Edward Conard

Top Ten New York Times Bestselling Author

  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Wednesday, September 24, 2025

AI Summary. Long-term government bond yields have risen in the US and globally, while the dollar has stayed broadly stable against other major currencies even as gold prices rise. The authors argue this pattern signals debasement of fiat currencies against gold, driven by a crisis of confidence as high government debt and deficits raise incentives to inflate away obligations.

Robin Brooks Robin Brooks Substack
Date Posted:

Since Powell’s Jackson speech, gold has risen 13% while the dollar has remained stable against G10 currencies in a broad debasement of advanced economies’ currencies relative to gold.

Does rising gold with a stable dollar signal fiat currency debasement?

Core argument: The 30-year U.S. Treasury yield has resumed rising, pushing up 30-year yields globally including France's, which the author argues has the makings of a global debt crisis.

Longer-term bond yields are resuming their rise. As the left chart above shows, the 30-year Treasury yield has risen (blue line), which has pushed up 30-year yields globally, including for France (red line). All this has the makings of a global debt crisis. The Dollar has been stable against G10 currencies. Even as markets priced additional Fed cuts after Jackson Hole, the Dollar has been broadly stable, as the right chart shows (blue line). The fact that the Dollar is stable even as gold prices rise (black line, right chart) signals debasement of fiat currencies against gold. With government debt and deficits at alarming levels all over, investors are scrambling for safe havens. The continued rise in gold prices - as markets scale back expectations for Fed cuts and with the Dollar stable - is highly unusual. One possible explanation is that we’re seeing a crisis of confidence in fiat currencies, as fiscal imbalances in many places raise the incentive for governments to inflate away debt.

Takeaways by Macro Roundup® AI

  1. The 30-year U.S. Treasury yield has resumed rising, pushing up 30-year yields globally including France's, which the author argues has the makings of a global debt crisis.
  2. The Dollar has been broadly stable against G10 currencies even as markets priced additional Fed cuts after Jackson Hole, while gold prices have continued to rise, which the author reads as debasement of fiat currencies against gold.
  3. With government debt and deficits at alarming levels across countries, investors are scrambling for safe havens, and one possible explanation offered is a crisis of confidence in fiat currencies as fiscal imbalances raise governments' incentive to inflate away debt.

Related Articles:

  • Fiscal Risk from Rising Bond Yields — US interest rates fell for roughly 40 years before the pandemic, allowing maturing high-coupon debt to be refinanced at lower rates and keeping federal interest expense manageable even as debt rose. Because Congressional Budget Office projections assume the 10-year Treasury yield drifts down to 3.8% from about 4.1%, the author argues its debt-service projections face upside risk.
  • Gold Surpasses Inflation-Adjusted Record High Set in 1980 — Gold's spot price reached an all-time high of $3,674.27 an ounce, surpassing the inflation-adjusted peak set when gold topped out at $850 in January 1980. That earlier peak came amid a collapsing US currency, an inflation spike, and a recession.
  • Global Debt Report 2025 — About 60% of fixed-rate government debt in advanced economies maturing by 2027 — roughly $9tn — was issued before the recent interest-rate tightening, with weighted average yields below 2% versus projected 10-year rates near 3.6%, implying refinancing at nearly double the original cost. France, Spain, the UK, and the US face heightened vulnerability, with maturing debt exceeding 15% of GDP.

AI Summary. Measured in gold — dividing the S&P 500 by the gold price — US stocks have lost ground this decade, as bullion outperforms a booming equity market. The article argues central banks' efforts to reduce reliance on the dollar, including China's offer of Shanghai as a gold storage venue, are driving gold demand.

John Authers Bloomberg
Date Posted:

Since January, gold is up 42.4%, experiencing its strongest rally since 1979. John Authers argues the rally “seems to be driven by rational calculations of central banks,” suggesting it’s sustainable.

Are US stocks losing ground when measured in gold?

Core argument: The S&P 500 has lost ground this decade when measured in gold, as dividing the index value by the bullion price shows a decline even as US stocks boomed in dollar terms.

Look at the S&P 500’s performance so far this decade in terms of bullion (by dividing the index value by the gold price) and stocks have actually lost ground. How is gold managing to outperform the booming US stock market? An answer is that US shares are only doing so well because of monetary debasement. It’s true that the Federal Reserve cut its target rate last week, and that money supply is rising again. But neither of those events comes as a particular surprise. Politics may be the greatest factor. Shaken confidence in the US hasn’t dented the performance of American stocks this year, but countries’ attempts to build a Plan B to reduce their reliance on the dollar could now be showing up in demand for gold. China’s decision to start offering Shanghai as an alternative venue for central banks to store their gold may be more symbolic than anything else. But it tends to underscore that any adaptation of the world financial system will mean more demand for gold. If 1979 was about a somewhat irrational panic over inflation, this latest rally seems to be driven by the more rational calculations of central banks. It might last longer.

