Eye On The Market

Over the last year, the Eye on the Market included views on sectors, rates and currencies. For this back-to-school piece, I prepared a rear window post-mortem on each. Watch the video

The Year of the Trojan Fire Horse: China’s imbalanced economy and unrelenting mercantilism While there’s plenty of evidence to support Stephen Roach’s thesis of unsustainable imbalances in China’s economy, China is living up to anthropomorphic characteristics of this year’s zodiac, the Fire Horse, in at least one regard: bold moves, self-reliance, speed, action and innovation in the energy transition. Watch the video

I mean pretty as an adverb, as in pretty cautious on cyber risks, open and closed weight challenges to the frontier labs seeking to go public and some market technicals related to AI. Watch the video

Semiquincententacles: The US grip on markets on the 250th anniversary of the Declaration of Independence Behold the Aquilaceph, half-bald eagle and half-octopus. On the semiquincentennial 250th anniversary of the US Declaration of Independence, this imaginary beast is a metaphor for the continued US grip on financial markets. In this special issue we look at the details: US reserve currency status, capital flows, the much anticipated but still unprofitable “Sell America” trade, US corporate profitability and productivity in the age of AI, investing in Security & Resilience, equity market concentration, energy independence and the revival of the US IPO market. The biggest medium-term concerns for investors in US assets, other than the sustainability of the US Federal debt and cyclical inflationary pressures: the increased unpredictability in the rule of law, and government defunding of science and sidelining of scientific expertise. Watch the video

The new Fed chair Kevin Warsh, like Kevin McCallister in Home Alone, faces a lonely vigil: survive until the adults get home again. The latest on inflation, rising Treasury yields, shrinking equity risk premia and pressure from the White House. Also: investing in China’s home-grown AI ecosystem, and the predation in prediction markets. Watch the video