Markets Weekly April 13, 2024

Hello my friends, today is April 13th and this is Markets Weekly. So this week was a pretty turbulent weekend market. Seems like the CPI and ongoing geopolitical tensions really spooked the market. But zooming out, I noticed that we seem to find pretty good support at the 50 day moving average for the S&P 500 and I bought the dip there. Let's see how that turns out. With I think nothing bad happens over the weekend, I would expect a pretty strong relief rally on Monday. Okay, so today I want to talk about three things. First, we have to talk about all the inflation data we got the past week that really seemed to spook the markets. Secondly, I want to talk about how even though it looks like inflation is sticky above the Fed's target, the Fed is going to still cut rates this year and personally I still think about three cuts. And lastly, I want to talk about this review Ben Bernanke did on the Bank of England. So over the past few years, central banks did not do their forecasting very well. The UK government wanted to improve the Bank of England so they invited rockstars under banker Ben Bernanke to help them out. Let's see what Ben's report found.

大家好，今天是4月13日，这里是《市场周报》。本周市场非常动荡。通货膨胀率和持续的地缘政治紧张局势似乎让市场感到恐慌。但总体来看，我发现标普500指数在50日移动平均线处似乎找到了相当好的支撑，我在那里买入了。让我们看看结果如何。如果周末没有发生什么不好的事情，我预计周一会有相当强劲的反弹行情。好的，今天我想谈论三件事。首先，我们必须谈论过去一周得到的所有通货膨胀数据，这些数据似乎让市场感到恐慌。其次，我想谈论即使通货膨胀率超出了美联储的目标，美联储今年仍将降息，我个人认为将有三次降息。最后，我想谈论本周本·伯南克对英国央行的审查。在过去几年里，各国央行的预测表现不佳。英国政府想要改进英国央行，所以他们邀请了银行家本·伯南克率领的一批行业专家帮助他们。让我们看看本的报告发现了什么。

Okay, starting with inflation. So this past week we got three inflation data points. First, we got CPI, which was the most important print. Secondly, PPI somewhat important and lastly import prices much less important. Now CPI was higher than market expected in all around, not a very good print. Now, when you look at CPI month over month, either core or headline, what you see is that at a month over month level, it looks like CPI bottomed sometime in the fourth quarter of last year and has since then somewhat accelerated. Now, to see this more clearly, we can also look at CPI at a three month, six month and 12th month annualized rate. Now what you see is that CPI is notably accelerating in recent months. The three month annualized rate is comfortably above 4% which is really not good. Now let's zoom out even more and let's look at CPI analyzed over the past few years.

好的，让我们从通货膨胀开始。这个过去的一周，我们得到了三个通货膨胀数据点。首先，我们得到了CPI，这是最重要的数据。其次，PPI相对重要，最后是进口价格，影响较小。现在CPI在所有方面都高于市场预期，这个数据不太好。现在，当你看CPI的月度数据，无论是核心数据还是整体数据，你会看到在月度水平上，CPI似乎在去年第四季度触底，并且自那时以来有所加速。为了更清楚地看到这一点，我们还可以看一下CPI的三个月、六个月和十二个月的年率。现在你会发现CPI在最近几个月明显加速。三个月的年化率明显超过了4%，这真的不太好。现在让我们放大范围，看看过去几年的CPI数据。

Now what you notice is that CPI absolutely surged in 2021 as we were doing dealing with all that high inflation and since then came down a lot but didn't come all the way down to where it was pre pandemic, it seems to have stabilized somewhere around 3.5%. Now the market looked at this and really didn't like what they saw. It seems like the market was really buying into all this steady disinflation but now finally the market is beginning to realize that inflation seems to be somewhat sticky about the fifth target and so it had major implications on asset pricing across the market. First, let's look at short-term interest rates. So the market now is pricing in just two Fed cuts this year. In contrast, as recently as March, the Fed themselves guided towards three cuts so the market is being notably more hawkish than the Fed. Now fewer cuts of course is also going to have impacts on long-related interest rates. The US-tenure yield surged this week to above 4.5%. There's a little bit of a retracement seemingly on the back of geopolitical fears but it is a pretty big move over the week. And of course it also got a strong bid for the dollar.