Takeaways by Macro Roundup® AI

  1. The S&P 500 has lost ground this decade when measured in gold, as dividing the index value by the bullion price shows a decline even as US stocks boomed in dollar terms.
  2. One explanation for gold's outperformance is monetary debasement, though the Federal Reserve's rate cut and the renewed rise in money supply came as no particular surprise.
  3. Politics may be the greatest factor behind gold's rally, as countries' attempts to build a Plan B reducing dollar reliance could be showing up in gold demand, with China offering Shanghai as an alternative storage venue for central banks.

Related Articles:

  • De-Dollarization? Diversification? Exploring Central Bank Gold Purchases and the Dollar’s Role in International Reserves — Central banks' gold accumulation is generally not associated with reducing the dollar's share of international reserves at the country level, apart from a few prominent cases, and is more consistent with modest overall diversification. Gold's role as an official-sector store of value has grown, but its use as a unit of account and medium of exchange remains limited.
  • Taking Stock: Dollar Assets, Gold, and Official Foreign Exchange Reserves — Gold accounts for about 10% of aggregate official foreign exchange reserves, roughly its level in the early 2000s. International Monetary Fund country data indicate most added official gold holdings came from a few central banks, with over half of reported accumulation from China and Russia and about a quarter from several emerging markets.
  • Gold Overtakes Euro as Global Reserve Asset, ECB Says — Gold has overtaken the euro as a global reserve asset, with central bank gold holdings reaching 36,000 tons, near the mid-1960s peak of 38,000 tons, helped by a 30% rise in the gold price. The European Central Bank finds countries geopolitically close to China and Russia accumulated gold more than others.

AI Summary. Data center construction spending has eclipsed office construction, and the specialized power rates most data centers pay fall short of covering the cost of a new natural gas plant, leaving other customers to bear part of the bill. In the PJM grid region, data center demand accounted for 70% of the increase in electricity costs over the past year.

Michael Cembalest JP Morgan
Date Posted:
Is Database:
Database

Since the launch of ChatGPT in November 2022, AI related stocks have accounted for 75% of S&P 500 returns, 79% of earnings growth, and 90% of capital spending (Capex and R&D) growth.

Are other electricity customers paying part of data centers' power costs?

Core argument: In the PJM region, 70% of last year's increased electricity cost resulted from data center demand, while specialized power rates for most data centers fall short of covering the cost of a new natural gas plant, leaving other customers to pay part of the bill.

Data centers are eclipsing office construction spending and are coming under increased scrutiny for their impact on power grids and rising electricity prices. Specialized power rates for most data centers aren’t enough to cover costs of a new natural gas plant (leaving other customers to foot part of the bill), and in the PJM region, 70% of last year’s increased electricity cost was the result of data center demand. The biggest medium-term risk I can think of for top-heavy US equity markets: China’s Huawei and SMIC pierce the $6.3 trillion NVIDIA-TSMC-ASML moat by creating their own supernode computing clusters and deep-ultraviolet lithography machines of comparable quality. Other recent AI news: Oracle’s stock jumped by 25% after being promised $60 billion a year from OpenAI, an amount of money OpenAI doesn’t earn yet, to provide cloud computing facilities that Oracle hasn’t built yet, and which will require 4.5 GW of power (the equivalent of 2.25 Hoover Dams or four nuclear plants), as well as increased borrowing by Oracle whose debt to equity ratio is already 500% compared to 50% for Amazon, 30% for Microsoft and even less at Meta and Google.

Takeaways by Macro Roundup® AI

  1. In the PJM region, 70% of last year's increased electricity cost resulted from data center demand, while specialized power rates for most data centers fall short of covering the cost of a new natural gas plant, leaving other customers to pay part of the bill.
  2. The author identifies the biggest medium-term risk to top-heavy US equity markets as Huawei and SMIC piercing the $6.3 trillion NVIDIA–TSMC–ASML moat with their own supernode computing clusters and deep-ultraviolet lithography machines of comparable quality.
  3. Oracle's stock jumped 25% after being promised $60 billion a year from OpenAI, which does not yet earn that sum, for cloud facilities Oracle has not built that will require 4.5 GW of power; Oracle's debt-to-equity ratio is already 500% versus 50% at Amazon and 30% at Microsoft.

