Episode #3: Two Markets at Once - Inside the CREFC BOG Sentiment Index Survey

A quick word on what this number is.

We launched the index in 2017 at 100.

It collapsed during COVID.

It started weakening in late 2021 before the Fed's first hike.

It hit a record in late 2024, and it has whipsawed twice since.

Now it is back at 101, which on its own does not tell you what is happening underneath.

Each of the nine questions asks whether a piece of this market gets better, stays the same, or gets worse over the next year.

This quarter, the middle answer won seven of the nine.

So rather than me explaining the methodology, I want to start with someone who actually takes it.

So David, when you choose neutral, what do you mean? That you think nothing changes or that you genuinely do not know?

Well, my default is generally that I don't know.

So I should stop there.

But I mean, I'm generally trending towards, you know, that that there is truly the level of change will be muted out that there, you know, I don't expect a substantial increase.

you know, transition, you know, above or below the baseline.

And, you know, again, when you think about my prior answer on how I try to frame things out, sometimes that can be challenging just given the breadth of the lens that I look through.

But when I go for a true neutral answer, it really isn't.

I'm just trying to find the middle of the fairway because I don't know.

It's truly that, you know, I think it ends up ultimately being in that neutral kind of baseline category.

Toby, same question.

Well, I agree with David that it's definitely the baseline that I don't know.

But, yeah, you know, I think sometimes I really feel like things aren't going to change.

So, you know, it's hard to answer other than sometimes it's because I don't know and sometimes because I don't think things are going to change.

But that's just, yeah.

A quick word on what this number is.

We launched the index in 2017 at 100.

It collapsed during COVID.

It started weakening in late 2021 before the Fed's first hike.

It hit a record in late 2024, and it has whipsawed twice since.

Now it is back at 101, which on its own does not tell you what is happening underneath.

Each of the nine questions asks whether a piece of this market gets better, stays the same, or gets worse over the next year.

This quarter, the middle answer won seven of the nine.

So rather than me explaining the methodology, I want to start with someone who actually takes it.

So David, when you choose neutral, what do you mean? That you think nothing changes or that you genuinely do not know?

Well, my default is generally that I don't know.

So I should stop there.

But I mean, I'm generally trending towards, you know, that that there is truly the level of change will be muted out that there, you know, I don't expect a substantial increase.

you know, transition, you know, above or below the baseline.

And, you know, again, when you think about my prior answer on how I try to frame things out, sometimes that can be challenging just given the breadth of the lens that I look through.

But when I go for a true neutral answer, it really isn't.

I'm just trying to find the middle of the fairway because I don't know.

It's truly that, you know, I think it ends up ultimately being in that neutral kind of baseline category.

Toby, same question.

Well, I agree with David that it's definitely the baseline that I don't know.

But, yeah, you know, I think sometimes I really feel like things aren't going to change.

So, you know, it's hard to answer other than sometimes it's because I don't know and sometimes because I don't think things are going to change.

But that's just, yeah.