Connect with me on Substack: maggielake.substack.com 00:00 - Intro: Talking Markets with Peter Boockvar 00:35 - What’s Driving the Bond Market Action? 05:34 - Supply vs. Demand: The Struggles of Long-Term Bonds 08:05 - Are Bond Vigilantes Back? The Fed vs. Market Pushback 09:36 - The UK Gilt Market and Sovereign Debt Risks 12:30 - Alternatives to Bonds: Gold and Defensive Strategies 14:25 - Corporate America’s Mood Amid Rising Rates 16:15 - Will Inflation Return? Navigating the Next Phase 18:40 - What is The Bull Case Narrative? 22:14 - Is the US Economy Headed for a Recession? 25:00 - Global Opportunities: Mixed Economic Trends in Asia and Europe 26:10 - The Dollar Debate: Strength, Tariffs, and Trade Wars 29:10 - Tariffs as a Policy Tool: Pros, Cons, and Consequences 32:03 - Closing Remarks: Looking Ahead to 2025
Funny innit? Truss raised spending and cut taxes. Bond yields up. Rachel from Accounts cuts spending (of course, not for govrnment workers but for the poor, elderly etc.) and raises taxes and bond yields go up. They all do what they're told to bring forth crisis.
Bearish on 2025 - some opportunities in commodities for those who specialize: I’m long gold and silver but that’s about my limit. Peter’s absolutely right about Truss (and I’m no fan - she’s not really a free market person - just someone who adopted those ideas opportunistically): BoE definitely to blame. Bright bloke, good channel: well done Maggie - always fascinating people you seem to find. Really glad I stumbled on the channel.
Raising taxes and cut spending is the right combination. Thats how you pay off yours debts! The problem is: people dont want to go through the necessary pain .Its near impossible to fix things up, as if the person in office does the right thing, he is replaced or lose next election, and then the new guy starts the socialism again.
im at the point i wish someone would raise taxes, cut spending and crash the market. Because at this point it seems like its damned if you do damned if you dont.
For most of my life mortgage interest rates were stable at 13% and stable at 7% for many years. My first house was purchased at 16%. I suspect banks want a higher rate than now while people want it lower. Stability is what is needed.
According to von Mises, the Fed follows the market, and that what the Fed calls the "neutral rate of interest" the market sees as the prospective rate of profit. The Fed tries to keep it's product (bonds) as cheap as possible, yet still more profitable than it's competitor's product (equities). Thus, in 2020, anticipating a complete shutdown, and not only no profits but costs in maintaining a business, the Fed was free to reduce the price of it's product, bonds, to zero or below. Remember that for the Fed profit is how cheaply it can finance it's day job, financing the government.
Japan is finally raising it's interest rate because it has to. It sees the prospective rate of profit raising because it will soon be able to put its factory capacity to work making war material.
When the Fed saw the strong job creation report, it raised the interest rate, not because it was trying to cool inflation, but because it saw future profit rates raising in equities which required it to raise the profit rate in it's product or lose business to it's competitor.
England finds itself in a different position from Japan because England's tax base is finance, while Japan's is industry. Both are shifting from a peace economy to a war economy, greatly confusing matters. England's Chancellor of the Exchequer cut spending and raised taxes, war time necessities, and the Prime Minister is fired for raising the interest rate.
Cut spending with no increase in taxes to balance the budget?? Yeah. How about taxing the non-producers? That would be a good chunk of the financial sector. Those focused on shorts, put spreads, pump and dumps, flash trades.....
Interesting also that private equity is trying to open itself to retail investors as the government changes. Is it doing worse than the public stock market, but concealing their fall so far?
I love Peter but he is completely wrong with this take. Liz Truss and Kwasi Kwarteng tried to force through £49B unfunded tax cuts without notifying anyone - not even the Cabinet - and genuinely were surprised when the UK Gilt market choked. Truss has repeatedly failed to acknowledge any responsibility and laughably claim that it was the work of establishment left-wing woke forces. Yeah, left-wing woke Global Bond Investors 😅😅 She is the perfect example of the Peter Principle in action
@@putonghua73It will all have been engineered. Every step. To get the bankers' chosen guy in the job. Truss left with a former Prime Minister's pension guaranteed, for "serving" for barely months. Nice
Honest question: why is it that none of these videos even consider that billionaires are taxed at the same rate as middle class? They always say social spendings need to be cut, but completely ignore that the revenue side of the equation- that companies generating billions in profit seldom pay any taxes at all, and even get refunds, funded with the taxes from w2 earners, like Amazon? Why is that idea so foreign to all of these financial videos? Why is bezos and musk paying less than 1% in taxes?
