FBZ - Weekly Commentary: Disrupted
2025-02-22 04:00:09 ET
Summary
- Bubbles are mechanisms of wealth redistribution and destruction - with detrimental consequences for social and geopolitical stability.
- The future of key international institutions, including the UN, WHO, NATO, is murky at best.
- Tariffs have become integral to various negotiations, with Wall Street too complacent about the critical role they'll play in budget talks and the passage of 'one, big, beautiful bill.'
- Despite historic over issuance, perceived safe and liquid money-like Treasury debt still enjoys insatiable demand.
"Bubbles are mechanisms of wealth redistribution and destruction - with detrimental consequences for social and geopolitical stability. Boom periods engender perceptions of an expanding global pie. Cooperation, integration, and alliances are viewed as mutually beneficial. But perceptions shift late in the cycle. Many see the pie stagnant or shrinking. A zero-sum game mentality dominates. Insecurity, animosity, disintegration, fraught alliances, and conflict take hold."
A whirlwind first month for the "Disruptor in Chief," such a monumental late-cycle figure and phenomenon. Campaign promises kept. Red meat for the MAGA and "nation saved" half. Affirmation for the "nation doomed" half. Unprecedented executive orders of overwhelming scope and consequence. Radical federal spending cuts and downsizing (enter photo of sunglass-donned Elon wielding his chainsaw at CPAC). The post-WWII global trade architecture in a jumble. WTO - along with traditional trade conventions and practices - on life support.
Relations with allies in disarray. The future of key international institutions, including the UN, WHO, NATO, is murky at best. A month in, the existing world order is increasingly in tatters. The world now waits anxiously to see if two autocratic strongmen can fashion a plan acceptable to Zelenskyy, Ukraine, and Europe - or whether Putin refocuses his attention on Kiev and beyond. Insecurity, animosity, disintegration, fraught alliances, and conflict. Disruption at the brink of chaos.
Fortunately, he spends most of his time these days on school work and music instead of gaming. But I was reminded this week of that ill feeling in my gut when I would see the vitriol and toxicity my son experienced playing video games. How these kids communicate with each other can be shocking. Anathema to traditional sportsmanship. Bereft of even a modicum of civility and decency, the impulse is often to goad hostility and malice. A microcosm of the degradation plaguing society and, increasingly, our international relations. Words matter. Civility and respect matter.
It sounds goofy and hopelessly out of touch, but I miss those "Choose Kindness" signs that used to be a fixture in our community. And if (politically incorrect) kindness has become far too much to ask, it seems like we could at least strive for respectful. Kind of civil, as the new ideal? Clearly, it won't be coming from the top. This week's posterity content:
"I think I have the power to end this war, and I think it's going very well. But today I heard, 'Oh, well, we weren't invited.' Well, you've been there for three years. You should have never started it. You could have made a deal." President Trump, February 18, 2025
"We've seen this disinformation, we understand it comes from Russia. Unfortunately, President Trump - and we have great respect for him as a leader of people we also respect very much - he lives in this disinformation space." Ukraine President Volodymyr Zelenskyy, February 19, 2025...
Weekly Commentary: Disrupted