Kathy Jones

You know, I think it's appropriate because coming into this, the idea was it was going to be a short-term event, and we were going to pass right through it.

Now we're into, what, the fourth week, I think?

Third week, okay.

So we're approaching the fourth week, and that's significantly longer, and it's gotten significantly more popular.

escalated than had been anticipated, so we're seeing the energy price shock.

And sort of between the rise in energy prices and the slowdown in growth that will come from that is the inflation hit.

And so I think the market is reflecting that the inflation hit is coming and it needs to deal with that.

I'm not sure that it's accurate that the Fed's gonna hike rates anytime soon, but I think it's more appropriate to go from building in one or two rate cuts to being at least neutral at this stage.

Yeah, I think this is reflecting that rush at the short end to price in a shift in rate expectations and at least take out the rate cuts on the part of the Fed, as George indicated.

So I think the long-term trend is probably still towards steepening.

There is a chance in one scenario, and there's so many scenarios to play out, but one scenario is this continues, inflation becomes a big concern, the Fed does have to tighten, growth slows down.

So we know that behind the inflation push is probably a growth slowdown.

So I think the market's starting to reflect that right now.

But it'll probably play out these scenarios a dozen times before we actually know what the end game is here.

Well, it creates risk of overshooting, but also creates some opportunity, right?

When the market's overshoot, that's when you get some good valuations to grab onto.

But I do think particularly when it comes to something like this because it's a war and it's politically driven, there's so much uncertainty about how it turns out, right?

This isn't something that we can kind of model out easily.

We're modeling many scenarios now.

And so, yeah, markets are going to overshoot in all directions.