WEBVTT 00:00:00.000 --> 00:00:02.339 So you're tuning in because you want to cut through 00:00:02.339 --> 00:00:04.919 the noise, right? You've got this pile of information, 00:00:04.980 --> 00:00:06.759 maybe feeling a bit swamped, and you just want 00:00:06.759 --> 00:00:09.019 the key takeaways, the stuff that really matters. 00:00:09.179 --> 00:00:11.300 Yeah. And that's exactly what we do here. We've 00:00:11.300 --> 00:00:13.919 been digging through a fresh set of sources. 00:00:14.839 --> 00:00:17.160 So you don't have to. For this deep dive, we've 00:00:17.160 --> 00:00:20.339 got, well, quite a mix. We do. First up, there's 00:00:20.339 --> 00:00:24.600 a news roundup from electoral -vote .com, dated 00:00:24.600 --> 00:00:28.039 May 12, 2025. gives us that political pulse. 00:00:28.579 --> 00:00:30.899 And we're pairing that with the mid -quarter 00:00:30.899 --> 00:00:33.880 investment outlook for Q2 2025. That's from hedge 00:00:33.880 --> 00:00:36.539 -eye risk management. So an economic lens, too. 00:00:36.719 --> 00:00:39.039 Exactly. Our mission, really, is to pull out 00:00:39.039 --> 00:00:41.399 the critical political stuff, the economic developments, 00:00:41.439 --> 00:00:43.380 from both of these. Right. We're hunting for 00:00:43.380 --> 00:00:46.000 those surprising bits, the connections maybe 00:00:46.000 --> 00:00:47.479 you wouldn't spot otherwise, things that give 00:00:47.479 --> 00:00:49.479 you that deeper understanding. OK, let's dive 00:00:49.479 --> 00:00:52.479 in. And we are starting with a political story 00:00:52.479 --> 00:00:55.479 that definitely made me do a double take. Oh, 00:00:55.500 --> 00:00:59.679 yeah. This electoral -vote .com piece leads with 00:00:59.679 --> 00:01:03.039 a pretty wild headline. Today, in grift, Qatar 00:01:03.039 --> 00:01:06.340 allegedly plans to donate Air Force One. I mean, 00:01:06.480 --> 00:01:08.560 right away, that sparks questions. We're talking 00:01:08.560 --> 00:01:13.579 a $400 million luxury Boeing 747 -8. And the 00:01:13.579 --> 00:01:16.719 idea is the Qatari royal family wants to hand 00:01:16.719 --> 00:01:19.099 it over to the Trump administration to replace 00:01:19.099 --> 00:01:22.799 Air Force One. Right. And Trump, of course, he 00:01:22.799 --> 00:01:24.879 jumped on Truth Social with his take. Naturally. 00:01:24.980 --> 00:01:27.239 Calling it a gift free of charge for the Defense 00:01:27.239 --> 00:01:29.959 Department. A temporary fix, he says, for the 00:01:29.959 --> 00:01:33.079 40 -year -old Air Force One. And, you know, blaming 00:01:33.079 --> 00:01:35.219 the crooked Democrats for wanting to pay top 00:01:35.219 --> 00:01:37.480 dollar for a new one. It's a standard playbook, 00:01:37.579 --> 00:01:39.900 isn't it? Frame himself as the great dealmaker 00:01:39.900 --> 00:01:42.640 saving taxpayer cash. But when you actually look 00:01:42.640 --> 00:01:45.640 closer. Yeah. The situation gets, well, let's 00:01:45.640 --> 00:01:48.719 say murky and pretty concerning, frankly. Oh, 00:01:48.840 --> 00:01:50.859 so. It's not like a simple handover to the US 00:01:50.859 --> 00:01:53.000 government. The reporting suggests the plane's 00:01:53.000 --> 00:01:55.280 only being loaned while Trump's in office. Loaned, 00:01:55.280 --> 00:01:58.420 OK. And here's the kicker. Yeah. The plan, apparently, 00:01:58.579 --> 00:02:01.180 is for ownership to then transfer to the Trump 00:02:01.180 --> 00:02:03.519 Presidential Library Foundation after he leaves 00:02:03.519 --> 00:02:06.579 office. Whoa, OK. That's different. Because you 00:02:06.579 --> 00:02:08.319 think of like the Air Force One at the Reagan 00:02:08.319 --> 00:02:11.050 Library. It's just sitting there. Exactly. But 00:02:11.050 --> 00:02:12.750 that one's non -functional. It's basically a 00:02:12.750 --> 00:02:15.069 museum piece. And it belongs to the National 00:02:15.069 --> 00:02:17.289 Archives. So the federal government owns it. 00:02:17.569 --> 00:02:21.169 Right. This Qatari jet, though, fully functional. 