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The Fed fumbles
Credibility concerns re-emerge, as will inflationary pressures
Observations: Pokrovsk, polls & paradoxes
Allies & adversaries alike dislike Trump, shifting geopolitical risks in time
"Events, my dear boy, events"
Midyear mark to market, Part I: It’s the end of the world and markets feel fine
The other election
UK general election has transformative potential French election does not
Observations: Rage rolls on
Underlying recent political upheaval across the world, The Politics of Rage grows
Addendum to Geopolitical Vega
LSEG errata & added details on return estimation
Addendum to Leitmotif 8: EU spins the Wheel of Fortune
EU Parliament’s de facto rejection of “One-China” policy
May you live in interesting times, The Wheel of Fortune
Leitmotif 8: Global entropy tips over the Complexity cascade
May you live in interesting times, The Tower
Leitmotif 7: A western crisis of confidence
May you live in interesting times, The Hierophant (reversed)
Leitmotif 6: American political instability
May you live in interesting times, Judgement
Leitmotif 5: The Politics of Rage returns
May you live in interesting times,
The Lovers (reversed)
Leitmotif 4: FX volatility & divergence
May you live in interesting times,
The Hermit (reversed)
Leitmotif 2: Central bank credibility
Happy New Years!
May you live in interesting times
Leitmotif 1: Trend inflation’s path
Observations: Inflation's final mile
The journey back to target is unlikely to be steady or easy
The Magnificent Seven slay the zombies
Real interest rates undermine labor hoarding incentives at tech monopolies.
Observations: Götterdämmerung
If your model didn’t predict inflation’s persistence, higher rates and robust growth, maybe it’s wrong.
Opportunity knocks; are you listening?
US rates markets are now wildly mispriced and offer compelling opportunities, both outright and in relative value.
Are we there yet?
Markets, still dazed from the worst bond rout on record, remain puzzled by US economic resilience amid real interest rates markedly above consensus estimates of neutral. Have rates now fully adjusted?
Debt reality meets perceptions
Just as April showers bring May flowers, 2022’s historic rise in real interest rates likely has sown 2023’s credit traumas. Which macro-credit risks are the ones to watch this year?
Clash of the Themes
2022’s higher-than-expected inflation, aggressive Fed tightening, unstoppable dollar, and US economic resilience all caught the consensus by surprise, yet were anticipated by the Thematic approach. What does it hold for 2023?
Observations: Plaza 2.0 bid, not offered
Expectations for “Plaza Accord 2.0” are sure to be dashed. The dollar’s unstoppable rise is not “breaking” global financial markets nor is it caused by unnecessarily tight Fed policy. Both narratives are false and any international accord to halt the dollar’s ascent would be either folly or the precipitant of a systemic risk event. Part I of IV.
Solved: Drivers of the dollar cycle
The big, multi-decade swings in the dollar are among the greatest sources of volatility in the global economy and yet the source of these cycles has remained a mystery…until now.
The solution to that mystery not only has implications for the dollar’s current path, but also for the economic outlook, interest rates, asset prices, and asset allocation.
An emerging small island
Indebted, isolated, inflated, and beset by policy blunders: Is there any hope for Britain? Localization suggests a brighter future, but a mystery as to why not already.
Coming Soon!