It’s an astute question and one the Investment Committee thinks about a great deal.  Ultimately, it depends on why the Fed would be lowering interest rates.  If things go as planned, inflation continues to subside, and the economy can maintain positive economic growth (aka soft landing), then we may not have a credit event.  This is essentially where we sit today as far as present expectations go, at least for the next few quarters until something proves otherwise.  Of course, if the economy does slow faster than anticipated and they end up behind the curve with overly restrictive policy, then you would have credit spreads widening beyond any duration benefit in that part of the bond market.  It’s always client-specific, but it's a balancing act between the two and we have begun shifting to favor high grade fixed income in our portfolios at this point. We still believe there is room to allocate to both, but we are leaning into the ‘boring bond’ side of the equation. We feel adequately rewarded with yields in the 5% range and want a little duration to lock them in and hedge against that soft landing not materializing.  Resisting the urge to stretch for yield and reduce some of that credit risk at this stage is prudent, and we feel it offers a better risk-reward skew for fixed-income portfolios.
~ Brian T. Szytel, July 2, 2024

A lot of it has to do with the fact that baby boomers are the ones of age who are leaving the workforce for retirement, and those who were born 60, 65, and 70 years ago were, at that time, almost entirely native-born in our country. Therefore, the percentage of the population at birth 65 years ago was so little in the foreign-born category that the net labor force number now is disproportionately benefiting from immigration, while boomers pull the net number down (that is, boomers who were predominantly native-born). There are other factors, too, marginally, but this is far and away the largest contributor to the current data.
~ David L. Bahnsen, July 1, 2024

Yes  =)
But in all seriousness, there is nuance with each company and each sector that requires a good analyst to look at both.  Across the whole stock market, I believe forward multiples are more important (it allows me to see what good news is already priced in).  But with individual company analysis, which is what we do at TBG, both are important.  Ultimately, free cash flow matters a lot more to us than EBITDA.
~ David L. Bahnsen, June 27, 2024

We wouldn’t permanently exclude direct exposure solely for the sake of it, although investments in things like airlines and autos really haven’t been something we have been keen on over the decades due to the high cyclicality and vulnerable business models (you probably don’t need me to rattle off how many of both have failed over the years).  Even setting those realities aside, though, things like low free cash flow generation and what we would want to see from a valuation (let alone a dividend) just aren’t there for us in most EV names.  I also believe all large automakers will continue to bring new models into the space as they all already have and continue to make investments in EV companies to capitalize on that opportunity.  From a market share perspective, I would suspect companies like GM, Volkswagen, Toyota and Huyndai to gain against the company you mention (that just laid off 10% of its workforce, posted y/y sales declines and is trading at 45X earnings).  The bar is low for those legacy companies to advance in the space, considering that none of them have managed to sell over 100,000 EVs in a single year yet.  There are more predictable investment themes with defensible business models touching the space that we prefer.  Our integrated energy names investing in Lithium production used in EV batteries  (and many other applications) is a small example.
~ Brian T. Szytel, June 26, 2024