
While this year's decline is still well short of that, we don't think we have to approach that level this time.

We'd caution against succumbing to this tendency, even as moving to the sidelines or higher short-term yields offer what may appear at the moment to be an enticing hiding spot. They have a knack for turning long-term investors into short-term traders. We don't think we've seen the end of inflation-driven volatility, but the market's measured reaction – which we think indicates that there is already a large amount of pessimism priced into stocks and bonds - offers an encouraging signal that we're making progress within the current bear market.īear-market declines are never comfortable. While the September consumer price index (CPI) showed that consumer prices are still rising at an uncomfortable clip, stocks rallied sharply on Thursday (the Dow staged a 1,500-point intraday swing higher) to stem the tide of weakness that had led equities back to 2022-lows 1.

Markets showed a welcome glint of resiliency last week, holding on despite an inflation report that could have added to the chorus of concerns that the Fed is destined to overstay its welcome.
