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Trump says Powell has been too tight. The data says the opposite. Powell has run the easiest monetary policy in modern Fed history, and the credibility cost is what makes the institution so vulnerable today Later today the Federal Open Market Committee will almost certainly leave its target range for the federal funds rate unchanged at 3.50 to 3.75%, and markets are pricing a 100% probability of…

The chief executives of the world’s most powerful artificial intelligence companies have been saying remarkable things about the future of work. Dario Amodei of Anthropic has warned, in multiple interviews, that AI could eliminate half of all entry-level white-collar jobs within the next few years. Sam Altman of OpenAI has spoken of AI agents “joining the workforce” and of intelligence…

Regular readers of this blog will know that most of what I do here is explain, analyse, and argue about macroeconomics, monetary policy, and increasingly artificial intelligence. That work is public and free – and I intend to keep it that way. But over the past year, we have increasingly been asked – through PAICE, the consultancy I co-founded – to bring that kind of thinking directly into…

Blue Owl is one of Wall Street’s big names in private credit – a manager of nearly $300 billion in assets. The company’s logo is an owl: the animal that, according to legend, can see everything, even in the dark. On February 19, 2026, Blue Owl restricted withdrawals from one of its retail-focused funds and quickly sold $1.4 billion in loans to raise liquidity. Investors who wanted out couldn’t…

Two weeks ago, Microsoft’s AI chief Mustafa Suleyman told the Financial Times that most white-collar work will be fully automated within 12 to 18 months. Lawyers, accountants, project managers, marketing professionals – everyone who “sits at a computer.” Anthropic’s CEO Dario Amodei has warned that AI could eliminate half of all entry-level office jobs. Ford’s Jim Farley predicts a halving of…

On Friday, Bill Pulte (Director of the Federal Housing Finance Agency and chairman of both Fannie Mae and Freddie Mac) announced that America’s two government sponsored housing finance giants are exploring equity stakes in technology companies. Speaking at the ResiDay conference in New York, Pulte described potential partnerships where tech firms would offer Fannie and Freddie equity positions,…

The Paradox of Preppers Who Want Stock Tips I’ve had some rather paradoxical conversations in recent weeks. One second, I’m standing there talking to people about prepping—buying water, hand-crank radios, and whatnot. Then two minutes later, they’re asking me, “Lars, which shares should I buy?” There’s something deeply contradictory about that, isn’t there? This captures the strange moment we…

Another day, another politically motivated attack in the United States. This morning’s shooting at a Dallas ICE detention facility – where a sniper killed two detainees and wounded another before taking his own life prompted me to revisit a question that’s been troubling me: Is political violence actually increasing in America, or does it just feel that way? To explore this, I’ve conducted what…

The Argentine markets took a beating last week, but US Treasury Secretary Scott Bessent has rushed to the rescue with a remarkable promise: America will provide what amounts to unlimited support to prop up Argentina. His declaration that “all options for stabilization are on the table” – including swap lines, direct currency purchases, and buying Argentine government debt – represents an…

The Federal Reserve cut rates by 25 basis points yesterday, bringing the fed funds rate to 4.00-4.25%, exactly as markets had expected. Stephen Miran – Trump’s recently appointed member to the FOMC- dissented, preferring 50bp. Notably, the two other known “doves” on the committee, Christopher Waller and Michelle Bowman, voted with the majority rather than joining Miran’s call for more aggressive…

Many economists and market observers have expressed surprise at the apparent absence of inflationary effects from President Trump’s economic policies. I find this a bit puzzling, as I believe the inflationary impact is already clearly visible if one examines the data properly. In this post, I will demonstrate why I’m convinced we’re seeing the beginning of a rather significant inflationary…

Long-term British government bond yields are now at their highest level in almost 30 years. What is even more concerning is that the UK economy is actually slowing down, which means that nominal GDP growth must now be considered significantly lower than long-term interest rates. This is extremely critical, as it means that public debt as a percentage of GDP is now on an explosive rise, and if…

The American economy stands at a critical juncture. President Trump’s assault on the Federal Reserve has reached an intensity that threatens the very foundations of independent economic institutions. Lisa Cook, a Federal Reserve Board member, has become the primary target of Trump’s political pressure. Despite repeated claims of dismissal, Trump has encountered formidable legal barriers. The…

Suppose I came to you and said: “I would like to borrow a very large sum of money in order to buy massively overpriced shares. By the way, I am already drowning in debt.” What interest rate would you charge me? The answer would be either prohibitively high or a flat refusal. Yet this is precisely the course the United States government has embarked upon. The Intel Purchase: A Costly First…

Donald Trump calls it a win for American industry. Trump’s economic advisor (or what ever it is he is doing) Kevin Hassett calls it the first step towards a sovereign wealth fund. I call it Red Hat Socialism. Trump’s economic adviser Kevin Hassett says the government is likely to take ownership stakes in more companies just like they did with Intel: “I can really not see how anyone would think…

If you’re a heavy user of language models, as I am, you’ll have undoubtedly noticed that the various AI models, such as ChatGPT and Claude, aren’t behaving quite as they used to. This has particularly come into focus since OpenAI launched ChatGPT 5.0 a fortnight ago. One must say that the reception has been anything but favourable. It’s been difficult to spot the improvements (unless one uses…

In my three decades as an economist—including 15 years as Chief Analyst for Emerging Markets at Danske Bank—I’ve seen some truly bizarre economic episodes. I’ve watched Argentina default on its debt. I’ve analysed Turkey’s monetary policy madness under Erdoğan. I’ve observed Venezuela’s descent into hyperinflation. But what happened today in the United States might top them all. This morning…