Deep Dive

DEEP DIVE: We Dissent

The following is an excerpt from our October 27, 2025 Morning Briefing. The Fed will almost certainly cut the FFR by 25bps on Wednesday. It will probably do it again on December 10. Apparently, Fed officials believe that the current 4.00% reading of the FFR is restrictive. That’s because they are collectively convinced that the long-run FFR is 3.00% (Fig. 12 below). This rate is also often

DEEP DIVE: An Open Letter to Scott Bessent

Dear Scott,  I Wholeheartedly Agree Thank you for your public service as Secretary of the Treasury of the United States. I read your recent excellent article in The International Economy titled “The Fed’s New ‘Gain-of-Function’ Monetary Policy.” I agree with much of your criticism of the Fed. In addition, I believe that we share the same optimistic “Roaring 2020s” outlook for the US economy, and we both hope that

DEEP DIVE: The Chair Has Spoken

The following is an excerpt from our Morning Briefing dated August 22, 2025. The Fed I: Markets Hear Powell Cooing. We expected Fed Chair Jerome Powell to sound neither dovish nor hawkish when he spoke at the Fed’s Jackson Hole Symposium on Friday. We expected him to be owlish, expressing the need to wait and watch for further data before committing to another round of monetary policy easing. The

DEEP DIVE: Tarrifying Semiconductors

💡The following is an excerpt from our Morning Briefing dated August 7, 2025. Semiconductors initially were exempt from the tariffs President Donald Trump announced on imports from Taiwan and elsewhere, but their rarified status may be about to end. President Trump said on Tuesday that semiconductor-specific tariffs would be announced in the next week or so. Then, last night after the financial markets closed, the President floated the idea of

DEEP DIVE: Foreign Investors Love US Stocks & Bonds

The following is an excerpt from our Morning Briefing dated July 21, 2025. Foreign Buyers I: Loading Up on US Treasuries & Equities. The phrase "I have always depended on the kindness of strangers" is a famous line from Tennessee Williams' play, A Streetcar Named Desire. It's spoken by the character Blanche DuBois in the final scene as a doctor and a nurse are leading

DEEP DIVE: What's The Matter With China's Consumers?

China’s Consumer Bust I: Blame Xi, Not Trump. As US President Donald Trump does his worst to hobble China’s economy, China’s President Xi Jinping may be beating him to the punch. There’s no doubt that Trump’s tariffs are destabilizing Asia’s biggest economy. Though the current 30% US tariff on Chinese imports is a fraction of Trump’s earlier 145% China tax, it’s still

DEEP DIVE: Essential Rare Earth Minerals

This is an excerpt from the June 5, 2025 Morning Briefing of Yardeni Research, Inc. “People who live in glass houses should not throw stones.” That’s a saying that President Trump should have taken to heart before slapping aggressive tariffs on Chinese imports, because China has one thing that the US lacks and needs: rare earth minerals. These minerals are necessary components of high-tech equipment like automobiles, robots, and

DEEP DIVE: Demographics Entrench Deflation In China

For a decade now, economists have been theorizing about how China’s aging and shrinking population might affect its economic growth potential (Fig. 1 below and Fig. 2 below). Yet there’s nothing conjectural about the ways demographics are now exacerbating the nation’s deflation troubles. As Japan’s experience since the 1990s has highlighted, few Asians in their mid-60s and higher consume with gusto as twenty- and thirty-somethings do.

DEEP DIVE: A Semiconductor Revival