Making Sense of a Wild Week

The video discusses the market's reaction to the Fed's hawkish pivot, with expectations of multiple rate hikes. It covers the rotation out of high-flying stocks and the impact on valuations. Earnings growth is slowing, and the Fed's normalization process is accelerating. Despite hawkish communication, the terminal rate expectations remain unchanged. The Fed aims to manage market expectations through strategic communication.

What was the market's initial reaction to the Federal Reserve's hawkish pivot?

• Optimism about economic growth

• Fear and re-rating of stocks

• Stability in stock valuations

• Increase in meme stock popularity

What significant change began a year ago in the stock market?

• Stability in tech stock prices

• Rotation out of high-flying stocks

• Decrease in interest rates

• Increase in meme stock investments

Which of the following was NOT one of the economic tailwinds from the previous year?

• 48% earnings growth

• Abundant liquidity

• High nominal rates

• Negative real rates

What is the current consensus estimate for earnings growth in 2022?

• 48%

• 7.9%

• 10%

• 5%

How is the Federal Reserve attempting to manage market expectations?

• By being consistently dovish

• By avoiding any communication

• By promising no rate hikes

• By talking hawkish to scare markets