Core Viewpoint - The nomination of Kevin Worsh as the next chairman of the Federal Reserve has sparked discussions about the current monetary policy and its implications for the economy, particularly regarding interest rates and inflation. Group 1: Federal Reserve and Monetary Policy - The Federal Reserve's current policy mix is criticized for being misaligned, with a large balance sheet and high interest rates, which are seen as detrimental to economic conditions on Main Street compared to Wall Street [2][3] - There is a call for a regime change at the Federal Reserve, emphasizing the need for credibility and effective monetary policy to address inflation and interest rates [3][8] - The expectation is that once confirmed, Kevin Worsh will implement rate cuts, with Wall Street economists predicting at least two cuts in 2026 [26][27] Group 2: Economic Impact and Housing Market - The mortgage portfolio of Fannie Mae and Freddie Mac has grown significantly, with Fannie Mae's portfolio exceeding $4.1 trillion, indicating a robust performance in the housing market [15][17] - A $200 billion mortgage bond buy ordered by President Trump is expected to lower interest rates and make housing more affordable, with a noted 40% year-over-year increase in refinancings [20][22] - The current high mortgage rates, around 6.1%, are attributed to the actions of the Federal Reserve, particularly under Jay Powell, and there is a strong belief that new leadership will help address these issues [24][25][33]

Core Insights - The Federal Reserve is adjusting interest rates downward as inflation rates decrease, moving towards neutral levels [1] Group 1 - Thomas Barkin, president of the Federal Reserve Bank of Richmond, highlighted the relationship between falling inflation rates and the Fed's interest rate adjustments [1]

Investment Rating - The report does not explicitly provide an investment rating for the industry. Core Insights - The focus in private markets has shifted from interest rates and inflation to tariffs and trade policies, which have reached levels not seen in a century, increasing operational and investment risks for funds [4][33] - Fundraising sentiment is stable but demanding, with capital flowing towards large platforms or niche managers, while those in the middle face tougher conditions [5] - AI adoption in private markets has accelerated, with nearly all firms exploring AI tools, although governance and clear policies are still lacking [6][116] Macro - The federal funds rate is expected to decrease, with market pricing indicating two cuts by year-end and another two next year, although inflation concerns may affect borrowing costs [19][21] - The effective US tariff rate has risen significantly, impacting private markets and leading funds to manage FX risk through increased hedging [33][36] Private Market Trends - Fundraising has returned to pre-pandemic levels, but there is a split in capital flow, with large and niche funds performing better than mid-sized funds [5][52] - Investors expect moderate growth in AUM, with nearly 70% anticipating an increase of 10% or more over the next 12 months [62] - The fundraising environment is characterized by a bifurcation, where large funds are aggregating capital while niche funds succeed through sectoral expertise [63] Spotlight: AI and Firm Operations - The era of AI hesitation has ended, with most firms now exploring AI tools, although implementation remains a challenge [116] - Firms are focusing on building data infrastructure to maximize the benefits of AI, as many lack the necessary data foundation [117][118] - AI tools are primarily being used in areas where junior staff work, but hiring for junior positions remains strong as firms view AI as a complement rather than a replacement [129][130]

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the economic outlook for the US, Euro area, and Asia/EM regions, focusing on monetary policy, inflation, and GDP growth forecasts. Core Points and Arguments US Economic Outlook - The FOMC maintained the federal funds rate at 3.5-3.75% in a split decision of 10-2, aligning with consensus expectations [4] - Anticipation of two 25 basis point cuts in June and September, potentially lowering the rate to 3-3.25% [5] - Better growth news and signs of labor market stabilization suggest the FOMC is positioned to hold rates steady while assessing incoming data [5] - Q4 GDP tracking estimate was lowered by 0.4 percentage points to +2.0%, influenced by a 5.3% increase in durable goods orders and a widening trade deficit [5] Euro Area Economic Outlook - Euro area real GDP increased by 0.3% in Q4, surpassing expectations [6] - Inflation in January was slightly above expectations in Spain (2.5% YoY) and Germany (2.13% YoY), leading to an upgrade in the Euro area headline inflation forecast to 1.77% YoY [6] - The ECB is expected to maintain its policy rate at 2% for the foreseeable future, with no major changes anticipated in the upcoming meeting [6] Asia/EM Economic Outlook - The Bank of Japan kept its policy rate unchanged at 0.75%, with expectations for a rate hike in July [10] - The Riksbank maintained its policy rate at 1.75%, signaling stability until at least the second half of 2027 [8] - Client sentiment from a Global Macro Conference indicated increased optimism about the global economy, with a preference for EM equities, particularly in China and Korea/Taiwan [8] Additional Important Insights - The potential removal of US tariffs could lead to significant changes in trade flows and consumer prices, as evidenced by the experience in Canada [4] - The labor market remains a critical uncertainty in the economic outlook, with expected net job losses in AI-exposed industries [5] - Geopolitical developments are ranked as the highest risk concern among clients [10] Conclusion - The economic outlook across the US, Euro area, and Asia/EM regions shows cautious optimism, with central banks maintaining current rates while monitoring inflation and growth indicators. The potential for tariff changes and labor market dynamics are key factors to watch in the coming months.

