Transcript

Little Rambo. · ANGLES.

0:01
SPEAKER_00: Little Rambo, my weekly market review, September 13, 2026.
0:09
SPEAKER_00: After a news-light long weekend,
0:11
SPEAKER_00: markets woke up on Tuesday
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SPEAKER_00: to Canada announcing its promised like-for-like retaliatory tariffs on many U.S.
0:18
SPEAKER_00: goods, while at the same time plotting a massive trade deal with Europe.
0:23
SPEAKER_00: Oil prices hurtling back towards $100 with a further escalation of hostilities in
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SPEAKER_00: the Middle East.
0:30
SPEAKER_00: And Trump nonsensically barking that
0:32
SPEAKER_00: the Fed should somehow immediately cut its interest rate from 3.625% to 0.5%,
0:40
SPEAKER_00: in an environment where the central bank may well need to raise it later this week
0:44
SPEAKER_00: to combat sticky inflation.
0:47
SPEAKER_00: With a busy week ahead of new inflation data,
0:50
SPEAKER_00: a European central bank meeting with interest rates spiking around the world
0:54
SPEAKER_00: to multi-decade highs in some cases,
0:57
SPEAKER_00: Apple's launch event,
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SPEAKER_00: Increasing war and tariff tensions and goodness knows what else from
1:03
SPEAKER_00: an increasingly erratic U.S. president.
1:07
SPEAKER_00: The stock indexes dropped,
1:08
SPEAKER_00: with Amgen and Novartis leading the charge lower
1:11
SPEAKER_00: after disappointing drug trial results.
1:15
SPEAKER_00: Qualcomm, however, surged after signing a data center partnership with Amazon.
1:21
SPEAKER_00: Clearly under orders from his master,
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SPEAKER_00: who is looking to bend financial markets to his will with the midterms in mind,
1:28
SPEAKER_00: Treasury Secretary Besant declared war on the bond market on Wednesday,
1:33
SPEAKER_00: giving his nasal nerdy version of a bring-it-on-motherfucker speech,
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SPEAKER_00: squarely aimed at the Wall Street bond vigilantes
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SPEAKER_00: who have pushed interest rates higher lately,
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SPEAKER_00: telling them, I am the house now, bet against me if you want.
1:50
SPEAKER_00: Bond traders,
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SPEAKER_00: or Bloomberg terminal bros,
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SPEAKER_00: as Besant dismissively called them,
1:56
SPEAKER_00: may well take him up on that suggestion,
1:58
SPEAKER_00: since governments have had a historically close
2:00
SPEAKER_00: to zero win rate whenever they've taken on the bond market.
2:05
SPEAKER_00: Indeed,
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SPEAKER_00: their initial reaction to the Treasury Secretary's little Rambo-style challenge was
2:11
SPEAKER_00: to stare him down by taking interest rates to new three-year highs.
2:17
SPEAKER_00: After the dismal failure of his first attempt
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SPEAKER_00: at intimidation market manipulation last month,
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SPEAKER_00: Besant tried again,
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SPEAKER_00: this time announcing a treasury buyback of $6 billion
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SPEAKER_00: of longer-dated government debt.
2:31
SPEAKER_00: Yet again,
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SPEAKER_00: bond traders called his bluff,
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SPEAKER_00: shrugged off the gimmick, and kept on raising rates like crazy.
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SPEAKER_00: Continued U.S.
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SPEAKER_00: attacks on Iran drove the oil price back up through $100 again,
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SPEAKER_00: and the odds of an imminent Fed funds rate increase continued to move higher.
2:52
SPEAKER_00: Stocks reacted accordingly by registering a third straight day of losses.
2:57
SPEAKER_00: As is common on new product launch days,
3:00
SPEAKER_00: Apple's stock price dropped in response to this year's rather underwhelming event,
3:04
SPEAKER_00: which was completely dominated by the splashy new foldable iPhone release.
3:10
SPEAKER_00: While Besant was desperately waving a stick at the bond market in order to try
3:14
SPEAKER_00: and help Republicans at the midterms,
3:17
SPEAKER_00: Trump dangled a carrot in front of the electorate on Thursday,
3:22
SPEAKER_00: floating a probably illegal $5,000 payment to every U.S.
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SPEAKER_00: voter if the party retains control of both houses of Congress,
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SPEAKER_00: a measure that would cost the U.S.
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SPEAKER_00: taxpayer an estimated $1 to $2 trillion and send inflation skyrocketing.
3:39
SPEAKER_00: Just like his promises of a 5K per person doge dividend and
3:43
SPEAKER_00: a 2K per person tariff dividend,
3:46
SPEAKER_00: Trump's latest idea is obviously a total non-starter and won't ever happen,
3:49
SPEAKER_00: of course.
3:51
SPEAKER_00: But there is a group of voters out there who are dumb enough to believe it might.
3:55
SPEAKER_00: And that's what the president is counting on.
3:58
SPEAKER_00: PPI came out pre-market and showed wholesale inflation running at an annualized rate
4:04
SPEAKER_00: of 5.4% higher than forecast.
4:08
SPEAKER_00: Citing enhanced global inflation risk,
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SPEAKER_00: the European Central Bank raised local interest rates by a quarter of a point.
4:16
SPEAKER_00: Americans remained miserable about their economic prospects
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SPEAKER_00: with consumer sentiment readings continuing to plummet.
4:24
SPEAKER_00: Stocks and bonds fell meaningfully as energy prices continued to explode higher.
4:30
SPEAKER_00: After the closing bell,
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SPEAKER_00: Oracle released a blowout earnings report and the stock shot higher in
4:35
SPEAKER_00: the aftermarket.
4:37
SPEAKER_00: But Adobe disappointed and its stock price fell.
4:41
SPEAKER_00: But Friday's big event was the pre-market July CPI release,
4:46
SPEAKER_00: which showed annualized retail inflation stuck at a still hot 3.4%,
4:51
SPEAKER_00: well above the Fed's official target of 2%.
4:55
SPEAKER_00: This was deemed to make a Fed funds rate increase this week much more likely,
5:01
SPEAKER_00: to the extent that if the central bank doesn't raise rates on Wednesday,
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SPEAKER_00: its entire credibility and the perception of its freedom
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SPEAKER_00: from political interference will be in question.
5:12
SPEAKER_00: Expected rate hikes are pretty much already priced into stocks and bonds by now,
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SPEAKER_00: however,
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SPEAKER_00: and the indexes surge to close higher after four straight days of losses
5:22
SPEAKER_00: as oil prices ease back from their recent spike.
5:26
SPEAKER_00: Over the course of the holiday-shortened week,
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SPEAKER_00: however,
5:29
SPEAKER_00: the S&P 500 and NASDAQ 100 large-cap indexes,
5:35
SPEAKER_00: U.S. small caps and international stocks all lost ground.
5:40
SPEAKER_00: Some other things I'm thinking about.
5:43
SPEAKER_00: The average 30-year mortgage interest rate in the U.S.
5:46
SPEAKER_00: rocketed last week to smash through 7% as a result of new multi-year highs in
5:52
SPEAKER_00: the impactful 10-year Treasury rate.
5:55
SPEAKER_00: At an average of $4.30 gas,
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SPEAKER_00: with reports of up to $10 gas in parts of California,
6:02
SPEAKER_00: and $6 diesel at the pump,
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SPEAKER_00: American consumers and businesses have never in history paid this much for fuel in
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SPEAKER_00: the month of September.