现在您可以注意到的是，随着我们应对所有的高通货膨胀问题，2021年CPI急剧攀升，自那时以来有所下降，但并没有完全回到疫情前的水平，似乎已经稳定在3.5%左右。市场看到这一点后并不满意。市场似乎真的很看好持续通货紧缩，但现在市场终于开始意识到通货膨胀似乎有些棘手，达到了大约5%的目标，并对市场各处的资产定价产生了重大影响。首先，让我们来看看短期利率。市场目前正在定价今年只会有两次联邦基准利率下调。相比之下，就在今年3月份，联邦储备委员会自己还指引预计将有三次下调，所以市场比联邦储备委员会更为鹰派。更少的下调当然也会对长相关利率产生影响。美国国债十年期收益率本周飙升至4.5%以上。有一点点由于地缘政治恐慌而出现回调，但整周来看这是一个相当大的波动。当然，这也导致美元受到强劲的支撑。

Now when you're looking at the dollar it's not just what the Fed does but it's also about what other central banks are doing as well. Now we did have other central bank meetings this past week and it looks like the market is becoming more comfortable that the ECB is going to cut in June. So just as the market is becoming less confident of a Fed cut in June it's becoming more competent of an ECB cut in June and that whining interest rate differential is strengthening the dollar. Looking over the past week it looks like the Dixie, the dollar index, strengthened notably. Looking across the world you can see that the higher US-tenure yield is of course also pushing placing upward pressure on sovereign bond yields in other countries, say Japan, South Virginia, JGBs, a notch up a bit at this past week and you did see the Japanese yen. A weakened past that 152 soft ceiling that the Japanese authorities have been warning about.

现在当你看美元时，不仅仅是联邦储备系统在做什么，还有其他央行也在做什么。上周我们看到了其他央行的会议，市场看起来越来越认为欧洲央行将在六月份降息。正如市场对于联邦储备系统在六月份降息的信心减少，对于欧洲央行在六月份降息的信心增加，利率差距加大，从而加强了美元。回顾过去一周，美元指数表现明显上涨。从全球范围来看，美国十年期国债收益率的提高当然也在推动其他国家主权债券收益率上升，比如日本、南弗吉尼亚，JGB在上周有所提升，你可以看到日元贬值超过了日本当局一直在警告的152软上限。

You can see that slightly poking its head above that there was no intervention just more stern words. Again eventually we're going to have to see the Japanese authorities do something or I think this could really run higher. Now eventually I would think that higher yields in a stronger dollar is going to be a headwind for the US economy and for risk assets but probably not at this level. As I recall last year the markets really didn't like it when the tenured yield hit 5% and we're still quite a bit below that. Now secondly we got other inflation data as well, PPI was a bit softer than expected and that seemed to calm the market quite a bit. And lastly we got input prices which was hotter than expected but really I don't think anyone pays attention to that.

你可以看到有一点点冒头，那里没有干预，只是更加严厉的话语。我想最终日本当局会采取一些行动，否则局势可能会进一步恶化。最终我认为，更高的收益率和更强劲的美元将成为美国经济和风险资产的风险，但可能不会在这个水平上。据我记得，去年当债券收益率达到5%时，市场确实不太喜欢，而我们仍然远低于这个水平。其次，我们还有其他通胀数据，PPI略低于预期，这似乎安抚了市场。最后，我们还有输入价格，超出预期，但实际上我认为没有人会注意这个。

Now related to that the next thing that I want to talk about is how I think that even though inflation seems to be stickier than expected I still believe that the Fed is going to cut rates and probably three times this year. Well first off when you're looking at inflation it's important to note that there are many different ways to measure inflation. We got CPI, you also got third party private measures like true inflation and so forth. When you're talking about the Fed what you want to focus on is the inflation measure the Fed cares about and that's not CPI it's PCE. Now PCE and CPI both measure consumer inflation but they measure it in different ways. If you're interested in learning more about this I would highly recommend the odd lots episode with Omar Sharif that breaks it down for you. Among the many different differences for example a CPI tends to measure consumer out of pocket expenses whereas PCE would be broader and also capture expenditures on behalf of the consumer.

