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2000, 2008 And… 2025?
US equities are down 10% from record highs and 10-year US yields are 50bps off their local peak.
So, stocks down, yields down. That's not an especially favorable conjuncture, as it pretty clearly suggests bad news is just bad news.
As a quick reminder, sometimes traders like a little bad news on the economic front to the extent cooler data tempers macro "overheat" concerns like those which predominated earlier this year, when rates priced out all but one 2025 Fed cut.
But if the bad news pile
What ever you do, don’t read news, it is scary.
Time to buy then avoid news and check back in 5 years? Good chance one will look like an idiot either way in the short term, but the AI story still exists unless Deepseek has legs. Not investment advice.
Where else are you going to park your money? Europe? China? I choose US.
‘he said. “Since an equity bear market threatens a recession, fresh declines in stock prices will provoke a flip in trade and monetary policy back to a ‘he loves me’ stance.”’
If this is supposed to be a prediction that Trump will fold on his tariffs, I’m firmly convinced that is a delusional assessment.
I think he’s dug in now. Trump has made it crystal clear that REALLY DOESN’T CARE about stocks or the economy or any of that shit. The only opinions that make even the slightest penetration into that hard shell pea brain of his are from the billionaires he met with in the “round table”, and they’ve made their feelings about it clear as well: “as long as we’re profitable and the deregulation promise is fulfilled, we’re just fine with sticking it out to see where this train wreck ends up (not to mention the tail quivering between their collective legs)
And lest we forget,Trump doesn’t need “the voters” any more. He no longer needs their services! And as we all know, he doesn’t give a damn about a single individual who voted for him anyway.
Trump is a stubborn child who would have to be dragged by his feet and put in the corner of his room before he behaves, but his would be parents on Capitol Hill are on permanent vacation and have no intention of exercising their parenting skills on the little monster. He’s the kid in the old Twighlight Zone episode who sends bad people to the cornfield if they don’t cater to his wishes.
Curious to see how Trump f***’s up the market rally today.
Bar sinister–because the line slopes from the lower left to the upper right–used to signify bastardy. This market’s a right bastard all right.
I am a “dreamer”- any chance all of this tariff nonsense ends up at global free trading?
I’ve been noodling something along these lines–an ultra-contrarian take where Trump’s administration winds up being the extreme end of the pendulum swing which snaps everyone back to their senses resulting in a long-term trend back towards democracy and away from authoritarianism.
It’s fun to think about, but I don’t think it’s the most likely outcome.
Bessent on CNBC:
“The market and the economy have become hooked, become addicted, to excessive government spending, and there’s going to be a detox period”
“There’s going to be a natural adjustment as we move away from public spending to private spending,”
[asked if “detox” was a euphemism for a recession] “Not at all. Doesn’t have to be because it will depend on how quickly the baton gets handed off,” “Our goal is to have a smooth transition.”
How quickly can US companies bring global supply chains back to the US?
I suspect that to build the factories, hire and train the workers, install enough automation to offset US costs, will take a decade or more, and require capex similar to what Megas are spending on AI, from industries that don’t have the FCF now (and certainly won’t have it in the tariff-burdened economy) and make maybe 10% ROIC in the best of times. They won’t even start trying in earnest until they have confidence and certainty on what tariff/trade policy will be over the coming decades, which no-one can have with Trump.
So how quickly does Bessent think the “baton will be handed off”? Many years? A few years?
It can clearly last long enough for the markets, economy, and voters to get nasty indeed. Probably “will”.
Bessent knows this. He’s probably thinking about his Plan B.
If markets start to believe Bessent’s brief baton-passing B-S, then US construction, factory automation, domestic supply chain names should start ripping. They are not, at least not the ones I’ve looked at. But worth keeping an eye on.
That’s for sure. (Speaking as someone who added to a long-held position in ROK after the election.)
The problem is that no CEO in their right mind would opt for a major expansion based on the ever-changing policies and diktats from the Whitehouse. It’s a much better idea to spend any free cash flow on share buybacks instead!
Breezy baton-passing . . . or Bataan Death March?