Markets Happy Hour Podcast with Aoifinn Devitt

In today’s Markets Happy Hour podcast we focus in particular on some of the other economies outside the US, with a look at how markets are reacting to the 7th Prime Minister in 10 years and ask who is the new “sick man” of Europe. Starting with what might be deemed to be inflation’s deep fake moment – the false dawn of June’s low number, we ask what is to come if oil price induced inflation breaks out in the second half of the year. The oil price is in now in overdrive, having surpassed $100 per barrel today, a sharp reaction to not only the reignition of the kinetic clashes in the Strait of Hormuz, but the report of low inventories on a global scale and a clear surging demand for energy has led to expectations of higher prices by the end of December. For the moment central banks have been minded to pause on interest rate hikes – a policy across the UK, the US and the ECB for now. Within equity markets the divergence of some sectors continues – although semi-conductors have recently given back some of their gains with a sharp reversal in momentum. Financials have been surging as trading volume and corporate transactions rise, while single stock volatility continues to be an issue after the IBM earnings report. We discuss other drivers of volatility such as the increasing level of retail participation in markets which seems to lead to exacerbated momentum. This is also a development in Asia – the exception is Europe, which has low retail participation and where the equity markets represent an ever smaller percentage of global volumes. While this is a sorry indictment of the state of the equity markets in Europe, it does mean that momentum stocks have been more volatile.

This week's podcast comes from a somewhat downbeat London after the exit of the England team from the World Cup semi-final last night. It was a tough loss - particularly poignant as the atmosphere had been so electric in London last night. Starting with inflation, the surprisingly low number in June reflects the fall in the oil prices, which continues to be very leveraged to geopolitical news. This is despite expectations actually being higher - per the headline from last week. The oil price is continuing to reflect the low inventories in oil, which are noted to be historically low. The expectation around interest rates is shifting as inflation shifts downwards, although based on the oil price sensitivity this could be premature. There is a fascinating rotation taking place in equity markets - whereby small-cap companies are seeing a strong underpinning of demand - even the negative earning companies. This suggests that there is an ability to see through the hype and to identify potential in smaller companies - at their early growth stage. Other notable trends include the financial sector which has performed exceptionally well as the volume of trading has increased and M&A activity. The economic outlook is bright with a smaller expectation of US recession probability - indicating a buoyant economic outlook sparked by lower inflation and strong earnings. The sharp drop in IBM stock was a telling development - as it was clear from their statement that they were experiencing consumers making choices away from their products in favour of AI expenditure. This could be a harbinger of other choices are likely to make, indicating that pockets are not unlimited and deep. The explosion of complex derivatives, including levered ETFs on single stocks is jolting volatility in markets such as Korea, and as the chart below shows the assets in such instruments have really grown.

In this second podcast of the week we are joined by Adam Berger, Multi-Asset Strategist at Wellington. Our conversation reflects on the fact that many of the current news items seem very like "deja-vu" - the tensions in the Strait of Hormuz, the spike in the oil price, the return of the heat wave. We cycle through our usual five topics and reveal some surprising points of view on inflation, as well as the risks in equity markets. The views expressed are those of the speaker(s) and are subject to change. Other teams may hold different views and make different investment decisions. For professional/institutional investors only. Your capital may be at risk.

**NOT INVESTMENT ADVICE AND DOES NOT CONTAIN INVESTMENT RECOMMENDATIONS" This week's Markets Happy Hour Podcast is a little bit different . . while we still bring you a market overview together with an outstanding guest, this time we are exploring how good some of the AI models are at picking stocks, building portfolios and deciphering equity market narratives. Guest Content Disclosure: This presentation was prepared by Jens Backes, an independent guest speaker, and reflects Jens Backes' opinions as of the presentation date. Moneta has not independently verified the information presented. For educational discussion purposes only. Not investment advice or a recommendation to buy or sell any security. Jens Backes is a former McKinsey consultant with an expertise in telecoms, based in Barcelona, where we recorded this episode. Since October of last year he has challenged 3 models plus his own Alphabot JB to pick 10 stocks to generate the best total return over 5 years. The results are intriguing. From Open AI's portfolio which has gone all in on every aspect of the AI value chain, to Claude which prefers to own tolls and not the road (whatever that means) each model has gone in its own unique direction and not all have beaten the index. We discuss what we can learn from these models in terms of persistence of market narratives and the unexpected winners that can come from such a highly concentrated portfolio. All examples are provided for illustrative purposes only and are not intended to represent all investment decisions or results achieved for client accounts. Client results will vary based on account objectives, restrictions, timing, fees, and market conditions.

In this week's Markets Happy Hour Podcast we are joined by special guest Roy Kuo, CIO of Galilei Investment Office, and we dive in to a sweeping discussion across global markets. Our conversation starts with a mixed inflation number, whereby consumer prices are driving the sustained inflationary level more than the energy prices, although as one of our charts shows, gasoline prices remain far stickier and less responsive to geopolitical news around the Strait of Hormuz. While jobs numbers continue to be a little sideways, the most recent employment number reflecting a small fall off in employment numbers, but when taken alongside the previous months positive numbers the effect is expected to be marginal. Mortgage rates remain high, which will put pressure on the lower end consumer, although Roy did not expect interest rates to place a stay on economic activity. Moving to equity markets we have just closed the strongest quarters for the Nasdaq and the S&P since 2020, while in contrast Microsoft has seen its worst month since 2020, and gold has seen its worst quarter in 13 years. We turn to the conversation around the frontier models and their relative role compared to the suppliers of compute as well as the proprietary layers, and reference a somewhat memorable recent CNBC appearance of Alex Karp of Palantir who has "said the quiet part out loud" when it comes to the tense relationship between the providers of the frontier models and the companies using them and supplying their data. We finish with another reflection on Alan Greenspan, as Roy's views on his legacy have changed over the years, as he notes. He believes that the damaging effects of the moral hazard created by the Greenspan put are continuing to be felt and that it is leading to a far more risk seeking type of market behaviour.

In this week's Markets Happy Hour Podcast we celebrate the life and times of Alan Greenspan, who died this week at the age of 100. His rich and multi-layered career in which he worked in multiple Presidential administrations and had a close to 19 year tenure as the 18th Chair of the Federal Reserve. The rich phenomena and quotes attributed to him deserve some analysis because of what they teach us about the fabric of markets and the tendency (or not) for patterns to repeat. The first thing to note is the collection of quotes attributed to him, which are in the slides for your viewing pleasure. He clearly relished and practiced the art of deliberate ambiguity in central bank commentary, and coined some pivotal terms, such as “irrational exuberance”. He presided over a relatively stable era, between recessions, in which the triple mandate of low unemployment, low inflation and a low 10 year yield were largely delivered, although there was a challenging “conundrum” towards the end of his tenure when the 10 year yield remained stable despite a steady bout of consecutive rate hikes (17 at one stage). He also gave rise to the Greenspan put, which may have reinforced the concept of “moral hazard” in markets – after 1998 traders believed that Greenspan would step in with monetary easing to steady the stock market. This has been hard to shake and as we saw subsequently in 2008 and during Covid institutions around the world remain ready willing and able to step in most times. The other Greenspan phenomenon was the calling of “irrational exuberance” in markets (pre LTCM in 1997) many years before markets finally cracked in 2000. This is a salutary reminder that markets can be irrational for far longer than one might think. Moving to today’s price action, the oil price has fallen to its pre-war levels, taking some of the sting out of inflation concerns and leading to a fall in the Euro as the pressure on European inflation fell. This echoes a similarly low print in the UK recently, where core inflation had actually fallen into line with the US. The expected rises in Apple device prices came to pass, reflecting a tightened supply of components and upwards pressure on prices. Bonds remained strangely sanguine, both in the UK where a change where the Prime Minister resigned on Monday and the heir apparent looked to be more to the left. The demand for SpaceX bonds was buoyant, particularly as a juicy yield had materialized and the 10 year yield fell in the US as the dollar jumped. There remains divergence in the jobs data alongside other economic indicators although the stock market has continued to sour on some of the Mag 7 stocks – now being referred to as the “Lag Seven). Another interesting data point this week has been the Korean stock market, which I refer to as potentially the “Korea in the Coalmine” as the heightened tech sensitivity in that market led to a steep sell-off by close to 10% earlier in the week. Other notable developments of the week were gold falling to an 8 month low (again reflecting the reversal of the debasement trade) and the fall in Bitcoin to below $60,000.

