Latest / Trend Watch / Episode 104: Ballrooms, Mines, and AfD’s Advance

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Episode 104: Ballrooms, Mines, and AfD’s Advance · Trend Watch

• 0:02
  SPEAKER_01: Ready to take a deeper look at where history, politics, and economics all intersect?
• 0:08
  SPEAKER_01: Well then, you've come to the right place.
• 0:11
  SPEAKER_01: Each week,
• 0:11
  SPEAKER_01: here's where we pull back the headlines and focus on the big trends,
• 0:16
  SPEAKER_01: the stuff that actually shapes our future.
• 0:19
  SPEAKER_01: Through the noise, we focus on the signal.
• 0:22
  SPEAKER_01: I'm your host, Neil Howe, and this is
• 0:25
  SPEAKER_00: Trend Watch.
• 0:27
  SPEAKER_01: Today is September 3rd, 2026, and this is Trend Watch.
• 0:32
  SPEAKER_01: Welcome back, everybody.
• 0:34
  SPEAKER_01: As usual, I have on my fellow analyst, Christian Ford.
• 0:38
  SPEAKER_01: Christian, how was your week?
• 0:39
  SPEAKER_00: It's been pretty good, Neil.
• 0:40
  SPEAKER_00: I've been in planning mode, as I have told you that I am this weekend going to get a dog.
• 0:46
  SPEAKER_01: Yeah, I heard about that.
• 0:47
  SPEAKER_01: Traveling five states away to get it, right?
• 0:50
  SPEAKER_00: That's right.
• 0:51
  SPEAKER_00: I'm driving to Louisville tomorrow.
• 0:54
  SPEAKER_01: Because you insisted on some rare breed.
• 0:57
  SPEAKER_00: That's right.
• 0:57
  SPEAKER_00: We wanted a rough collie.
• 0:59
  SPEAKER_00: And they're not that popular these days.
• 1:01
  SPEAKER_00: It's kind of hard to find good ethical breeders.
• 1:04
  SPEAKER_01: Wow.
• 1:06
  SPEAKER_00: I wouldn't even ask.
• 1:08
  SPEAKER_01: What's the difference between an ethical and a non-ethical breeder?
• 1:11
  SPEAKER_01: But I guess the collie is the collie, right?
• 1:17
  SPEAKER_01: That's right.
• 1:18
  SPEAKER_01: They're very smart dogs.
• 1:20
  SPEAKER_01: Yes.
• 1:21
  SPEAKER_01: Yes.
• 1:22
  SPEAKER_01: Now, I actually remember Lassie.
• 1:25
  SPEAKER_01: I'm sure you do not.
• 1:27
  SPEAKER_01: I'm sure Lassie and all of Lassie's children were dead long before you came along.
• 1:35
  SPEAKER_01: But, you know,
• 1:38
  SPEAKER_01: like all Shepard dogs,
• 1:40
  SPEAKER_01: but extraordinarily intelligent, good with people, I think you'll be happy.
• 1:47
  SPEAKER_00: Yeah, I'm excited.
• 1:49
  SPEAKER_01: Learn how to train it.
• 1:51
  SPEAKER_01: So that's right.
• 1:53
  SPEAKER_01: Well, let's get right into it.
• 1:54
  SPEAKER_01: Why don't you just start out taking us through the markets and we'll go from there.
• 2:00
  SPEAKER_00: All right, Neil.
• 2:00
  SPEAKER_00: Well, the S&P 500 closed up today 1.06%, and over the last five days is up 0.22%.
• 2:09
  SPEAKER_00: As for the VIX, closed down at 14.3%, so pretty low there.
• 2:13
  SPEAKER_00: And as for the 10-year Treasury,
• 2:15
  SPEAKER_00: that is at 4.776% and is up 10.2 basis points over the last five days.
• 2:22
  SPEAKER_01: Yeah, well, 14.3%.
