2023 Q2 Market Update

“If you owe the bank $100 that’s your problem. If you owe the bank $100 million, that’s the bank’s problem. – J. Paul Getty

Robert Frost was a fortuitous man, as he only had 2 diverging paths in the woods to choose from. If only we were so lucky. Right now, it feels like the dispersion of potential market outcomes is growing at a rapid and expanding pace. Recent banking events have stressed the markets, specifically the financial and energy sectors. Yet, equities have remained resilient in the face of 2 bank failures and Credit Suisse doing Credit Suisse things. Even though participants have access to the same data at the same time (earnings releases, economic data updates, breaking news etc.) markets have multiple ways one can analyze data and forecast the future. Hindsight is always 20-20 but every manager has a preferred way of looking at information and weighing the probability of return in the future. Investors are currently confronted with extremely muddled data and no clear signals to follow. How do you read the road signs when the signs are all pointing in different directions?

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