You and I have talked about infrastructure so much, but I almost consider names like TSMC and ASML as being kind of soft data sets rather than kind of hard data sets. ASML gave us one signal and then TSMC gave us another. As somebody that looks at their exposure to this air supply chain.What did you make of it. Well, I think you really have to go up to kind of a higher order of capital expenditures, which is impacting so many different semiconductor stocks. If you look at the top four builders of infrastruc ...

Geopolitical fragmentation is a poor instrument of economic policy (via @opinion) https://t.co/rNJJ13fOzb ...

Investment Rating - The report maintains a neutral rating on European equities while favoring fixed income assets in Europe over other geographies [4][7][9]. Core Insights - The report emphasizes that the world is undergoing a transformation driven by mega forces such as geopolitical fragmentation and technological advancements, which are reshaping economic landscapes and investment strategies [4][21][27]. - It highlights the need for Europe to reform its growth model in response to changing global dynamics, with a focus on infrastructure and defense spending as key areas for investment [4][10][74]. - The report suggests that while there are selective opportunities in European equities, the overall outlook remains cautious due to competitive challenges and the need for structural reforms [9][46][96]. Summary by Sections Investment Environment - The macro environment is characterized by elevated policy uncertainty and a shift from stabilizing to destabilizing forces in financial markets [22][24]. - The report notes that inflation pressures in the U.S. are persistent, influenced by geopolitical factors and labor market conditions, which limits the Federal Reserve's ability to cut rates significantly [54][55]. Themes - The report outlines three main themes: investing for the near term, managing macro risks without clear anchors, and finding stability in mega forces [15][26]. - It emphasizes the importance of tracking mega forces like AI and energy transitions as durable drivers of returns, despite the uncertainty surrounding their long-term impacts [63][72]. Mega Forces - Geopolitical fragmentation is reshaping investment strategies, particularly in Europe, where defense spending is increasing significantly [73][82]. - The AI mega force is evolving through phases of buildout, adoption, and transformation, with significant capital spending expected in related sectors [83][86]. U.S. Assets - The report maintains that U.S. assets remain core to investment portfolios, supported by strong corporate earnings and resilience in the tech sector [94][96]. - Despite recent volatility, the U.S. dollar's role as a global reserve currency is expected to persist, although adjustments in currency hedging may occur [104][106].