RiskReversal Pod Marko Kolanovic: Might is Right & The New Economic World Order
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Mar 18, 2025 Marko Kolanovic, former Chief Market Strategist at JP Morgan, shares his insights on the current state of the S&P and the dynamics behind its recent declines. He analyzes the geopolitical factors and US tariffs influencing market trends. The discussion covers recession indicators, corporate capital expenditures, and the implications of fiscal policies. Marko emphasizes the uncertainty in today's economy and the challenges that arise in forecasting market movements, particularly for major sectors like tech and consumer spending.
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S&P 500 Decline
- The S&P 500's decline was driven by a combination of factors, starting with tech concentration and speculative momentum names.
- Quantitative selling, triggered by volatility and technical levels, accelerated the drop, but fundamental recession indicators remain unclear.
Market Sentiment and Geopolitics
- The Biden administration's messaging about not caring about the stock market is surprising and potentially counterproductive.
- This contrasts with China's approach of actively supporting its market, attracting US capital.
Trade War Risks
- The current administration's trade policies, targeting major trading partners and allies, create significant economic and geopolitical risks.
- These policies' impact on the market and global dynamics raises concerns, particularly with China's and Europe's economic responses.