RiskReversal Pod You Say You Want An AI Revolution with SoFi's Liz Thomas
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Dec 16, 2025 Liz Thomas, Senior Market Strategist at SoFi, dives into the recent Fed decisions and their market implications, explaining the contrast between dovish actions and hawkish rhetoric. She discusses why Bitcoin hasn’t rallied despite increased liquidity, highlighting factors like leverage unwind and rising yields. Liz also addresses the significance of upcoming jobs data for Fed policies going forward. The conversation culminates in an exploration of the evolving AI landscape, identifying emerging winners and use cases as we head toward 2026.
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Fed Cut Felt More Dovish Than Expected
- The Fed's December action was more dovish than many expected because it cut rates and restarted $40B in Treasury purchases.
- That combination effectively added liquidity and acted like an extra 25bps of accommodation to markets.
Why Bitcoin Didn't Surge
- Bitcoin's weakness reflects more than Fed liquidity; leverage unwind and liquidity constraints weighed on crypto.
- Rising 10-year yields and reduced risk appetite also pressured Bitcoin and stocks despite the Fed's purchases.
Treat Regional Surveys As Noisy Signals
- Regional surveys like the Empire State Manufacturing print are noisy and erratic when viewed alone.
- You must average multiple regional surveys to see meaningful trends rather than overreacting to one release.