• 2:25
  SPEAKER_01: I don't know how low that is, but in today's environment, that's low.
• 2:30
  SPEAKER_00: Yes.
• 2:31
  SPEAKER_01: We're not seeing the VIXs of 10 that I recall back in 2018, but it's low.
• 2:42
  SPEAKER_01: And what else is going on?
• 2:45
  SPEAKER_01: Did we have many, I don't know, state of the economy reports?
• 2:50
  SPEAKER_01: Yes.
• 2:51
  SPEAKER_00: Yeah, we had the ISM PMIs for August, the final reading here.
• 2:55
  SPEAKER_00: Manufacturing fell from 55.6 to 54.6,
• 2:59
  SPEAKER_00: but it's still the eighth consecutive month of expansion,
• 3:02
  SPEAKER_00: so looking good on that front.
• 3:04
  SPEAKER_00: And services, they rose from 54.1 to 55.4.
• 3:08
  SPEAKER_00: That's the strongest gain they have seen in six months.
• 3:12
  SPEAKER_01: Well, this is the political business cycle,
• 3:14
  SPEAKER_01: and you can believe that the Trump administration wants it to stay this way all
• 3:20
  SPEAKER_01: the way up until about two months from now, right, with the midterms.
• 3:25
  SPEAKER_00: Right.
• 3:26
  SPEAKER_01: Look, I'm expecting this to be a lot of liquidity in the market.
• 3:35
  SPEAKER_01: I expect,
• 3:35
  SPEAKER_01: if anything,
• 3:36
  SPEAKER_01: we're going to err on the side of A little bit of inflationary pressure,
• 3:41
  SPEAKER_01: downward pressure on the dollar, and a little bit of the debasement trade.
• 3:48
  SPEAKER_01: We saw that today, actually.
• 3:50
  SPEAKER_01: It was a big day for precious metals.
• 3:54
  SPEAKER_01: The big question, of course, is whether the Fed is going to hike on September 16th.
• 4:03
  SPEAKER_01: A lot of people are talking about Kevin Warsh's hawkish speech at Jackson Hole.
• 4:12
  SPEAKER_01: It was hawkish for him, but he didn't commit himself to anything in particular.
• 4:18
  SPEAKER_01: He just said, you know, employment's fine.
• 4:22
  SPEAKER_01: Inflation is unacceptable.
• 4:23
  SPEAKER_01: We are absolutely committed to making sure that we're going to fall
• 4:28
  SPEAKER_01: within our 2% mandate in inflation.
• 4:31
  SPEAKER_01: And if it doesn't...
• 4:33
  SPEAKER_01: If it doesn't go down, we have work to do.
• 4:35
  SPEAKER_01: You know, that kind of thing.
• 4:36
  SPEAKER_01: He sounded very adamant.
• 4:38
  SPEAKER_01: But I'll tell you honestly, I'm going to be very surprised if they hike on September 16th.
• 4:45
  SPEAKER_01: That is before the midterms.
• 4:49
  SPEAKER_01: And I just don't think they're going to do it.
• 4:53
  SPEAKER_01: Now, I will say today, Christopher Waller, he's on the Fed board.
• 4:59
  SPEAKER_01: And he said he's open to holding rates steady.
• 5:02
  SPEAKER_01: You remember,
• 5:03
  SPEAKER_01: this is the Trump appointee who's actually been surprisingly hawkish
• 5:08
  SPEAKER_01: in recent months, saying he's ready to hike.
• 5:11
  SPEAKER_01: Well, he said he's open to holding rates steady.
• 5:14
  SPEAKER_01: And at that point, the Fed futures actually reflected that immediately.
• 5:20
  SPEAKER_01: So yesterday, the probability of a hike by the September 16th meeting was 63%.
• 5:28
  SPEAKER_01: It came down to 50%.
• 5:31
  SPEAKER_01: The probability of a hike, at least one hike, by October 28th meeting came down to 64%.
