U.S. Economy

After months of hinting that interest rates would fall, Chairman Powell finally came out and said it; the economy has slowed enough to declare that interest rates are going to fall. This is understandable as the economy continues to slow. 
 
The economy does appear to be slowing in the United States. Even on a global basis, other economies appear to be slowing as well so a global recession is not off the table. 

We have been on record stating that we believe the Fed will cut twice at 25 basis points each. I said as much on a recent CNBC appearance. 
 
As additional economic data comes in the Federal Reserve may need to take action greater than a total 50 basis point interest rate reduction. We believe there’s a reasonable chance the Federal Reserve will cut 50 basis points at the next meeting and another 25 at the next meeting. 

Remember that the Federal Reserve’s mandate is to control inflation and stimulate employment. The inflation part appears to be working in terms of the actions they have taken. Now it’s on to making sure the job market remains solid.
 
Portfolios are invested on an expectation of falling rates. We see no reason to alter our view. We will adjust as needed.