China · Lead feature
China's Silent RecessionThe numbers Beijing doesn't want you to see — and what they mean for the rest of the cycle.
By George MagnusA+0.171
Senior Contributor · China · Today, 09:12 GMT
8,421 873 live markets
The numbers Beijing doesn't want you to see — and what they mean for the rest of the cycle.
Powell isn't fighting 2021 inflation any more. He's pre-empting a labor-market collapse — and the dot plot hasn't caught up.
The interesting question is not the headline cut, but whether Riyadh holds the line through March against US shale at $70.
Rapid AI-driven productivity, concentrated foreign capital into AI themes, and unusually cheap credit are cross-linking the credit cycle, labor market, and trade in ways that could undermine the marginal buyers supporting high US equity valuations—sowing structural risk for a future bear market even if a near-term crash is not imminent.
An IMF working paper finds stablecoins would be more resilient if issuers held a larger share of safe assets and had multiple revenue streams; it warns self-regulation alone cannot prevent funding-run risk.
The author is building an AI-driven, agentic research and macro trading system to map the prevailing macro regime and identify a few large asymmetric trades; they argue AI converging with higher-quality data and expanding hardware infrastructure will precipitate a major market reckoning while markets underprice geopolitical risk.
The Governing Council adopted multiple operational, regulatory and strategic measures including simplifying remuneration of excess reserves, advancing the digital euro pilot and payments strategy, strengthening statistics and data reporting, and taking supervisory actions including an administrative fine and streamlined model approval processes.
Investors can be driven by moral identity rather than traditional fear-based risk aversion, creating situations where probability-based pricing and identity-based preferences collide; the piece examines how that tension alters allocation decisions, pricing, and market behavior.
US real and nominal GDP have been stronger than expected—driven by consumer demand, wage gains, and tech-led business investment—and are likely to cool modestly but remain above recent averages in 2025; inflation is expected to remain sticky around 2.5–3%, the Fed is likely to deliver more rate cuts than markets currently price, and tariffs show statistically significant effects on PCE and the effective exchange rate.
Kevin Warsh's nomination raises the prospect of a Fed that prioritizes shrinking the balance sheet and treats inflation as a fiscal/monetary problem rather than purely demand-driven, while his views on interest rates are more ambiguous—optimistic about AI-driven productivity but warned by history to possibly raise neutral rates.
Rising Middle East tensions and shipping disruptions pushed oil sharply higher, prompting inflation and policy concerns that coincided with widening credit spreads and a defensive rotation in equities toward energy and commodities.
Iran’s attacks on merchant shipping and warnings of $200 oil have turned the Strait of Hormuz risk premium from theoretical to real, amplifying market and political volatility; concurrently, private-credit funds face a liquidity reckoning, yield-curve history raises recession alarms, and coverage spans consumer culture, transport tech, emissions gaps, hardware, and an outlier NBA performance.
Forecast is for a constructive 2026 driven by a fiscal and AI-capex boost that lifts annual GDP toward ~3.2%, while a structurally constrained labor supply and measurable labor-market slack imply continued wage deceleration; easing policy supports lower defaults, a steeper curve, and a bullish equity backdrop (S&P 500 target 7,400).
Drop a tracked-claim market into any Substack, Beehiiv, or WordPress post. Self-styled, two lines of HTML.
Cross-product identity bridging from Prophecy Social. Coming next.