00:02:21.770 --> 00:02:24.289 And it would belong to a foundation tied directly 00:02:24.289 --> 00:02:26.569 to Donald J. Trump. So even if the foundation 00:02:26.569 --> 00:02:29.250 technically owns it, he basically gets a personal 00:02:29.250 --> 00:02:32.930 super luxury jet after his presidency, paid for 00:02:32.930 --> 00:02:36.569 by Qatar. That seems to be the implication. Which, 00:02:36.569 --> 00:02:38.090 you know, immediately makes you think about the 00:02:38.090 --> 00:02:40.210 emoluments clause. Right. The constitutional 00:02:40.210 --> 00:02:42.490 thing about presidents not taking gifts from 00:02:42.490 --> 00:02:45.270 foreign powers. Exactly. And A .G. Pambondi weighed 00:02:45.270 --> 00:02:48.430 in. She did. Her view is that it doesn't violate 00:02:48.430 --> 00:02:50.990 the clause because it's not tied to a specific 00:02:50.990 --> 00:02:54.310 official act. But, I mean, you have to ask. Yeah. 00:02:54.310 --> 00:02:56.689 Can you really see a nearly half billion dollar 00:02:56.689 --> 00:02:58.810 plane changing hands and not think there's some 00:02:58.810 --> 00:03:01.210 expectation? Like, maybe favorable treatment 00:03:01.210 --> 00:03:03.789 for Qatar down the line. Maybe something on tariffs. 00:03:04.090 --> 00:03:06.990 It's a fair question, and the reactions are all 00:03:06.990 --> 00:03:10.770 over the place. Democrats are predictably apopleptic, 00:03:11.069 --> 00:03:13.169 according to the report. But it's not just them. 00:03:13.870 --> 00:03:16.150 Some MAGA Republicans are apparently unhappy 00:03:16.150 --> 00:03:19.389 too, mostly because of Qatar's ties with Iran, 00:03:19.789 --> 00:03:22.069 which they strongly oppose. Interesting so push 00:03:22.069 --> 00:03:24.569 back from both sides potentially. Yeah, the Republican 00:03:24.569 --> 00:03:27.090 members of Congress are mostly quiet But Maggie 00:03:27.090 --> 00:03:29.449 pundits like Laura Loomer they're criticizing 00:03:29.449 --> 00:03:32.030 it publicly and then Qatar itself put out a statement 00:03:32.030 --> 00:03:35.229 right calling the news premature Which could 00:03:35.229 --> 00:03:38.490 mean a few things maybe it's an out for Trump 00:03:38.490 --> 00:03:41.909 if things get too hot Or maybe more likely it 00:03:41.909 --> 00:03:44.590 means the details of what Qatar gets in return 00:03:45.080 --> 00:03:48.080 They're still being hammered out possibly during 00:03:48.080 --> 00:03:50.259 Trump's upcoming trip, which by the way is his 00:03:50.259 --> 00:03:52.159 first foreign trip since taking office Okay, 00:03:52.240 --> 00:03:54.939 so still very much in flux, but the implications 00:03:54.939 --> 00:03:58.039 if this does go through a huge Yeah, they could 00:03:58.039 --> 00:04:00.199 basically get the emoluments clause, right? Yeah 00:04:00.199 --> 00:04:02.099 set a precedent where foreign money flows in 00:04:02.099 --> 00:04:04.039 through these foundation structures Yeah, it 00:04:04.039 --> 00:04:06.460 potentially opens the door to well more influence. 00:04:06.500 --> 00:04:09.400 Maybe even bribery Is there any chance Congress 00:04:09.400 --> 00:04:12.199 or the courts step in the report suggests that's 00:04:12.199 --> 00:04:14.780 unlikely? It actually says the best hope to stop 00:04:14.780 --> 00:04:17.500 it might be political pressure. Yeah. From the 00:04:17.500 --> 00:04:20.439 right wing. Wow, okay. Let's, uh, let's switch 00:04:20.439 --> 00:04:23.800 gears, then. From luxury jets to drug prices. 00:04:24.040 --> 00:04:26.339 Right. Trump announced a new executive order. 00:04:26.660 --> 00:04:29.639 Big promises. Cutting prescription drug prices 00:04:29.639 --> 00:04:33.839 by 30 % to 80%. 