现在我想要谈谈的与此相关的下一件事是，虽然通胀似乎比预期更难以降低，但我仍然相信联邦储备委员会将降息，可能今年会降息三次。首先，当谈到通胀时，重要的是要注意有许多不同的衡量通胀的方式。我们有CPI，还有第三方私人衡量方式，如真实通胀等等。当谈论联储时，你想要关注的是联储关心的通胀衡量方式，而不是CPI，而是PCE。现在PCE和CPI都衡量消费者的通胀，但它们以不同的方式衡量。如果你对此感兴趣，我强烈推荐听一下奥马尔·沙里夫的odd lots节目，其中对此进行了详细解释。举例来说，CPI倾向于衡量消费者的实际支出，而PCE会更广泛，同时也会捕捉代表消费者支出的开支。

For example when you go to the doctor let's say you see the doctor and you pay your copay and then you go home. Now the copay is you're out of pocket expenditure so that's what we captured in CPI. But of course that's not the end of the story because your insurance company then also makes a payment to the doctor on your behalf. That payment on your behalf would also be captured by PCE so it's broader and again you have different things like weights. Shelter inflation would be higher. Shelter would get a higher weight in CPI and a lower weight in PCE. So historically speaking PCE and CPI they move in the same direction but if you look at what's been happening over the past couple years you notice that CPI and PCE have diverged notably. In fact that wedge whereas PCE is historically higher than PCE has widened. And so looking at say CPI stuck at around 3.5% doesn't really give you the person isn't really what the Fed is looking at.

举个例子，当你去看医生时，你看到医生，付了自己的医保费，然后回家。现在这笔医保费是你的个人支出，这就是我们在CPI中捕捉到的。但当然，故事还没有结束，因为你的保险公司还会代表你向医生支付一笔费用。这笔代表你支付的费用也会被PCE所捕捉，因此它更广泛，而且有不同的权重。住房通胀会更高。在CPI中，住房的权重会更高，在PCE中则会更低。从历史角度来看，PCE和CPI的走势是一致的，但如果你看看过去几年发生的事情，你会注意到CPI和PCE明显分道扬镳。事实上，PCE一直高于PCE的差距越来越大。因此，看看CPI停留在约3.5%左右并不真正反映联邦储备系统所关注的情况。

The Fed is looking at PCE. So what's PCE at? Well we don't get PCE until later in the month but the Cleveland Fed has a PCE forecast based on latest data such as PPI. Now if you look at the Cleveland Fed's forecast you'll note that they actually have PCE coming down over the month and PCE it looks like core PCE is about 2.5% so that's pretty close to the Fed's target and you can see that if the Fed is looking at inflation based on PCE and they're seeing that you know it's getting really close to target obviously they're going to be thinking about cutting and definitely definitely not thinking about hiking. That is in my view just totally not in the cards. Now another way that you can see how the Fed is thinking about this is just to listen to what they're saying. So we got a lot of Fed speak the past week but when you look at Fed speak you got to be careful there are a lot of people on the Fed but they are not of equal importance.

美联储正在关注核心个人消费支出（PCE）。那么PCE是多少呢？我们要等到本月晚些时候才能得到PCE数据，但克利夫兰联储根据最新数据（如生产者物价指数）预测了PCE。现在，如果你看克利夫兰联储的预测，你会注意到他们实际上预计PCE在本月会有所下降，核心PCE大约为2.5%，这非常接近美联储的目标。你可以看到，如果美联储正在关注基于PCE的通胀，他们发现通胀非常接近目标，显然他们会考虑降息，绝对不会考虑加息。在我看来，这是完全不可能的。另一种了解美联储如何思考的方式就是倾听他们在说什么。过去一周我们听到了很多美联储讲话，但当你听美联储讲话时，要小心，因为美联储中有很多人，但他们的重要性并不相等。

The most important speaker that we got the past week was John Williams of the New York Fed and he is just talking about bumpiness in the inflation path which is basically what I sure Paul has been saying also. So these guys they're looking at this inflation data and they're just telling you that it's bumpy and so that's just me that they're not really changing their core view. And what's their core view? Well we also got the Fed meetings minutes on Wednesday and it's very clear. Fed meeting minutes are telling you that everybody thinks almost everybody and I think we know who that one person who doesn't agree thinks everyone was everybody thinks that we're going to be cutting this year. Could be cutting one could be cutting two could be cutting three. Now on March the guidance was three maybe that's changed.

