Posted Dec 24, 14:08

Everyone's Talking about this Risk

Dec 24:

Ask any economist about the likely dangers of 2026 and they will say inflation. Before I cite the 3 reasons to worry about inflation, here is the chart of annual stock indices' returns, mentioned in my last video. Next year is a mid-term election year, typically a volatile year. What's the likelihood we'll get a 4th straight positive year?. Now onto those 3 reasons.

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Bank of Japan Massacre or Yawn? Dec 18, 2025 20:50:

It does not matter the Bank of Japan will raise rates to a 30-year high. It also unlikely to cause a violent unwiding of the carry trade as was the case in August 2024? Why? First of all, Friday's 25-bp hike in the overnight rate to 0.75% is widely anticipated and will not be a surprise as in August 2024. Also remember, we had a rate hike in January, which was harmless in scale and in anticipation. Secondly, stock markets are well below their highs, meaning they're not at their peaks as was the case in August 2024, when they were vulnerable to any pricking from the Japanese needle. BoJ Governor Ueda, shall temper market fears, by indicating that the new 0.75% rate is well below the neutral rate, which is around 1.0%. This means 0.75% is not at all hawkish. If anything, it remains too low. Once Ueda asserts this point, while assuring no rush in future rate hikes --markets are likely to take it in stride. TIMINGS: BoJ announcements are usually between 3-4 am GMT, followed by the important press conference around 4.5 hrs later.