Markets Happy Hour Podcast with Aoifinn Devitt

Markets Happy Hour Podcast - LIVE from Salt Lake City - March 6, 2025

In this second live series in as many weeks, we reflect on the recent volatility around tariff news, and with the benefit of two audience members focused on, respectively, emerging markets public equities and private equity and venture capital, we discuss how this uncertainty is being felt and acted upon.Europe seems to be experiencing a renaissance of sorts this week - with an indication of the release of Germany's fiscal brake bringing an almost giddiness to sentiment there - with expenditure likely to be as much as 900 billion Euro. This may be one of the unintended consequences of the JD Vance challenge to Europe, and it may make a seismic shift in fiscal positioning. The ECB just cut rates and seems to have got ahead of any fiscal stimulus by delivering its sixth interest rate cut - coupled with a sixth downgrade to economic growth projections. There was a sign that this may be it for a while - particularly if the fiscal pedal is now pressed, it might be possible to ease off the monetary pedal. We talk too about whether there is a Trump put in markets - whether there is a level at which market pain might be too much to bear, and certainly thus far the pause on tariffs has not really given markets a chance to experience this.

Markets Happy Hour Podcast - LIVE from Tampa, February 27, 2025 - In the Crosshairs

In this week's live Markets Happy Hour Podcast, we traveled to Tampa, Florida, and were privileged to share insights from post-hurricane recovery and consumer sentiment on the ground, as well as observations from professionals who focus on private debt and venture debt. We started with a discussion of recent market developments - what some have termed Trump 2.1. The fall in the 10 year yield, the dollar and the oil price may stack up like a "wish list" of the new administration, but it actually seemed to be a reaction to less than positive market news. The focus of the week has been on DOGE and its immediate effect on government agencies, a well as its more indirect effect on markets and sentiment. We examine the fall in consumer sentiment, the rise in uncertainty and some of the unintended consequences of broad geopolitical action - such as the galvanizing of support within Europe for more defense spending. We do a bit more of a deep dive into US v. European defense spending with one guest suggesting he would choose a relative value trade given that a less expansionist USA needs to spend less on defense while Europe clearly needs - and has committed - to spend more. We hear a lot too about pendulums swinging back and forth - often too far in one direction, as is the case with anti-engagement and anti-DEI sentiment today, and as may be the case with digital asset euphoria. Many of our participants believed in taking the long view and waiting out some of the short term market volatility, which is of course easier said than done.

Markets Happy Hour Podcast - February 21 - What’s Next for Europe?

In this week's Markets Happy Hour Podcast we come to you from Europe, and do a deep dive into that region - its stock market and its prospects. In Europe, as is the case elsewhere, there is a bit of reeling from the clear conclusions both from the Munich security conference and its aftermath - that the transatlantic alliances as we had known them for the last few decades no longer exist.This new world order will take some time to digest although markets, as ever, may have either cut through the noise, or jumped to the wrong conclusion. European markets have performed strongly since the Trump inauguration, and China has also seen some signs of life as the consumer stirs - despite what could be a pending residential property crisis there. For now all eyes are on German elections at the weekend to see if they transpire as the polls show - with little volatility and more of the status quo - or if they create the kind of surprise that French elections sowed.

Markets Happy Hour Podcast - February 14, 2025 . . I’m not Loving It . .or the New Abnormal

This week's podcast comes to you one day late - on Valentine's Day - due to travel, but is this love we feel in the Air? Hardly . . there is rather a sense of inundation with government policies, geopolitical surprises and unconventional developments that has led the sense of a new "abnormal". An unwelcome US inflation print - 3% annualized - in January initially sent markets into a negative tailspin with stocks falling and the US ten year yield spiking. . but then, it was revealed that the devil was in the detail. While energy prices contributed a little to the increase, there was also the Personal Consumption Expenditure which was a bit more subdued with a 2 handle - 2.6-2.7%. This boosted market confidence, and we were back to the familiar ebullience that has characterized most of the start to the year.This is even more staggering if we think of the volley of news around DOGE cuts into the federal workforce and spending, bold corporate actions (c.f. Elon Musk's $98 bn bid for Open AI - which may now be pulled it if returns to non-profit status). Tariff news has been volatile too - with both big bangs (25% tariffs on steel and aluminum) and incremental (reciprocal) tariffs under discussion, and maybe did the boy cry wolf? Markets don't seem to be as moved today by tariff rhetoric.

Markets Happy Hour Podcast - February 6, 2025 - Spend, Spend, Spend

In this week's Markets Happy Hour Podcast we digest the challenging month of January and reflect on where we stand now that markets have contended with President Trump's grand entrance.And President Trump knows how to make an entrance. The torrent of executive actions in the first few week's of the administration (54 to date) have created a deluge for markets who are still grappling with the election results, the warp speed movement of technology and a post-inflationary reality that is still only coming into focus. There have been a series of announcements in January and early February - from the launch of Deepseek to the surprise tariffs (since paused) on Mexico, Canada and China, and markets are increasingly jittery and lurching from one piece of news to another.This leads us to question the resilience of both corporate projections as well as markets themselves and overall we expect public equity markets to have more volatility going forward, and that fixed income markets will maintain their elevated volatility. Overall this bodes well for the private market segment of a portfolio if it exists.