上周我们最重要的演讲者是纽约联邦储备系统的约翰·威廉姆斯，他谈到的是通货膨胀路径的不稳定，这基本上也是保罗说的。这些人正在观察通胀数据，告诉你它是波动的，这意味着他们并没有真正改变他们的核心观点。他们的核心观点是什么呢？周三我们还获得了美联储会议记录，并且非常明确。美联储会议记录告诉你几乎每个人都认为，我认为我们知道那个不同意的人是谁，每个人都认为我们今年将会削减。可能削减一次，可能削减两次，可能削减三次。现在在3月份指引是三次，也许已经改变了。

I still expect that we would get three simply because going forward it does seem like the Fed is more concerned about over tightening and I think the odds are that going forward we would probably hit some kind of air pocket either in the deployment data or just simply because of just some self-passion economic data and I think that would rapidly change the the the markets pricing but we'll see when that we'll see we'll see how that plays out.

我仍然希望我们会获得三个，因为在未来看来，美联储似乎更关注过度收紧，我认为未来我们可能会遇到某种程度的困难，不管是在部署数据还是由于一些自发的经济数据，我认为这将迅速改变市场的定价，但我们会看到到底如何发展。

Okay the last thing that I want to talk about is Ben Bernanke's review of the Bank of England. Now for those of you who know a bit of history this is you know kind of a sad moment so for for hundreds of years the Bank of England was okay London the UK Great Britain was the financial center of the world. Again Bank of England a big player in that space and now today they're inviting a foreign central banker to come to teach them how to do their homework. So the what happened was that over the past few years the Bank of England inflation forecasts have been really wrong and the government in order to have some more accountability hired Ben Bernanke to come and just do a review and see how the Bank of England could improve. Now to be clear everyone's inflation forecast was really bad the past few years including the Fed and so it's not too fair to pile in on the Bank of England economic forecasting. Honestly I'm not sure if anyone takes out so seriously but they weren't no worse than anyone else.

好了，我要谈论的最后一件事是本·伯南克对英格兰银行的审查。对于那些对历史有点了解的人来说，这算是一个有点伤感的时刻，因为数百年来，英格兰银行一直是伦敦和英国的金融中心。英格兰银行在这个领域是个重要的参与者，而今如今他们却邀请一位外国央行家来教他们如何做好工作。事实是，过去几年来，英格兰银行的通货膨胀预测一直都错得很厉害，政府为了加强问责制，聘请了本·伯南克来进行审查，看看英格兰银行如何能够改进。清楚地说，最近几年每个人的通货膨胀预测都很糟糕，包括美联储在内，所以对英格兰银行的经济预测进行指责并不太公平。老实说，我不确定是否有人真的会非常认真对待这些预测，但至少他们并没有比其他人做得更糟糕。

But let's see what Bank of let's see what Ben Bernanke found in his review. Now the first thing the most salient thing that he found that I thought and first thing he listed was that the Bank of England's systems are really not good. It seems like Ben Bernanke showed up and being an economist he wanted to say hey what does your day look like. Alright let's pull some data let's run some regressions let's see what happens and it seems like Ben was really shocked and my gosh these databases they're so slow. The software is so out of date there's many things that I'm used to doing that I can't do and he seems to be very surprised.

但让我们看看英格兰银行的本·伯南克在他的审查中发现了什么。现在，他发现的最显著的事情，我认为，并且他列出的第一件事是，英格兰银行的系统真的不好。看起来本·伯南克来了，作为一名经济学家，他想说：“嘿，你的日常工作是什么样的？”好的，让我们提取一些数据，进行一些回归分析，看看会发生什么，而本伯南克似乎非常震惊，我的天啊，这些数据库太慢了。软件已经过时，有很多我习惯做的事情现在做不到，他似乎非常惊讶。

So at the Fed board in DC so they have actually really good data. In my experience they have a very good mainframe and you just typed in what you want in SQL and you can get the data downloaded very very quickly so across the Fed system so they do have good systems and it seems like they don't have that in the Bank of England and so Ben was pretty upset about that. Now for some context though the Bank of England is really not a well funded organization. Note if you for example are a newly minted PhD and you get a job at the Bank of England and you can look at this public data the starting salary is like 60, 60,000 pounds which in dollars is like 75,000 dollars.

