He was recently saying that for the first time in a long while he likes Treasuries better than Equities.
Totally agree!
Nominal rates would stay low almost no matter inflation – many reasons for that.

When major asset allocators like Rick would be buying more Treasuries, they would be effectively selling large Technology stocks which still dominate the index.

Well, the ever-opportunistic railroad union leaders would deliberately pick the most vulnerable time to strike the highest negotiation power!

See the chart below how Railroads (illustrated by the Union Pacific) stocks closely match the inflation – i.e. Railroads do well when inflation is high, and that is exactly when rail employees have the highest bargaining power.

typically, in a recession earnings drop 20%+, while S&P500 Index still prices in $230 of earnings.

This time around despite the inflation (and, hopeful thinking), earnings might drop even more: 

1) US corporate margins are SO high – multi decade highs

2) undoing the unusually favorable Macro conditions of the last 20-30 years, we would have high inflation, super strong USD and higher rates eating into margins beyond the typical cyclical punch  

3) you have to estimate the drop in earnings from the previous peak of $200 (2021) not from the illusive $230 for 2022 that ppl still anchor themselves to

Tesla just made EVs popular due to climate change and the coolness factor.
But almost 125 years ago EVs were successful in the States!
Even EV taxis in NYC.
And back then that fate of the automotive industry wasn’t clear – either electric or internal combustion engine.

In New York, a company was providing electric taxis as early as 1897. They were not competing with other cars, but with horse-drawn carriages.
The Electric Car Company closed in 1907, it had more than 1,000 vehicle . They were all scrapped.

Despite the (mis)perception, seemingly Defensive sectors (Staples & Utilities) don’t really work in RiskOff regime.

Check this chart of the US Staples stocks with the periods of RiskOn or RiskOff (as defined by TenViz).

Being thick in cash is a better strategy…

Let’s look at headlines from Microsoft last few weeks:
1) Microsoft cuts earnings on the weakness in the PC segment
2) Microsoft Curbs Spending on Travel, Gatherings in Bid to Reduce Costs

From here we can conclude:
1)The nature of their misses says that they have NO ability to forecast the future beyond a simple extrapolation of short-term trends. 
They overhired at the peak of Covid lockdowns and they didn’t expect that the boom in PC sales would abate….

2) Now Microsoft Corp is asking teams across the company to rein in some employee expenses as the software giant tries to control costs in the current economic environment.

● Are they facing cash shortage? NO! They have $105B of cash on their BS
● Are they draining cash? No! They rake in $50B+ of Free Cash Flow a year (stunning, right?!)
● They overspent/overhired at the top and now they are cutting when everyone is!

BTW when Microsoft behaves in these pro-cyclical moves (i.e., hiring at the top and cutting employees when we enter a recession), how much do they help the economy? Given their enormous size, they just amplify the economic cycle globally…

Dear Mr. Microsoft, can I offer you predictive service to help improve your business forecasting function?

It would certainly pull higher prices of other locally traded natural gases globally,
– including in Asia and, inevitably, in the US.
And, eventually, given the substitution of crude oil and gas this would lead to new highs of higher Energy prices globally.

Again, that would feed into the inflation globally through all commodities and global shortages.

Inverted Yield Curves (the US, Canada, the UK, Germany, Mexico) would argue strongly for the inevitable recession.

Have a look at how profoundly inverted US Yield Curve is!

Finally the money is not free – that madness is over.

When money costs at least something nominally (1-2-4-5% – pick your number) it starts curtailing unproductive, speculative investments.

Zero interest rates – good riddance!

how come the economy has contracted despite adding 2-3 million new workers?
Possible answers look disturbing:

1) a dramatic drop in hours worked

2) a dramatic drop in productivity

Thoughts?