Core Insights - The quantum computing sector experienced significant volatility in January 2026, with major players like IonQ, Rigetti Computing, and D-Wave Quantum facing substantial sell-offs due to broader tech market jitters and risk-off sentiment [1][4][5] Market Performance - In January, IonQ's stock declined by 10.9%, while Rigetti and D-Wave saw larger drops of 18% and 18.9%, respectively [2][8] Market Drivers - The sell-off was primarily driven by uncertainty surrounding interest rates, as central banks indicated that rate cuts would be slower and more dependent on economic data, leading to reduced attractiveness of long-duration assets [4][5] - Geopolitical tensions, including ongoing conflicts and trade pressures, raised concerns about supply chains and capital spending, prompting investors to shift towards defensive sectors [5] February Outlook - For February 2026, selective stabilization is anticipated rather than a broad-based rebound, with stock-specific developments becoming increasingly important [6] - IonQ's announcement of a $1.8 billion acquisition of SkyWater provided a temporary boost in sentiment, with analysts projecting a 74.61% increase in price target from its last closing price of $43.24 [7][8] - D-Wave reported $30 million in contracts and growing traction for its Advantage2 system, which helped stabilize its shares, with an average price target increase of 73.8% from its last closing price of $23.22 [9] - Rigetti, however, lacks near-term catalysts, making it more vulnerable to macro sentiment, with an average price target increase of 103% from its last closing price of $19.85 [10] Valuation Sensitivity - Valuations for quantum pure plays remain highly sensitive to interest-rate expectations and overall risk appetite, limiting upside potential unless macro conditions improve significantly [15]

Core Insights - The Schwab Core Bond ETF (SCCR) generates income through investment-grade bonds, yielding 4.32% and providing monthly distributions to investors [2][8] - SCCR focuses on high-quality U.S. dollar-denominated debt, ensuring a predictable income stream due to the low default risk associated with investment-grade bonds [3] Interest Rate Impact - Recent Federal Reserve rate cuts totaling 75 basis points to 3.75% have enhanced the value of existing bonds, positively impacting SCCR's net asset value and performance [4][8] - The 10-year Treasury yield at 4.24% serves as a benchmark, contributing to SCCR's stability in distributions [5] Distribution and Performance - SCCR has maintained consistent monthly distributions since its launch, with yields remaining in the 4% to 5% range, indicating stability despite fluctuations in individual payment amounts [6] - The fund's total returns are competitive with established bond ETFs, closely tracking the iShares Core U.S. Aggregate Bond ETF (AGG), suggesting effective management without eroding net asset value [7]

