Fed's Mester Doesn't Buy the Inflation Dips

Surprise, surprise.

Despite recent reports of lowered inflation rates, Cleveland Federal Reserve President Loretta Mester remains skeptical that the central bank has overcome the challenge of high prices.

Like a broken record, at this point. And trust us, they won’t stop until the music stops (something breaks).

She insists on more tangible evidence, pointing out that the consumer price index still stands at 3.2%, even as wholesale prices fell by 0.5%.

As you can tell by the massive rallies the SP500 and Nasdaq have had thus far off the lows, the market has responded to these reports, ruling out further interest rate hikes and anticipating four quarter-point rate cuts in the next year.

Despite what many think, the Fed loosening rates is actually a sign of bearishness for the economy - and has lead to a recession after every rate hike campaign since the 1960s - without flaw.

The million dollar question is, do you believe this time is different?

The Federal Open Market Committee prepares for its meeting on December 12-13.

Don’t be surprised to see a market melt-up continue well into Christmas and 2024 - to get every retail investor off the bearish sidelines, buying the top and embracing “the recession is behind us / soft landing” sentiment on Bloomberg TV.

At that point… we could see things start to unravel - as history tells us it will since the 1960s.

Stay tuned for more.

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We just recently bought the low on the SP500 and are up 50% on long call options.