When you are on a flight and there is a bit of turbulence, do you; (1) believe it is only minor and will be very brief, or (2) expect it to get worse fast and tighten your seatbelt? Even after it passes, most prepare for it to start right back up at any moment and stay focused on the risk. The early year 17.5% straight-up move in the S&P 500 (SPX) and increase in optimism that caused us to expect a pause in the upside has clearly passed, and with the 10-year US Treasury (UST) yield below the lower bound of the current Fed Funds Rate, that economic and market optimism is beginning to turn to fear of recession.

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