Guggenheim CIO touts a 'bond-pickers' market, thinks Fed rate cuts this year a longshot

Anne Walsh, chief investment officer at Guggenheim Partners Investment Management, is ready for the “Fed put” to end.

The “put” has meant that major market shocks over nearly two decades were met by an equally big Federal Reserve response: interest rates cut to almost nothing and a resumption of bond-buying, which is seen as analogous to holding a “put option on the price of stocks at least. While Walsh does see the Fed skipping a June rate hike next week, she also predicts a recession will unfold that isn’t “ginormous” in the third quarter of 2023. However, she doesn’t expect the Fed to cut rates this year, even in a backdrop where stocks and bonds selloff, and a cycle of credit downgrades and defaults kicks in.

“I think in the old adage [that] it’s a stock-picker’s market, well, in this case, it’s a bond-picker’s market,” she said.

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