First. He doesn’t ignore the revenue side of the equation. The entire point he is making about reducing govt spending is government spending REDUCES the revenue side of the equation. Also several assumptions in the premise of your question are just 180 degrees false. We have a progressive tax system. Higher income is taxed at a higher rate. The top tax bracket is 37%. The bottom bracket is 0%. Now it is fair to say a billionaire who makes $100k in income in a year will pay the same INCOME tax as a middle class person. But that is just income tax. The billionaire will pay MUCH more in capital gains tax and estate tax.
Can I let you in on a little secret. When company x gets taxed they pass along the cost to you. So when you buy a product from company x you pay the tax. You are how old and just learning this? Or do you think the tax paying unicorn pays taxes and not end users
Honest answer: you don’t know what you are talking about. You have so many things wrong, it’s hard to know where to begin. Just a few things; the whole idea that lower earners pay a larger percentage of their income is false. To get that number, you have to change the definition of the payroll tax. The payroll tax is not a tax at all. It is a mandatory contribution to the national retirement system known as Social Security. (By the way, SS is a horrible system in that it is grotesquely underfunded.). The truth is that our income tax system is steeply progressive. The more you earn, the more your tax rate grows. Next, the idea that you can tax the rich enough to pay for all of our social spending or our deficit spending is silly. The last issue I will cover deals with the corporate tax rate. Corporations don’t pay taxes; people pay taxes. The problem with corporate taxes is that you don’t know which people are paying the taxes. Is it the shareholders, the employees or the customers? No one really knows, but you can be sure it includes you!
If investment income was taxed identically to wage income these peoples’ heads would explode. You’re right that the top wage income tax rate is 37% but the top rate for dividends and capital gains is 20% (and the first $90k is taxed at 0%). US tax code is massively biased toward investors vs wage earners. This is also to say nothing about things like the estate tax allowing the first ~$27M to be inherited TAX FREE. This is the wealthiest nation in the history of civilization. There are many ways to raise tax revenue to pay for programs regular American people want - a lot of people just don’t want you to understand that and frankly most voters will never understand it.
Tariffs on imports on countries who are putting tariffs on our exports is an intelligent approach to trade -- period. We have never had fair trade, and from here on out we should cease to be the benefactor of the rest of the world.
@@erickanter If you don’t understand Supply Side Economics, then you wouldn’t. And the bond market isn’t reacting to a fear of inflation - it is reacting to the inexorable collision between deficits/debt, interest rates on rolling $10T in long bonds over this year and the inevitable downgrade of U.S. credit.
I always hear if we taxed billionaires they wouldn’t innovate. Let’s test the theory many of them were poor to begin with. Taxing wealth above a certain income amount is rational, super wealthy exerting themselves on society and the politics of said society is basically rent seeking to me, and in that they offer little to no value to the functioning of a society, like say a nurse or teacher who are grossly underpaid and under valued. We should find a way to tax wealth better globally where I know most extreme wealth is paper wealth in form of assets; shares/ bonds/ physical assets. Extreme wealth inequality is what lead to trump and the like, treating the uber wealthy as special doesn’t aspire others just helps us all realise the whole system is rigged.
Thank you Maggie for the discussions with always competent guests. I have already listened to you on Real Vision, and you always delivered strong content there too. I cannot understand why you only have around 10,000 subscriptions so far. That's a joke, I hope you have a lot more soon. Greetings from Germany.
china getting OUT of us tresaurys. does that mean that they are getting ready to make their move on taiwan takeover? I can sure see it with coward trump almost in office.
Peter always delivers. Breaks it down and exposes the cause and effect. At the end of the day, which Is more of a risk? Ten yr govies or overvalued tech sector cheers
@@davebellamy4867 this is true, but but all tech is exponentially deflationary. Likely it will be more deflationary than the spendthrift politicians can cause inflation, which is saying a lot.