In this week's Markets Happy Hour Podcast we are joined by two-time guest Christian Abuide, who first appeared on this podcast in April 4, 2026. We start with a comparison of today's market conditions to April 4, 2026, which is quite interesting, given how starkly the narrative has changed with respect to the economic outlook, the outlook for rates and the concerns around geopolitics. This makes us ponder whether we do get distracted by what Kevin Warsh has described as the "echoes of history" expecting historical patterns to repeat, instead of today's nuanced circumstances to play out. We discuss the inflation pattern around the world, in which in the UK core has unexpectedly slipped below that of the US. The energy and food variable may well now start to be less pressing as the Strait of Hormuz opens, but this has not deterred the ECB from its recent rate hike. Meanwhile "poker face" Kevin Warsh gave nothing away at his first press conference and this has stacked the odds of a rate hike before the end of the year. The technical factors in markets continue to affect the performance of SpaceX and other shares, while gold similarly is in decline while the dollar remains supported.

Alison Taylor is a clinical professor in the Business and Society Program at NYU Stern School of Business. She teaches ethics, sustainability, and leadership courses to undergraduate, MBA and EMBA students. She holds senior advisor roles at KKR and Unilever, is an Ethical Systems collaborator and a Senior Advisor at Enlighten. She is also LinkedIn Top Voice, a member of the FT Moral Money advisory board and the author of the successful “Higher Ground” substack. We gathered together a salon of industry participants in London to debate some of the recent topics that Alison has broached, including in particular: The Shift in workplace culture, whereby Alison argues that "Your whole self was never the point". She makes the point that leaders now more often focus on the workflow and replacement of the workflow with new production functions. This raise the question: What is the economy for? And the erosion of trust? If we do not trust people, will we trust AI? We ask if we are in a Zero Trust economy? Or a depleted trust economy? The integration of AI into our workplaces and customer experiences is having an effect on how we behave and who we trust. We ask what are the broader/long-term implications of a zero-trust economy. Moving to the question of whether good governance is still in effect - we ask whether too much complexity – e.g. AI models, quantum computing, is eroding corporate governance. Our salon saw considerable discussion around the pace of change and adoption of AI, what is being lost or threatened in this process, as well as the challenges presented to employees.

In this week's Markets Happy Hour Podcast, which comes to you live from Dublin, we take our usual tour through market dynamics but take a detour into nature finance, thanks to our hosts in Dublin – Gresham House Asset Management Ireland. We discuss inflation that is moving incontrovertibly in the wrong direction (citing the recent 4.2% print in the US) as well as the shifting stance of Central Banks, which is firmly towards tightening now, with Japan expected to be next and the ECB not far behind. The jobs narrative has taken a stark turn, probably as much for PR reasons as anything else – with the AI IPOs fast approaching. This sits at odds with an increasing wave of anti-AI populism as well as angst regarding AI’s march, and we turn to the Gresham House guests to reflect on whether this same angst and populism is in evidence in Ireland and the EU more generally. We discuss the grid investments in Ireland, which may be lacking, as well as the current consumer sentiment, as it relates to inflation and AI more generally. Moving then to nature finance, we discuss the enduring characteristics of this asset class, particularly around inflation participation, long term investment characteristics, low volatility and return potential. We discuss investor sentiment, where the asset class fits in the portfolio and whether this will ever be an asset class suitable for retail investors.

In today's Markets Happy Hour Podcast - the second of the week - we have a fascinating conversation with Christie Townsend, long-time institutional investor (with the X/Twitter persona @ ROI Christie) with an audience of other senior allocators in Dallas. Our conversation is wonderfully rich - starting with inflation and the divergence between Main Street and Wall Street inflation and moving to the economic vibes with a focus on Texas in particular. As a pro growth state enjoying a real estate boom, and a shift in the percentage of state revenues that come from energy, "drilling in" to the economic vibes in Texas gives an interesting insight into the US more broadly - and we speak about a two speed USA. We have a particularly vigorous debate about policy safety nets and whether there are a good or a bad thing. We reflect on the policy intervention during Covid and the price that was ultimately paid for that - the spike in inflation and the K shaped economy that resulted. We move then to equity market momentum and the impact of FOMO and the analysis of the upcoming SpaceX IPO. We end with geopolitics and the role that this is playing today.

In this week's Markets Happy Hour Podcast - the first of two this week, we feature my Moneta colleague Cynthia Kirkpatrick for a "Conversation in Clayton". In beautiful Clayton we discuss our usual five lenses of the Markets Happy Hour Podcast with the perspective of Cynthia's private client base. This unique "view from Main Street" includes insights on inflation as it is being experienced by clients as well as persistently high mortgage rates (which are getting higher as the Fed seems stuck). We ask if these higher rates are deterring home sales or downsizing moves, and then look at the growing cash pile - as expressed by the soaring amount in money market funds - which now exceeds $8.3 trillion. This dry powder pile will essentially act as a backstop on markets as momentum and FOMO continue to drive flows. We do a quick consumer vibe check on AI before then moving to behavior around portfolio construction and time horizon. With thanks to JJ Kirkpatrick for the exquisite video work.

In this week's Markets Happy Hour Podcast we reflect on a short - and in many places - sweltering - week in markets that was punctuated with two bombshells from Italy - the pope weighing in on AI and humanity as well as the ridiculed Ferrari EV - Luce. Clearly everyone is in a race - to the top or the bottom remains to be seen. Inflation numbers in the US continue to be challenging and we show in particular how wages have continued to be under pressure – as real wages are ticking down across the board. This is particularly linked to consumer sentiment and we know that consumer sentiment has been particularly low in the US, so this is another indicator of prolonged pain for the lower end consumer. In other “vibe” checks we reflect on a suggestion that there are now fewer policy tools – such as policy put – available to any central banks as a way to calm markets. Looking at the massive boost in market caps across the board we reflect on the three new members of the $1 trillion club in Asia – Samsung, TSMC and SK Hynix, which have represented the bulk of the recent outperformance in Asia. Other equity market datapoints are the deterioration of the S&P dividend yield as well as the equity market risk premium raising the question as to whether investors are being paid to take risk. We touch on the latest funding round secured by Anthropic as it races to the finish line to its pending IPO. The arms race for funding rounds and to IPO is clearly picking up pace, and all US stock markets have moved in a surge of momentum. We end with a reflection on emerging market risks and note how the likelihood of downward GDP revisions has gone up while both inflation and policy rates are also likely to rise. This is all linked to the outbreak of hostilities in Iran and is yet more evidence as to how Asia and Europe have seen the brunt of the current war much more than that of the US.

in this week's Markets Happy Hour Podcast we do a quick whistlestop tour through the traditional balanced portfolio, since it is the traditional bond and equity allocations that are attracting all of the buzz right now. From bond markets balking at rising fiscal obligations to equity markets drunk on optimism the balanced portfolio is a schizophrenic one. The oil price has been moving in opposite fashion to the newsflow regarding ships and the Strait of Hormuz and given the limited positive newsflow about two China-bound tankers making it through in the past 24 hours, the oil price fallen. Markets have responded positively to indications of a deal in the near future although little concrete has been stated. Equity markets have also been boosted by the US administration's commitment to invest in quantum computing as well as the ongoing outperformance in revenues from companies such as Nvidia. The "sprint" to IPOs by Anthropic, Open AI and SpaceX signify the desire to capture the momentum of today's heady markets. New highs have been reached in markets and investors show no signs of backing down. On the other hand bonds have rarely looked less attractive, and there has been a widespread sell-off and desire to exit duration. These two counterveiling sentiments are in a tense balance as we await further news in geopolitics.

