Barron's Live The Fed at the Crossroads
Sep 22, 2025
Blake Gwinn, head of U.S. Rates Strategy at RBC Capital Markets, discusses the Federal Reserve's recent rate cuts and the economic landscape. He provides insights into the market's reaction to Fed decisions and assesses the challenges ahead, including the state of the labor market. Gwinn emphasizes that while hiring has slowed, he's optimistic about avoiding a recession due to healthy balance sheets. He also explores inflation dynamics, Fed independence risks, and implications for mortgage rates, diving into the intricacies of macroeconomic indicators.
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Rising Indexes Hide Weak Breadth
- Short-term market breadth is weak even as indices rise, prompting technicians to warn of possible near-term pullbacks.
- Over months, earnings and Fed direction could still propel higher prices.
Micron's Rally Hinges On Durable AI Demand
- Micron's surge is driven by AI-related high-bandwidth memory demand and a big revenue rebound.
- The key is management's commentary on sustainability of that demand beyond the AI stock-up.
Costco Valuation Priced For Consistency
- Costco's share price reflects a high valuation despite steady, predictable growth and strong membership economics.
- Growth must remain consistent to justify the premium valuation.