The ACID Capitalist Podcast Acid Breath. Inside the Macro Storm: Fed Policy, TSMC Earnings, and the Next Credit Crunch
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Oct 17, 2025 Amidst choppy markets, insights flow about the sharp drop in the Philadelphia Fed manufacturing survey and Taiwan Semiconductor's record growth driven by AI. Hugh connects current auto credit stresses to past cycles, highlighting worrying indicators from companies like CarMax. Discussions on the significance of bond yields, potential Fed cuts, and the peculiar gold rally unveil deeper market signals. Through a cinematic lens, the podcast also reflects on historical parallels, offering practical advice against leverage and underscoring the necessity to heed market warnings.
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Bond Market As The Macro Compass
- The 10-year Treasury yield recently dropped below 4%, marking a potential pivot between 4% and 5% like in 2007.
- Hugh Hendry sees the bond market as a key signal for macro direction and liquidity shifts.
Manufacturing Index Shows Sharp Weakness
- The Philadelphia Fed manufacturing index plunged sharply, the steepest drop since June 2020.
- Hendry warns this volatility signals possible recessionary data ahead for manufacturing.
TSMC's Scale Powers AI Surge
- Taiwan Semiconductor reported blowout results with ~30% YoY growth and record margins, driven by AI demand.
- Hendry highlights TSMC's scale and neutrality as a powerful moat in semiconductor manufacturing.