Christopher M. Brigati

I’m excited to speak on this upcoming webinar about the recent increase in delinquencies and what leaders should be thinking about as we move through 2026. Register here to attend: swb.us/4kRDkjo

Inflation risk, oil prices, and volatility remain front and center. This week’s Market Commentary from @Brigati_C, CIO, SWBC. blog.swbc.com/investmenthub/…

Good point Ron... I'm willing to wager that Wall Street will not use the money as intended with loans. I'm not sure if that changes the narrative, but it twists the story for sure.

This plan to ease capital requirements for the biggest banks is certainly a good economic initiative. However, one of the questions that arises is... will the banks use the excess dollars for lending purposes... or will they be used differently... investments for example?

A very similar job displacement happened in fast food when higher minimum wages were legislated in 2018. McDonald locations staffing was at least halved as self-service screens were implemented. Yes, workers that remained were happy with the increased $15/hr wage... the other 50% needing a new job struggled.

It's all about the oil. The Fed is kicking the can down the road per Chair Powell's messaging yesterday. This morning the BOE delivered a much more hawkish message though leaving rates unchanged. BOE estimates for inflation in Feb at 3% and 3.5% in March suggest a bigger concern than Powell's more measured comments. Notably the BOE voted 9-0 to maintain its key rate at 3.75% with statements that "all members stand ready to act." To be fair the oil shock will impact the US differently, however, the global inflation narrative will not leave the US economy unscathed. Overnight Brent Crude nearly touched $120, pushing Treasury yields above 4.29%. The markets seem more rattled than appeared to be the case earlier this week. TY futures hit the key support level of 111-08+ we previously identified as needing to hold. A break below could pressure prices down to to the 110-06 area.

Economic history buffs may recall that hiking interest rates into an oil price surge is not a good dynamic as it compounds the inflationary supply-side effects of tighter economic conditions from higher oil prices. The US has suffered from real recessions or nearly fallen into one following such monetary policy reactions in the past. Higher oil prices tighten economic conditions with a real hit to consumers’ disposable income. Doubling down on that with a demand-side rate hike or sustaining already higher rates only further hurts consumers. Below are instances when the Fed either raised rates or kept them higher in the face of a spike in oil prices · 1973-74 -- Oil embargo → Fed Tightens → Recession/stagflation · 1979-80 -- Iran crisis → Aggressive Tightening → Recession/ Higher Unemployment · 2007-08 -- GFC, Oil tops $140 →Fed maintains tighter policy → prolongs existing inflation In short, the Fed should be wary of inflation fighting policy in the face of higher oil prices. Though history does not necessarily repeat itself…. It often rhymes.

Volatility remains high, though it has settled down recently. Don't get caught flat-footed and assume things are back to normal when the market is slightly more calm. Click below for some thoughts on last week's market volatility. #rates #MarketInsights #economy #inflation #muniland

All my weekend reading and news digestion, especially from the experts with a deeper understanding of the oil market than 99.9% of us normies… has me more convinced that the Fed will have to delay any cuts and may not be able to do so this year at all. Basically inflation concerns are rising. Even if the war ends immediately and the Strait of Hormuz is opened right away… oil production and distribution will take months to return to normal. That is definitionally going to raise the price of oil further and boost inflation globally. Don’t kill the messenger, but if this conflict lasts longer than a few more weeks, stagflation concerns go from 5% - my current handicap - to 30% immediately. Buckle up this will get bumpy.

Core-PCE came in right on the screws for survey expectations MoM +0.4% YoY 3.1% The inflation data does not include any impacts from the conflict with Iran... so downstream inflationary pressures directly related to the war remain a pending narrative. 4Q GDP missed "bigly" with 0.7% vs 1.4% expectations reinforcing the slowdown impacts from the government shutdown. The weaker economic data for Q4, though quite dated given the significant changes we have experienced of late, may offer some solace to doves wishing for more accommodative policy to spur the economy forward. The larger concern about the price of oil remains the single largest input to the calculus for rates going forward... thus I expect little meaningful follow-through to any lower rate expectations or guidance until there is indication of more measured aggression in the Middle East. Oil experts are suggesting that oil prices have a lot of room to continue to move higher... which would cause a large correction in equities and interest rates to test much higher yield levels. #rates #economy #inflation #OilPrices

War angst and oil prices are creating powerful forces impacting equities and rates. Concerns about a slower economy, pressure on consumer spending, margin compression, and a risk-off sentiment are weighing on equities. Inflation worries, higher federal deficits, higher risk premia, a slowing path for FOMC accommodation have lifted Treasury yields. Volatility is expected to remain high and traders looking for the edge are targeting extreme moves to position for short-term opportunities. Buying dips in equities will eventually be a good play, but my suspicion that prices could decay further before they bounce remains my base case scenario. #rates #economy #inflation

Following yesterday's big swing in prices across asset classes the market seems to be looking for its next move. Rates are bounded by the range highlighted by yesterday's "outside day" (higher high and lower low than the previous days trading - between 4.08% and 4.21%. Outside days potentially indicate a reversal of the previous trend... but no guarantee. Based on the chart we can see where to position to capture the move in either direction. Despite President Trump's aggressive statements about the conclusion of fighting and the expected escalation of attacks today per Hegseth, the markets are seeking indications of what to do next. A quicker timeline for the end to the war and opening of the Strait of Hormuz would offer relief to markets... but as we know... nothing can be taken for granted in this regard. Oil is back well-below $100 taking some of the inflation angst out of the market. Stocks as indicated by the S&P 500 have stabilized, but we are not out of the woods yet. I prefer to identify an extreme in prices, identify a rejection of a price move and trade with the existing trend... given the volatility and uncertainty provided by the conflict with Iran - this is a little more complicated to accomplish. BUT if we trade to higher yields and reject 4.21%.... going long rates is the trade. A rejection of the 4.08% level suggests we revisit 4.21% and possibly trade up to the 4.30% level from January.

Great segment on @FoxBusiness with @cvpayne this afternoon discussing the wild market, reminding investors to avoid panic and some ideas that I like coming out of the volatility!!!

News is moving so fast commentary on last week's markets seems like old-news by Monday afternoon... but there is still value in understanding what occurred last week. Oil topped $100 and retraced already today.... that being said, the volatility is intense and shouldn't scare investors. Click below for a quick analysis. #rates #economy #inflation

Markets are volatile tune in to @FoxBusiness today between 2-3 eastern time with @cvpayne for some thoughts on how to manage through the chaos!!!

At a recent conference, I was asked... "what keeps you up at night" with regard to markets. In short my answer was... the unknown-unknowns that are nearly impossible to anticipate and handicap. Prior to the conflict with Iran tensions were high and escalating... so I could account for the possibility of open conflict. However, the closing of the Strait of Hormuz was never part of the calculus. IMO, this helps explain the severity and speed of the oil price rise so far... nobody likely had an inkling of its possibility, let alone probability.

@JSeyff Well played pal!!! Respect!!

If anyone asks — I am now an oil and geopolitics expert. In other news, check out the price of crude

I don't think those were my exact words.... kidding it wasn't me... but could have been. I wrote a tongue-in-cheek analysis answering the question posed by a client years ago... " The bond market seems to read the tea leaves better than the stock market, are bond traders smarter than stock traders?" I pointed out the person was asking a bond trader so of course the answer was... YES!... and better looking, funnier and more humble.

This move is much faster than I anticipated.... I expected 4 to 5 weeks to top $100... Risk off in stocks will be more pronounced as a result.