In today’s podcast we come to you from a conference room in New York City with a two guest roster fresh off an investment committee where we all play a role. I’m delighted to be joined by Jon Chesshire of Sindia Capital and Jesus Amadeo, CFO of MDRC. We gathered to discuss our usual five topics - reflecting on the fact that New York City, like other key metropolitan centers, is experiencing a higher level of inflation than the “national” rate across the rest of the country. This underscores the unevenness with which inflation is felt, and why every institution and investor needs to factor their own inflation experience into a return assessment. We move then to discuss the new Chair at the Fed, the fact that Susan Roberts suggested that persistent inflation might lead them to hike and not cut next, and pondered whether the new Fed Chair was likely to set a new direction - with fewer updates, signalling and telegraphing of intention. We ask whether this might trouble markets that are used to a more regular diet of communication from the current Fed. Might we need to wean ourselves off the relative certainty and approach of “no surprises” that the current Fed has promoted? We ask what a U turn in bonds would look like and stress that the economic picture is unlikely to be robust enough to absorb a change of direction. Turning to jobs, we discuss the relatively strong recent jobs picture in the US and note that wages have started to decouple from deflation again - being largely flat over recent months. Moving to equity markets we examine the earnings season like no other that is continuing to stun markets, not just here but also in Asia, and markets are exhibiting a very clear rotation from the Mag 7 names into the semi-conductor picks and shovels names in order to “follow the money”. Finishing with a look outside the US we ask what opportunities exist in countries such as China, which is growing market share significantly in areas like robotics, maritime engineering and advanced railway, and where the stock market is displaying similar exuberance. Even Europe has unearthed some gems in the semi-conductor and AI adjacent space, underscoring that not all of the tech action has to happen in the US, and that there is an abundant and maybe underserved market in Europe that might need attention.

In today's Markets Happy Hour Podcast, we are back in a salon-style session - this time live from Sydney on the eve of Tuesday's budget. Our special guest if Annette Beacher, investment manager of Hesta, an Australian Superannuation fund with over AUD$100 m in assets under management. This conversation is in the usual podcast format but we include data points and discussions of Australian economic fundamentals such as the recent third consecutive rate hike by the Royal Bank of Australia, and the inflation and led to it. We discuss the unique structure of the housing market here, the role it plays for consumers, and the state of the jobs market. We spend some time on the Superannuation system and the split of assets that most clients experience, the underpinning demand for Australian equities and the need to seek return abroad too, given the rising volume of assets in the mandated system. After a breakdown of the drivers of the Australian equity market snd a comparison with the AI and tech narrative driving the US indices we bring things back to local again by looking at the likeky contents of the next day's budget.

In today's Markets Happy Hour Podcast we are joined by Kristina Hooper, Chief Market Strategist of Man Group. a global alternative investment manager. In this role, she provides views and insights on the economy and markets.

In today's Markets Happy Hour Podcast, which we held "salon style" in Singapore with a diverse group of guests, we bring you highlights from our multi-faceted discussion. First we track the spread of the inflation epidemic into this part of the world - note the divergence from economies with inflation at a six year high (Vietnam) and economies where inflation has succumbed to longer term deflationary expectations - as in Japan. We track the inflationary changes - which are impacting the region - in some areas more than others and ask whether affordability is an issue. This leads to a question as to whether an markets have the same K shape as the US market, and whether inequality is likely to persist and impact consumer demand – just as in the US a small percentage of the population (10%) are responsible for 50% of the consumer spending. We discuss recent equity market volatility and the new highs just reached, then assess the latest news regarding GameStop and E-Bay, as well as the consulting ventured being pursued separatelyThen we move to what investors are underestimating about this region - and the swiftness and dynamism behind AI rollouts, healthcare advances, and building from the ground up particularly in China are noted. The recent blocking of Meta's acquisition of Manus highlights the perceived threats to national security as well as IP and the protectionist responses that this is inducing.

In today’s Markets Happy Hour podcast we reflect on more bumper earnings from tech stocks, discuss the semi-conductor sector that is making huge strides as demand seems to be totally inelastic and in fact growing, despite price rises. We ask whether it will soon be time to “sell in May and go away”? Starting with inflation it is interesting to reflect on how much sentiment and expectations affect the ultimate outcome – in Japan for example the memory of an extended inflationary era is quite raw, so there even though inflation briefly got over 2% it is already more subdued. The Iran war has had the opposite effect on European inflation expectations which are already heading towards 2.75% for the end of the year, having been lower for some time. In terms of the rising components of inflation food and oil prices continue to be high. The Fed guard will officially change soon but the outgoing Chair, Jerome Powell is staying on as a Governor, which introduces some stability. Expectations have sharply turned around in terms of rate cuts with a minority now expecting rate hikes this year. The fact that the Fed described inflation as “misbehaving” is rue to have struck a chord. Equity markets remain buoyed by solid earnings and certain sectors like semi-conductors in particular which are experiencing a meteoric rise quite similar to pre-1999. Other factors of interest include the weak performance of the Bill Ackman “best ideas” fund and the fact that Ken Griffin thinks that retail investors had a poor understanding of private credit. While this may be true, it is more likely the case that their advisors lost conviction, which raises a more troubling possibility that these investments were not taking place with the right level of portfolio planning.

In this week's Markets Happy Hour Podcast we are joined with Dr. David Kelly of J P Morgan Asset Management. Both of us are delicately negotiating stairs based on having run Monday's Boston Marathon, so we share our race experiences and - naturally - relate them to some of our market observations. The first of these is - "Beware the Downhill" - the Boston marathon is notorious for its long downhill section at the beginning and for the uninitiated, or undisciplined or the simply euphoric, it can be a damaging start - particularly to the quads. The second is pattern recognition - while 8 year consecutive runners like David can rely on the pattern recognition of the 130 year old course, in markets pattern recognition has been more difficult given the length of the upswings and the downswings are shifting to become longer, and shorter, respectively. The third is innovation - we discussed the appeal of products such as the super shoes as well as gel products - and while David prefers the unique marathon fuel of dense traditional Christmas cake (of the fruitcake variety) he does wear "super shoes" and does believe in making small changes designed to generate small, incremental improvements. And clearly they were successful for him in 2026. We move then to the question of inflation and the "landmark" analogy we have used of the Eiffel Tower - inflation tends to rise steeply and then fall steeply. David's view is that this is a temporary aberration in that the economy is not "inflation prone". We dig into this concept at little looking at the three factors that render the economy not inflation prone, and suggest that this leaves more leeway for interest rate cuts in time. Staying on the factors that render the economy not inflation prone, we discuss the waning power of labor and pricing power that workers enjoy, discuss how this translates into earnings, which have remained strong. We compare the resilient US consumer to the European consumer, and David suggests that there may be a case of a different mindset around austerity that applies in the US and Europe and certainly a different approach to spending. We cycle through equity markets dynamics, the validity of the rotation into the Russell 2000 stock market and other factors that have been underpinning the markets and end with a quick discussion of the current private credit dynamics, asking if the current concentration is really a concern, and likely to be a systemic problem or something that adjusts and plays out over time.

For today's Markets Happy Hour Podcast we gathered our first Salon together in London with six opinionated guests - for a fantastic discussion from AI to geopolitics to the UK real estate market. We had bulls and bears present, and cycled through our usual topics of inflation, interest rates, equity markets geopolitics and other asset classes. With the title "Paying it Forwards" we discussed consumers bringing forward expenditure as expectations of inflation rise, discuss the allure of equities amid the "debasement" trade and whether the current geopolitics are a real concern for markets - do they render them "different this time" or will it pass. We look then at the productivity revolution and ask where in the market cap spectrum the most productivity gains are likely to be felt. Turning to the concept of "resilience" we discuss a different kind of resilience this time - not simply market resilience, although a streak of 10 days positive market performance suggests that markets really are simply looking through the war. This resilience is the one that KKR describes as the "Resilience of Everything". We ask if this is a new trend or if markets and operators have always cared about resilience and security, particularly when it comes to energy, cybersecurity and security of supply chains. We end by discussing the real estate market in London and the dynamics that are prevailing around residential as well as office, and ask whether real estate will likely form a solid component of a portfolio diversification going forward.