Related Articles:

  • Fair Shakes — Technology-sector capital spending has accounted for 35%–45% of US GDP growth over three quarters, implying that without it growth would be near 1% given weak consumption. Among S&P 500 companies, capital spending rose 24% and research and development 10%, but the median stock grew both by only 3%–4%.
  • How America’s AI Boom Is Squeezing The Rest Of The Economy — About a sixth of America's 2% real GDP growth over the past year came from investment in computer and communications equipment and data centres, and one estimate puts the artificial intelligence boom's total contribution to growth at 40%. Average electricity bills rose 7%, attributed in part to data-centre demand, while housebuilding and non-AI business investment slumped and real consumption flatlined.
  • Honey, AI Capex is Eating the Economy — Capital spending on AI data centers is around 20% of railroads' peak spending as a share of GDP and is rising quickly, having already surpassed the dot-com era peak in telecom investment. Unlike long-lived rail infrastructure, data centers are short-lived assets requiring frequent hardware replacement, and the capital is being reallocated from other sectors.

AI Summary. Drones are the foundation of hard power in the early 21st century, so a country unable to produce them domestically is at a disadvantage. As electric motors overtake combustion engines as the core technology that makes machines move, the same supply chains and production processes used for electronics can also produce cars, drones, robots, and appliances.

Noah Smith Noahpinion
Date Posted:

Noah Smith argues that manufacturing the “Electric Tech Stack” [lithium-ion batteries, permanent-magnet electric motors, and power electronics] domestically is critical due to the electrification of “everything” and drones being the “key to hard power.”

Does mastering electric technology determine both military and manufacturing strength?

Core argument: Electric motors are overtaking combustion engines as the fundamental technology that makes machines move, meaning the supply chains and production processes used for electronics will also serve to make cars, drones, motorcycles, robots, and appliances.

I want to emphasize two key points: 1. Drones are the key to hard power in the early 21st century. If your country can’t make drones, you’re in trouble. 2. If you have the ability to make drones domestically, you can also manufacture an increasingly large percentage of everything else. In the past, manufacturing industries were very differentiated — making a car, an airplane, a telephone, a TV, and a stove all involved very different production processes and very different supply chains. Being able to manufacture cars didn’t really make you able to manufacture TVs, or vice versa. That’s changing as we speak. Electric motors are overtaking combustion engines as the fundamental technology that makes machines move. This means that the same supply chains and production processes that allow you to make electronics will now also allow you to make cars, drones, motorcycles, robots, appliances, and a bunch of other products.

Takeaways by Macro Roundup® AI

  1. Electric motors are overtaking combustion engines as the fundamental technology that makes machines move, meaning the supply chains and production processes used for electronics will also serve to make cars, drones, motorcycles, robots, and appliances.
  2. Manufacturing industries were historically differentiated, with cars, airplanes, telephones, TVs, and stoves requiring distinct production processes and supply chains, so capability in one conferred little capability in another.

Related Articles:

  • Drones Are Key to Winning Wars Now. The U.S. Makes Hardly Any — China's DJI accounts for about 70% of commercial drones sold globally, and industry experts estimate its output far exceeds that of any other manufacturer, with capacity in the millions of drones a year. About 500 US companies manufacture drones, producing fewer than 100,000 annually, according to an industry association.
  • How Xi Sparked China’s Electricity Revolution — Electricity has risen to 30% of China's final energy use while plateauing near 22% in Europe and the US, supported by a decades-long grid expansion and upgrade program projected to cost as much as $800bn by 2030. Chinese grid investment is forecast to grow about 5% annually through 2030, faster than projected economic growth.
  • Heliocentrism — An energy use must be electrified before green grid electricity can decarbonize it, and while US grid decarbonization continues at a steady pace, the electricity share of final US energy consumption has grown little. Transmission line growth runs well below Department of Energy targets for 2030 and 2035, and transformer delivery times have stretched from 4–6 weeks to 2–3 years.

AI Summary. Research estimates that rising numbers of workers on H-1B skilled-worker visas accounted for 30–50% of US productivity growth from 1990 to 2010. The estimate comes from comparing economic outcomes in US cities most and least affected by large congressional changes to the annual visa cap.

Michael Clemens Peterson Institute For International Economics
Date Posted:

Btw 1990–2010, the increase in H-1B holders drove 30–50% of all US productivity growth. Michael Clemens argues if changes to the program reduce the number of H-1B visa holders, it will be “a crippling blow to US innovation and productivity.”

How much of US productivity growth came from skilled-visa workers?

Core argument: Research finds that rising numbers of H-1B visa holders caused 30–50% of all US productivity growth from 1990 to 2010, making H-1B labor a crucial factor of production in US economic growth.

H-1B workers are not merely jobholders; their labor is a crucial factor of production that drives US economic growth and opportunity, extensive research has found. From 1990 to 2010, rising numbers of H-1B holders caused 30–50% of all productivity growth in the US economy. This means that the jobs and wages of most Americans depend in some measure on these workers. This is not from a textbook narrative or a computer model. It is what happened in the real world following past, large changes in H-1B visa restrictions. For example, Congress tripled the annual limit on H-1B visas after 1998, then slashed it by 56% after 2004. That produced large, sudden shocks to the number of these workers in some US cities relative to others. Economists traced what happened to various economic indicators in the most-affected cities versus the least-affected but otherwise similar cities.

