Nice summary of rates action yesterday from @arishisays.bsky.social

How it started vs How it’s going!

Rate Cuts? You have to say please and thank you!"

Powell’s opening statement reads hawkish! While he emphasizes that there is risk to both growth and inflation, for now they are focused on ensuring inflation expectations stay anchored! This means the Fed put is much lower!

SPX falling 5% and wiping trillions in wealth after they (mis)used ChatGPT to calculate the (in)appropriate tariffs for every country in the world (including those occupied by penguins and polar bears) proves...

Short thread on Waller's speech today. He set the bar for a skip in December is high! He gave three reasons

1 Rates are still above neutral
2 Inflation though not moderating, shows no risk of reaccelerating
3 Labor market has cooled but remains strong and the Fed doesn’t want it stay like that

R star estimates diverging from Trend growth. Really just looks like an over-fitted regression gone when the model is tested on out of sample data 😂

Here goes my first thread on Bluesky - we have a new Treasury Secretary!

Large rally in bonds to begin the week as the drama behind "who will sign the next batch of US Dollars" comes to an end. We will soon be carrying Scott Bessent's autograph in our pockets.

1/8

WSJ: In Potential Arrangement, President-Elect Would Select Warsh to Lead Treasury Until Jerome Powell's Term as Fed Chair Ends, and Scott Bessent to Lead NEC Before Replacing Warsh at Treasury

So

Fed Chair: Powell -> Warsh
Treasury Sec: Warsh -> Bessent

Not the worst picks Trump could have made.

Friends on the sell-side, as they finish their 2025 annual outlook knowing fully well that none of their assumptions will survive the first quarter 😂 👇

Hello 🌎