More sellers than buyers of bonds. At 5%, the Fed will need a reason to intervene. Equities are still more attractive than the Ten year Treasury at 4.7%. Not a good sign for bonds
Equities are not more attractive than bonds. Long term treasury bonds are already down single digits since the rates have gone up but the downside is limited (ie will not be like the early 80’s when rates were above mid teens, as least not for the foreseeable future). But equities? How about the PE Schiller of 38, only 2nd to 2000 as the highest in history. Or the Buffet Indicator of over 200 which is why he holds 325 billion in cash. Or US deficit to GDP ratio of over 6 whereas it was in the 4 range during previous recessions (not including WW 2) which we are not currently in yet. And the S and P PE is over 23 though in part driven by mag 7. And apple stock PE mid 30’s and slow growth with risks in China and consumers in other areas priced out re too much debt. And Tesla has a PE of 120 and Price/Sales of nearly 15. So it is not 2000 when companies were overvalued and no free cash flow (some had no revenue) but sill with the S and P overvalued and a dividend rate of 1.2%, not sure how you can suggest equities are more attractive (though you may be right for awhile longer but I am buying out of the money long dated puts on some tech/others as a hedge)
Connect with me on Substack: maggielake.substack.com
00:00 - Intro: Talking Markets with Peter Boockvar
00:35 - What’s Driving the Bond Market Action?
05:34 - Supply vs. Demand: The Struggles of Long-Term Bonds
08:05 - Are Bond Vigilantes Back? The Fed vs. Market Pushback
09:36 - The UK Gilt Market and Sovereign Debt Risks
12:30 - Alternatives to Bonds: Gold and Defensive Strategies
14:25 - Corporate America’s Mood Amid Rising Rates
16:15 - Will Inflation Return? Navigating the Next Phase
18:40 - What is The Bull Case Narrative?
22:14 - Is the US Economy Headed for a Recession?
25:00 - Global Opportunities: Mixed Economic Trends in Asia and Europe
26:10 - The Dollar Debate: Strength, Tariffs, and Trade Wars
29:10 - Tariffs as a Policy Tool: Pros, Cons, and Consequences
32:03 - Closing Remarks: Looking Ahead to 2025
Thanks Maggie and Peter. Excellent channel 👍
Thank you for all your support!!
Enjoyed the episode! Thanks!
Glad you enjoyed it!
US auto industry is uncompetitive. We used to laugh at the Russian economy in the 80's. Hey guess what, that's America now.
Excellent interview
Thank you!
Now for an encore he could sing Tainted Love.
Very good interview.
Funny innit? Truss raised spending and cut taxes. Bond yields up. Rachel from Accounts cuts spending (of course, not for govrnment workers but for the poor, elderly etc.) and raises taxes and bond yields go up. They all do what they're told to bring forth crisis.
Bearish on 2025 - some opportunities in commodities for those who specialize: I’m long gold and silver but that’s about my limit.
Peter’s absolutely right about Truss (and I’m no fan - she’s not really a free market person - just someone who adopted those ideas opportunistically): BoE definitely to blame.
Bright bloke, good channel: well done Maggie - always fascinating people you seem to find. Really glad I stumbled on the channel.
Raising taxes and cut spending is the right combination. Thats how you pay off yours debts! The problem is: people dont want to go through the necessary pain .Its near impossible to fix things up, as if the person in office does the right thing, he is replaced or lose next election, and then the new guy starts the socialism again.
im at the point i wish someone would raise taxes, cut spending and crash the market. Because at this point it seems like its damned if you do damned if you dont.
For most of my life mortgage interest rates were stable at 13% and stable at 7% for many years. My first house was purchased at 16%. I suspect banks want a higher rate than now while people want it lower. Stability is what is needed.
According to von Mises, the Fed follows the market, and that what the Fed calls the "neutral rate of interest" the market sees as the prospective rate of profit. The Fed tries to keep it's product (bonds) as cheap as possible, yet still more profitable than it's competitor's product (equities). Thus, in 2020, anticipating a complete shutdown, and not only no profits but costs in maintaining a business, the Fed was free to reduce the price of it's product, bonds, to zero or below. Remember that for the Fed profit is how cheaply it can finance it's day job, financing the government.
Japan is finally raising it's interest rate because it has to. It sees the prospective rate of profit raising because it will soon be able to put its factory capacity to work making war material.
When the Fed saw the strong job creation report, it raised the interest rate, not because it was trying to cool inflation, but because it saw future profit rates raising in equities which required it to raise the profit rate in it's product or lose business to it's competitor.
A collapse of the stock market allows the Fed to cut interest rates to zero, because it can, not to stimulate business.
England finds itself in a different position from Japan because England's tax base is finance, while Japan's is industry. Both are shifting from a peace economy to a war economy, greatly confusing matters. England's Chancellor of the Exchequer cut spending and raised taxes, war time necessities, and the Prime Minister is fired for raising the interest rate.