Takeaways by Macro Roundup® AI

  1. Research finds that rising numbers of H-1B visa holders caused 30–50% of all US productivity growth from 1990 to 2010, making H-1B labor a crucial factor of production in US economic growth.
  2. Congress tripled the annual H-1B visa limit after 1998 and then cut it by 56% after 2004, producing large, sudden shocks to H-1B worker numbers in some US cities relative to others.
  3. Economists traced various economic indicators in the US cities most affected by those visa limit changes against the least-affected but otherwise similar cities, rather than relying on textbook narratives or computer models.

Related Articles:

  • The Extreme Shortage of High IQ Workers — Semiconductor manufacturing requires workers of above-average intelligence, with the most demanding roles needing IQs in the top 1 in 1,000 — a pool of about 164,000 people in the US, of whom perhaps 100,000 can be placed in such professions. The author argues this scarcity explains reliance on high-IQ workers abroad and on smarter tools and non-human intelligence.
  • Third-Country Effects of U.S. Immigration Policy — U.S. H-1B visa denial rates rose from about 6% to 16%, and the authors estimate a 10 percentage point rise in denials increases Canadian applications by 30%, roughly one Canadian application per four forgone visas. More exposed Canadian firms increased sales and hired about 0.5 native workers per immigrant.
  • Top Talent, Elite Colleges, and Migration: Evidence from the Indian Institutes of Technology — Among top scorers on India's Joint Entrance Exam for the Indian Institutes of Technology, 62% of the top 100 and 36% of the top 1,000 migrated abroad within eight years, primarily to the U.S. for graduate school. The authors argue elite schools shape migration by signaling ability and providing access to networks.

AI Summary. The Australian Strategic Policy Institute's Critical Technology Tracker finds China leads in 57 of 64 critical technology categories while the United States leads in 7, and that China surpasses the United States in top-tier scientific publications across all 8 technology domains. In energy and environment China accounts for 46% of top-tier publications versus 10% for the United States.

Justin Riggi Information Technology and Innovation Foundation
Date Posted:
Is Database:
Database

An Australian analysis of the top 10% of high-quality scientific publications found Chinese researchers have surpassed American researchers across 8 critical technology domains.

Is China leading the United States across most critical technology categories?

Core argument: The Australian Strategic Policy Institute's Critical Technology Tracker finds China leads in 57 of 64 critical technology categories across 8 domains, while the United States leads in only 7.

According to the latest findings from Australian Strategic Policy Institute’s (ASPI) Critical Technology Tracker, which evaluates 64 critical technology categories across 8 domains (e.g., artificial intelligence and robotics), show that China leading in 57, while the United States leads in only 7 technology sub-categories. This is concerning because these critical technologies are the key input to advanced sectors that China is quickly overtaking. When evaluating the top 10% of high-quality scientific publications, ASPI finds that China surpasses the United States across all 8 critical technology domains. The gap is particularly pronounced in the energy and environment domain, where China accounts for 46% of top-tier publications compared to just 10% for the United States. Despite U.S. leadership in AI, China produces more top publications, contributing 30% versus 18% for the United States.

Takeaways by Macro Roundup® AI

  1. The Australian Strategic Policy Institute's Critical Technology Tracker finds China leads in 57 of 64 critical technology categories across 8 domains, while the United States leads in only 7.
  2. China surpasses the United States in the top 10% of high-quality scientific publications across all 8 critical technology domains, with the widest gap in energy and environment, where China accounts for 46% of top-tier publications versus 10% for the United States.
  3. China produces 30% of top artificial intelligence publications compared with 18% for the United States, according to the Australian Strategic Policy Institute, despite U.S. leadership in AI.

Related Articles:

  • We Warned About the First China Shock. The Next One Will Be Worse — The authors argue China is moving from follower to leader by aggressively contesting innovative sectors long dominated by the United States, including aviation, artificial intelligence, telecommunications, microprocessors, robotics, and nuclear and fusion power. They note the world's largest and most innovative makers of electric vehicles, EV batteries, drones, and solar wafers are all Chinese firms under 30 years old.
  • Was Made in China 2025 Successful? — Chinese firms have narrowed the gap with foreign competitors across targeted industries, with China's share of global patents rising by more than 4 percentage points in electric vehicles, new materials, electronics, and robotics. Gaps remain in areas such as advanced semiconductors, where Chinese firms still lag the global frontier.
  • US Efforts to Contain Xi’s Push for Tech Supremacy Are Faltering — Research by Bloomberg Economics and Bloomberg Intelligence finds that of 13 key technologies tracked, China has reached global leadership in five and is catching up in seven others, with clear leads in electric vehicles, automotive software and lithium battery technology. China still struggles to develop manufacturing processes for advanced semiconductors, the main focus of US export controls.

