The Market Continues to Shrug Off Foreign Policy Developments

This week, Greg and Doug focus on foreign policy, most notably the looming China Trade War, and why the markets remain relatively unfazed. They also discuss the anticipation of lower interest rates, the Fed’s dual mandate, America’s AI domination, and optimism for another era of technological innovation that will lead to prosperity, despite short-term disruptions.

Key Takeaways

[00:17] - The markets are shrugging off Chinese tariff developments

[05:45] - How the U.S. is trying to counter China’s manufacturing prowess

[09:01] - Israel/Gaza peace deal and Kushner’s influence in the Middle East

[13:34] - Trending back towards some sort of normal interest rate environment

[16:15] - The Fed’s dual mandate

[19:41] - Every serious technological innovation in history has led to prosperity

[23:01] - The U.S. has a massive lead in the AI/data center race

View Transcript

Links

Breakneck: China’s Quest to Engineer the Future

GS: We Estimate That Tariff Increases Have Boosted Core PCE Prices by 0.44% So Far This Year and Will Boost Them by a Further 0.6% Eventually

The median S&P 500 stock is in a 15% drawdown