In today's Markets Happy Hour Podcast we talk about two sorts of ships passing in the night - the ships that are stalled, or slowly passing through the Strait of Hormuz, as well as the Artemis II mission that will be shortly returning to earth - a symbol of persistent technological progress and pace towards a new frontier in energy extraction. Markets have come down to earth too as geopolitical risk has increased although since Tuesday's announcement of a fragile ceasefire have shown intermittent attempts at take off again - fuelled by resilient earnings and strong economic data. The inflation picture remains mixed - short term focused on transitory drivers, such as gas at the pump (up over 20% year to date) and the spike in oil and other supplies such as fertiliser. However the long-term picture is more muted and more in line with historic norms. This settling into long-term norms has also led to interest rates enjoying a soft landing too - with a new Fed chair on the horizon and the expected "points on the board" he seeks to score with an early concessionary rate cut (or cuts). Moving to the economic vibes we saw a stark rally in global markets in the aftermath of the cessation of escalation rhetoric. We ask whether the new normal is in fact the “new chaos” as markets have now normalized a rupture in the old world order as we knew it – starting with the new unorthodox foreign policy of President Trump and punctuated by Canadian Prime Minister Mark Carney’s “rupture” speech at Davos. This same chaos has been now the norm in oil markets and the movement in oil prices this week – which ranks with other dramatic oil price sell-offs in history, reflecting the real impact of these geopolitical tensions. Flows have told another interesting story about risk appetite. The US has been seen as a safe-haven, despite being one of the real actors in the current conflicts. We have seen a surge of flows into US assets including US treasuries and the US Dollar has essentially seen a recovery of its slump. The Euro has levelled out with its weakness. Meanwhile flows have continued out of emerging markets although there has been some parsing of the difference within emerging markets with some countries clearly more dependent on the Middle East for its energy supplies and these countries suffering accordingly. We cycle quickly through other trends in markets – the sustained underperformance of software, the surprising underperformance of defence stocks despite the increase in kinetic warfare and rising concern around trust and security around AI. This adds to the uncertainty around AI business models just as the increase in fund raising in this sector breaks prevous records.   We ask ultimately whether this breakdown of geopolitical trust and the need to reduce dependency on single sources of energy supply will lead to deglobalizing forces or enforce alliances between “middle powers” such as Europe. This echoes what is termed as the “energy trilemma” – the tension between energy security, energy affordability and energy Ending with private credit while much remains unknown about the nature of the contagion and underlying default rate across this segment the policy of “sell first, ask later” continues to apply, particularly in some high profile funds, and given that in the worst affected funds there has not been the same level of satisfaction or meeting of redemptions, which of course compounds the negative impression and the selling pressure. This has become a crisis management exercise at this point – a public relations quest to stem panic and shore up confidence and trust. Jamie Dimon’s recent statement on the matter suggested that the risk was not likely to be “systemic” due to the relative small size of the private credit sector, but he did continue to stoke concern.

In this week’s Markets Happy Hour podcast we are joined by special guest Christian Abuide, Christian brings an international perspective to our discussion, with more than 20 years’ experience managing multi-asset portfolios and asset allocation strategy for private and institutional clients. He is the former Head of Asset Allocation at Lombard Odier, where he chaired the firm’s Global Investment Committee with responsibility for investment strategy and positioning over CHF 200bn in assets. Our conversation is heavily grounded in portfolio construction and how to counter some of the current stresses in market where a hierarchy of risk is prevailing with investors forced to sift through the risks and rank them, acting to protect or participate accordingly. We start with the shift in inflation expectations and reflect how they have ticked up in 2026, driven by the geopolitical stresses, while they remain heading downwards in 2027. We reflect on how this has been a bad outcome for the balanced portfolio – with the traditional 60/40 portfolio seeing its worst month since 2022. One question is asked regarding how many investors still hold 60/40 portfolios at this stage, given the low return potential in bonds, particularly with a backdrop of persistently higher inflation. The conversation turns to oil prices and demand destruction and we look at a few examples where this is already taking place - such as in Malaysia where there has been a return to remote working in some sectors in order to save on fuel. Moving to the situation for government bonds we reflect on a few interesting factors in the bond market today – volatility seems to be low, while rates on government bonds have been spiking in countries such as the UK and Italy, as well as in the US over the past month. There is a discussion of the foreign holdings of US treasuries, which are continuing to see their own form of “demand destruction”, while recently government bonds have started to see a shift back into favour as the expectations turn to rate cuts once more. Equity markets continue to demonstrate their core fortitude with earnings doing the “heavy lifting” and noise such as the Space X IPO and a number Open AI fundraise indicating the strong underpinning of FOMO that is driving equity market flows.

In today’s markets happy hour podcast we host a group of investors in Washington DC, with representation across public funds, the buy side and industry bodies representing LPs and their interests. We start with our usual examination of inflation, and clearly the stealth mode and creep of service inflation as well as rising wages are continuing to press upon the consumer, while the stark spike in the oil price has now reached a crisis level for oil consumers outside the US. On the interest rate side government bonds are starting to fell “oily” – i.e. moving on geopolitical news and showing a gap out in all markets – relating to concern, perhaps, regarding government debt levels and fiscal guardrails. Speaking of guardrails, we look to where investors can look to diversify today epecially amid the lack of the safety trades working as they should c.f. gold and government bonds. We ask what is behind the flighty behavior in the quarterly liquidity funds – is it the clients themselves feeling jittery, is it financial advisers losing conviction around some of their erstwhile high conviction recommendations. One guest asked whether this stemmed from the mergers of mainstream institutional consulting firms merging with the private wealth channel, and some disconnect in terms of the communication of the use of such products? We ask then where rebalancing out of private credit and private equity will go? There are few options today given the current levels of valuations – but arguably the rotation trades will still be compelling. With thanks to our wonderful guests for allowing us such a robust discussion.

In this week’s Markets Happy Hour Podcast we are joined by special guest Richard Tomlinson, CIO of Local Pensions Partnership Investments, who brings a strong institutional investing lens to our discussion today. We obviously can’t discuss market events without the oil price moves as a starting point, and we start there, noting that the situation remains very fluid with prices spiking past $110 per barrel today. Equity markets are remaining relatively resilient to the price moves, which is somewhat surprising, as we can see the very direct impact that fuel prices have on the savings rate, and therefore the cushion against adverse conditions that consumers can maintain. Equity markets were less impressed by new messaging regarding the trajectory of interest rates, and while the US Fed maintained rates on hold, their telegraphing regarding current uncertainty and likely future rate moves, triggered a negative reaction. Otherwise traditional safety trades are not working as intended, and we distinguish in our conversation between maintaining shock absorbers in a portfolio and cushioning against shocks and building in far more long-term protections around something like Stagflation, which is now rearing its head not just in the UK where it has been a frequent interloper. Now that fund managers see this as a likely scenario in the near term we turn to the thought experiment as to what works when inflation is high and growth is anemic to stagnant. There are few obvious answers to this – although we do toy with the idea that defensive and staple holdings – the last bastion of consumer spending will remain resilient in this scenario. Our conversation takes a whistle stop tour through the UK and China – taking a view on their respective economic states of health, and then turns to analyzing the behavior of gold and short term government bonds as the uncertainty in markets continues to cascade. Our last word is on private credit and the nagging concerns that plague this market. Stay tuned for next week’s podcast which will be live from Washington DC.

In today's Markets Happy Hour Podcast we start "happy hour" early on Thursday morning, which is an essential disclosure - given the pace of newsflow affecting market expectations and trends in real time. We kick off with a discussion of the oil price shocks, and how oil has now for some months been the marginal responder to geopolitical news. We illustrate how much it moved in one day alone in response to a (later rebutted) assertion that some oil tankers were being escorted through the Straits of Hormuz. Inflation was - prior to the current oil shock - trending downwards and had been subdued both in terms of pressure from labour and from services, although there were pockets of concern that the next rate move - at least by the ECB - would be upwards following their current pause. Interest rate expectations have seen a significant U turn in recent days - suggesting that expectations around the effect of the current conflict would not be transitory. This has manifested as spikes in government bond yields - particularly the 2 year GILT and the US 10 Year Treasury. This is an interesting development as it begs that question as to whether these - supposedly - risk free assets are behaving like safety assets. It would seem not, perhaps it is because the overhang of currency debasement, rising fiscal deficits (only rising more with defence and war expenditure) and general skittishness that is preventing investors from fleeing to government bonds. Gold similarly has not been seeing many inflows - falling 2% over the last few weeks - since the outbreak of the conflict. Again, this could be due to unique factors driving technical levels in gold over recent weeks. In equity markets there has been volatility but no clear move down - indicating the level of assets on the sidelines that will be risk seeking as they seek to deploy cash. Certain markets such as Korea were particularly exposed to oil price movements, as we saw last weeks market movement there. Moving then to private markets, the current newsflow is certainly a distraction from the spotlight being shone on private credit and private equity. The nagging concerns persist however, with a concern around contagion from SAAS companies and their travails, a general lack of due diligence (MFS in the UK) and crowding in the general space. Our final comment is regarding AI and the current wave of interrogation that is facing that segment, which is around governance. The spat between the Department of War and Anthropic underscored the moral pivot points that will define the AI rollout and now that companies themselves are concerned about guardrails of their own systems, is an indication that reviews will be forthcoming.

