket currently shows an 87% chance that the Federal Reserve will cut interest rates by 25bps. https://t.co/nudirlrFhm ...

Group 1 - The investing group Reading the Markets, led by Michael Kramer, provides daily commentary and videos to help members understand market dynamics and trends [1] - The group offers education on macro trends, interest rates, and currency movements to assist members in making informed investment decisions [1] - Subscribers benefit from unprecedented access to expert analysis at a fraction of the cost compared to similar services [1] Group 2 - Michael Kramer is affiliated with Mott Capital Management but operates independently, providing his own analyses and opinions [3] - The report emphasizes that the information is for educational purposes and should not be considered as specific investment advice [3] - There is no guarantee of completeness or accuracy in the analyses provided, and past performance does not indicate future results [3]

💥BREAKING:🇺🇸 Odds Jerome Powell cuts rates hit 97.5%, with an 85% chance of a 25 bps cut, per Polymarket. https://t.co/8tsyOb7xSJ ...

Interest Rate Impact - The market has priced in a 100% chance of a rate cut next week, which is a major topic at the housing summit [1][2] - Lower interest rates are expected to reduce the cost for builders by potentially lowering the need to buy down rates [3] - Lower mortgage rates would increase confidence in home sales, encouraging land developers to supply more lots to home builders [5] Land Market Dynamics - In Q2, Brookfield generated $500 million in land revenue, but lot sales and prices experienced declines across both residential and commercial sectors [6] - A report indicated that land demand decreased by 23% in the past quarter, mirroring trends observed in 2022 when mortgage rates decreased [6] - Brookfield operates as a land banker, lot serer, and community developer, with the majority of its portfolio focused on long-term master-planned communities [7][8] - New land banks may see lower values, but existing contractual agreements remain largely unchanged, with builders continuing to take down lots as contracted [9] Housing Market Outlook - Starts are projected to be somewhat flat next year, but builder demand for the second half of the year is expected to moderate slightly [10] - Community side of the business remains strong, with builders still requiring lots in community developments [10] - There is support for a "chips act equivalent" for housing, focusing on opening up more federal land for housing development [11] - There is potential to partner with the building industry to develop federal land in high-demand housing locations [12]

For more on the inflation print, the market reaction, let's bring in Westwood Holdings Group CEO Brian Casey. Westwood has more than 18 billion dollars in assets under management. How how are you positioned right now given the backdrop.You know, we're we're always going to invest in highquality companies that are improving that are mispriced. So, that has been our mantra for 42 years and we can always find those kinds of companies. I was going to say, is that harder though with record highs as everything ha ...

Core Viewpoint - Jim Cramer discussed The Home Depot, Inc. (NYSE:HD) in the context of interest rates, highlighting its performance and potential future movements based on Federal Reserve actions [2][3]. Group 1: Stock Performance - Year-to-date, The Home Depot, Inc. (NYSE:HD) has gained 6.4%, underperforming the S&P 500's 11% gain [2]. - The stock was previously a leader but has recently lagged behind, with Cramer emphasizing the importance of being invested when the Fed cuts rates [2][3]. Group 2: Consumer Sentiment and Economic Environment - The CEO of The Home Depot noted a "deferral mindset" among consumers due to a high-interest-rate environment [2]. - Cramer indicated that if the Fed cuts rates, long-end rates might decrease, potentially stimulating stock prices, including The Home Depot [2][3]. Group 3: Housing Market Insights - Cramer mentioned a significant potential increase in housing starts, suggesting a positive outlook for housing-related stocks like The Home Depot [3]. - He expressed confidence that The Home Depot could see substantial growth, contrasting its recent stagnation [3].

Monetary Policy Stance - The ECB governing council decided to keep the three key ECB interest rates unchanged [1][21] - The ECB will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance [3][22] - The ECB is not pre-committing to a particular rate path [4][22] - The ECB stands ready to adjust all instruments within its mandate to ensure inflation stabilizes sustainably at the 2% medium-term target [23] Inflation Outlook - Headline inflation is currently around the 2% medium-term target [1] - ECB staff projects headline inflation averaging 21% in 2025, 17% in 2026, and 19% in 2027 [2] - Inflation, excluding energy and food, is expected to average 24% in 2025, 19% in 2026, and 18% in 2027 [2][13] - Annual inflation edged up to 21% in August from 2% in July [10] Economic Growth - The economy grew by 07% in cumulative terms over the first half of the year [5] - The economy is projected to grow by 12% in 2025, revised up from the 09% expected in June [2] - The growth projection for 2026 is now slightly lower at 1%, while the projection for 2027 is unchanged at 13% [3] - The unemployment rate was 62% in July [6] Financial Conditions - The average interest rate on new loans to firms moved down to 35% in July from 36% in June [20] - The cost of issuing market-based debt was unchanged at 35% [20] - Loans to firms grew by 28%, slightly more strongly than in June, while the growth of corporate bond issuance rose to 41% from 34% [20] - The average interest rate on new mortgages was again unchanged at 33% in July, while growth in mortgage lending picked up to 24% [20]

Summary of European Central Bank Update / Briefing September 11, 2025 Key Points on the ECB and Economic Outlook ECB Interest Rates and Inflation Projections - The European Central Bank (ECB) decided to keep the three key interest rates unchanged, with inflation currently around the 2% medium-term target [2][11] - Headline inflation is projected to average 2.1% in 2025, 1.7% in 2026, and 1.9% in 2027, while inflation excluding energy and food is expected to average 2.4% in 2025, 1.9% in 2026, and 1.8% in 2027 [2][7] - The economy is projected to grow by 1.2% in 2025, revised up from 0.9% expected in June, with a slight decrease in growth projection for 2026 to 1% [2][4] Economic Resilience and Consumer Spending - The economy grew by 0.7% in cumulative terms over the first half of the year, driven by strong domestic demand [4] - The unemployment rate was reported at 6.2% in July, which is expected to boost consumer spending as people save less of their income [4][6] - Investment is expected to be supported by substantial government spending on infrastructure and defense [5] Risks and Challenges - Risks to economic growth are now considered more balanced, with recent trade agreements reducing uncertainty [8] - Geopolitical tensions, such as the conflict in Ukraine and the Middle East, remain significant sources of uncertainty [8] - The outlook for inflation is uncertain due to the volatile global trade policy environment, with potential for both lower and higher inflation depending on various factors [9] Financial and Monetary Conditions - Short-term market rates have increased, while longer-term rates have remained stable [10] - The average interest rate on new loans to firms decreased to 3.5% in July, with corporate borrowing costs continuing to decline [10] - Growth in loans to firms was reported at 2.8%, and corporate bond issuance rose to 4.1% [10] ECB's Approach to Monetary Policy - The ECB will follow a data-dependent and meeting-by-meeting approach to determine monetary policy stance, without pre-committing to a specific rate path [3][11] - The Governing Council emphasizes the importance of assessing incoming economic and financial data to inform interest rate decisions [3][11] Additional Insights - The ECB is focused on ensuring that inflation stabilizes at the 2% target in the medium term, with a commitment to adjust instruments as necessary [11] - The introduction of a digital euro and the completion of the Savings and Investment Union are highlighted as critical for future economic stability [6] Conclusion - The ECB remains vigilant in monitoring economic conditions and is prepared to adjust its monetary policy as needed to maintain stability and support growth in the euro area [11]