在华盛顿特区的美联储董事会，他们实际上有非常好的数据。根据我的经验，他们拥有一台非常好的主机，你只需在SQL中键入你想要的内容，就可以非常快速地下载数据，因此在整个美联储系统中，他们拥有良好的系统，而似乎在英格兰银行中并没有这样的系统，所以本对此感到很不满。然而，需要提供一些背景信息，英格兰银行实际上并不是一个充足资金的组织。举个例子，如果你是一名新获得博士学位的人，并且在英格兰银行找到了工作，那么你可以查看这些公开数据，起薪仅为60,000英镑，相当于75,000美元。

A new PhD at the Fed board would be starting more like 150 to 200,000 dollars a year depending on your specialty. So you know Fed board guys are making twice as much there as they are at the Bank of England and London is much more expensive than Washington DC. So Bank of England definitely doesn't have a lot of funding and so that may explain why their systems are not are not as good. But I think the conceptually the most important critique that Benéke Benéke made in his findings was that the Bank of England's communication strategy could benefit from some updating.

在美联储委员会，一位新的博士可能会从每年15万到20万美元起步，这取决于你的专业。所以你知道，美联储委员会的人赚的比在英格兰银行多一倍，而伦敦要比华盛顿特区昂贵得多。所以英格兰银行显然没有太多资金，这可能解释了为什么他们的系统不那么好。但我认为，本内克在他的研究中最重要的批评观点是，英格兰银行的沟通策略可能需要更新。

So let's actually for some context let's see where Ben is coming from. So again at the Fed the way that the Fed communicates to the market many press conferences and stuff like that but a big way they communicate is through what's called the dot plot and if you look at the stop plot what what what happens is that everyone on the FOMC is giving their best guess as to where interest rates will be over the next few years and conditional on that path of policy. So saying that hey if we adjust interest rates according to my what what I think we should do this is what growth would be this is what unemployment would be and this is what inflation would be.

因此，让我们看看本的看法背景。再次提及联邦储备委员会，联邦储备委员会向市场传达信息的方式有很多，比如许多新闻发布会等等，但一个重要方式是通过所谓的点图。如果你看点图，每个FOMC成员都会根据自己的最佳判断给出未来几年利率将会如何走势的预测，并且根据政策路径。也就是说，如果我们根据我的建议调整利率，这将会对经济增长、失业率和通货膨胀率有什么影响。

So that's how the Fed communicates to the markets how they're thinking it helps guide the markets. Now the Bank of England does something that is really different but they also publish forecasts like all other central banks but their forecasts are not conditional on what they think the rates will be their forecasts are conditional based on market expectations.

这就是美联储向市场传达他们的思维方式，帮助引导市场的方式。现在英格兰银行做的与其他中央银行类似，也公布预测，但他们的预测与他们认为利率将会如何不相关，而是基于市场预期的条件。

So what they'll do is they'll look at the market and say well what's the market pricing in right now okay I'm going to use that as an input in my model and this is my forecast. So Ben was saying that you know this is not super useful because it doesn't actually help the market understand what the Bank is doing. So again for example let's say that you're the Bank of England and the market is pricing in let's say 5% interest rates for the foreseeable future and based on these 5% interest rates you forecast a deep recession and inflation coming down and that's what you present in your policy report but let's say that you are Bank of England and you think well this market expectations of interest rates much too high that's ridiculous obviously I'm going to be cutting rates so the market is wrong.

