Difficult To Be A Bull
If the Fed cuts rates early next year, it will be because the economy is further weakening.
If the Fed were to maintain the current Fed Funds rate well into 2024, it will be because there is upward pressure to CPI.
I believe CPI is declining as a direct result of M2 declining (chart below). The shrinking money supply (M2) will shrink GDP at a time when Treasury will issue $ Trillions in new debt, which will force long yields higher.
I believe the Fed will exercise QE at the long end of the Treasury curve before it will take Fed Funds down to 2-3%.
