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Consensus wanted Powell to be brave & tough like Volcker by hiking to fight inflation in 2022. Paradoxically, the brave & tough thing with debt/GDP at 120% was “let inflation run hot while capping yields w/QE to devalue the debt first.” Powell didn’t do that, so here we are 🤷‍♂️

"Jensen Huang hates America!" "Jensen Huang is an American fatalist!" 🤦‍♂️ OR...he's trying to do America a favor by telling us the truth. Yes America, we ARE losing. There's no other way to spin 95% to 50% share in 4 years! Choices = YCC-financed industrial policy or lose.

When I posted on Sunday that Bessent (inadvertently) told us to sell LT USTs, a lot of the comments were "You don't know what you're talking about" 🤷‍♂️ x.com/LukeGromen/sta…

BTC (blue) v. NDX, since the date that 10y UST yields stopped falling with stocks in late Feb 2025: #Divergent

Seems notable

Consensus has seemingly entered the "bargaining" phase of grief over the US fiscal position: US receipts are already at ATH's, so cut WHAT? Entitlemts (70% of ATH receipts)? DoD (20%)? Veterans Affairs (8%)? Only thing they can cut is interest (30%) - ie rates, ie INFLATION.

Bessent, per his "3 Arrows" plan: If we get oil down (blue, RS), 10y UST yields will follow (red, LS), and then we can term out US debt. "Life is what happens to you while you're busy making other plans." -John Lennon #FiscalDominance

Traditional finance consensus: "What's the use case for BTC?" Allowing Millennials to afford a home despite Boomer policymakers actively pursuing policies to prevent them from doing so Median US home price, priced in BTC, 2020-today👇 IMO, this chart is going <1 in coming yrs.

“If all Chinese students were removed from all US colleges, there would be a wave of bankruptcies and closures among US private colleges.” -Administrator of private university in NE USA

The foreign policy version of "mistakes were made": "China is chipping away?" We willingly shipped a quorum of our defense base to China to save 40% on labor & break American unions. At least we're getting closer to the "acceptance" stage of grief on this.

Thanks for having me on the podcast for a fun conversation, Pahueg (Less Noise More Signal) ! To clarify - the longer a trade war goes on with the world's factory that has capital controls (China), the more likely it becomes the US & others may be forced to employ capital controls of sorts as well.

Conspiracy theorists hearing that the Supreme Court just defended the Fed as a "uniquely structured, quasi-private entity":

"What is important is that the economy grows faster than the debt." -Sec. Bessent Chart below shows that over past 60 yrs, the only times debt/GDP has fallen is via high inflation (1965-85 & 2020-23), or via asset bubbles (1995-99). Either way, LT USTs must underperform.

If you read “Lords of Finance”, “1931: Debt, Crisis, & the Rise of Hitler”, & “The Raven of Zurich”, much of what we have been watching in recent years is not very surprising. Managing one’s mind around watching history rhyme can admittedly be tough at times though. 🤷‍♂️

Alternate headline: "OFFSHORE US DOLLARS ARE NO LONGER GOOD FOR TUITION AT HARVARD" Offshore USDs can still buy lots of other things in the US though... ...just not Huawei Ascend AI chips anywhere in the world...& not NVDA AI chips if you're China...and...

Narrator: "The problem was that 'giant hedge funds' were one of the biggest marginal creditors of the US, at a time Bessent was desperately trying to term out US debt."

It’s even worse than Luke describes, as Beijing retains major leverage over our AI electrification build-out. Turns out U.S. hyperscale data-centre expansion is massively constrained by the heavy-duty power transformers—and the grain-oriented electrical steel (GOES) inside