Thursday, September 25, 2025

AI Summary. A capital-market equilibrium model estimates that the steady-state safe natural rate of interest across advanced economies has fallen from about 5% to about 0%, driven by slower growth, demographics, higher mark-ups, and rising risk premia. The author estimates that artificial-intelligence-driven growth and heightened inflation risk could each raise it by about 1 percentage point.

Lukasz Rachel Brookings Papers On Economic Activity
Date Posted:

In a base model, steady state r* is still ~0, suggesting that “secular stagnation” may not be a thing of the past. AI expansion and inflation risk could each raise r* by 100 bps. Remilitarization and unfunded social spending may also push up r*.

Why has the natural rate of interest fallen to zero?

Core argument: In a capital-market equilibrium framework, the model-implied steady-state safe r* across advanced economies falls from roughly 5% in the 1970 steady state to about 0% in the new long-run steady state, reflecting shifts in capital demand and especially capital supply.

I develop and quantify a capital-market equilibrium framework to study the joint evolution of r∗ and wealth across advanced economies. This bloc [saw] shifts in capital demand and especially in capital supply. As a result, the model-implied steady state safe r∗ has fallen from ~ 5% in the 1970 steady state to ~0% in the new long-run steady state. A decomposition of the dynamics of r∗ shows the role of the growth slowdown and demographics [as well as] the rise in mark-ups, which temporarily depress r∗ before pushing it up, and of the rising risk premia, which push down on safe r∗ close to 1-to-1. Decomposition of the rise in the wealth-to-GDP ratio [which ~doubled from 3 to 6], [shows] longer expected retirement and slower growth [but not risk premia] as dominant. [Finally, because] current long-term real yields stand above the baseline r∗ estimate, I consider the possibility that new shifts in the environment have acted to raise the natural rate sharply higher∗. I find that AI and inflation risk scenarios are most powerful quantitatively, each raising r∗ by circa 1 percentage point. The heightened inflation risk raises the safe rate very quickly, while the effects of AI-driven growth boom build up over several years.

Takeaways by Macro Roundup® AI

  1. In a capital-market equilibrium framework, the model-implied steady-state safe r* across advanced economies falls from roughly 5% in the 1970 steady state to about 0% in the new long-run steady state, reflecting shifts in capital demand and especially capital supply.
  2. A decomposition of r* dynamics points to the growth slowdown and demographics, to rising mark-ups that temporarily depress r* before pushing it up, and to rising risk premia that push down safe r* close to one-for-one.
  3. The wealth-to-GDP ratio roughly doubled from 3 to 6, with longer expected retirement and slower growth dominant and risk premia not contributing.

Related Articles:

  • Data Update 4 for 2025: Interest Rates, Inflation and Central Banks! — Interest rates are ultimately driven by macroeconomic fundamentals, with an "intrinsic risk-free rate" defined as the sum of the inflation rate and real GDP growth tracking the observed 10-year Treasury bond yield closely. On this view, central banks' influence comes from preferential access to data on those fundamentals, their capacity to alter them, and their credibility.
  • The Race Between Asset Supply and Asset Demand — The authors estimate that demand for assets has outpaced supply by roughly 400% of GDP versus 100%, making rising asset demand the leading contributor to falling interest rates. They project that debt sustainability requires fiscal consolidation exceeding 10% of GDP, though debt could reach 250% of GDP without raising interest rates.
  • Demographics, Wealth, and Global Imbalances in the Twenty-First Century — Because the elderly hold much more wealth than the young and on average do not draw it down much as they age, the authors' model projects no "great demographic reversal": population aging is estimated to push global rates of return down by about 1.07pp and raise global wealth from 456% to 498% of world GDP.

AI Summary. Rising longer-term bond yields, outperformance of safe-haven assets like gold, and a stable US Dollar against other major currencies together suggest markets are pricing debasement across many developed-market currencies, not just the Dollar. Market-implied real 10-year yields remain higher in emerging markets, but the divide is blurring, with Chile already below New Zealand.

Robin Brooks Robin Brooks Substack
Date Posted:

Noting that “the dividing line between EM and G10 [yields] is already getting blurred,” Brooks argues advanced economies are beginning to resemble EMs with “simplistic populism, reckless fiscal policy, and fiscal dominance of their central banks.”

Are markets pricing currency debasement across developed economies, not just the Dollar?