I'm 100% in gold and gold stonks. 2025 will be a good year for goldbugs.
Peter is amazing. Thanks for bringing him on
Yes, Peter is awesome!!
Cut spending with no increase in taxes to balance the budget?? Yeah. How about taxing the non-producers? That would be a good chunk of the financial sector. Those focused on shorts, put spreads, pump and dumps, flash trades.....
If u had billions of dollars in cash and u invested that cash in t bills, would u like yields going up or down?
stocks ARE competing to attract $. I see stocks continuing to fall and shoppers go elsewhere, a variety of options are a out there.
Interesting also that private equity is trying to open itself to retail investors as the government changes. Is it doing worse than the public stock market, but concealing their fall so far?
It was absolutely Liz Truss' fault. Massively inflationary combination of policy choices all at once. It's moronic to say otherwise.
Cut the defence budget and boost social security.
Peter is right. Treasury and BOE conspired toget rid of the elected PM Truss.
To get the candidate that the parliamentary party wanted i.e. Sunak.
I love Peter but he is completely wrong with this take. Liz Truss and Kwasi Kwarteng tried to force through £49B unfunded tax cuts without notifying anyone - not even the Cabinet - and genuinely were surprised when the UK Gilt market choked.
Truss has repeatedly failed to acknowledge any responsibility and laughably claim that it was the work of establishment left-wing woke forces.
Yeah, left-wing woke Global Bond Investors 😅😅
She is the perfect example of the Peter Principle in action
@@barcooter8248Didn't the parliamentary party choose Truss but the bankers wanted Sunak? So they found a way to get him, perhaps?
@@putonghua73It will all have been engineered. Every step. To get the bankers' chosen guy in the job. Truss left with a former Prime Minister's pension guaranteed, for "serving" for barely months. Nice
@@davebellamy4867 no, it is a membership vote between the last 2 candidates. The membership voted in Truss and the MP's wanted Sunak.
Honest question: why is it that none of these videos even consider that billionaires are taxed at the same rate as middle class? They always say social spendings need to be cut, but completely ignore that the revenue side of the equation- that companies generating billions in profit seldom pay any taxes at all, and even get refunds, funded with the taxes from w2 earners, like Amazon? Why is that idea so foreign to all of these financial videos? Why is bezos and musk paying less than 1% in taxes?
First. He doesn’t ignore the revenue side of the equation. The entire point he is making about reducing govt spending is government spending REDUCES the revenue side of the equation.
Also several assumptions in the premise of your question are just 180 degrees false. We have a progressive tax system. Higher income is taxed at a higher rate. The top tax bracket is 37%. The bottom bracket is 0%. Now it is fair to say a billionaire who makes $100k in income in a year will pay the same INCOME tax as a middle class person. But that is just income tax. The billionaire will pay MUCH more in capital gains tax and estate tax.
Can I let you in on a little secret. When company x gets taxed they pass along the cost to you. So when you buy a product from company x you pay the tax. You are how old and just learning this? Or do you think the tax paying unicorn pays taxes and not end users
Honest answer: you don’t know what you are talking about. You have so many things wrong, it’s hard to know where to begin. Just a few things; the whole idea that lower earners pay a larger percentage of their income is false. To get that number, you have to change the definition of the payroll tax. The payroll tax is not a tax at all. It is a mandatory contribution to the national retirement system known as Social Security. (By the way, SS is a horrible system in that it is grotesquely underfunded.). The truth is that our income tax system is steeply progressive. The more you earn, the more your tax rate grows. Next, the idea that you can tax the rich enough to pay for all of our social spending or our deficit spending is silly. The last issue I will cover deals with the corporate tax rate. Corporations don’t pay taxes; people pay taxes. The problem with corporate taxes is that you don’t know which people are paying the taxes. Is it the shareholders, the employees or the customers? No one really knows, but you can be sure it includes you!
If investment income was taxed identically to wage income these peoples’ heads would explode. You’re right that the top wage income tax rate is 37% but the top rate for dividends and capital gains is 20% (and the first $90k is taxed at 0%). US tax code is massively biased toward investors vs wage earners. This is also to say nothing about things like the estate tax allowing the first ~$27M to be inherited TAX FREE. This is the wealthiest nation in the history of civilization. There are many ways to raise tax revenue to pay for programs regular American people want - a lot of people just don’t want you to understand that and frankly most voters will never understand it.
@@tomgibbens6261 AMEN….better response than mine!!!
Quite right abt Liz Truss. BoE didn’t like her.
