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Global Financial Markets

Sailing in the fog

Thursday, 06 November 2025, written by Edward Markus

With the longest government shutdown in history and Supreme Court hearings on Trump’s tariffs in full swing, the U.S. economy is sailing blind. We examine how political fog, rising debt and AI-fueled growth shape the outlook for rates, currencies and risk assets.

This report is published: Bi-weekly

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Previous reports

US economy likely stronger than expected

Thursday, 23 October 2025

The Fed fears that the prolonged stagnation in job growth will lead to lower consumption and rising unemployment. Is the US really that vulnerable, or is the economy stronger than expected?
 

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Inflate or die?

Thursday, 09 October 2025

Investors in precious metals and equities are increasingly assuming that central banks will prioritize economic growth over fighting inflation. However, once this path has been taken, it will be difficult to reverse course. This is very positive for gold and equities, but has the enthusiasm gone too far now?

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Risk from an unexpected source

Thursday, 02 October 2025

For the US economy and Fed policy, the big question is what will prevail: the deteriorating labor market or a number of positive forces? In any case, we suspect that investors are assuming too many interest rate cuts, which means we can expect considerable volatility in the equity, interest rate, and FX markets in the coming period.

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Eddy's Weekly Market Insight

Friday, 14 November 2025

Eddy's Weekly Market Insight

S&P 500 continues to bounce off the 7,000 threshold: Last week, we already noted that the S&P 500 seems to be pricing in a near-perfect future, something that rarely materialises in reality. This is especially true for stocks related to AI. While we do not deny that AI will bring many improvements, it is important to remember the vast amounts of money currently being invested in AI both in the West and in China. This is creating intense competition, which will make it very difficult for AI-related companies to meet the highly optimistic profit expectations. Moreover, it remains uncertain whether sufficient electricity can be generated in the future to power all AI-related businesses. In our view, this alone is reason enough to be sceptical about the high valuations of various AI companies, a sentiment that likely applies to many other stocks as well...
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— Edward Markus, Founder & Chief Economist