Core argument: Rising longer-term bond yields, outperformance of safe havens like gold, and a US Dollar stable against its G10 peers share a common factor, in the author's reading: markets pricing debasement of many G10 currencies, not just the Dollar.

My [recent] posts have documented an alarming confluence of things: (i) a global rise in longer-term bond yields; (ii) drastic outperformance of safe haven assets like gold; and (iii) a US Dollar that’s been remarkably stable against its G10 peers. The common factor in all these moves is that markets seem to be trading debasement of many G10 currencies - not just the Dollar - as countries across the G10 succumb to simplistic populism, reckless fiscal policy and fiscal dominance of their central banks. The two charts show market-implied real 10-year yields across the G10 and EM. The left chart shows the evolution over time of these real yields, while the right chart shows a cross-section of these yields as of yesterday. Real yields in EM are a lot higher than in the G10, so we’re still in the early stages of this process. But the dividing line between EM and G10 is already getting blurred. Take the example of Chile (CL) that already has a lower real yield than New Zealand (NZ). As markets start to price more and more G10 dysfunction, these kinds of cross-overs will become more frequent.In recent weeks.

Takeaways by Macro Roundup® AI

  1. Rising longer-term bond yields, outperformance of safe havens like gold, and a US Dollar stable against its G10 peers share a common factor, in the author's reading: markets pricing debasement of many G10 currencies, not just the Dollar.
  2. The author attributes the G10 currency debasement trade to simplistic populism, reckless fiscal policy, and fiscal dominance of central banks across the G10.
  3. Market-implied real 10-year yields remain far higher in emerging markets than in the G10, but the dividing line is blurring, with Chile already carrying a lower real yield than New Zealand.

Related Articles:

  • Global Debt Report 2025 — About 60% of fixed-rate government debt in advanced economies maturing by 2027 — roughly $9tn — was issued before the recent interest-rate tightening, with weighted average yields below 2% versus projected 10-year rates near 3.6%, implying refinancing at nearly double the original cost. France, Spain, the UK, and the US face heightened vulnerability, with maturing debt exceeding 15% of GDP.
  • How A Global Debt Crisis Starts — Far-forward government bond yields — what markets price for the 10-year yield 10 and 20 years ahead — have risen in Japan, the UK, France and Germany, with Japan's 10-year yield 20 years forward at 4.5%. The US 10y20y forward yield has fallen slightly, which the author attributes to safe-haven inflows.
  • French Companies’ Borrowing Costs Fall Below Government’s As Debt Fears Intensify — Bond yields for French companies including L'Oréal, Airbus and Axa have fallen below those on French government debt of similar maturity, with 10 French firms trading at a negative spread to the sovereign — the most in data going back to 2006, according to Goldman Sachs. Sovereign yields typically set a baseline for corporate bonds.

AI Summary. Gold broke above its $3,200–$3,400 range to a record high above $3,600, with the near-term catalyst identified as threats to Federal Reserve independence driving US investor demand. Chinese total gold demand bottomed near $9bn and nearly doubled to $16bn before moderating to about $13bn as private-sector buying partially normalized.

Martin Lynge Rasmussen Money: Inside and Out
Date Posted:

Chinese demand is underlying the gold rally; since January 2024, China has imported a cumulative ~$170B in gold.

What is driving gold to record highs?

Core argument: Gold broke out of its $3,200–$3,400 May–August range in late August to reach an all-time high above $3,600, after surging in January–April.

After surging during January-April, gold spent most of May-August stuck in the $3,200-$3,400 range. In late August, however, gold decisively broke out of the range to hit a new all-time high of >$3,600. The near-term catalyst for gold has been the ongoing threats to Fed independence, which has led to an increase in US investors’ demand for gold. But while US flows have been crucial for gold recently, China likely still holds the key to medium-term trends. We provide an overview of recent developments in Chinese gold demand. Chinese total gold demand bottomed out at around $9bn in March, but nearly doubled to $16bn by June. There has probably been a moderation towards $13bn by August, however, as a pickup in undisclosed official buying has been more than offset by a partial normalization in private sector demand.

Takeaways by Macro Roundup® AI

  1. Gold broke out of its $3,200–$3,400 May–August range in late August to reach an all-time high above $3,600, after surging in January–April.
  2. The near-term catalyst for gold has been ongoing threats to Fed independence, which raised US investors' demand for gold.
  3. Chinese total gold demand bottomed near $9bn in March and nearly doubled to $16bn by June, with a probable moderation toward $13bn by August as a pickup in undisclosed official buying was more than offset by partial normalization in private sector demand.

