Headline of the Day: The Fed Sees Trouble Brewing

In a review meeting yesterday my astute client stated that he agreed with our assessment of conditions and was happy to play defense for the time being, but struggled with why the market continues to hold up.

Of course we discussed the pending trade deal, Fed stimulus, and so on, and the fact that, counterintuitively, the present trend -- conditions weaken while the market makes its last leg higher (could be different this time) -- has generally characterized the final stretch leading to the major tops of the past.

Whether or not we're at last nearing the end of history's longest expansion, the quote below tells us, unequivocally, that the Fed sees potentially serious trouble brewing:

"FED'S CLARIDA SAYS FED WILL CONSIDER NEW TOOLS TO EASE POLICY IF NEEDED: SAYS NEW TOOLS TO BE REVIEWED INCLUDE SOME THE FED REJECTED BEFORE, LIKE CAPPING TREASURY YIELDS"