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“What the K-shaped economy gets right, what it exaggerates, and what believing the worst version is costing a generation.” The bottom half of American households owns about 2.5% of the nation’s wealth. That number is real, and it ought to bother you. However, that number is also higher than it was in 2019 and 2015, […]

We publish this article hours before the Fed updates monetary policy at its September 16, 2026, FOMC meeting. Prior to its decision, the Fed has kept the Fed Funds rate steady even as inflation runs stubbornly above target. At the same time, longer-term bond yields have risen appreciably and, in the process, are tightening financial […]

Wall Street’s latest doom thesis says the Fed is trapped and a US debt trap is nearly here, but it never names a date, and the data says the trap door isn’t opening. Every few months, a new essay declares that the US debt trap has finally sprung. The latest one making the rounds from […]

Heading into the September 16 FOMC meeting, the debate over whether the Fed should raise rates or hold is heated. To help you appreciate the range of views, we present this article as a courtroom exercise. We will let the prosecution make its case for a rate hike, and the defense make its case for […]

While the AI bears focus on concentration and circular financing, the last tech overbuild was financed with debt, and this one is being paid for in cash. Before I discuss why I disagree with the “AI bears,” I want to state that I respect their opinions, have evaluated their concerns, and have simply derived a […]

The S&P 500’s Shiller CAPE ratio just hit 41. Since 1881, the market valuation has been more expensive under CAPE only once. That was during the final months of the dot-com bubble. At the same time the CAPE is ringing warning bells, the PEG ratio, which measures price relative to expected earnings growth, is at […]

Democratic Socialism promises affordability and fairness. The bill, from Caracas to Copenhagen, is something else entirely. On January 1st, a self-described democratic socialist was sworn in as mayor of the largest city in America. Weeks before that, socialist candidates swept a wave of primaries, sending the largest bloc of socialist legislators in New York history […]

Over 7 years ago, we wrote a piece using the 1960s TV sitcom Gilligan’s Island to provide a simple example of why productivity is the most important driver of economic growth. In this article, we present the next episode of Gilligan’s Island, describing what happens after the benefits of innovation no longer drive economic growth. […]

A 5% long bond isn’t the crisis, it’s the receipt, and the fifteen years when money was free did far more damage to growth than normal interest rates ever will. This past week, two charts crossed my desk, arguing the same thing from opposite ends. The Kobeissi Letter flagged that U.S. borrowing rates just hit […]

Would you consider investing in a bond that earns more than three percent after accounting for inflation? What if that security has zero chance of default? Such an opportunity exists today in US Treasury Inflation-Protected Securities (TIPS). One more question: Would your answer change if the expected real return on stocks over the next ten […]

Japan didn’t just spark a currency crisis; it reminded everyone that the Fed has quietly backstopped the dollar for 60 years. The Yen intervention is not new, and while the “end of fiat, buy gold” crowd is right about the destination, they are wrong about the departure time. Every time somebody touches the plumbing of […]

Economist Lacy Hunt has been a bond bull longer than most money managers have been in the business. Recently, he made a surprising U-turn on his bullish stance. The following paragraph opens his Second Quarter Review and Outlook. The structural backdrop for U.S. inflation increasingly suggests that the long-run equilibrium range is migrating from roughly1.5–3.5% […]