We were delighted to be back in NYC for our second live podcast - joined by 25+ year veteran Jai Jacob. Jai overseas multi-asset and equity strategies and has built platforms that translate data science into practical portfolio decision. He speaks on modernization, customization and disciplined investment process in evolving markets. This special live podcast digs deeply into AI and investing, and Jai strips the discipline of investment back to 8 verbs e- Observe, Believe, Categorize, Qualify, Analyze, Rank, Weight and Commit. We go through each one and assess the different that AI will make, and explore areas where it might be less effective - such as in fiduciary oversight (can AI be a board member for example) and in creativity. We also tackle the problem of nurturing and training human capital and what that means for th next layer of ingenuity and resilience.

In today’s Markets Happy Hour Podcast we discuss the unfolding geopolitical events that are impacting markets and are joined by special guest Ryan Boothroyd. Ryan is Head of External Manager Research at Border to Coast Pensions Partnership a pool of over £100bn which manages the assets of 18 UK local government pension funds. He is responsible for the management of over £20bn of funds across equities and credit. Our conversation starts with the recent jumps in inflation, which are bucking a trend of steadily declining inflation that we have seen in recent months. Just as headline UK inflation seemed to be showing it was coming closer to 3% we have seen a spike in food price inflation to 4.3%, while European inflration rose to 1.9%, up from 1.7%. These inflation pressures are likely to be more intense due to rising fuel prices, and Ryan discusses the more general pattern that we are seeing in inflation more generally. While some headlines describe this as a “phony inflation scare” due to the immediate circumstances, it is certainly true that they are likely to increase the strain on the consumer, which is already showing some stress. Moving to equity markets, we discussed the immediate fallout from the war in Iran – a fall in gold, US Treasuries and emerging markets – particularly the Kospi, which is particularly exposed to imported oil, while the USD and US assets were broadly winners, as well as oil of course. We look back at some of the experience from recent history in which market downturns had been more pronounced than the current drawdown, but ask whether this is because the current geopolitical shock had the clear shock absorber of the boon in AI and tech stocks to support it – as indeed it has propped up most of the economy and markets for months. Moving to AI and the current state of investor thinking we reveal the divergence of outcomes that investors are currently grappling with and ask whether it is possibly to modify one’s exposure in reaction to this. We conclude with a discussion of private credit and the current negative tailwinds there. Tune in to our second podcast of the day later when we hold a LIVE discussion in NYC with Jai Jacob, a 25+ year veteran and have a particular focus on AI and investing.

In this week's Markets Happy Hour we discuss the long winter that has descended on the East Coast of the US and the ongoing chill and flurries of anxiety and activity that we are experiencing in markets. We suggest with the new injection of volatility in the aftermath of the US Supreme Court striking down the tariffs imposed under the International Emergency Economic Powers Act (IEEPA) are in at 6:3 decision. This uncertainty is continuing to unsettle markets which are already coping with the rupture that AI is continuing to create in market expectations. This week was a particularly busy one for this kind of existential thinking, between the continuing fallout from the SAAS-apocalypse as well as well as more contagion. Much of this was due to the 5000-word viral Citrini research piece, has started to cascade through financial services and beyond. We parse this, as well as two other pieces of critical newflow – the standoff between Anthropic and Pentagon with respect to the use of its models in citizen surveillance as well as autonomous weapons, and just overnight the announce of Block cutting 40% of its workforce as it pivots to a more lean business model. Block’s announcement was met by a surge in the stock price. So will it be a sign of things to come? Nvidia’s earnings were blowout, but not that well-received given the already fraught mood in markets. Moving then to private credit we note the “winter” that has descended on sentiment there, which awkwardly is coinciding with a full throttle advance by that segment into the burgeoning private wealth (and retirement savings) business. Clearly a time to be highly selective. Finally the recent fallout for Bitcoin seems to have levelled out somewhat and we analyze this hints at a “floor” or simply a broadening of the depth. Don't forget to tune in next week to our live event in NYC - we will be featuring multi-asset specialist Jai Jacob for a special discussion on AI. Details here.https://www.eventbrite.com/e/1983274102228?aff=oddtdtcreator

Full episode: INUNDATED linked below https://www.youtube.com/watch?v=fWxIlGvENsQ&t=101s

Full Episode: INUNDATED linked below https://www.youtube.com/watch?v=fWxIlGvENsQ&t=10s

In this week’s Markets Happy Hour Podcast we deal with the inundation – both literal and metaphorical that markets and populations are contending with this week – whether the flooding of the zone with newsflow and the actual inundation with rain and snow and parts of Europe. We kick off with apparent evidence that inflation continues to ease – particularly in the case of the service component which is now lower. This could, of course be a further indication of the waning power of labor and indicate the source of some of the consumer discontent we highlighted last week - all in all though, inflation is subdued in major developed markets, and in the UK in particular, there was a surprise drop to 3%, leading to heightened expectations of a near-term rate cut by the Bank of England. Returning to the “calm” in fixed income discussed last week, we again refer to the diminished volatility in fixed income markets, as well as the record tight investment grade spreads, which are back to levels not seen since before the 2008 crisis. Equity markets continue to be a model of “rotation” in action, as well as shifting investor sentiment away from lavish AI expenditure. The rotations that we discussed before are in evidence still - growth to value, Mag 7 to the other 493 stocks, and from US stocks to Asian and European markets. AI expenditure is continuing to get scrutiny - and the Apple example is held up as an outlier, whereby the company has preferred to outsource its solutions to other companies while waiting on the sidelines when it comes to its own spend. We end with a discussion of geopolitics, and ask whether the same inundation that we discussed at the beginning has led to investors capacity to understand and digest developments, particularly those as severe as the building tensions between the US and Iran. We do a brief thought experiment on what this could mean for markets were it to intensify . . clearly the oil price would be affected, but it might rattle anotherwise jittery set of investors.

In this week's Markets Happy Hour Podcast we ask where is the love? As Valentine's Day approaches, it seems that consumers, and investors themselves are not displaying a whole lot of love for the AI and tech stocks of which they had been quite enamored not long ago. There is, similarly, a bit of a shift away not only from them but also the US as a market, as other markets such as Japan and Europe start to show their relative strengths. In the discussion of inflation we reflect on soaring food prices and how – in the US at least – this has started to affect footfall and spend at restaurants such as McDonalds and Burger King. There has been a shift in the spending from restaurants towards grocery stores. We move from discussing the K shaped economy to a new concept that Alex introduces – the W shaped economy, in which there are two key segments – those that shop at Wholefoods and those who shop at Walmart, each of whom are struggling in their separate ways. This vibe check notes the recession in consumer confidence and the fact that the labor market is no longer putting as much pressure on inflation. Interest rate expectations have moderated again, as markets have digested the announcement of the next Fed Chairman, while fixed income volatility remains very low relative to its history. Moving to equity markets, the calling cries of markets are of a US tech detox and the continuing rotation into European tech, Japanese equities value from growth and sectors such as infrastructure and financials. This is all occurring against a backdrop of “sell now, see later” whereby AI automation threats are cascading through different sectors – first SAAS and now wealth management as new intelligent tools are released at a fast pace.

In today's Markets Happy Hour Podcast we digest another busy week of market movements, economic data, momentum shifts and shifting expectations. We start with the surprisingly low (and under control) inflation data from Europe, where Eurozone inflation came in at 1.7%. This has led to the ECB maintaining rates on hold and Christine Lagarde suggesting that the Eurozone is in a “good place” (at least with respect to inflation), and similarly the Bank of England kept its rates on hold at 3.75% although did hint at a further cut later in the year (its inflation had surprised on the upside in December at 3.4%). Turning to the economy vibe checks, it is interesting to see that there remains a divergence between customer's actual experience (trending downwards) and expectations (low and remaining low), as actually expectations have never really been too elevated, despite the foaming at the mouth that has occurred by onlookers of the "red hot" economy. Employment numbers have been weaker than expected, while expectations are weaker still, so there is definitely a cloud hanging over the K shaped economy, especially as the oil price gets higher on geopolitical concerns, which could drive pump prices. All eyes remain on the putative Chair of the Fed, Kevin Warsh, and there has been some vacillation around his expected positioning. It is clear he is in favor of a smaller Fed, with a shrunken balance sheet, but his positioning around inflation is less clear. Is he a hawk and mindful of inflation - or does he not consider it important - as calculated by economists anyway. The answer to this question could dictate his positioning around rate cuts and for now, he is a bit of a challenging study. The initial expectation that he would be hawkish (another Volcker?) sent the dollar higher and other assets into somewhat of a tailspin this week. Gold and silver were particularly hard hit, with both falling precipitously, silver more than gold. This may have been due to technical factors such as silver being essentially thinly traded, but either way it was spectacularly bad timing for an asset class that had been recently driven upward by a large degree of retail buying. Bitcoin had an even worst trajectory - and has now fallen back to its pre-election levels, below $70,000 as we write. There is no particular fundamental reason for this, although it is clearly a risk-off trade, and it could be an indication of the risk aversion coursing through tech exposures currently. Finally turning to tech stocks, the focus on capex after the Alphabet earnings call indicates that investors are increasingly scrutinizing capex to see if the expenditure will be justified. There is more skepticism regarding tech stocks broadly, particularly after the staggering revelations about Moltbook, a social network for AI agents. This perhaps sent a chill - a reminder that the pace of advancement in AI has been rapid, and perhaps that it has got ahead of our ability to control it. More skepticism ensued. The fallout from this skepticism was a rise in rotations - from growth to value (value has outperformed growth for the last three months, from tech stocks into smaller and mid-cap stocks and out of the US into non-US equities. For clients with a broadbased portfolios this will be rewarding.

