Against a backdrop of sky high inflation, rising rates, and growing recession concerns, the

S&P 500 has had an undeniably grim start to the year.

With the tech heavy NASDAQ and unprofitable growth companies performing even more dismally.

But are these moves just a rate story? After all, the Fed continues to increase rates at a pace that seemed unimaginable only a few months ago, and the higher

rates go, the bigger the discount you might expect for tech companies who are only expected

to make earnings far into the future,

or are the equity markets in the midst of a more lasting paradigm shift?

These questions are top of mind.

I'm Allison Nathan and this is exchanges at Goldman Sachs.

On this special episode of exchanges at Goldman Sachs, we're breaking down my most recent top of mind report.

Amid the sharp sell of inequities,

we turned to perspectives from three longtime market heavyweights,

Kathywood of Arken Best, Cliff Asnes of AQR capital management, and our chief U.S. equity strategist David

Kosten.

Kathy Wood, who's closely followed ARC ETS of innovative high-growth companies,

has plummeted this year, argues that this

sell-off is mostly due to the rates move, but that the era of growth equity leadership

is far from over, in large part because inflationary headwinds are starting to ease.

We have been saying for some time that the inflation we're seeing now is a one-shot shock to the system and it lasted a lot longer than we

expected. I've never seen supply chain issues take this long,

almost two years to work out.

And we never expected Russia to invade Ukraine.

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