Premium to Humility (guest: Neil Azous)
The Market Huddle
00:00
The Fed's Neutral Rate
The rate at which the five-year treasury yields settled that week of the first Federal Reserve hike is where the neutral rate returns to with 100% accuracy. So a good argument, if you're structuring an option position, for example, my view is is that we are going to broadly return by the end of this year to somewhere between 3.5% and 2.5% in the Fed funds rate down from 5.25%.
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