Related Articles:

  • Taking Stock: Dollar Assets, Gold, and Official Foreign Exchange Reserves — Gold accounts for about 10% of aggregate official foreign exchange reserves, roughly its level in the early 2000s. International Monetary Fund country data indicate most added official gold holdings came from a few central banks, with over half of reported accumulation from China and Russia and about a quarter from several emerging markets.
  • De-Dollarization? Diversification? Exploring Central Bank Gold Purchases and the Dollar’s Role in International Reserves — Central banks' gold accumulation is generally not associated with reducing the dollar's share of international reserves at the country level, apart from a few prominent cases, and is more consistent with modest overall diversification. Gold's role as an official-sector store of value has grown, but its use as a unit of account and medium of exchange remains limited.
  • The Gold Rally and Fiat Debasement — Long-term government bond yields have risen in the US and globally, while the dollar has stayed broadly stable against other major currencies even as gold prices rise. The authors argue this pattern signals debasement of fiat currencies against gold, driven by a crisis of confidence as high government debt and deficits raise incentives to inflate away obligations.

AI Summary. Americans averaged 35 minutes a day socializing in person in 2024, down from 38 minutes in 2019, and social time among 15- to 25-year-olds is the lowest in the 21-year history of the survey, 26 minutes a day below 2003. Adults 50 and older now socialize in person slightly more than teens and young adults.

Jean Twenge Generation Tech
Date Posted:

BLS’s American Time Use Survey shows that 15 to 25-year-olds spend 26 fewer minutes a day socializing than they did in 2003. For the first time ever, adults 50 and older spent more time socializing in person than teens and young adults.

Are Americans, especially young people, spending less time socializing in person?

Core argument: Americans aged 15–25 spend 26 fewer minutes a day socializing in person than in 2003, amounting to three hours a week, 13 hours a month, and 158 hours a year less time with friends.

The average American spent 38 minutes a day socializing in 2019 and 35 minutes in 2024. In 2024, for the first time, adults 50 and older spent (very slightly) more time socializing in person than teens and young adults. Young people’s social time is at an all-time low in the 21-year history of the survey. Fifteen- to 25-year-olds spend 26 fewer minutes a day socializing in person than they did in 2003. That’s three hours a week, 13 hours a month, and 158 hours a year less getting together with friends, having a face-to-face conversation, meeting for dinner, or chatting before seeing a movie together. No wonder so many more teens now describe themselves as lonely.

Takeaways by Macro Roundup® AI

  1. Americans aged 15–25 spend 26 fewer minutes a day socializing in person than in 2003, amounting to three hours a week, 13 hours a month, and 158 hours a year less time with friends.
  2. The average American spent 35 minutes a day socializing in 2024, down from 38 minutes in 2019, with young people's social time at an all-time low in the survey's 21-year history.
  3. Adults 50 and older spent slightly more time socializing in person than teens and young adults in 2024, the first time that has occurred in the survey.

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  • The Anti-Social Century — Americans spend less time with other people than in any period with reliable data back to 1965, with in-person socializing down more than 20% from 2003 to 2023 according to the Bureau of Labor Statistics' American Time Use Survey. Among unmarried men and people under 25, the decline exceeded 35%.
  • America’s Cultural Crossroads: Enduring Discontent, Rising Disconnection, and an Uncertain Future — Americans with more close friends express greater confidence that others behave fairly: 59% of those with no close friends say most people would take advantage of them, versus 29% of those with at least six close friends.
  • Disconnected: The Growing Class Divide in American Civic Life — 17% of Americans report having no close friends, and survey data show a wide educational gap: 24% of those with a high school education or less have no close friends versus 10% of college graduates. Three decades ago, Americans with less formal education reported social circles at least as large.

AI Summary. An analysis of H-1B visa registration and wage data finds a proposed wage-level-weighted lottery would not prioritize the best-paid workers, since wage levels measure seniority within an occupation rather than actual pay. The author estimates outsourcing firms would gain 8% more visas while median H-1B salary rises just 3%.

Jeremy Neufeld Institute for Progress
Date Posted:

Jeremy Neufeld argues that DHS’s H-1B proposal is “ill-equipped to rank workers” because its “F-1” criterion measures age and seniority rather than actual wages, and will penalize “genuinely high-wage, high-skill talent, especially students trained in the US.”

Would ranking skilled-visa applicants by wage level actually select higher-paid workers?

Core argument: Using FOIA data on all H-1B registrations and petitions from FY2021–2024 linked to Department of Labor Wage Level data, the author finds the proposed weighted lottery would raise the median H-1B salary by just 3%, from $92,000 to $95,000.

