Ever heard of a “ Jacob’s ladder” ”? It’s a notoriously difficult sailing ship apparatus that requires finesse to use effectively. One small shift in body weight, and you get all twisted around (if you don’t fall completely off). Federal Reserve Chairman Jerome Powell seems to be grappling with his own Jacob’s ladder, balancing between raising rates to tame inflation and supporting banks under increasing pressure due to the Fed’s rate hikes.

Markets had their best January since 2019, and the upward momentum has spilled into a strong start to February thanks to the dovish Fed last week.

The Federal Reserve met last week and raised the federal funds rate another 75 basis points (0.75%) to a range of 3.75%-4.00%. This really wasn’t a surprise; the markets pretty much expected the fourth consecutive increase of 75 basis points. (It’s the sixth move upward in 2022.)