In this week's Markets Happy Hour Podcast we cover the post-Davos week, which, as is now typical has been filled with newsflow, most recently chatter regarding the pending appointment of the next Fed Chair. As we go to print it seems likely to be Kevin Warsh - a current Fed Governor, one of the youngest, and considered to be an "orthodox" pick, given his existing reputation as a Fed Governor and expectation that he will not be necessarily a channel for political preferences. The recent Fed decision to leave rates flat was difficult to parse - as the message was essentially more of the same. There is clearly a mixed message in terms of jobs, the perception of jobs being plentiful and being hard to find are now roughly the same – so clearly no big gap as there was post Covid. The employees in tech industries are flat to trending lower despite revenues and capacities soaring – this points to productivity gains and will continue to matter for jobs. Other equity market sectors have diverged, there are some indications of saturation points being met in certain areas of tech – there is a fall and stabilization of TikTok users, while Apple (which has had a mixed AI launch) has had a set of 8 consecutive weekly declines. Other sectors such as “gridTech” – a new sector coined by Bloomberg – which contains a basket of companies exposed to the pick-up in investment in the electricity grid. It is notable that this, as well as the utilities index more broadly have not generally performed as well as other equity sectors. This latency is interesting – as clearly the one broadly accepted truth is that more electricity will be needed going forward and that this will have to be met from all sources, including solar, which has accounted for 61% of the increase in electricity demand in the US. The performance in precious metals has continued to define the risk off appetite from time to time – with gold moving to a record $5,500 per oz, and US markets considerably weaker compared to the gold. There is some indication that Chinese retail holders of gold have peaked considerably pointing to the potential for some speculative interest there and the potential for more volatility. Silver, similarly, has seen a stark ascent, as well as sharp intra-day volatility just in the past week. The podcast ends with a comment on the use of precious metals in a portfolio and the role that they play.

In today's Markets Happy Hour Podcast we conduct a "review" of the drama (and at times melodrama) that has played out at Davos this year, and digest what it has meant for markets. We are joined by CIO and founder of Vistamark and former CIO of the consulting firm Fiducient - Matt Rice, who works with institutional investors and shares his insights on market dynamics and portfolio construction. Starting at our usual starting point of inflation Matt shares his view of the long term deflationary impact that AI is likely to have we touch on the impact of the oil price weakness that will in the more immediate term depress prices. Turning then to the economic "vibe check" we note the sensitivity of equity markets to the prevailing geopolitical drama around both the rhetoric on Greenland as well as the on-again/off-again tariff announcement on European countries. The uncertainty over recent days has been reflected in equity markets, which clearly still show some sensitivity to geopolitical risk, and the ascent of metals continues - clearly reflecting a risk aversion and a concern about currency debasement. Oil, on the other hand, remains flat - reflecting high inventories and only some sensitivity to geopolitical news (in this case the news from Iran). Moving to other sources of risk, even Secretary Bessent has attributed some of this week's weakness in US equity markets to the dramatic movements in the Japanese long dated government bond market over the past week. In what may be Japan's Liz Truss moment (echoing the weakness in UK markets which ultimately led to the downfall of Prime Minster Liz Truss towards the end of 2022). In recent developments the Japanese 40 year bond yield had surpassed 4% for the first time, while the 30 year bond had never suffered such a large drop in a single day. In our discussion Matt suggests that this correction was well overdue and could be the canary in the coal mine for other economies with high levels of government debt. We end our discussion with a reflection on Europe, firmly in the cross-hairs now at Davos, and remind ourselves of the positive impact on European defense stocks that has been a direct response to the challenge from President Trump, as well as on some of the other areas said to be trailing (IT infrastructure) as well as "financial plumbing".

We started the year with some chilly weather, some American football inspired blocking and tackling and a tech challenged yet warmly engaging live podcast in New York. The video and slides will follow next week, but for now please enjoy the audio. In front of a live audience we discussed the inflation picture, the delayed transmission effect of tariffs and the ongoing disconnect with consumer's price experience on the ground. We examined the market reaction to the announcement last week of a criminal investigation into former Chairman Powell. The decisive push back, via video recorded by Chairman Powell, seems to have been viewed as a form of checks and balances working as they should, and, as ever in recent years, bond markets have reacted calmly, being decidedly unbothered. Equity markets have been somewhat lack luster this week, coming off the prevailing uncertainty in geopolitics and domestic checks and balances, but the US market still stands alone in having experienced few "flight" events in recent years - a flight event being defined here as a simultaneous fall in equities, bonds and currency. This underscores the sense of "might is right" that dominates not just in equity markets but also - now - in geopolitics. We discuss some of the tangential effects of the recent rhetoric around Venezuela and the importance of military power. We examine whether this is galvanizing efforts in Europe to join forces, as well as within other trading partners - namely China, which is seeing its largest ever trade surplus.

In this week's Markets Happy Hour Podcast, we are joined by Alan Dunne, founder of Archive Capital, who has written a recent white paper on the regime adaptive portfolio. It is a particularly appropriate topic given the heightened discussion of regime change that we have seen over the past week – both at the level of a specific country, as well as at a broader level as a new form of foreign policy is now emerging, fairly unprecedented its scope. We start our discussion by reflecting on the likely impact on the oil price that the Venezuelan situation may have – so far the impact has been muted, and an increase of supply should – according to traditional metrics, lead to lower prices. The mixed signals that inflation is sending – lower oil prices on the one hand – continuing pressure on services on the other is also being noted by the US Fed, and the latest minutes of their most recent meeting underscore the divide that is in place there. Moving to the outlook for interest rates, Alan underscores the mixed data facing the Fed as well as the rising fiscal burden and concern about central bank independence that defines this regime as different from the last one. Equity markets remain robust, particularly according to market commentators in the US, but we ask whether it is likely to be a 1995 or a 1999 in terms of market outcome, and we then proceed to examine the sectors that are most likely to offer diversification and resilience. Alan then sets forth his thesis on what a regime adaptive portfolio should look like. We discuss the characteristics of the current regime, how different asset classes are behaving and the role that traditional diversification will play.

In this first Markets Happy Hour Podcast of the New Year, we reflect on the dark turn that many of the “Year in Review and Look Ahead” commentaries took over the traditionally slow period between Christmas and New Year. Some of this related to the new financial “nihilism” and not only was there a Wall Street Journal on the topic but an X post describing a degenerate generation attained over 20 million views. This suggestion that Generation Z is increasing opting out when it comes to traditional professional paths and paths of wealth creation and are opting to “bet the house” to aim for large and outsized gains, hence the increase in gambling and betting, such as Kalshi and Polymarket. This suggestion that there is divergence in terms of meaning and wealth creation is also a subcurrent of one of our themes for 2026, which is a theme of “enough”. Equity markets have ended the year on a positive note, although recent sharp sell-offs in silver after the margin requirements were altered by CME have been a reminder of the volatility that has now become a feature instead of a bug in markets, and another reminder of the perils of leverage. We discuss some positive news in real estate which shows how some real estate is becoming affordable due to overbuilding as well as the technical factors that baby boomers will be downsizing at around the same time that many Gen Z buyers are (belatedly) preparing to buy their first home. This may make affordability fall within reach for some, and is a welcome antidote the common doom-laden refrain about housing being out of reach for an entire generation. Financials have had a strong year and the top 6 US “too big to fail” banks now top $2 trillion, with JP Morgan representing one third of that. Similarly green energy has had a surprisingly strong year despite the headwinds presented by the Trump administration, as the demand for energy and electricity has been so high. In a final sweep through other asset classes we note how the Bitcoin Treasury frenzy has died down given the volatility in Bitcoin. As we have done before we compare it to other diversifiers such as metals – and note that the drivers for using these diversifiers is actually quite different. While metal purchasers may be driven by greed, it may also be fear – fear of currency debasement, fear of rising fiscal imprudence, lack of trust in traditional assets. Bitcoin, on the other hand, is driven more by greed than fear, particularly as it is still not a universal store of value.

