The Macro Trading Floor Macro Crossroads: What's Next For Markets?
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Jul 18, 2025 Alf and Brent explore the current crossroads for the economy, analyzing how recent trends are affecting the dollar and trading strategies. They delve into the complexities of the job market and bond dynamics, while also evaluating the impact of tariffs on fiscal spending and inflation. Discussions also cover the Federal Reserve's role amidst shifting policies and market uncertainty. Finally, they consider the potential global ramifications of upcoming Japanese elections and the prevailing bearish sentiment surrounding the dollar.
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Short-term Trading Beats Macro Now
- Short-term trading thrives while bigger macro themes have fizzled out, like tariffs and dollar selling.
- Policy favors elites and specific sectors, making macro predictions difficult.
Endogenous Shocks Drive Macro Trends
- Macro trends need endogenous economic changes, not just exogenous shocks like Trump's interventions.
- This sets the stage for possible stronger macro trends in the next 6-12 months.
Tariff Delays Cloud Macro Outlook
- Tariff delays create data lags, making clear macro regimes unlikely until fall 2024.
- Markets remain uncertain with known unknowns, making macro trend-following challenging.
