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Guy LeBas, industry influencer, raises questions about the disconnect between perceived systemic credit risk and current market pricing. In a recent comment on a survey by Steve Liesman regarding the U.S. Federal Reserve's FOMC, LeBas points out that 70% of respondents labeled systemic credit risk as either extremely or somewhat elevated. Despite these concerns, investment grade credit spreads stand at 80 basis points, placing them in the bottom quintile.
LeBas recently reported that his core PCE model projected a 0.37 percent increase, closely matching the actual 0.367 percent rise in economic data, according to his model update. He has also commented on a growing gap between crude futures prices and actual physical delivery, noting that asset classes have adjusted to this difference in a previous observation. These insights add context to his ongoing market commentary.