This week’s Markets Happy Hour Podcast comes to you the day after Christmas and is the last of 2025. We ask whether in what often seems to be a season of plenty – we are about to enter the year of “enough”. Will 2026 be the year when consumers declare that they have had enough of the productivity enhancements that technology – and particularly AI – can bring? Will they have had enough of price rises and vote with their feet accordingly? Will affordability become the new siren call? Will they have had enough tokenization and cut some of their streaming subscriptions – again hearkening back to affordability? Consumer spending data continues to underscore the sharp K shaped divide – with over 50% of consumer spending in the US coming from only 10% of the households. This supports the fact that thus far in this cycle, the struggles of the consumer at the lower end of the spectrum don’t move markets. Markets buy what they know. Most market participants come from the upper earning end of the spectrum. Other trends of note in the markets as we near the end of the year are the strong contribution of cyclicals and the fact that Asian markets have actually outperformed US and European equity markets year to date. Flows into ETFs are at record levels, and now are approaching $60 trillion in traded value with over $1.5 trillion in flows and over 1000 ETFs launched in 2025 alone. While this data does not differentiate between active and passive ETFs the majority of ETFs are passive (90%) which suggests that the flows into passive investing remain extremely robust. Meanwhile Gold is on a trajectory to have its best year since 1979, having hit records on no less than 50 occasions this year alone. The year has been framed as a “defining” one for metals. The dollar, on the other hand, is set for its largest annual drop since 2017.

In today’s Markets Happy Hour Podcast - our last before the Christmas break, we ask ourselves how happy markets are feeling in this market are joy - and the answer is, well, a touch of Bah, Humbug. We first start with the surprise drop in UK inflation which may well serve as a welcome Christmas treat for the UK consumer. With inflation now coming in at 3.2% in the UK (and US inflation expectations of closer to 3.1%) could it be that the UK has slayed the stagflationary beast of Christmas past? The Bank of England is poised to cut rates today to 3.75% (from 4%), just as the US did in early December and current expectations in the US are around one further rate cut in 2026, although it is quite clear that there could well be more if the new Chair decides to start with a splash. Despite this lower inflation and recent rate cut, the consumer remains hyper focused on inflation and affordability, which continues to hurt consumer sentiment and has become elevated to a live and real election issue. Markets have been unsettled recently despite clear signs that commentators and strategists are bullish, and investors too, evidenced by the flows into equity funds and the fact that cash levels have fallen to recent lows. This is somewhat surprising given the still meaningful return on cash and it is in sync with the broad optimism that are seeing in the now ubiquitous 2026 outlooks. The wrinkle in this optimism is the recent skittishness in equity markets just in the last few days, most of it traceable to AI concerns, and we discuss the unease around Meta’s “turbulent” AI trajectory, which has led to it underperforming some of its Magnificent 7 counterparts. In fact, if we look to the breadth of the Magnificent 7 Counterparts and how they have performed year to date it has really been Alphabet and Nvidia that have been outliers, as the chart below shows. Tesla has had the most negative sentiment, probably due to some unique leadership and market factors, but even the other stocks - despite dominating the newsflow - remain bare round trips year to date. We look at some of the change in sentiment around China, which has seen a fascinating U turn of its own - having gone from “uninvestable” in the aftermath of rising trade tensions, concern about regulatory overreach and concern about a precarious retail sector. While fund managers assiduously removed China from EM portfolios - creating EM ex China strategies, behind the scenes something was changing. This came to the fore during Covid, when it was apparent that surveillance and technology in China had reached sophisticated levels, but also the launch of Deepseek sealed the impression that there was a giant emerging in not only AI but also EVs. This has now dawned upon investors and it has been not lost on them that Chinese stock markets have started to really resemble technology sector developments and could be a real play on technology - but maybe a questionable diversifier to the US, which is also, itself, a play on technology. It has also been a time of turbulence in geopolitics with governments in Europe now openly speaking about the threat from Russia, and President Trump imposing a blockade on Venezuelan oil. This has already been reflected in the oil price and is likely to be a fairly contained regional skirmish, but it is nonetheless yet another piece of flooding of the zone, which will make 2026 hard to navigate. Moving to other asset classes we reflect on the fourth annual loss for Bitcoin, although it significantly lower than previous annual losses, but ask what this means for risk sentiment broadly and the likely behaviour of this asset class. We reflect on where portfolios may sit now that we are at the end of 2025. Clearly equity markets have done well and we do now see breadth creeping in, not only to markets themselves but also by investors seeking to diversify into other cap sectors and other asset classes. Bonds remain expensive, so are less interesting as return drivers, and we continue to stress diversified (global) equity exposure as strong growth drivers as well as infrastructure and real assets, which build in both diversification and inflation resilience. Finally, we wish all of our listeners and followers a wonderful holiday season. See you on December 26th for our next episode, and thank you for your support in 2025.

Today’s Markets Happy Hour Podcast is recorded live in St. Louis, just ahead of the holidays, and features a wide-ranging and candid conversation with Stephen Douglass, Chief Economist at NISA. We begin with an economy “vibe check,” exploring the growing disconnect between headline inflation data and lived experience. From partisan consumer sentiment to the K-shaped reality facing households and businesses, we discuss why inflation still feels very real for lower-income consumers even as markets remain buoyant. We then turn to monetary policy, unpacking the high probability of a near-term Fed rate cut, the concept of “risk-management cuts,” and how the Fed is balancing downside labor risks against renewed tariff-driven inflation pressures. We compare the US outlook with other major central banks and ask whether policy rates may now be flatter — and higher — for longer than markets expect. A deeper dive into fixed income follows, focusing on why bonds are behaving unusually. Despite tight credit spreads, all-in yields remain attractive, raising important questions about portfolio construction, liquidity, and the growing fragility of the Treasury market as supply rises and traditional sources of demand wane. From there, we explore the K-shaped economy across multiple dimensions — consumers, corporations, and capital markets — including why large firms continue to add jobs while small businesses shed them, and what that means for the resilience narrative. We spend significant time on private credit, examining where stress is building beneath the surface, the rise of PIK interest and “extend and pretend” dynamics, and why headline default statistics may understate the true level of risk. This leads naturally into a discussion of private equity, venture capital, and whether the current wave of retail democratization is well-timed. Turning to real estate, we assess surprising shifts in vacancy rates across industrial and residential markets, alongside emerging shortages in top-tier office space. We also touch on data centers, infrastructure demand, and the energy and power implications of the AI build-out. Finally, we tackle equities and AI, discussing valuation concentration, bubble dynamics, and why timing matters as much as narrative. We close with a sobering look at US fiscal sustainability, the limited policy levers available, and what all of this means for investors as we look ahead to 2026. As always, the conversation ends with a clear focus on what these macro crosscurrents mean for real-world portfolios.

Today's Markets Happy Hour Podcast is live from Miami, and was kindly accommodated by the ALTSMIA conference in Miami. We start with a discussion of an economy vibe check where one guest describes a basket of identical goods being tracked from Whole Foods, which is up a whopping 30% year on year - significantly higher inflation than is being reported in the data. We turn then to the seemingly high probability of a US rate cut this week, and compare the trajectories of other central banks, which, interestingly have been thought to have reached a bottom in terms of rates again after some stabilization. Moving to equity markets we reflect on what our expectations were at the beginning of 2025, and whether the concept of resilience to threat is going to be "forever" or whether we should still be mindful of cracks that can be seismic to a sector such as banks or private credit. We look in particular at real estate and some of the bright spots (e.g. London office) as well as the warning signs - e.g. vacancy rates ticking up in residential and some areas of industrial. We also examine some stats regarding private equity and venture capital returns and ask whether now is the right time for democratization.

