The Macro Minute with Darius Dale Why are crypto and commodities breaking down?
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Nov 19, 2025 The podcast delves into the recent breakdown of crypto and commodities amid early warning signs from the global liquidity cycle. It explores how asset classes hit hardest by liquidity stress are showing first signs of trouble. The discussion touches on the Fed's missteps, risk management strategies like KISS and Dr. Mo, and the implications of Japan's shifting bond yields on global markets. Darius highlights potential consequences of a tardy Fed response and the risks of rising hedging costs, painting a vivid picture of current financial dynamics.
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Liquidity Hits The Periphery First
- Liquidity ebbs hit assets farthest from the financial core first, like crypto and commodities.
- Darius Dale compares this to peripheral vasoconstriction where the system preserves the core at the expense of periphery.
SRF Stigma Is Amplifying Repo Stress
- Short-term funding stress and a muted SRF response are keeping repo rates elevated and tightening liquidity.
- Darius warns the SRF's stigma and operational frictions mean the Fed may not proactively supply needed liquidity.
Use Systematic Overlays To Manage Risk
- Prepare for a potential positioning unwind if the Fed continues to react late to market stress.
- Use systematic risk overlays like KISS and Dr. Mo rather than relying solely on fundamental research, says Darius Dale.