30 to 80%, ow! Through something 00:04:33.839 --> 00:04:36.689 called a most favored nation's policy. But you 00:04:36.689 --> 00:04:38.389 know, it raises that immediate question. Yeah. 00:04:38.569 --> 00:04:40.709 The piece points us out, if it's that easy just 00:04:40.709 --> 00:04:43.269 signing an order, why hasn't anyone, including 00:04:43.269 --> 00:04:45.790 Trump himself before, already done it? Exactly. 00:04:45.970 --> 00:04:47.970 So the report floats three possibilities. None 00:04:47.970 --> 00:04:50.949 too optimistic. OK. One, Trump's the first president 00:04:50.949 --> 00:04:53.930 not beholden to Big Pharma, which, given his 00:04:53.930 --> 00:04:57.990 history, seems unlikely. Two, the order is actually 00:04:57.990 --> 00:05:00.600 unlawful. Like other attempts that got shot down 00:05:00.600 --> 00:05:03.500 in court. Possible. Or three, the actual change 00:05:03.500 --> 00:05:05.480 is pretty small and the talk of trillions of 00:05:05.480 --> 00:05:08.439 dollars in savings is just, well, hype. Trillions? 00:05:08.600 --> 00:05:10.540 Is that even feasible? Well, the U .S. spends 00:05:10.540 --> 00:05:13.500 a lot on drugs. But trillions in savings implies 00:05:13.500 --> 00:05:16.160 something massive and immediate. It's more likely 00:05:16.160 --> 00:05:19.019 any savings, if they happen, would be much smaller 00:05:19.019 --> 00:05:22.259 and take longer to show up. Yeah. Big gap between 00:05:22.259 --> 00:05:25.240 the claim and the probable reality. Got it. OK, 00:05:25.379 --> 00:05:27.990 moving on to some political commentary. This 00:05:27.990 --> 00:05:30.629 time about JD Vance. Yeah, apparently he tried 00:05:30.629 --> 00:05:32.370 to tell a joke during a press conference about 00:05:32.370 --> 00:05:35.189 the World Cup. Something referencing Secretary 00:05:35.189 --> 00:05:37.250 Noem and visitors overstaying their welcome. 00:05:37.370 --> 00:05:40.410 Oh, boy. How did that go over? Like a lead balloon, 00:05:40.410 --> 00:05:42.970 apparently. It just fell completely flat. Why? 00:05:43.230 --> 00:05:45.410 I mean, what was the issue? Well, the electoral 00:05:45.410 --> 00:05:47.430 vote piece makes a good point. With everything 00:05:47.430 --> 00:05:49.829 going on around immigration and deportations, 00:05:50.329 --> 00:05:53.310 it's just, it's not really joking matter for 00:05:53.310 --> 00:05:55.310 a lot of people. It comes off as insensitive, 00:05:55.410 --> 00:05:57.829 out of touch. Yeah, I can see that. But the deeper 00:05:57.829 --> 00:06:00.389 analysis here is about authenticity. The report 00:06:00.389 --> 00:06:02.790 suggests Vance is trying to copy Trump's style, 00:06:03.009 --> 00:06:05.149 his rhetoric. Trying to be Trump. Yeah, but it 00:06:05.149 --> 00:06:07.370 feels forced. Like, people might disagree with 00:06:07.370 --> 00:06:09.970 Trump, but his supporters often feel he means 00:06:09.970 --> 00:06:13.029 what he says. With Vance, it supposedly lacks 00:06:13.029 --> 00:06:15.589 that genuine feel, a bit like the critique of 00:06:15.589 --> 00:06:18.490 Ron DeSantis trying the same thing. Ah, OK. So 00:06:18.490 --> 00:06:21.509 the prediction is this inauthenticity might hurt 00:06:21.509 --> 00:06:24.250 him if he, say, runs for president later. That's 00:06:24.250 --> 00:06:27.319 the idea. that struggle to seem authentic, to 00:06:27.319 --> 00:06:29.560 really connect with the base in that Trump -like 00:06:29.560 --> 00:06:32.680 way, could be a real hurdle. Interesting. Voters 00:06:32.680 --> 00:06:34.779 can often sniff that out, can't they, when someone's 00:06:34.779 --> 00:06:36.220 trying too hard to be something they're not? 00:06:36.420 --> 00:06:38.920 Absolutely. Perceived conviction matters, even 00:06:38.920 --> 00:06:40.600 if you disagree with the substance. All right, 00:06:40.600 --> 00:06:44.220 let's shift focus now to the actual working part 00:06:44.220 --> 00:06:46.699 of Washington, or maybe the lack thereof in some 00:06:46.699 --> 00:06:49.860 cases. We have two reports here under work in 00:06:49.860 --> 00:06:52.879 nine to five. First up, FBI Director Kash Patel. 