In today's Markets Happy Hour Podcast we were delighted to feature David Miller, Director of Investments at Conficap based in Finland. David is a long-term commentator and markets expert, having spent years as a portfolio manager, most recently at Quilter Cheviot in London. He has written a regular market newsletter for many years, and currently it is called "Northern Lights" - always a stimulating and riveting read. We start with our usual analysis of inflation, and David shares his insights from a low-inflation, relatively high tax jurisdiction, and we return to the US analysis of wage inflation which shows that lower end earners have seen their wage inflation trail that of higher earners, which only accentuates the K shaped inequality in US markets. We move then to interest rates, and the consolidating probability around a rate cut trajectory in the US, and compare it to the current viewpoint in the Eurozone, where the risk of overheating is significantly different. We turn then to the somewhat unusual behavior of bond markets, whereby long term government yields remain elevated, even in Japan, which indicates a shift that has not been seen for decades. We reflect on the reasons for this shift - suggesting that it shifts the definition of government bonds as a risk free asset, but by the same token also presents them as reasonable ways to generate a yield, while inflation remains subdued. This may alter the use case for bonds as investors learn how to price in the looming fiscal problems with developed economies. Coming to equity markets, there has been a spot of indigestion in the US in the aftermath of a volatile but ultimately flat November and the declaration of a Code Red by Open AI as it downs tools to focus on its core models, sensing encroachment from Google and others, has only sparked more concerns of cracks in the AI ediface. Earnings present a robust picture with the virtually all sectors displaying a high percentage of components beating expectations, and healthcare at the top of the list. This is positive news and suggests there could be a broadening of market strength beyond the concentration that has been in place year to date. The flipside of this positive story has, of course, been what strong earnings mean for corporate costs, and what this in turn means for labor. Finally after a discussion of the Northern European perspective on the current global economy - compressed into an impossibly short space of time, we move to other asset classes that are of interest - David comments on his positive view on India as well as gold, and we discuss some of the key dynamics that drive that.

In today's Markets Happy Hour Podcast we are celebrating Thanksgiving Day, and noting the many things that US investors have to be thankful for - a market that pulled itself together sufficiently to end the month broadly flat, a likely incoming Fed chairman who is positively inclined towards rate cuts, and an economy that continues to show its resilience. Plus Thanksgiving staples seem to be down in price - which is good news for lovers of Turkey and cranberry sauce! We were delighted to welcome Lindsey Stewart on to the podcast to discuss Morningstar's Institutional Insights across our usual five topics, and we debate whether inflation is in fact down (outside the Thanksgiving basket) while taking the temperature on the economy, this time focusing on fund managers who are definitely "glass half full" at this time. We look at the ongoing "low hiring/low firing" job market and ask whether it is likely to change, then move to look at the recovery in equity markets, which has brought a relatively volatile November to a close. Interesting dynamics currently in markets include Nvidia driving market volatility, an increasing discernment between stocks (e.g. Google and Nvidia) and a pickiness among stockpickers. Moving on to the UK budget we discuss the highest tax regime in history and the nature of this experiment which seems set to rival the NYC mayoral elections in terms of the concern that it will lead to an exodus of high earners. Markets have received this news relatively well and we will watch to see whether it is in fact a quencher of growth as has been widely surmised. Finally, we examine Bitcoin's torrid performance of late and the fact that so called "DeFi" companies have trailed traditional finance companies recently, suggesting that old stalwarts still have value in today's markets' craving for some certainty.

In this special edition of the Markets Happy Hour Podcast we are joined by Paula Campbell Roberts who is the Chief Investment Strategist for the Global Wealth business and a Managing Director on KKR’s Global Macro & Asset Allocation team As usual we debate the implications of the shifting inflationary, interest rate and equity market environments for our clients and end with a discussion of the asset mix that KKR espouses for wealth clients according to their investment objectives - income generation, capital preservation and return seeking. Starting with inflation we examine the higher "resting heart rate" of inflation and the role that higher electricity prices play in that. Given the demand for data centers and power usage relating to that we draw upon recent charts showing the power demands of data centers and comparing them to the power consumption of entire countries. We move then to some of the indicators around AI and technology stocks, and in particular the massive amounts of capex needed as well as how this will be funded (increasingly by resorting to debt). Finally we move to the trajectory of the USD, which has stabilized and is somewhat stronger now. The topics presented herein are related to financial markets, geopolitics, and world news. This material is provided for educational purposes only and does not constitute any recommendation. Please see the important disclosures within the video contained on the presentation slides.

In today's Markets Happy Hour Podcast we feature the legendary Pete Drewienkiewicz of Thoughts from The Loft (TFTL) fame (of Gallagher Benefit Company, formerly Redington in the UK) and a robust discussion ensues. Starting with "Food Glorious Food" and its driver of inflation, we examine whether inflation will rest at the higher 3.6% level in the UK and what trajectory is likely in the US. We move then to the different apparent interest rate plateaus across the US, the UK and Europe, and ask whether the UK should be "resting" at a higher level than the US, given the clear strains on its economic growth. We turn then to discussing what this means for holding cash today. Equity markets again take centre stage, and we reflect on the recent Nvidia earnings release and then turn to a fascinating piece of analysis that Pete has drawn upon in TFTL the strong earnings growth across all markets, not just the US. While US margins still trump those in other countries, other valuation metrics don't necessarily point to stark US exceptionalism. This underscores the challenge of true diversification today. Finally we touch on the recent excellent analysis of Total Portfolio Approach by Toby Nangle in the Financial Times, and ask whether it is all it is cracked up to be. We do note, however, that some asset class "walls" have started to become porous as new asset classes evolve and investors allocate between them. You can write to Pete directly to get on his weekly distribution list for his excellent newsletter.

Full Episode: Too Big to Fail - 2.0 and Beyond https://www.youtube.com/watch?v=BQeihjN5UO0

In today's live podcast from Dublin we do a comparative vibe check on the Irish economy compared to the US economy. We speak about the pressure of inflation on investor portfolios and ask what investors should do to guard against that. In looking like a now-familiar chart plotting the size of the US stock market v. the rest of the world the question is asked as to whether investors are in fact happy running that level of risk, particularly as it pertains to US stocks and tech stocks in particular. One guest suggested that the best approach was to communicate early and often to investors about the realistic expectations as to risk and return and how to modify their portfolios accordingly. We cycled back to AI, the bubble question and the use case and collected some "anecdata" from the guests in the room as to how they were using AI in their personal and professional lives, citing some of the shortcomings of the dataset so far. In general there was a skepticism around its broader, aspirational use case, and definitely a sensitivity to cost. When discussing AI as a kitchen table issue it was clear that when translated into monthly consumer expenditure the revenue projections seem untenable. This begs the question as to who will pay - inevitably enterprises - and where they will take money from in order to achieve this.

In today's Markets Happy Hour Podcast we are delighted to host Rich Nuzum, Head of OCIO at Franklin Templeton, for our usual canter through the macro drivers of investor portfolios - inflation, interest rates, equity markets, geopolitics and other asset classes. We look at inflation firstly - and ask about expectations, which, remarkably, are diverging along political lines in the US. It seems that inflation is very much in the eye of the beholder - an aspect noted by Rich who suggests that averages "often lie" and are not an accurate depiction of client by client inflation. We move then to central banks and their challenging task of navigating in the fog without even less data than usual, and we move then to geopolitics where Rich discusses the oil price and demand and supply issues as well as the importance that investors think through the ramifications that current geopolitical forces have on their portfolios. We move to US equity markets and the AI underpinning, the effect of the shutdown and why non-US markets seem to be signalling something else today. We end with a detailed discussion of credit markets and Rich gives an alternative take on some of the weakness that seems to have recently been noticed in credit markets.

In this week's Markets Happy Hour Podcast (our second recorded this week - there will be a special episode featuring Paula Campbell Roberts from KKR released shortly), we focus on recent rumbles in markets around the integrity of the AI story, the increased concern about power costs and how our "discovery phase" around Bitcoin is continuing, with more and more clues added weekly. We start with the usual inflation analysis and the strain that power costs are likely to have for the lower income consumer. Fixed income volatility continues to be subdued, even among government bonds which suggests an interesting sense of calm among a cohort (bond investors) which continues even in the government bond arena. Equity markets continue to be rattled by the scope of spending on AI infrastructure as well as some high profile shorting in the space, and it is worth recalling three hallmarks of bubbles - as suggested by a Financial Times journalist - Leverage, Liquidity and Lunacy. We trace each of these with reference to the current market context. Finally we examine recent behavior in Bitcoin and see how it has decoupled from gold and ask what this tells us about its characteristics as an asset class.