Private credit and private equity are suddenly everywhere in the headlines, and if you're taking those headlines at face value, the picture looks apocalyptic. I think those fears are significantly overstated — and it really comes down to one critical distinction that almost nobody in mainstream macro-financial media is getting right.

That distinction is the difference between endogenous money — the actual money-creation engine of the banking system — and what private credit is actually doing, which is something fundamentally different.

In this post, we'll walk through exactly what happens on the balance sheets when a private credit transaction takes place versus when bank credit creates endogenous money. Once you see the mechanics side-by-side, it becomes obvious why private credit stress, while real and painful for investors directly exposed, is not the kind of systemic threat that 2008 was — and why the real thing to watch isn't the private credit headlines at all.

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The market has gone from panic to fresh highs in a hurry, and the big question now is whether this snapback rally still has room to run. In this week’s update, I break down the flow acceleration behind the move, why tariff refunds could add another liquidity tailwind in the months ahead, and why I still think end-of-cycle risk is something to watch closely — just not something the market has to fear yet.

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Markets finally got the catalyst they needed.

Tonight’s ceasefire announcement between the Trump administration and Iran has sparked the sort of move that can change the short-term character of this market very quickly. Equities responded exactly how you would expect when a major pocket of uncertainty gets lifted: aggressively, and all at once.

The bigger point, though, is that this rally did not come out of nowhere. The data was already getting very close to a proper turn. Tonight’s news may have simply been the final push that kicked off the move we had been waiting for. In the full update below, I go through the playbook, where the buy signals stood before tonight, what this changes, what still needs to be watched, and why I think this likely marks the beginning of the next leg higher.

Why Rising Oil Prices May Not Break This Market

Last night, Donald Trump delivered an address to the nation, offering an update on the ongoing conflict with Iran. The takeaway, at least from my perspective, was fairly clear: the message to the rest of the world was essentially, you deal with the Strait of Hormuz, while we may still have more to do with Iran. Markets initially did not like that framing at all.

Futures sold off heavily overnight. But interestingly, by the time the regular session unfolded, we saw a strong recovery. In fact, from the lows we saw on Friday to where things stand now, the S&P 500 has bounced roughly 4%. That raises an important question: are markets beginning to stabilize, even with oil continuing to surge?

Because while equities have started to recover, oil has been having another explosive move higher. As I’m writing this, WTI is sitting around $113 per barrel, and markets are clearly preparing for the possibility that prices could climb further. The issue now is no longer just whether oil is rising, but what that rise actually means for growth, inflation, and the broader market outlook.

(Note: Below is a summary of the Market Update Video for 03/29/2026, click here to watch the video update)

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Last week finally brought the kind of selling I had been warning about for months. Since the end of 2025, the core argument has been that markets were overpriced relative to flows, and we’re now seeing that mismatch resolve in a much more visible way. The big question now is not whether the selloff was justified — I think it clearly was — but whether this is simply the final shakeout before the next leg higher, or the beginning of something more serious.

It’s been a rough stretch for markets.

Over the past several weeks, we’ve seen a sharp uptick in volatility and consistent selling pressure across equities. The S&P 500 is down meaningfully from its recent highs, the Nasdaq has slipped into correction territory, and investor sentiment has clearly shifted.

Naturally, the big question on everyone’s mind is:

Are we on the verge of a major bear market—or is this just a temporary pullback?

In this post, I want to walk through how I’m thinking about the current environment, with a particular focus on one key variable driving concern right now: oil and how I'm analyzing things through an MMT lens.

The Source of Market Anxiety

There are several forces converging at once:

• Geopolitical instability (particularly in the Middle East)
• Rising oil prices
• Weakness in private credit and private equity
• Broader macro uncertainty

All of this feeds into volatility. And volatility, in turn, gets priced into markets.

But volatility alone doesn’t necessarily mean we’re headed for a full-blown recession or a prolonged bear market. To answer that, we need to dig deeper into the mechanics—specifically through an MMT (Modern Monetary Theory) lens.

This past Friday, we finally got the macro headline a lot of us have been waiting on: the Supreme Court ruling on the IEEPA tariffs. The decision came down early Friday morning, and the court deemed the IEEPA tariffs illegal—effectively ending the version of the tariff regime that began on “Liberation Day” last year.

If you remember the mood a year ago, we were stepping into a chaotic policy experiment: a massive wave of tariffs, a lot of uncertainty, and a market trying to price the downstream effects in real time. Now, one year later, the original structure of those tariffs has been ruled unlawful.

But here’s the catch:

The end of the EPA tariffs doesn’t necessarily mean the end of tariff-driven damage. In fact, based on what followed, we may be walking into something that’s economically worse than what we just got rid of.

The Market Reaction: Calm… Then Chaos

The immediate market response to the Supreme Court decision was surprisingly muted. Friday’s session was fairly “meh” at first—there was a modest rally into the close, but nothing that screamed regime shift.

