The Contrarian Investor Podcast

Markets Face Headwinds in First Half of 2024: Barry Knapp, Ironsides Macroeconomics

Jan 11, 2024

Barry Knapp of Ironsides Macroeconomics discusses the economy and markets in 2024. Topics include the Fed's influence, recovery in earnings, deflationary shock in goods prices, interest rates, bond rally, yield curve inversions, and stock outlook.

52:56

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Episode guests

Barry Knapp

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Quick takeaways

Investment cycle and technological innovations can improve productivity in various sectors.

Bond returns may not be attractive, and yields could grind higher over time.

Deep dives

Summary of Main Idea 1

The speaker discusses the importance of productivity and how a strong investment cycle and technological innovations can lead to improved productivity in various sectors, such as industrials, energy, materials, and healthcare.

Introduction

2min

Market Outlook and Factors Influencing Views

21min

Analysis and Predictions for Fed Rates, Labor Market, and Market Positivity

2min

Tapering QT and Liquidity Concerns

10min

The Favorable View on the Short End of the Curve

8min

Outlook for Capital Investment and Labor Productivity

11min

Closing Remarks and Political Ad

2min

This episode was recorded on Jan. 8, 2024, and made available to premium subscribers the following day -- without ads or announcements. For details on how to become a premium subscriber (it's very easy), visit our Substack or Supercast.

Barry Knapp of Ironsides Macroeconomics rejoins the podcast to discuss his outlook for the economy and markets in 2024.

Content Highlights

Knapp's outlook for 2023 played out until September. Then the Fed changed the rules of the game somewhat and markets now face a difficult period... (3:29);
Investors are expecting a recovery in earnings, which may be hard to achieve (7:00);
The drop in inflation can be traced to one cause: a deflationary shock in goods prices (8:57);
How the Fed can justify interest rates as soon as March... (11:36);
Why bonds haven't continued to rally this year (16:58);
The Fed will cut to 4% by year-end and the yield curve should dis-invert with 10-year Treasury yields rising to 4.5% (22:06);
Fed independence is taken for granted. That may be about to change... (28:35);
Only four occasions post WWII have seen yield curve inversions this deep. All have led to major recessions... (36:40);
How do stocks look in this whole picture (40:31)

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