Mining Stock Daily Barry Knapp and Why the Fed Under-Delivered in September
Oct 7, 2025
Barry Knapp, a macro strategist and author at Ironsides Macro, shares insights on the Federal Reserve's recent decisions impacting small banks and businesses. He argues that the latest rate cut fell short of effectively supporting these sectors. Barry also discusses the implications of a weakening labor market and how an increased capital expenditure strategy could be influenced by current economic conditions. Additionally, he explores the significance of rising gold prices in relation to global trade dynamics.
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Small Banks Suffer From Rate Tightening
- Small banks and floating-rate borrowers have borne the brunt of Fed tightening since September 2022.
- That stress has translated into weak small-business hiring and constrained credit supply.
Cut Rates To Restore Small‑Bank Credit
- Cut policy rates faster to reopen the bank credit channel and relieve floating-rate borrowers.
- Barry recommends cutting the policy rate by 100 basis points including September's move to restore small‑bank profitability.
Easing Quickly Boosts Bank Profitability
- A modest cut can quickly improve small‑bank ROE and banking-sector dynamics.
- Barry notes one quarter of easing previously lifted ROE materially and could do so again fast.