Group 1: Silver Market Overview - Silver prices surged from approximately $70 per ounce at the beginning of the year to over $110 per ounce at its peak, driven by inflation concerns and government policy [1] - Following the appointment of Kevin Warsh as the next Fed Chair, who is perceived as less supportive of lower interest rates, silver prices have declined to the low-$80s, although this remains significantly higher than the low-$30s from a year ago [1] Group 2: Investment Opportunities in Silver Mining - Higher silver prices benefit silver mining stocks, with Wheaton Precious Metals (NYSE: WPM) highlighted for its low-cost structure and ability to capitalize on silver prices [2] - Investing in mining companies can potentially yield higher returns than the price increase of silver itself, as these companies may enhance production and profitability at a rate exceeding the metal's price rise [3] Group 3: Wheaton Precious Metals Business Model - Wheaton Precious Metals employs a unique and lower-risk business model by providing capital to mining companies through streaming agreements, allowing it to secure a percentage of a mine's production at a fixed cost [4] - An example includes Wheaton's $485 million upfront payment to support the Peñasquito mine, enabling the company to purchase a quarter of its silver output at a starting price of $4.56 per ounce, adjusted annually for inflation [4] Group 4: Production Expectations - Wheaton Precious Metals operates 23 mines and projected its streams to produce between 20.5 to 22.5 million ounces of silver, 350,000 to 390,000 ounces of gold, and 12,500 to 13,500 ounces of other metals in the previous year [5] - The company anticipated that approximately 39% of its revenue would come from silver streams, with 59% from gold, and 1% each from cobalt and palladium [5]

Don't expect Kevin Warsh to be a bomb-thrower. Several longtime observers of the Federal Reserve told Business Insider that President Donald Trump's pick to become its next chairman is a good listener who looks for consensus.That could prove essential for Warsh, who has emerged as a sometimes-vocal critic since leaving the central bank more than a decade ago. While some Fed watchers criticized Warsh's nomination, citing shifts in his stance on interest rates, others praised his experience and communication ...

Group 1: Investment Strategies - Many family offices are shifting towards real estate and alternative investments, particularly private equity and hedge funds, to protect their portfolios against inflation [1][3] - U.S. family offices reported holding 40% of their investments in public equities, while 34% are in private investments, including private equity, venture capital, private credit, and real estate [5] Group 2: Concerns and Risks - A significant number of family offices are concerned about inflation and geopolitical risks, with 64% citing interest rates and 61% citing inflation as major risks to their portfolios [2] - Nearly three-quarters (72%) of family offices surveyed reported having no exposure to gold, indicating a reluctance to invest in gold despite its recent price surge [6][7] Group 3: Focus on Technology - Artificial intelligence (AI) is a prominent investment theme for family offices, with 65% including AI in their portfolios or prioritizing it for future investments [4] - There is a strong belief among family offices that AI should be a central part of their investment strategy, although there are concerns about concentration risk [6] Group 4: Cash Management - Family offices are maintaining large amounts of cash and cash equivalents, with some holding cash to prepare for potential downturns and to capitalize on opportunistic investments if asset prices decline [8] - Concerns about inflation are leading some family offices to prefer holding cash, as higher rates could result from inflationary pressures [9]

Market Overview - US stock futures experienced a significant decline, with Nasdaq 100 futures dropping 1%, S&P 500 futures falling approximately 0.7%, and Dow Jones Industrial Average contracts sliding 0.3% [1] - Precious metals, particularly gold and silver, faced intense selling pressure, with gold briefly falling by 10% and silver sinking over 15%, marking a record single-day drop of around 30% on Friday [2] - Bitcoin fell below the $80,000 mark for the first time since April, trading just below $77,000 per token [3] Federal Reserve and Interest Rates - The nomination of Kevin Warsh to lead the Federal Reserve by President Trump has raised speculation regarding future interest rate movements, with traders anticipating two rate cuts by the end of the year [4] Corporate Earnings and Economic Data - Over 100 S&P 500 companies are set to report earnings this week, including major firms like Amazon, Alphabet, Disney, Palantir, and Advanced Micro Devices [6] - The upcoming January jobs report is expected to show an addition of 65,000 jobs, with the unemployment rate projected to remain at 4.4% [6] Company-Specific Developments - Estée Lauder's stock rose by 6% following a partnership with SalonCentric to distribute products across over 850 US stores [7] - GameStop's stock continued to rise, climbing 4% on Friday, as CEO Ryan Cohen expressed intentions to expand the company through acquisitions [7] - Newmont's stock fell more than 3% during premarket hours as gold prices dropped below $5,000 [8] Currency Movements - The US dollar strengthened against major currencies, particularly those sensitive to commodity prices, as gold and silver prices plummeted [10] - The dollar gained approximately 1% over the weekend, rebounding after a decline in the second half of January [11]