We do have breaking news. Um, just moments ago, the federal appeals court does not allow Donald Trump to remove Lisa Cook from her post. I'll just read from their order.Upon consideration of the emergency motion for stay pending appeal and administrative stay, the opposition's thereto and the reply. The motion for leave to participate as amicus cure filed by the separation of powers clinic and the lodge. Yes. Yes. Yes.This is the order. The motions for leave to participate as uh amicus cure be granted. The ...

US stocks mostly nudged higher on Tuesday after the Senate confirmed President Trump's pick, Stephen Miran, as a Federal Reserve board governor, following another record-setting day on Wall Street. The benchmark S&P 500 (^GSPC) edged less than 0.1% higher, and the tech-heavy Nasdaq Composite (^IXIC) rose around 0.2%.The Dow Jones Industrial Average (^DJI) fell more than 0.1%. The Senate narrowly confirmed Stephen Miran, President Trump's Fed pick, in a 48-47 vote on Monday evening — a day before the cen ...

US stock futures climbed on Tuesday after the Senate confirmed President Trump's pick, Stephen Miran, as a Federal Reserve board governor, following another record-setting day on Wall Street. Futures attached to the Dow Jones Industrial Average (YM=F) rose just above the flatline, the benchmark S&P 500 (ES=F) edged higher 0.1%, and the tech-heavy Nasdaq 100 (NQ=F) rose 0.2%. The Senate narrowly confirmed Stephen Miran, President Trump's Fed pick , in a 48-47 vote Monday, a day before the central bank's ...

Core Viewpoint - The Federal Reserve is facing increasing pressure regarding its independence and the composition of its policy-setting committee, particularly with President Trump's push for significant interest rate cuts amid concerns over job growth and rising unemployment [1][4][5]. Group 1: Federal Reserve's Independence and Composition - A federal appeals court is set to rule on whether Fed Governor Lisa Cook can remain in her position while litigation regarding her potential firing by Trump is ongoing, which could impact the Fed's independence in monetary policy [2]. - The U.S. Senate is expected to confirm Stephen Miran to the Fed's Board of Governors, which may align the Fed more closely with the Trump administration's calls for aggressive rate cuts [3]. Group 2: Interest Rate Decisions - Trump has publicly urged the Fed to cut interest rates significantly, suggesting a reduction larger than previously considered, which he believes will boost the housing market [4]. - The Fed is anticipated to lower its benchmark interest rate by 0.25 percentage points to a range of 4.00%-4.25% at the conclusion of its meeting, despite concerns about inflation [4][5]. - Further rate cuts may occur in October and December, but at a slower pace than Trump's demands, as economists view his call for a 1% reduction as misaligned with the need to maintain stable inflation [5]. Group 3: Risks to Monetary Policy - A recent poll indicated that a majority of former Fed policymakers perceive a heightened risk that diminished Fed independence could lead to overly loose monetary policy and increased inflation [7].

Gary Stern, just just on the the drama surrounding the governors and the personnel, I I wonder what why how you think that it'll be important ultimately for for where Fed policy goes. Well, well, potentially it'll be quite important because it's uh essential that the integrity of the Fed policym process be sustained and if opportunities arrive strengthened. So obviously uh criticisms well criticisms of a sitting Fed governor who they're trying to fire is clearly a risk. Uh appointing somebody who is only go ...

Gary Stern, just just on the the drama surrounding the governors and the personnel, I I wonder what why how you think that it'll be important ultimately for for where Fed policy goes. Well, well, potentially it'll be quite important because it's uh essential that the integrity of the Fed policym process be sustained and if opportunities arrive strengthened. So obviously uh criticisms well criticisms of a sitting Fed governor who they're trying to fire is clearly a risk. Uh appointing somebody who is only go ...

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the **Global Macro Outlook**, focusing on **US Rates**, **International Rates**, **Commodities**, **Currencies**, and **Emerging Markets** [3][4][8]. Core Insights and Arguments US Rates - Risks to the front end of the yield curve are biased lower due to labor market weakness, while concerns about Fed independence are pushing long-end rates higher [3][15]. - The first Fed cut is projected for **September 2025**, with expectations of **four sequential cuts**, bringing the funds rate target range to **3.25-3.5%** by **1Q26** [12][11]. - Anticipated **2-year Treasury yields** are expected to reach **3.50%** and **10-year yields** to **4.20%** by the end of **2025** [12][11]. International Rates - Developed market (DM) curves have steepened, particularly in the US, amid renewed focus on the long end of the curve [4][36]. - The European policy easing is losing momentum, impacting the overall yield curve dynamics [36]. Commodities - The oil market is expected to face a significant surplus, with price forecasts remaining unchanged for now due to uncertainties surrounding China's stock build [8][88]. - The European natural gas market is entering winter with historically low storage levels, leading to a bullish stance for **4Q25** and a price target of **42 EUR/MWh** [8][93]. - Copper prices are anticipated to face bearish pressure, potentially dropping to **$9,000/mt** due to unwinding demand from the US and China [8]. Currencies - The US dollar has not weakened despite recent yield curve steepening, attributed to domestic growth factors [56][58]. - Concerns regarding Fed independence and fiscal excesses are influencing the dollar's performance, with expectations of a bearish outlook [58][63]. - Fiscal policy is expected to be a key differentiator for FX, with the hypothesis that fiscal easing supports currencies in low-debt countries [63][59]. Emerging Markets - The resilience of global growth and downside risks in the US are supporting emerging market (EM) local markets [8]. - A recommendation to stay overweight (OW) in EM FX and local rates, while maintaining a market weight (MW) in EM corporates and underweight (UW) in EM sovereigns [8]. Additional Important Insights - The US Treasury is well-funded through **FY25**, but a significant funding gap is expected to emerge in **FY26**, prompting coupon auction size increases starting in **May 2026** [19][22]. - The passage of the **OBBBA** is projected to lead to a surge in T-bill issuance, with an estimated **$529 billion** of net T-bill issuance expected in the current quarter [25][23]. - Demand from foreign investors remains weak, with expectations of a shift towards more price-insensitive demand in the Treasury market [29][31]. This summary encapsulates the critical insights and projections discussed during the conference call, providing a comprehensive overview of the current macroeconomic landscape and its implications for various markets.