Then the follow-on headline hit.

Over the past five months, the S&P 500 has gone essentially nowhere.

Yes, we’ve made marginal new highs. Yes, we’ve had bursts of volatility. But zoom out and what you see is a market stuck in sideways consolidation dating back to early October. The S&P is up barely 1–1.5% over that stretch. The Nasdaq is actually down slightly.

So the real question is:

Are we building pressure for a sustained breakout — or setting up for another leg lower first?

To answer that, we have to step away from the noise and focus on what actually drives price.

And if you’ve followed my work for any amount of time, you know exactly where this is going:

Flows.

Markets Follow Flows — Not Narratives

Heading into Q4 of last year, I laid out the case that we were likely to see volatility increase. Why?

Because underlying fiscal flows were slowing down.

That deterioration in flows — partly tied to tariff dynamics earlier in 2025 — suggested we were entering a weaker liquidity backdrop. We did get volatility, but instead of a dramatic selloff, we’ve largely just gone sideways.

That part has played out exactly as expected:

On Friday, we got the January CPI report. Headline year-over-year inflation came in at 2.4%, below the consensus expectation of 2.5%. On the surface, that looks like another step in the “inflation is cooling” narrative that has dominated over the past year.

But I want to explain why I don’t think this print changes the bigger picture—and why, from a business cycle and MMT perspective, we may actually be getting close to the point where inflation starts to reaccelerate.

More importantly, I want to walk through what this means for portfolios and asset positioning. Because if you wait for CPI to clearly turn higher before positioning for inflation, you’re probably already too late.

The Market Isn’t Fully Buying the “Cooling Inflation” Story

Here’s something interesting: even as CPI has cooled over the last year, assets that typically outperform in inflationary environments have been winning.

Think about what’s been working:

Over the past six months, the S&P 500 has staged an incredible rally—one that was very much in line with what my models had projected earlier this year. Back at the start of 2025, following the tariff tantrum and the heavy selloff, we flagged the market’s move as a clear mispricing. Flows were simply too strong to justify the decline, and sure enough, the rebound has been powerful.

But as we head into October, the winds that fueled this rally are beginning to shift. What were tailwinds over the summer are now turning into headwinds. The key message I want to make clear is this: I believe we’re at an inflection point, and volatility is likely to spike in the near term. The rally looks exhausted, and a breather—possibly a sharp one—is overdue.

The First Domino: Treasury Flows and the Tax Drain

The most important factor right now comes down to fiscal flows. The daily Treasury statement is, in many ways, the first mover of macroeconomic outcomes.

Each September, we see a major corporate tax drain. This year, starting around September 11th, roughly $120 billion was pulled out of the private sector over a two-week period. On its own, that may not change the long-term trajectory of the economy—but in the short run, it significantly pressures the balance sheet capacity of the financial sector.

As Bitcoin continues to carve out a larger and larger share of the global financial system, the question of what truly drives its price has never been more important. For years, commentators have pointed to “Fed liquidity” as the main force behind Bitcoin’s price action. But as I argue in my latest video, this explanation doesn’t hold up under scrutiny. Instead, the evidence strongly suggests that fiscal flows—not monetary liquidity—are the true driver of Bitcoin’s long-term price trajectory.

Why “Fed Liquidity” Falls Short

In the post-COVID era, analysts have been quick to tie Bitcoin’s movements to changes in so-called Fed liquidity. Whether through quantitative easing (QE), reverse repos, the Treasury General Account (TGA), or reserve balances, the idea was that when the Fed injected liquidity, Bitcoin’s price would rise.

But there’s a fundamental flaw in this argument: Fed liquidity only swaps assets, it doesn’t add new ones. QE and related tools merely change the composition of private sector balance sheets; they don’t create new net financial assets. That means there’s no direct channel for these measures to bid up Bitcoin—or any other financial asset—in a sustainable way.

On Friday, the jobs data hit—and it wasn’t good. Non-farm payrolls came in at just 22,000, far below the already low expectation of 75,000, and well short of the 53,000 that would have at least met consensus. By any measure, that’s a weak print.

It raises a big question: are we looking at the beginning of a major slowdown, or is something else going on beneath the surface?

In this post, I want to break down how to interpret this report, why it might not mean what the “perma-bears” think it does, and how it fits into the broader macroeconomic picture.

Framing the Question: Major Slowdown or Temporary Pause?

Whenever I see a headline-grabbing data point like this, I try to step back and ask a few simple questions:

1. What are the main drivers of the economy right now?
2. What should we expect to see if the bearish case is real?
3. What doesn’t line up with that story?

With jobs data, the natural concern is that weak hiring means the cycle is rolling over. But to confirm that, we need to see reinforcing signals in credit, fiscal policy, inflation, and layoffs. Without those, a bad number might just be noise—or the result of something temporary.