00:06:53.019 --> 00:06:55.740 Right. NBC News had a report alleging that Patel, 00:06:55.779 --> 00:06:59.399 who's a political appointee, is cutting corners, 00:06:59.579 --> 00:07:01.720 not fully engaged. What are the specific claims? 00:07:02.079 --> 00:07:05.079 Pretty specific, actually. Daily briefings, down 00:07:05.079 --> 00:07:06.939 to just twice a week, apparently because he's 00:07:06.939 --> 00:07:10.120 often late. Weekly Zoom calls with law enforcement 00:07:10.120 --> 00:07:14.139 leaders across the country, canceled. And there 00:07:14.139 --> 00:07:16.019 are even claims that briefers find it hard to 00:07:16.019 --> 00:07:18.339 keep his attention, sometimes needing to use 00:07:18.339 --> 00:07:21.160 pictures, similar to what was reported about 00:07:21.160 --> 00:07:23.829 briefing Trump. Wow. And something about travel. 00:07:24.250 --> 00:07:26.610 Yeah. The report alleges frequent use of government 00:07:26.610 --> 00:07:28.949 planes for, let's say, less than official trips. 00:07:29.569 --> 00:07:32.269 Nashville, Las Vegas, New York City mentioned. 00:07:32.509 --> 00:07:35.009 And Patel's response? He and his allies are pushing 00:07:35.009 --> 00:07:38.129 back hard, calling it a hit piece, offering other 00:07:38.129 --> 00:07:40.589 explanations for his schedule and travel. Standard 00:07:40.589 --> 00:07:43.670 counterattack. So who do you believe? Well, you 00:07:43.670 --> 00:07:46.420 always consider the source. Potential bias. But 00:07:46.420 --> 00:07:48.500 the electoral vote analysis kind of suggests 00:07:48.500 --> 00:07:50.480 the truth is likely somewhere in the middle probably 00:07:50.480 --> 00:07:53.600 leaning towards NBC's version having some substance 00:07:53.600 --> 00:07:56.019 Raises real questions about his engagement at 00:07:56.019 --> 00:07:58.920 least okay, and the second work in nine to five 00:07:58.920 --> 00:08:01.850 item is about senator John Fetterman Yeah, some 00:08:01.850 --> 00:08:03.870 unflattering reports there, too, from New York 00:08:03.870 --> 00:08:06.730 Magazine and NBC News, focusing on his work habits 00:08:06.730 --> 00:08:10.209 and what they call increasingly erratic behavior. 00:08:10.509 --> 00:08:13.089 Erratic. What's the evidence they cite for lack 00:08:13.089 --> 00:08:16.310 of engagement first? Quite a bit, actually. A 00:08:16.310 --> 00:08:18.750 high number of missed Senate votes since April 00:08:18.750 --> 00:08:22.110 2024. Very little committee attendance. People 00:08:22.110 --> 00:08:23.970 having trouble scheduling meetings with him. 00:08:24.430 --> 00:08:26.490 Not many public appearances back in Pennsylvania. 00:08:26.769 --> 00:08:29.240 OK, those are measurable things. Right. They 00:08:29.240 --> 00:08:31.939 suggest a lower level of participation. And the 00:08:31.939 --> 00:08:34.399 erratic behavior claims. Those are more concerning. 00:08:35.100 --> 00:08:37.600 Reports of an increased temper, being more isolated 00:08:37.600 --> 00:08:40.120 socially, and maybe some conspiratorial thinking, 00:08:40.799 --> 00:08:43.620 especially about why he's being criticized, linking 00:08:43.620 --> 00:08:45.860 it to his views on Israel. And his explanation. 00:08:46.100 --> 00:08:48.039 He pushes back too, of course. Since it's because 00:08:48.039 --> 00:08:50.419 he's an outsider. that he prioritizes the important 00:08:50.419 --> 00:08:52.720 votes and campaigning. He claims his health is 00:08:52.720 --> 00:08:56.100 good. And he suggests it's really about left 00:08:56.100 --> 00:08:58.759 -wing anger over his stance on Israel and his 00:08:58.759 --> 00:09:01.039 relationship with Trump. Hmm. But there was also 00:09:01.039 --> 00:09:04.100 a letter. Yes, that's significant. A leaked letter 00:09:04.100 --> 00:09:05.919 from someone described as a former supporter 00:09:05.919 --> 00:09:08.669 and staffer. And what did it say? It detailed 00:09:08.669 --> 00:09:11.750 some really worrying stuff, potential issues 00:09:11.750 --> 00:09:14.409 with sticking to his medication regimen, the 00:09:14.409 --> 00:09:16.970 conspiratorial thoughts again, what the litter 00:09:16.970 --> 00:09:20.330 calls megalomania regarding Israel, mood swings, 00:09:20.909 --> 00:09:23.649 apparent lying. And the report makes a point 00:09:23.649 --> 00:09:26.230 of saying the author leans centrist, presumably 00:09:26.230 --> 00:09:28.250 to counterclaims it's just a political attack. 