Core Viewpoint - The discussion emphasizes the importance of Federal Reserve independence from political influence, particularly from President Trump, while acknowledging the need for accountability in monetary policy [1][2][10]. Group 1: Federal Reserve Independence - The Federal Reserve's independence is crucial, and the individuals being considered for leadership roles understand this importance [1][2][8]. - Historical examples of dictators who harmed their economies by controlling central banks highlight the risks of political interference [9][10]. - Critics of Trump misinterpret his comments on monetary policy as a desire to undermine Fed independence, while many appointed individuals assert their commitment to maintaining that independence [10][11]. Group 2: Monetary Policy Critique - The op-ed by Scott Besson compares the Fed's monetary policy to dangerous experiments during the COVID pandemic, suggesting that the Fed has taken on too many functions and is failing at its core responsibilities [4][7]. - The prolonged period of low interest rates and aggressive money printing since the 2008 crisis is seen as unsustainable and potentially harmful to the economy [5][6]. - Concerns are raised about the devaluation of the dollar due to excessive money printing, which could undermine its status as the reserve currency [6]. Group 3: Government and Market Interaction - The Fed has been criticized for acting as a bailout mechanism for reckless financial behavior, indicating a pattern of intervention in the markets [13][14]. - The discussion suggests that government involvement in lending practices, particularly in the housing market, has contributed to economic instability [16][17]. - There is a call for reducing government interference in financial markets to allow for a more free-market approach [18].

Core Insights - The Federal Reserve is currently in the spotlight due to recent headlines regarding potential rate cuts and changes in its governance structure [2][10] - The Federal Open Market Committee (FOMC) is facing scrutiny over its decision-making process amid discussions of President Trump's influence on Fed nominations [3][10] FOMC Structure and Dynamics - The FOMC consists of seven Fed governors and five regional bank presidents, with the New York Fed president being a permanent voting member [5] - Recent changes include the resignation of Adriana Kugler and the nomination of Stephen Miran, which may allow him to participate in the upcoming FOMC meeting [4] - The FOMC has historically preferred unified decision outcomes, despite recent dissent from governors Waller and Bowman [6][10] Political Influence and Future Implications - There is speculation about President Trump potentially having a majority of his nominees on the Fed Board, which is not unprecedented in history [7][10] - Seven out of eleven candidates for the Fed chair position have experience on the FOMC, highlighting the importance of their roles in monetary policy [8] - Concerns regarding Fed independence could impact Treasury yields, although current market responses have been muted [9][10]

Economic Outlook - The economy is not in recession, and the expected easing from the Fed is likely to support market sentiment in the coming months, limiting equity market downside [3][12] - A strong earnings backdrop and positive forward earnings guidance from market leaders contribute to a constructive market setup for the next six months [2][3] Federal Reserve and Market Dynamics - The upcoming resumption of the Fed's easing cycle is a key focus, with expectations of a potential rate cut driven by weakness in the labor market [1][2] - Concerns about the independence of the Fed, particularly in light of political pressures, could impact market reactions, especially in the long end of the yield curve [5][6] Market Concentration and Valuation - The concentration of a few leading companies in the S&P 500, particularly the "MAG 7," is not viewed as a problem due to strong earnings supporting their valuations [7][8] - The artificial intelligence theme driving market leaders is seen as a less interest rate-sensitive factor, potentially shielding the market from disruptions related to easing expectations [8][9] Labor Market and Consumer Impact - Recent jobless claims have shown a slight increase, indicating potential weakness in the labor market, which could affect consumer spending [9][10] - A significant deterioration in the labor market is necessary to confirm a sustained easing cycle, with current inflation risks still present [11][12] Sector Analysis - Financials are identified as a potential beneficiary of expected rate cuts, particularly if a bull steepener occurs in the yield curve [14][15] - The financial sector may benefit from a more favorable net interest margin environment and potential financial deregulation in the coming months [15]