Using recently released FOIA data on all H-1B registrations and petitions filed from FY2021–2024, linked with Department of Labor data showing those individual workers’ Wage Levels, I show that the proposed system would not prioritize the highest-skilled or best-paid workers, [because] the Wage Level framework was never designed to compare wages across occupations because it measures relative seniority within a job category, not actual pay. Instead, it would have three surprising consequences: 1) A windfall for outsourcers. Large IT outsourcing firms would actually gain under the rule, receiving 8% more visas, because they systematically register mid-career workers classified at higher Wage Levels despite paying comparatively low salaries. 2) A setback for US-educated talent. International students graduating from American universities earn higher salaries on average than other H-1B workers, but because they are early-career, they are overwhelmingly classified at the lowest Wage Levels. 3) Minimal skill gains. DHS justifies the rule as raising skill levels, but the effect is trivial: the weighted lottery would lift the median H-1B salary by just 3% (from $92,000 to $95,000).

Takeaways by Macro Roundup® AI

  1. Using FOIA data on all H-1B registrations and petitions from FY2021–2024 linked to Department of Labor Wage Level data, the author finds the proposed weighted lottery would raise the median H-1B salary by just 3%, from $92,000 to $95,000.
  2. Large IT outsourcing firms would receive 8% more H-1B visas under the proposed rule because they systematically register mid-career workers classified at higher Wage Levels while paying comparatively low salaries.
  3. International students graduating from US universities earn higher average salaries than other H-1B workers but are overwhelmingly classified at the lowest Wage Levels because they are early-career, as the Wage Level framework measures relative seniority within a job category rather than actual pay.

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  • The Extreme Shortage of High IQ Workers — Semiconductor manufacturing requires workers of above-average intelligence, with the most demanding roles needing IQs in the top 1 in 1,000 — a pool of about 164,000 people in the US, of whom perhaps 100,000 can be placed in such professions. The author argues this scarcity explains reliance on high-IQ workers abroad and on smarter tools and non-human intelligence.
  • Third-Country Effects of U.S. Immigration Policy — U.S. H-1B visa denial rates rose from about 6% to 16%, and the authors estimate a 10 percentage point rise in denials increases Canadian applications by 30%, roughly one Canadian application per four forgone visas. More exposed Canadian firms increased sales and hired about 0.5 native workers per immigrant.
  • Top Talent, Elite Colleges, and Migration: Evidence from the Indian Institutes of Technology — Among top scorers on India's Joint Entrance Exam for the Indian Institutes of Technology, 62% of the top 100 and 36% of the top 1,000 migrated abroad within eight years, primarily to the U.S. for graduate school. The authors argue elite schools shape migration by signaling ability and providing access to networks.

AI Summary. The US government has held talks with the developer of the Thacker Pass lithium mine in Nevada that may lead to it taking an equity stake, sending the company's shares more than 90% higher. The negotiations, which also involve General Motors, centre on a $2.3bn government loan approved to develop the project.

Camilla Hodgson Financial Times
Date Posted:

The US Government is in negotiations with Lithium Americas to take an equity stake in the mining company in exchange for an extension of a $2.3B DoE loan.

Is the US government taking equity stakes in lithium miners?

Core argument: Lithium Americas shares rose more than 90% after the company said the Trump administration had held talks that may lead to the US government taking a stake in the business.

The Trump administration has held talks with the developer of a giant lithium mine in Nevada that may lead to it taking a stake in the business, sending the company’s shares more than 90% higher. Lithium Americas said on Wednesday that it was in negotiations with the US Department of Energy and carmaker General Motors, one of its investors, about financing support for the Thacker Pass project, which aims to become a top US producer of lithium to be used in electric vehicles. The talks centre on the $2.3bn loan that Joe Biden’s government approved to help the Canada-based company develop Thacker Pass, which is expected to produce enough lithium to supply 800,000 electric vehicles per year when it comes online.

Takeaways by Macro Roundup® AI

  1. Lithium Americas shares rose more than 90% after the company said the Trump administration had held talks that may lead to the US government taking a stake in the business.
  2. Lithium Americas is negotiating with the US Department of Energy and General Motors, one of its investors, over financing support for the Thacker Pass lithium project in Nevada.
  3. The talks centre on the $2.3bn loan approved under Joe Biden's government for Thacker Pass, which is expected to produce enough lithium to supply 800,000 electric vehicles per year once it comes online.

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  • Why Every Country Needs To Master The Electric Tech Stack — Drones are the foundation of hard power in the early 21st century, so a country unable to produce them domestically is at a disadvantage. As electric motors overtake combustion engines as the core technology that makes machines move, the same supply chains and production processes used for electronics can also produce cars, drones, robots, and appliances.
  • Trump, Intel Agree to 10% U.S. Stake as President Promises More Deals — The U.S. government is taking a 10% stake in Intel, becoming the chip maker's largest shareholder, by converting $8.9bn in awarded but unpaid grants from the 2022 Chips Act into equity. The government could receive additional stock depending on the performance of Intel's chip manufacturing business.