Eric Wallerstein, Chief Macro Strategist at Clocktower Group, joins OPM to discuss why he sees substantial risk that the Fed is making a policy mistake by hiking into a supply shock that could cause a 2022 style bear market. He also explores the global coordination of rate hikes and why he believes the participation of lower growth economies like Canada indicate that this is a reaction to higher energy prices and not a substantially higher global neutral rate.
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Timestamps:
00:00 Intro
00:56 Fed Hike and Higher for Longer
02:30 Oil Driving Global Yields
05:58 Canada and Global Neutral Rate
07:14 Energy Crisis and Degrowth Risks
08:44 Politicized Fed and Credibility
11:50 Neutral Rate and AI CapEx Boom
14:47 Inflation Outlook and Policy Mistakes
17:20 Plutus Sponsor Break
18:46 Key Data to Watch: Bank Lending
20:07 Doves vs Hawks and Fiscal Drag
23:30 2022 Style Bear Market Setup
25:56 What Could Invalidate the Thesis?
26:41 BOJ Hike and Yen Intervention
31:20 Korea Silicon Boom
35:43 Europe Under Pressure
39:25 Middle East Outlook
43:06 Midterm Issues: AI vs. Gas Prices
48:34 China Oil Strategy
52:10 Big Calls Wrap
