Bad GDP… Good News?
What is it?
“The GDP report serves, as usual, as a backwards-looking overview of economic activity, capturing the January-through-March period.”*
The annualized GDP was down 1.4% quarter over quarter as opposed to the 1% expected gain.
Why does it matter?
Stocks rallied after the news came out. That matters since this is counterintuitive to a declining GDP.
“A recession is typically considered two consecutive quarters of negative GDP growth.”*
We believe the markets may be anticipating some relief from the Fed’s proposed rate hike after a bearish GDP report. Whether the consensus is wrong like they were for GDP estimates will be interesting to see.
This Week’s Federal Reserve Meeting
What is it?
The Federal Reserve board members are scheduled to meet this week. We will be looking for more clarity on what decisions may be around Monetary policies.
Why does it matter?
The current expectations for rate hike this week is 50bps while guidance that they will continue to aggressively raise rates in the coming months. Depending on the language used by Jerome Powell, the Chairman of the Federal Reserve, may provide fuel for market movements.
More on that next week.
Other articles we found interesting this week:
Is Real Estate a Shelter From Inflation? Not Always.
China signals easing of tech squeeze in bid to lift economy
The economic war against Russia is getting hot
Current 401(k) portfolio
Our last portfolio reallocation: 4/11/2022.
Want more information?
The weekly market insight provides a window into the process we use in our investment management process. At Breakaway, we believe markets are always changing and require a nimble yet data-oriented approach.
Our process attempts to identify trends and momentum in the financial markets. With that information, we align our clients’ portfolio accordingly in the hope to help our clients accomplish their life goals while attempting to lower the risk of a large drop in their portfolio.
Click here for more details about our investment management
Sources:
*Emily McCormick. “US GDP unexpectedly contracted at a 1.4% annualized rate in Q1”. 4/28/22. Yahoo Finance. https://finance.yahoo.com/news/q1-us-gdp-gross-domestic-product-economic-activity-190926750.html
IMPORTANT DISCLOSURES:
Educational use Only. The market update published by Breakaway Financial Group LLC (“Breakaway”) is intended to be educational in nature and is not intended to be a recommendation for any specific investment product, strategy, plan feature or other purposes. Accordingly, it should not be construed by any consumer and/or prospective client as solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation.
Advertising and Marketing. Communications such as this are not impartial and are provided in connection with advertising and marketing. This material is not suggesting a specific course of action or any action at all. Prior to making any investment or financial decisions, an investor should seek individualized advice from a personal financial, insurance, legal or tax professional that takes into account all of the particular facts and circumstances of an investor’s own situation. No person associated with Breakaway is a licensed attorney or tax professional and the information contained herein should not be considered tax or legal advice.
Links to Third Party Content. This Market Update contains links to articles or other information maintained by unrelated third parties. You acknowledge and agree to the following: All such information is provided solely for convenience purposes only because we believe that it may provide useful content. and all users thereof should be guided accordingly. We disclaim any responsibility for the link’s performance or interaction with your computer, its security and privacy policies and practices, and any consequences that may result from visiting it. We do not control the content published by the third-party; we do not guarantee any claims made on it, nor do we endorse its sponsor or any of the content, policies, activities, products or services offered by any advertiser on the site. Breakaway assumes no liability for any inaccuracies, errors or omissions in or from any data or other information provided by the third party and inclusion or reference by Breakaway to any third party link should not be construed by any consumer and/or prospective client as a solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet.
Important Information regarding Registration Breakaway and/or Patrick Traverse offer Investment advisory and financial planning services through Belpointe Asset Management, LLC, (“Belpointe”) 500 Damonte Ranch, Parkway Building 700, Unit 700, Reno, NV 89521, an investment adviser registered with the Securities and Exchange Commission (“SEC”). Registration with the SEC should not be construed to imply that the SEC has approved or endorsed qualifications or the services Belpointe offers, or that its personnel possess a particular level of skill, expertise or training. It is important to read disclosures pertaining to Belpointe Asset Management at this link https://belpointeasset.com/disclosure/. Breakaway is not affiliated with Belpointe. Additional information about Belpointe and Patrick Traverse is available on the SEC’s website at www.adviserinfo.sec.gov.
