Geopolitics
We got Trump's tariff shock and backtracking correct and predicted Israel's attack on Iran. But we missed the China rally — and there is still no Ukraine ceasefire.
On purely macroeconomic terms, the US economy appears to be heading towards a recession. But the whole point of our framework – GeoMacro – is to forecast the interplay between politics, geopolitics, and macro. The White House is taking control of the Fed in 2026 and, together, they will look to re-lever the US consumer.
Political instability across Asia is colliding with the trade war fallout, forcing Southeast Asian economies to ease monetary and fiscal policy, while pushing the Bank of Japan in the opposite direction.
The media is missing the big picture: the war is already contained. The falling oil price confirms that. We fully expect cold feet and volatility incidents in the very near term but there is only a 5% chance of Russia triggering a larger war with NATO – and that is what really matters.