00:09:28.769 --> 00:09:31.029 It paints a picture that seems to go beyond just 00:09:31.029 --> 00:09:33.269 work style differences. How are his Senate colleagues 00:09:33.269 --> 00:09:36.970 reacting? It's mixed. Some Democrats are expressing 00:09:36.970 --> 00:09:40.320 support. sympathy. But interestingly, some Republicans, 00:09:40.639 --> 00:09:43.259 Cotton, Grassley, Dave McCormick are mentioned, 00:09:43.700 --> 00:09:45.559 have defended him quite strongly. Republicans 00:09:45.559 --> 00:09:48.820 defending him. Why? Speculation ranges from maybe 00:09:48.820 --> 00:09:52.700 genuine empathy to perhaps political calculation, 00:09:53.320 --> 00:09:55.039 hoping maybe he'd consider switching parties. 00:09:55.289 --> 00:09:57.169 It's complex. Yeah, it sounds like a really tough 00:09:57.169 --> 00:09:59.830 situation, personally and politically. The intersection 00:09:59.830 --> 00:10:02.990 of health, high office, party politics. Definitely 00:10:02.990 --> 00:10:05.190 underscores all those pressures. Yeah. And the 00:10:05.190 --> 00:10:07.190 different reactions show how tricky these things 00:10:07.190 --> 00:10:10.070 are to navigate in the Senate spotlight. OK, 00:10:10.070 --> 00:10:12.730 let's move south to Georgia. Marjorie Taylor 00:10:12.730 --> 00:10:15.570 Greene. She decided not to run for Senate against 00:10:15.570 --> 00:10:18.570 John Ossoff. Right. And if you follow Georgia 00:10:18.570 --> 00:10:21.070 politics, this probably isn't a huge surprise. 00:10:21.250 --> 00:10:24.169 Why not? The analysis points to three main problems 00:10:24.169 --> 00:10:27.100 for her. First, while she's strong in her district, 00:10:27.440 --> 00:10:30.440 her statewide popularity among Republicans, reportedly 00:10:30.440 --> 00:10:34.039 low. Okay. Second, polling against Ossoff, especially 00:10:34.039 --> 00:10:36.860 with independent voters, weak. Right. And third, 00:10:37.360 --> 00:10:40.090 maybe the killer. Lack of support, maybe even 00:10:40.090 --> 00:10:42.950 opposition from Republican leadership. So even 00:10:42.950 --> 00:10:45.649 she saw the writing on the wall. Seems like it. 00:10:45.649 --> 00:10:47.889 Looks like a pragmatic move, maybe some self 00:10:47.889 --> 00:10:50.429 -preservation. Deciding to stay in her safe house 00:10:50.429 --> 00:10:52.909 seat instead of risking a tough statewide race. 00:10:52.970 --> 00:10:55.250 Who might run instead then? Names like Raffensperger, 00:10:55.330 --> 00:10:58.149 John King, Chris Carr floated. But interestingly, 00:10:58.389 --> 00:11:01.570 the polling right now shows generic Republican 00:11:01.570 --> 00:11:05.230 actually does best against Ossoff. Huh, so it's 00:11:05.230 --> 00:11:07.350 less about the specific candidate right now? 00:11:07.480 --> 00:11:10.039 It highlights the challenge any individual Republican 00:11:10.039 --> 00:11:12.419 might face and maybe the underlying partisan 00:11:12.419 --> 00:11:15.139 balance in Georgia. It's a strategic calculation 00:11:15.139 --> 00:11:19.259 for sure. All right. Now this next one is. Well, 00:11:19.259 --> 00:11:22.299 it's disturbing. Federal judges getting hundreds 00:11:22.299 --> 00:11:24.940 of unsolicited pizzas. Yeah, across at least 00:11:24.940 --> 00:11:26.559 seven states. It sounds almost like a prank, 00:11:26.620 --> 00:11:28.799 but the context is really chilling. Makes it 00:11:28.799 --> 00:11:30.960 so chilling. Three things the report highlights. 