1/ Working on a thesis why interests rates may fall not rise.
-Warsh had to first establish independence, credibility.
-Trump's barometer is stock market.
-Stock market is heavily concentrated in Mag7-10
-Retail participation + retail margin debt at record in stock market..
Positive users praised the VC thesis on falling interest rates as clever for using uncertainty to cool markets without changes, while negative users criticized political recruitment of youth toward socialism.
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3/-Young people are being politically recruited to socialism + communism, anti-capitalism, anti-business, anti-America (and American allies)
-Of those young people heavily leveraged into a market at highs and concentrated in AI + tech names...
2/ -Long end of curve is driven by market and mortgages and gov Treasury issuance
-For first time: younger generation REALLY does not own homes, cars, etc
-For first time: younger generation (college grads) unemployment rate higher than general population
2/ -Long end of curve is driven by market and mortgages and gov Treasury issuance
-For first time: younger generation REALLY does not own homes, cars, etc
-For first time: younger generation (college grads) unemployment rate higher than general population
4/...May matter much more to the economy than transient 'inflation' from oil from Hormuz/Iran
...market is not really anticipating the effects of the potent cocktail combo of passive-indexes ($1 in = buy indiscriminately, esp market cap weighted; but $1 out = sell all the same) + margin debt + retail participation who own stocks not homes
...front end of curve seems higher odds to me personally of falling not rising...
more later
3/-Young people are being politically recruited to socialism + communism, anti-capitalism, anti-business, anti-America (and American allies)
-Of those young people heavily leveraged into a market at highs and concentrated in AI + tech names...
@wolfejosh He's using uncertainty as a tool to cool markets without moving interest rates. Clever...
@joshpeck @wolfejosh that makes a lot of sense