Simply Put

The AI buildout is becoming increasingly financed by opaque, off-balance sheet partnerships like the Blue Owl and Meta venture “Beignet” that supplement already-surging corporate debt issuance. Given the estimated $9 trillion that will be spent on AI infrastructure between 2025 and 2032, revenue would need to exceed 8% of GDP to give investors modest returns. In this episode, we talk with Stijn Van Nieuwerburgh, Professor of Real Estate and Finance at Columbia University, about projecting AI investment over the next decade, why it’s moving off-balance sheet, and the emerging sources of systemic risk. Simply Put: Expert perspectives on the trends influencing fixed income, banking, and the macro landscape, hosted by FHN Financial’s Macro Strategist, Will Compernolle. Tune in to better understand what’s moving the markets and what to keep an eye on in the weeks and months ahead. Listen and subscribe wherever you get your podcasts.

Market participants are growing increasingly worried that ballooning debt levels and high interest rates could precipitate a fiscal crisis in the US. Total federal debt recently surpassed $40 trillion and the government’s annual debt service payments exceed $1 trillion. Last month’s selloff in French sovereign debt shows how a sudden shift in perceived credibility can lead to a negative feedback loop of higher rates and wider deficits. In this episode, we talk with Doug Elmendorf, former Director of the Congressional Budget Office, about assessing the sustainability of federal debt, how a fiscal crisis could unfold, and what bond yields are saying about expectations for a balanced budget. Simply Put: Expert perspectives on the trends influencing fixed income, banking, and the macro landscape, hosted by FHN Financial’s Macro Strategist, Will Compernolle. Tune in to better understand what’s moving the markets and what to keep an eye on in the weeks and months ahead. Listen and subscribe wherever you get your podcasts.

Hedge funds have absorbed much of the recent surge in Treasury issuance and now own a larger share of the market than domestic private banks. Unlike other market actors that are less price sensitive and hold the securities to maturity, hedge funds engage in highly leveraged trades over short time horizons that, in turn, exacerbate episodes of bond market volatility. With Fed officials hoping to reduce their footprint in the Treasury market, policymakers could have a limited toolkit to mitigate any market dislocations during the next crisis. In this episode, we talk with Jonathan Wallen, Assistant Professor of Finance at the University of Michigan’s Ross School of Business, about how hedge funds’ rising share of the Treasury market increases market fragility. Simply Put: Expert perspectives on the trends influencing fixed income, banking, and the macro landscape, hosted by FHN Financial’s Macro Strategist, Will Compernolle. Tune in to better understand what’s moving the markets and what to keep an eye on in the weeks and months ahead. Listen and subscribe wherever you get your podcasts.

The prosperity promised by railroads in the 1800s caused unprecedented investment in the United States that eventually led to the Panic of 1873, the steepest downturn in the US up to that point. The amount of capital being spent on AI today has some wondering if we are likewise in the midst of a bubble about to burst. But as the American experience with railroads shows, a technology can live up to all its hype and still cause a messy and painful adjustment along the way. In this episode, we talk with Robin Wigglesworth, editor of the FT’s Alphaville blog, about the frenzied investment that financed 19th century railroads, the amount of debt being issued by AI firms, and what the railroad boom (and bust) can teach us about the AI buildout’s potential winners and losers. For a chance to obtain a FREE copy of Robin’s new book, A Fabulous Debt: The Epic Story of How Bonds Built the Modern World, email [email protected] with your name and address by September 25. Simply Put: Expert perspectives on the trends influencing fixed income, banking, and the macro landscape, hosted by FHN Financial’s Macro Strategist, Will Compernolle. Tune in to better understand what’s moving the markets and what to keep an eye on in the weeks and months ahead. Listen and subscribe wherever you get your podcasts.

As the pandemic-era shocks of federal stimulus and domestic migration fade, some states are looking for new taxes to increase revenue while others consider tax cuts to address affordability concerns. Proposed reforms for property taxes in Florida, income taxes in Illinois, and a wealth tax in California show how the differences in states’ tax environments are widening even further. In this episode, we talk with Katherine Loughead, Vice President of State Tax Policy at the Tax Foundation, about states’ fiscal positions in the post-pandemic economy, three significant changes to state taxes that could be in the pipeline, and rules of thumb for ideal tax policy design. Simply Put: Expert perspectives on the trends influencing fixed income, banking, and the macro landscape, hosted by FHN Financial’s Macro Strategist, Will Compernolle. Tune in to better understand what’s moving the markets and what to keep an eye on in the weeks and months ahead. Listen and subscribe wherever you get your podcasts.