Is This the First Wave of a Bull Market? [VIDEO]

Jordi Visser

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Growing up with a father that taught him to handicap horses at the race, Jordi Visser uses a Bayesian probabilistic approach rather than binary one to think about markets. In the latest installment of Real-Time with Jordi Visser, Jordi reflects on the Elliot Wave theory when considering recent inflation and GDP measures to make the point that the market price action is telling a different story than market narratives. As a result, Jordi believes that the probability of a bull market is higher than is currently expected.

Key Takeaways:

  • Nominal, rather than real, GDP is the most important indicator of market health. Currently, nominal GDP is expanding at 8% annualized, which is well above typical yearly levels. Moreover, Jordi believes that nominal GDP will stay elevated in the coming years.
  • Jordi believes that we have hit peak YoY inflation. He points to declining core CPI, PPI (ex food and energy), import prices and export prices to underscore this belief. While the market has focused on owner's equivalent rent, he analyzes leading indicators such as building traffic and housing affordability, which indicate that this metric will likely come down in the future.
  • Finally, Jordi points to China and the impact that increased animal spirits could have across global markets. Despite decreased demand in the Chinese property market, Jordi believes a pick up in the equity markets animal spirits could pick up in the year's second half.

About These Videos: Our market videos seek to provide a data-focused interpretation of the market's most critical developments. Real-Time with Jordi Visser is a recurring series produced by our President and CIO based on his macro views. The purpose of his series is to isolate macroeconomic indicators ("green marbles") that are telling the true story of the market, rather than relying on the narratives or stories often portrayed as news. Jordi is a unique thinker and tends to publish these videos during market dislocations/regime shifts when he sees areas where his views differ from consensus sentiment.

 

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