所以他们会看市场，看市场现在对什么定价了，然后我会把这个作为我的模型的输入，这就是我的预测。所以本说这并不是非常有用的，因为这并不帮助市场理解央行在做什么。举个例子，比如说你是英格兰银行，市场正在预测未来利率会达到5%，基于这个5%的利率，你预测会发生深度衰退和通货膨胀下降，并在政策报告中展示出来。但是假如你是英格兰银行，你认为市场对利率的期望太高了，太荒谬了，我显然会降息，所以市场是错误的。

Now if only I can do something about that well well I'm the central bank obviously I can do something about that right so all you could all you'd have to do is to just communicate to the market that you know maybe you're pricing in not enough cuts because I think that interest will be lower and if the market were to do that you take that and compete into your model then maybe you know you get a very different forecast. So what the bank what Ben Bernanke is recommending is that maybe the Bank of England you know give a little bit more give the market a little bit more sense as to how they are thinking about what the path of policy is because that's so much more useful that could communicate to the markets as to how to they should be pricing interest rates and that you know that could change your forecast dramatically and so basically if the market and the Bank of England are not in step these forecasts don't help the market get more in step and these forecasts become useless because the the markets expectations are wrong because the Bank of England is actually not going to behave in that way.

现在如果我能做些什么对于那个好好的话，我是中央银行，显然我可以做些什么对此所以你只需要和市场沟通，也许你没有充分考虑降息的可能性因为我认为利率会更低，如果市场这样做了，你把这个纳入你的模型中，也许你知道你会得到一个完全不同的预测。所以本·伯南克建议的是，也许英格兰银行给市场更多的信息，让市场更了解他们对政策路径的想法，因为这样更有用，可以让市场知道他们应该如何定价利率，这可能会极大地改变你的预测。所以基本上，如果市场和英格兰银行不一致，这些预测就没有帮助，市场更不一致，这些预测就变得毫无意义，因为市场的期望是错误的，因为英格兰银行实际上不会这样行动。

Now a second critique that Bank of that Ben leveled is that the UK usually publishes what's called a fan chart where they have you know forecasts are uncertain and so they would give these really wide fans to give you a sense as to just how uncertain they are on these forecasts.

现在，本的另一个批评是，英国通常会发布所谓的扇形图，其中他们会列出预测的不确定性，并且他们会画出非常宽的扇形来让你感受到这些预测的不确定性有多大。

So Ben was looking at this and it's like you know based on conversations and looking at the methodology these forecasts they don't really these bands don't really make a lot of sense it seems like a lot of times they're just you know made upon human judgment and so it's they're not really telling you a lot I he recommends that people get rid of these fan charts altogether simply because you know they're just not methodologically sound and the fan charts are something that the Bank of England has been doing for a couple decades I believe so that seems to be a pretty big change.

所以本正在看这个，根据对话和方法论的理解，这些预测的波段似乎并没有太多意义，看起来很多时候它们只是基于人类判断而制定的，所以并不能真正告诉你很多信息。他建议人们彻底放弃这些风扇图表，因为它们并不符合方法论要求，风扇图表是英格兰银行进行了几十年的一项工作，所以这似乎是一个相当大的变化。

Now I have no idea if the Bank of England will implement any of these changes but it looks like you know oftentimes when you hire these consultants to come in it looks like they just kind of want cover to do changes that they already want to do or maybe this was forced upon them to provide the government in any case it looks like this is probably going to lead to some change hard to know exactly what that change would be.

现在我不知道英格兰银行是否会实施这些变化，但看起来你知道，往往当你聘请这些顾问进来时，他们似乎只是想要一种掩护来进行他们已经想要进行的变化，或者可能这是被迫提供给政府的，无论如何，看起来这可能会导致一些变化，很难确定具体会有什么改变。

So let's see what happens probably do this slowly public institutions are quite slow. Alright so that's all I prepared for today thanks so much for tuning in if you're interested in my writings check out my weekly blog foodguy.com this week I will talk about just to how the dynamics of the April tax train work and if you're interested in learning more about markets check out my courses at centralbanking101.com talk to you next week.

让我们来看看接下来会发生什么，也许要慢慢来，公共机构行事相当缓慢。好的，今天就准备这些，非常感谢你的收听。如果你对我的作品感兴趣，请访问我的每周博客foodguy.com，本周我将讨论四月税收制度的运作原理。如果你想了解更多关于市场的知识，请查看我在centralbanking101.com的课程，我们下周再聊。