2:00 gaslighting
Tariffs on imports on countries who are putting tariffs on our exports is an intelligent approach to trade -- period. We have never had fair trade, and from here on out we should cease to be the benefactor of the rest of the world.
What the hell does that have to do with the bond market. The bond market does not believe Trump will lower inflation. No one with a brain does.
@@erickanter If you don’t understand Supply Side Economics, then you wouldn’t. And the bond market isn’t reacting to a fear of inflation - it is reacting to the inexorable collision between deficits/debt, interest rates on rolling $10T in long bonds over this year and the inevitable downgrade of U.S. credit.
This guy thinks the rich need a tax break. And the poor need boot straps.
I always hear if we taxed billionaires they wouldn’t innovate. Let’s test the theory many of them were poor to begin with. Taxing wealth above a certain income amount is rational, super wealthy exerting themselves on society and the politics of said society is basically rent seeking to me, and in that they offer little to no value to the functioning of a society, like say a nurse or teacher who are grossly underpaid and under valued. We should find a way to tax wealth better globally where I know most extreme wealth is paper wealth in form of assets; shares/ bonds/ physical assets. Extreme wealth inequality is what lead to trump and the like, treating the uber wealthy as special doesn’t aspire others just helps us all realise the whole system is rigged.
Min 9:00 great question Maggie, and another at Min 14:00!
Saved us time there!👍👍👍
Great show, thank you!
Has Maggie just changed the background picture for a bear???...😅
That's the only alpha I need
Thank you Maggie for the discussions with always competent guests. I have already listened to you on Real Vision, and you always delivered strong content there too. I cannot understand why you only have around 10,000 subscriptions so far. That's a joke, I hope you have a lot more soon. Greetings from Germany.
I hate currencies
It's almost like China paid Peter to make this video
china getting OUT of us tresaurys. does that mean that they are getting ready to make their move on taiwan takeover? I can sure see it with coward trump almost in office.
Peter always delivers. Breaks it down and exposes the cause and effect. At the end of the day, which Is more of a risk? Ten yr govies or overvalued tech sector cheers
Interesting, always good to hear from Peter. Current times are very difficult to forecast.
Very!
Continuing Claims close to 2.2 million. All this Fed bs story is irrelevant. We're in a recession. I'm looking at 1.5% yield on the 10yr treasury.
AI can bring down inflation below zero most likely
What assets would be on the top of list in this situation?
Bullshit
@@erickanter not just below zero….WAY below zero. It’s coming
Yeah cuz nobody will have a job.😂
@@davebellamy4867 this is true, but but all tech is exponentially deflationary. Likely it will be more deflationary than the spendthrift politicians can cause inflation, which is saying a lot.
🏛️🙋🙋❤️
Where are our biggest international buyers? Is the Fed selling?
Great interview!
Aldo I would not worry about anything, while the price of one genuine Bitcoin is above 100k of dollars 😅
PETER
The smarter ones are in preserve wealth mode and hording physical silver and more precisely COIN OF THE REALM!
Poll? No poll for us on the replay, I take it.
Polls don't work after the live shows is wrapped. You should join the Live show at 4pm ET Mon, Wed, & Fri!
It’s different this time…
More sellers than buyers of bonds.
At 5%, the Fed will need a reason to intervene.
Equities are still more attractive than the Ten year Treasury at 4.7%. Not a good sign for bonds
Equities are not more attractive than bonds. Long term treasury bonds are already down single digits since the rates have gone up but the downside is limited (ie will not be like the early 80’s when rates were above mid teens, as least not for the foreseeable future). But equities? How about the PE Schiller of 38, only 2nd to 2000 as the highest in history. Or the Buffet Indicator of over 200 which is why he holds 325 billion in cash. Or US deficit to GDP ratio of over 6 whereas it was in the 4 range during previous recessions (not including WW 2) which we are not currently in yet. And the S and P PE is over 23 though in part driven by mag 7. And apple stock PE mid 30’s and slow growth with risks in China and consumers in other areas priced out re too much debt. And Tesla has a PE of 120 and Price/Sales of nearly 15. So it is not 2000 when companies were overvalued and no free cash flow (some had no revenue) but sill with the S and P overvalued and a dividend rate of 1.2%, not sure how you can suggest equities are more attractive (though you may be right for awhile longer but I am buying out of the money long dated puts on some tech/others as a hedge)
The AI spend and government spend is fueling everything.
Ooh the bull picture has been replaced by the bear picture 🧐