00:11:31.440 --> 00:11:35.600 One, the timing. It started after January 20th. 00:11:35.679 --> 00:11:38.860 Two. Many pizzas were addressed to Daniel Andral. 00:11:39.179 --> 00:11:41.000 That name sounds familiar. He was the son of 00:11:41.000 --> 00:11:44.080 Judge Esther Salas. He was killed in an attack 00:11:44.080 --> 00:11:47.139 targeting her by a disgruntled lawyer. Oh my 00:11:47.139 --> 00:11:50.399 god. Okay, and three, there's a pattern. Judges 00:11:50.399 --> 00:11:53.120 getting these pizzas often right after ruling 00:11:53.120 --> 00:11:55.299 against the Trump administration. So the message 00:11:55.299 --> 00:11:59.360 is intimidation. Clearly. Reminder, we know where 00:11:59.360 --> 00:12:02.139 you are. You're vulnerable. And apparently, some 00:12:02.139 --> 00:12:04.460 deliveries even went to judge's relatives, who 00:12:04.460 --> 00:12:06.879 likely don't have security details. That's awful. 00:12:06.980 --> 00:12:10.299 Just pure menace. It is. And while, sure, most 00:12:10.299 --> 00:12:12.080 people sending these probably won't act violently 00:12:12.080 --> 00:12:14.340 themselves. It only takes one. Exactly. Yeah. 00:12:14.659 --> 00:12:17.539 One unstable person seeing this as a signal or 00:12:17.539 --> 00:12:19.779 encouragement. It's a really worrying trend for 00:12:19.779 --> 00:12:22.139 the judiciary. Oh. Highlights the polarization 00:12:22.139 --> 00:12:24.740 and potential for real threats. Definitely concerning 00:12:24.740 --> 00:12:27.740 for judicial safety and independence. OK, let's 00:12:27.740 --> 00:12:31.639 make a pretty significant shift now to the economy. 00:12:31.820 --> 00:12:34.419 We're digging into the Hedgeye risk management 00:12:34.419 --> 00:12:37.639 Q2 mid -quarter report. Right. Moving from politics 00:12:37.639 --> 00:12:41.559 to data -driven economic analysis. Hedgeye uses 00:12:41.559 --> 00:12:45.519 their GIP model growth, inflation. policy. Okay. 00:12:45.820 --> 00:12:48.080 And their current take is that the U .S. economy 00:12:48.080 --> 00:12:50.820 is in Quad Four. Quad Four. What does that mean 00:12:50.820 --> 00:12:53.200 in their system? Quad Four is when economic growth 00:12:53.200 --> 00:12:55.279 is slowing down and inflation is slowing down 00:12:55.279 --> 00:12:57.340 or decelerating at the same time. Okay. Growth 00:12:57.340 --> 00:12:59.340 down, inflation down. What does that usually 00:12:59.340 --> 00:13:01.960 imply? Typically means the Fed or monetary policy 00:13:01.960 --> 00:13:04.379 leans more dubbish, easier money. And the market 00:13:04.379 --> 00:13:06.879 narrative shifts towards deflation or at least 00:13:06.879 --> 00:13:09.360 disinflation. Does the report give specific numbers? 00:13:09.659 --> 00:13:12.220 Yeah, they have projections for U .S. real GDP 00:13:12.220 --> 00:13:14.899 growth, headline CPI inflation year over year. 00:13:15.220 --> 00:13:17.519 They use their short term now cast models and 00:13:17.519 --> 00:13:19.320 also these enhanced comparative base effects 00:13:19.320 --> 00:13:22.299 models. They lay out specific estimates for Q2 00:13:22.299 --> 00:13:25.240 2025. So we know where they think we are right 00:13:25.240 --> 00:13:28.340 now. Right. Although, interestingly, their monthly 00:13:28.340 --> 00:13:31.220 inflation tracker showed that disinflation stalled 00:13:31.220 --> 00:13:34.360 a bit in early May. A little pause in the downward 00:13:34.360 --> 00:13:38.080 trend. What about looking further ahead beyond 00:13:38.080 --> 00:13:40.429 this quarter? Their forecast for the next 12 00:13:40.429 --> 00:13:42.950 months shows a shift. They see us moving out 00:13:42.950 --> 00:13:46.669 of Quad 4 and Q2 into Quad 3 and Q3. Quad 3 is 00:13:46.669 --> 00:13:49.789 growth slowing, but inflation accelerating. And 00:13:49.789 --> 00:13:52.370 then into Quad 2 and Q4. And Quad 2. That's growth 00:13:52.370 --> 00:13:54.710 accelerating and inflation accelerating. So