Things are awful, but is consensus getting very consensus? JPM’s Elan Luger points out a few relevant bullets:
1. What had been heavily debated in Q1 is now the overwhelming consensus.
2. Everyone is a bear.
3. China is shutdown, inflation is running wild, Russia / Ukraine continues to impact supply chains, animal spirits are dead, the fed has lost control etc.
4. JPM’s running assumption has been “fair value” for this market ~$4200 which is 15-16x 2023 EPS which was the multiple the last time the 10 year was at 3%
5. Investors haven’t been as unanimously bearish since ’08.
6. There is no rally like a bear market rally. Maybe this week’s CPI is the catalyst?