Another Thematic Shift

I got something on my mind.

I want to talk about rates for a little bit.

Let's do it.

So rates are up today because of the war, because the thesis is that war causes inflation and the Fed needs to do something about inflation.

So the Fed is going to

hike rates.

I, you know, I checked the work screen before I came in here.

World interest rate probabilities.

It's on the Bloomberg screen, and it tells you how many rate hikes are priced in across the curve.

So in June of next year, so basically a year from now, we're pricing in two rate hikes, which is nuts.

We're not going to hike rates.

I mean, you know, nothing is certain, but I would be shocked if we hiked rates to rate hikes next year.

We're getting the FOMC minutes today, which given how hawkish Warsh was at the press conference, my my thoughts are that the actual minutes will be much more dovish.

That's my thinking.

But out of this whole war trade, I mean, you mentioned, you know, you had that whole lineup of stuff in the beginning.

But the thing that just boggles my mind is like the rates trade.

It just drives me up a wall like I don't get it.

Yeah, you know, it's like you and I can tell that we're not going to get, you know, massive headline inflation like we had during the Ukraine-Russia conflict, right? 9%.

That is not happening.

We'll be lucky if we get it to perk up through 4% with oil back down in the mid-70s now.

And I don't see when it's going to become a big enough problem that everybody's going to be looking at the Fed saying, you guys got to start hiking now.

Like, I can't even imagine a scenario like that occurring.

So I'm with you 100%.

So

CPI comes out next Tuesday.