they 00:13:54.710 --> 00:13:56.710 expect the whole growth inflation mix to change 00:13:56.710 --> 00:13:58.649 significantly over the rest of the year. Their 00:13:58.649 --> 00:14:00.889 GDP Nowcast table breaks down the indicators 00:14:00.889 --> 00:14:03.129 driving this. Got it. Do they look globally, 00:14:03.389 --> 00:14:06.820 too? Yep. There's a G20 GIP model summary. It 00:14:06.820 --> 00:14:08.820 shows how the U .S. fits into the picture with 00:14:08.820 --> 00:14:11.080 other major economies, looking at growth and 00:14:11.080 --> 00:14:14.320 inflation for Q1 and Q2. And they briefly touch 00:14:14.320 --> 00:14:16.639 on their investment positions, longs, shorts, 00:14:17.059 --> 00:14:19.279 across different timeframes. OK, so what are 00:14:19.279 --> 00:14:21.600 the big macro themes they're focused on for Q2? 00:14:21.779 --> 00:14:25.080 The first one is basically, when does USA's Quad 00:14:25.080 --> 00:14:27.620 Four bottom out? They look at things like import 00:14:27.620 --> 00:14:29.840 container volume from China. Any market signals. 00:14:30.120 --> 00:14:32.320 Oh, yeah. They highlight some really interesting 00:14:32.320 --> 00:14:34.740 ones. Record high share of options trading in 00:14:34.740 --> 00:14:37.559 those zero data expiration contracts, zero DTE, 00:14:38.360 --> 00:14:41.580 super short -term speculation, and the biggest 00:14:41.580 --> 00:14:43.940 gap between what the market expects volatility 00:14:43.940 --> 00:14:46.139 to be versus what it actually has been since 00:14:46.139 --> 00:14:48.559 the global financial crisis. Huge uncertainty 00:14:48.559 --> 00:14:51.059 signal there. Anything else? Record high growth 00:14:51.059 --> 00:14:53.480 and tariff revenue year over year. Big strengthening 00:14:53.480 --> 00:14:56.200 in the Taiwan dollar. also the largest drop ever 00:14:56.200 --> 00:14:58.740 recorded in the outlook for stocks, and the second 00:14:58.740 --> 00:15:01.279 biggest jump in expectations for rising unemployment. 00:15:01.820 --> 00:15:03.799 So a lot of indicators pointing down are showing 00:15:03.799 --> 00:15:06.679 stress. Pretty much. They also talk about this 00:15:06.679 --> 00:15:09.600 sloth cycle concept, like the economies in this 00:15:09.600 --> 00:15:12.120 late cycle stasis. Sloth cycle. How do they measure 00:15:12.120 --> 00:15:15.039 that? Looking at trends like fewer overtime hours, 00:15:15.399 --> 00:15:18.519 less temporary staffing, lower rates of people 00:15:18.519 --> 00:15:21.500 quitting or being hired, all signs of a cooling 00:15:21.500 --> 00:15:24.159 labor market. OK. And a key point. Consumption 00:15:24.159 --> 00:15:26.659 capacity, basically. People's ability to spend 00:15:26.659 --> 00:15:29.940 is at a 50 month low in terms of its rate of 00:15:29.940 --> 00:15:32.899 change. Aggregate salary and wage growth is slowing 00:15:32.899 --> 00:15:36.179 down. Weakening demand that paints a pretty clear 00:15:36.179 --> 00:15:38.340 picture for the US. What's the second theme? 00:15:38.700 --> 00:15:41.779 That one's when does global quad to top so shifting 00:15:41.779 --> 00:15:44.580 focus internationally quad to again That's accelerating 00:15:44.580 --> 00:15:47.399 growth and inflation exactly They see potential 00:15:47.399 --> 00:15:49.639 for inflation picking up elsewhere, especially 00:15:49.639 --> 00:15:52.039 the eurozone partly because the comparisons to 00:15:52.039 --> 00:15:54.019 last year get easier That's the base effects 00:15:54.019 --> 00:15:56.440 idea. Okay, they also know yield curves steepening 00:15:56.440 --> 00:15:59.100 worldwide and they mentioned being long some 00:15:59.100 --> 00:16:01.519 European markets like Poland Switzerland the 00:16:01.519 --> 00:16:04.019 eurozone itself suggests they expect a different 00:16:04.019 --> 00:16:06.340 story unfolding outside the U .S. And the third 00:16:06.340 --> 00:16:09.659 theme sounds political again. It