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Yesterday's sell-off was fierce, the Dow shed over 1,000 points following the Fed decision and Warsh's press conference, and today we've already made almost all of it back. We're at a genuine inflection point, and my read is that this consolidation is close to resolving higher.

We now have two FOMC meetings under the new chair, which is enough to start drawing conclusions about how to play this Fed. I lay out what the market's response function is actually telling us, why I expect rates to keep grinding higher, and the one thing Warsh would have to do to break the pattern.

There's also a significant change to the flow picture that arrived on July 24th, which starts to reverse the tailwind that's been supporting this market since April. I walk through what it means for the back half of the year and for the cycle timing.

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The bearish calls are stacking up — Iran escalating, oil back above $80, and the semiconductor index down over 20% from its highs. So this week I steelman the bear case: I lay out every piece of evidence I'd use to argue for a rollover, from the chart pattern to overbought sentiment to the dark pool divergence. It's a fair case, and worth understanding.

Then I take it apart. The core reason I'm still constructive comes down to flows — and this week I dug into exactly why fiscal is re-accelerating this late in the game. There's a specific driver I'll admit had fallen off my radar, and once you see it in the data, it's hard to look at this market as fundamentally overpriced. It's significant enough that it's pushing my cycle-top timing even further out. Full breakdown below — the bear case, the bull case, and the one longer-term chart that genuinely gives me pause.

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We've gotten a little of everything since the last update — a pre-holiday pullback, a rebound, and fresh Iran tensions over the weekend that nudged oil higher. But the S&P is still range-bound in its consolidation, and my base case is unchanged: sideways for another week or few, then a breakout to new highs into late July or the August/September window.

The more interesting story is fiscal. Flows are re-accelerating, and the mid-July low is bottoming out meaningfully higher than April's — a break from the multi-year pattern. I dig into whether this is just a temporary boost from the One Big Beautiful Bill or a genuine sea change that extends this cycle's runway well into 2027. I also flag a rates breakout brewing in the background that could destabilize equities in the short run (and why it's actually supportive longer term), the one tool giving me pause on the next leg, and how a slowing-but-not-collapsing credit cycle fits when fiscal is this dominant. Full breakdown below.

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A big jobs miss (57k vs. 129k expected) shook markets yesterday, but price stabilized right back to where it started and the bigger picture hasn't changed. Flows are re-accelerating strongly into July, and everything in our toolkit still points to a sideways grind before a breakout into August.

This week I spend some time on a macro topic I think is more important than ever: the dollar, and why its direction quietly matters for your returns even when the index looks flat. I walk through the actual math of how a falling dollar affects a US portfolio versus a hedged international one and why I've been positioning for dollar weakness since early 2025.

On markets, there's one signal flashing caution amid an otherwise constructive setup, and I explain why I read it as noise rather than a warning. Plus: the strongest flow re-acceleration we've seen in a while, what it means for the cycle's runway, and the volatility pattern I'm watching as we head toward September. Full breakdown below.

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Volatility is back. Some tech high-fliers are getting hit hard, fear is creeping into the headlines, and a lot of people are reading this as the start of something much bigger. I don't think it is.

This sell-off is unfolding almost exactly as we anticipated heading into the June tax drain — a necessary breather after a long run, not a bubble bursting. The data simply doesn't support the doomsday read: margin debt acceleration actually dipped, fiscal is still too strong, and credit is recovering right on schedule from the Iran-related profit hit. What I'm watching for now is the mirror image of what we saw in May — instead of overbought into weak flows, I want to see oversold into accelerating July flows. That's the setup that defines the buying opportunity.

I'll lay out the levels I'm watching, the specific volatility signals that would confirm a bottom, why the sentiment surveys left a lot of people on the wrong side of this trade, and how I'm thinking about the eventual cycle turn into 2027 — including the historical analog I think fits best. Full breakdown below.

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Kevin Warsh ran his first FOMC meeting today, and it played out about how we should have expected: a dramatically pared-down statement, a more hawkish dot plot, and a clear signal that the new chair wants to keep markets guessing. We got a brief sell-off into the close, then a rebound — not much damage overall, with rates ticking higher.

I'll lay out why I think the market could genuinely benefit from a rate hike here (yes, really), the back-of-the-envelope math on how much interest income that adds to fiscal, and why the short-run picture still looks like a healthy pause rather than the start of something worse. We hit the levels we'd flagged, I trimmed a little risk, and I think we build a base here through the June tax drain before the next leg.

The bigger payoff this week is on the long-run side: oil's drop is buying the cycle more time, and I walk through the actual math of the credit cycle — why steady acceleration paired with collapsing fiscal is the real danger, why 2022 didn't cascade, and why this time will look different. Full breakdown below, including the updated cycle-top timing.