Markets Happy Hour Podcast - Live from St Louis - Jan 30, 2025, with special guest Brittany Lewis

In this special live podcast we come to you from St. Louis where we run through a tumultuous week in what has turned out to be a tumultuous month and feature our first guest on the Markets Happy Hour Podcast. Today we chat with Brittany Lewis, who joined the Olin Business School at Washington University as an Assistant Professor of Finance in July 2022. Her areas of expertise are Banking and Financial Institutions, Finance/Investments, Financial Economics and we hear about her research on financial regulation and some of the unintended consequences that it can have.Before that we run through the recent market conditions including a left field surprise from Deepseek that rattled markets at the beginning of the week, and, as is now a typical pattern, affected adjacent sectors such as energy in a more extreme fashion than the tech stocks themselves. This underscores how large cap tech is still regarded as a safe haven sector by some - while value and defensive sectors tend to be more susceptible to sell-offs. In the domain of interest rates clearly the Fed is under no hurry to do anything, while other countries have more of a sense of. urgency - namely Canada and the European Central Bank, both of which cut rates. This will, of course, be negative for those currencies v. the dollar, and the pending tariffs, which could come as soon as this weekend, seem poised to unsettle markets even further.

Markets Happy Hour Podcast Jan 24, 2025

In this shorter holiday week in the US, a flurry of executive orders have "flooded the zone" but markets are struggling for direction, perhaps feeling a sense of confusion and overload. We discuss the impact of this lack of certainty on different assets, the dollar and the likely response of the US Federal reserve. We turn then to something a little different - inspired by the impressive planning that the team behind the Getty Villa in Pacific Palisades put into action to save the Villa from destruction, we ask whether failing to prepare is preparing to fail. We look to the specific lessons of that crisis management - and ask whether the same forward-looking approach of preparing for the known, knowns and having the specific training to cope with unknown unknowns can help to build portfolio resilience.

Markets Happy Hour Podcast January 16, 2025 - Going All In

With 4 days to go until inauguration markets have been vacillating between enthusiasm and trepidation about the expectations for the incoming Trump administration 2.0. We know that policy change on the horizon will be abundant, and much of that is already being factored in, with companies such as Meta, McDonalds and Walmart preemptively abandoning DEI programs such as diverse slate hiring and even DEI training, and disbandment of asset owner alliances relating to Net Zero commitments.There has been more volatility in fixed income markets as we ask whether the stock market is starting to heed this volatility, and clearly incoming treasury secretary Scott Bessent is not in favor of removing tax cuts, so the governments potential actions will be limited when it comes to fiscal flexibility.An Israel-Hamas ceasefire bodes well for that region's stability, while the review of the ban on TikTok in the US reveals the deep insecurities and suspicion around data usage, secrecy and cybersecurity.Lots of newsflow as we embark upon regime change in the US as it continues to demonstrate its exceptionalism particularly with respect to the economic outlook.

Markets Happy Hour Podcast - January 9, 2025 - Fire and Ice

In this week's Markets Happy Hour podcast we were sadly not live from Dallas, where we had hoped to be hosting a group of you at the gorgeous Old Parkland campus. Unfortunately a forecast winter storm got in the way of our plans, and we will be rescheduling that for a later date - hopefully well out of the winter storm woods - in April. On a day that markets are closed for President Carter's funeral, we reflect on some unease at the start to the year, and the return of the good news is bad news conundrum. The "good" news in this case was the positive US employment numbers and a revised (upwards) PMI which only gave more substance to the notion that the formerly predicted pace of rate cuts would not happen (10) as expected. The expectations are now around 6 rate cuts, 4 of which have already happened in the US.The bond market continued to swing around quite wildly, with the yields on 10 year bonds rising sharply - and this was a global phenomenon. We discuss how certain markets have more intrinsic resilience around these developments that others - with a case in point being the UK which is experiencing perhaps some PTSD around the Liz Truss Mini-Budget chaos of the end of 2022, and fearing a similar sell-off. We move then to discuss the "message in a bottle" whereby geopolitics are moving around the volatility of President Trump's tweets - in this case with respect to Greenland, Panama and Canada, and we ask if this reflects a fundamentally different world order with different security concerns etc. Finally we turn to the devastating Los Angeles fires which continue to burn at the time of writing, and ask whether we need to factor this risk assessment into all investments - particularly real estate - in a more intentional way.

Markets Happy Hour Podcast - January 2, 2025 - A Chill In the Air for the New Year

In today's slightly shorter New Year edition we reflect on a chilly start to the year - both literally and metaphorically. The New Year's Eve terrorist attack in New Orleans in the US was a chilling reminder of the near-shoring of overseas terror, while the death of President Jimmy Carter at 100 crowded out some of the chatter around the incoming President Trump.Otherwise all forecasts are centering on Maganomics, and the future looks bleak according to the 222 economists surveyed, not only for the US but especially for its trading partners. We should caution, however, that many economists predicted a recession in 2024 that did not come to pass.The ongoing volatility in bonds suggests that fixed income investors continue to be concerned, whether about the budget deficits or coming spending, and this begs the question as to whether central banks actually have the control they used to - or whether control is waning - can monetary policy actually move the needle - to stimulate the economy (as is needed in the UK and the Eurozone) or to choke off activity - as was intended with the recent run up in rates.We then turn to whether the Fed can be accused of flip flopping, due to its strict data dependency, when data has, admittedly, been quite varied, and without a particular patter. So a lot more questions than answers this week, but that is a good, open-minded way to approach the year.