• 5:41
  SPEAKER_01: And December 9th, that's the last meeting of the year, it was 90% yesterday.
• 5:48
  SPEAKER_01: That came down to about 83% today.
• 5:49
  SPEAKER_01: So again...
• 5:53
  SPEAKER_01: I think it's going to be an interesting or relatively bullish sailing until
• 6:00
  SPEAKER_01: the midterms and good for the inflation trade, I would say.
• 6:08
  SPEAKER_01: Speaking of which,
• 6:09
  SPEAKER_01: I find it interesting just to say the rule of law and the And taking steps
• 6:16
  SPEAKER_01: to make sure that your interests are protected.
• 6:19
  SPEAKER_01: I don't know if you noticed this,
• 6:20
  SPEAKER_01: but the Dutch National Bank,
• 6:23
  SPEAKER_01: you know,
• 6:23
  SPEAKER_01: this is the Central Bank of the Netherlands,
• 6:26
  SPEAKER_01: is moving some 86 tons of gold from New York City to London.
• 6:33
  SPEAKER_01: You know,
• 6:33
  SPEAKER_01: you can never be too sure about these things,
• 6:35
  SPEAKER_01: you know, what those crazy Americans might do.
• 6:40
  SPEAKER_01: So there you have it.
• 6:44
  SPEAKER_01: Gold moving out, I think a relatively clear sailing ahead.
• 6:51
  SPEAKER_01: And this is what you want to do.
• 6:53
  SPEAKER_01: There's almost nothing now that's going to matter too much with inflation
• 6:57
  SPEAKER_01: that anyone can do now in policy.
• 6:59
  SPEAKER_01: The one thing you don't want to have happen is the market to go down.
• 7:03
  SPEAKER_01: So I think everyone is going to be sort of feeding that narrative.
• 7:08
  SPEAKER_01: And whether Kevin Warsh,
• 7:09
  SPEAKER_01: if he is going to go and push a rate hike in the face of Trump,
• 7:15
  SPEAKER_01: At the very least, I don't think he wants to do it before the midterms.
• 7:20
  SPEAKER_01: And frankly,
• 7:21
  SPEAKER_01: I think someone in the administration talked to Christopher Waller,
• 7:25
  SPEAKER_01: and I think that's basically why he said what he said, right?
• 7:28
  SPEAKER_01: In other words,
• 7:29
  SPEAKER_01: they're saying to these people,
• 7:31
  SPEAKER_01: whatever your beliefs are and whatever you think we have to raise hikes,
• 7:36
  SPEAKER_01: let's do it after the midterms.
• 7:38
  SPEAKER_01: This is a very president-oriented administration.
• 7:43
  SPEAKER_01: Wouldn't you agree, Christian?
• 7:45
  SPEAKER_00: Yep.
• 7:46
  SPEAKER_01: They're really looking at the next week or the next 10 days.
• 7:50
  SPEAKER_01: That's the way the whole war has been managed.
• 7:52
  SPEAKER_01: That's the way everything's managed.
• 7:54
  SPEAKER_01: You know,
• 7:55
  SPEAKER_01: there's Scott Besant,
• 7:56
  SPEAKER_01: you know,
• 7:56
  SPEAKER_01: just thinking about the next three or four days from now,
• 7:59
  SPEAKER_01: what are bond rates going to do?
• 8:04
  SPEAKER_01: There's a lot of focus on immediate results, not a lot of strategy here.
• 8:09
  SPEAKER_01: I really think they're focused on this.
• 8:10
  SPEAKER_01: I think that this is power.
• 8:16
  SPEAKER_01: That's going to be determined on the midterms,
• 8:19
  SPEAKER_01: and they want to do everything they can to help themselves.
• 8:23
  SPEAKER_01: I think they're resigned to losing the House,
• 8:29
  SPEAKER_01: but they certainly would like to keep a foothold in the Senate.