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Friday brought the sell-off we'd been flagging as a possibility — a hot jobs print spiked the VIX, dropped the Nasdaq nearly 5%, and sent yields jumping. The takeaway: the last argument for rate cuts (a soft labor market) just got dashed, and the market had to reprice valuations that were quietly still hoping for cuts.

We hit the 7300 zone I mentioned in the last update almost exactly. The question now is whether we hold it, bounce, or roll straight into the deeper sell-off I've been expecting around the mid-June-into-July window. I'll lay out exactly how I'm playing this, the level where I start moving defensive, and why I'm done chasing this move even if there's one more high left in it.

The longer-term picture hasn't changed: the deficit impulse keeps deteriorating in real terms with a 4.2% CPI consensus landing Wednesday, margin debt keeps accelerating toward danger levels, and credit is recovering from the oil shock exactly as we modeled. But — and this matters — I still don't think this is the end of the cycle. Full breakdown, including the levels and the playbook, below.

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Two weeks since the last update, and the market did what we thought it would — no risk-off moment, just an overextended grind that's now losing steam. We're near the same levels we were at, momentum has exhausted itself, and flows are noticeably less supportive than they were. I'm not risk-off yet, but I'm about as weakly risk-on as you can get.

Oil has finally cooled below $100 a barrel, which helps real flows in the near term — though I don't think the longer-term oil story is over. And the deficit impulse in real terms continues its slow march toward the zero line, with inflation now the dominant headwind.

The most interesting piece this week: bank credit took a dive after the Iran conflict and is now re-accelerating — and this is playing out almost exactly as our DeepMinsky simulation predicted when we modeled the oil shock. I'll walk through the theory of why an oil shock hits credit the way it does, what it means for the late cycle, and a scenario I've been chewing on where the new Fed chair keeping rates flat could actually be the thing that tips us into recession. Full breakdown below.

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Inflation continues to heat up, the April CPI came in at 3.8% annual, beating expectations. That matters a lot in this framework, because the model has been telling us late-cycle CPI surprises are the marker that the long chain of price hikes needed to defend balance-sheet expansion is finally working through the system. Today's print isn't a one-off. I think it kicks off a trend of hotter-than-expected inflation reads through the summer, with oil, the Iran supply shock, and lingering tariff effects all stacking on top of each other.

Equities sold off on the print, then bounced and held. Rates pushed higher, with the 10-year continuing the climb — and I want to walk through why rates are doing what they're doing even with the Trump administration jawboning the Fed. This is the late-cycle market function I've been watching for, and it's holding so far.

The bigger picture: in nominal terms flows are actually re-accelerating into summer, but in real terms the deficit impulse is deteriorating fast. There's a tension here that resolves one of two ways by end of summer, and the bank credit data is doing something that needs explaining. Full breakdown below, including why I'm still not looking to short and what the actual inflection point would have to look like.

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The new AppliedMMT dashboard is live this week — head to the beta dashboard link on the site to check it out. All the daily Treasury data, the flow phase model, vol shift, flow sentiment, and a handful of new model upgrades are now in one cleaned-up spot. I'll walk through what changed and how to use it.

On markets: April was a heck of a run, and we're now showing classic signs of technical exhaustion, we may need a pause here but I'm not convinced, with some caveats, that a big selloff is needed.

But here's the bigger story. While building out the dashboard, I came across a margin debt chart that genuinely jumped off the page. We're now seeing a divergence between price returns and margin debt growth that has only shown up at two other points in the last 50 years — and both times it preceded a major recession. Combined with what the deficit impulse is telling us about late 2026, the picture is getting clearer about where we are in this cycle. We're at least in the seventh-inning stretch.

Full breakdown below — including why I think the next leg higher is still on the table, and what the actual end-of-cycle trigger I'm watching for looks like.

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Markets are consolidating right around 7100 after breaking through 7000 — exactly the pattern I was laying out last week. A half-percent dip today off renewed Middle East negotiation headlines, but the underlying setup hasn't changed.

The bigger topic in this update, though, is theoretical — and I think it's important. There's a lot of noise in the macro world right now about "liquidity," and I want to walk through why I think that framing is actually missing what matters. Liquidity crises can take a swing at asset prices, but they don't break the system. What breaks the system is something else entirely — and understanding that distinction is the difference between being right about a scary headline and being right about where the market actually ends up six months later.

I'll also cover the flows picture, the deficit impulse, the economic calendar for next week including Powell's likely final FOMC as chair, and how we could grind higher into the summer even with some inflationary data starting to filter through.

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.