Positioning around fiscal and labor hoarding - VP March 2024 Asset Allocation Discussion

Highlights from this month's Asset Allocation discussion:

• Looking ahead, April tax receipts and micro-business job openings / NFIB hiring intentions will be key factors in determining the path of the US economy the rest of the year.
• The story remains ongoing fiscal stimulus is buffering downside growth risks in the US, in turn supporting labor hoarding and delaying resolution of labor mismatches.
• This backdrop supports our Godot's Recession thesis and creates inflation risks, although the data suggests a big inflation scare is unlikely. 
• Commodities and real assets remain our favorite long expression. TIPS and MBS offer the best value in US fixed income. The improving global growth outlook suggests overall risk-reward is better in EM/European equities, while inventory cycle beneficiaries and select bottom-up names are the better play in the US.

Links to Desert Island and Asset Allocation dashboards.