connects back, 00:16:09.659 --> 00:16:12.940 yeah. Timing Trump tariffs versus tax cuts. They 00:16:12.940 --> 00:16:14.799 look at the stated positions of the U .S. and 00:16:14.799 --> 00:16:18.019 China on trade, the current tariff rates. Which 00:16:18.019 --> 00:16:20.360 are high, historically speaking. Extremely high. 00:16:20.879 --> 00:16:22.480 They mention the U .S. effective tariff rate 00:16:22.480 --> 00:16:25.799 is the highest it's been in 125 years. And trade 00:16:25.799 --> 00:16:29.039 policy uncertainty is at record highs. Wow. So 00:16:29.039 --> 00:16:31.100 how does this timing work out in their view? 00:16:31.340 --> 00:16:35.179 They frame 2025 as pain first, reward later, 00:16:35.740 --> 00:16:38.539 quoting Trump and economist James Besson, suggesting 00:16:38.539 --> 00:16:40.980 the real economic bite from policies might hit 00:16:40.980 --> 00:16:43.940 in the next 6 -12 months, the goal being to re 00:16:43.940 --> 00:16:46.879 -privatize the economy. So induce some economic 00:16:46.879 --> 00:16:49.600 pain early on. That seems to be the theory. Sequencing 00:16:49.600 --> 00:16:52.360 the pain vies the reward. The idea might be Take 00:16:52.360 --> 00:16:55.299 the hit in 2025, which then sets up easier comparisons 00:16:55.299 --> 00:16:58.440 for potential economic re -acceleration in 2026, 00:16:58.799 --> 00:17:01.259 fueled by tax cuts. Timed nicely for the midterm 00:17:01.259 --> 00:17:03.059 elections, perhaps. One could certainly infer 00:17:03.059 --> 00:17:05.599 that. It suggests a very strategic, politically 00:17:05.599 --> 00:17:08.700 aware approach to economic policy timing. So 00:17:08.700 --> 00:17:10.599 wrapping this all up, wow, we covered a lot from 00:17:10.599 --> 00:17:12.980 that wild Qatari plane story and what it means 00:17:12.980 --> 00:17:15.559 for emoluments. Yeah, to the skepticism around 00:17:15.559 --> 00:17:18.579 those big drug price cut promises. A whole authenticity 00:17:18.579 --> 00:17:21.599 question with politicians like Vance, the questions 00:17:21.599 --> 00:17:24.299 about officials like Patel and Fetterman actually 00:17:24.299 --> 00:17:26.859 doing the work. Right, and the political calculations 00:17:26.859 --> 00:17:29.900 behind someone like MTG not running for Senate, 00:17:30.319 --> 00:17:33.079 plus that really disturbing pizza intimidation 00:17:33.079 --> 00:17:35.059 trend against judges. And then capping it off 00:17:35.059 --> 00:17:38.380 with that detailed hedge -eye economic forecast, 00:17:38.480 --> 00:17:41.039 anticipating this shift through different economic 00:17:41.039 --> 00:17:44.359 quads driven by policy, especially trade. It 00:17:44.359 --> 00:17:47.259 really shows how intertwined the political maneuvers 00:17:47.259 --> 00:17:49.579 and the economic outlook are right now. You can't 00:17:49.579 --> 00:17:52.660 really separate them. Definitely. So here's something 00:17:52.660 --> 00:17:55.400 to chew on. Hedge -eye, and apparently the administration 00:17:55.400 --> 00:17:58.380 itself, seemed to anticipate some economic pain 00:17:58.380 --> 00:18:01.559 in 2025. How does that square with the political 00:18:01.559 --> 00:18:04.099 climate? We talked about public reactions, pressures. 00:18:04.599 --> 00:18:07.299 Will the promise of the 2026 rebound be enough 00:18:07.299 --> 00:18:09.700 to manage those headwinds? That's a great question. 00:18:10.200 --> 00:18:12.359 Or maybe you want to dig deeper into history. 00:18:12.680 --> 00:18:15.220 Look at past periods with really high trade uncertainty 00:18:15.220 --> 00:18:18.160 like now. How did the economy actually perform 00:18:18.160 --> 00:18:20.660 then? Could be revealing. Lots to think about. 00:18:20.720 --> 00:18:23.240 And remember, if you've got your own stack of 00:18:23.240 --> 00:18:25.440 sources you want us to tackle. Yeah, send them 00:18:25.440 --> 00:18:27.579 over. We're always ready for the next deep dive.