Gloom and boom
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What is the main topic discussed in this episode?
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Pushkin. So it's actually not that weird that markets are doing fine, even though we're now entering month three of the US-Israeli war on Iran. The problem, though, is it's becoming increasingly clear that energy prices are going to be much higher for much longer. Is this really OK, like indefinitely? This week, we got a bunch of central banks and really big company earnings reports to help us understand what it all means. So today on the show, bear with me here. Is Donald Trump actually a master of getting markets exactly where he wants them? This is Unhedged, your friendly markets and finance podcast in the Financial Times. I'm Pushkin. I'm Katie Martin, a markets columnist at the FT in London, where it's warm, it's cold, it's warm again.
No one knows what to wear. It's chaos. And I'm joined through the miracle of technology by the larger than life, Mr. Robert Armstrong, all the way over there in New York City. Rob, how is the Big Apple?
Katie, it is a beautiful, sunny, cool day here in New York, a perfect spring day. And I know markets don't care about our listeners' feelings, but I do. We here at the Unhedged podcast, we really care.
We're here for you, listeners. So, look, it's maybe like a riddle and it's maybe not, but it's definitely a thing that, like, the cuffs and collars in markets just don't match at the moment. You were out in Switzerland talking to energy people the other week. Yes. I was writing about this yesterday. All the sort of energy analysts are saying, I don't like this much. I think the Strait of Hormuz is going to be basically impassable for much longer than I previously thought. I think oil prices are going to be much higher than we previously thought. I think this is going to go on for longer. I think it's going to be economically more painful than we perhaps thought at the start of this crisis. And yet, like, markets are still like, dee, dee, dee, dee, dee.
I think we can make sense of this, not perfect sense, but maybe as good sense as we can ever make of the wild squiggling that characterizes all markets everywhere always. I mean, you know, I thought your column on this was excellent, Katie, but the numbers they are talking about.
That's nice, Rob. You're never nice.
I'm never nice. I've taken some kind of a new pill this morning and they're working. I don't know. Anyway, the numbers they are talking about there. are higher, higher than we are now, and well higher than we were before the war. However— Well, the oil prices, you mean. The oil—so Brent is, what, at 110 or something now? Do you have that number in front of you?
Mm-hmm. Something like that.
I feel like from the work Hack Young has done and that I've done, you know, if we can keep it under 150 for the American economy, at least, that's bearable. Maybe a different story for Europe. Certainly a different story for Asia.
Right.
But like the danger zone, I think, is still above what most analysts are talking about. I, of course, allow for the unpleasant possibility that the analysts are not pessimistic enough, which is.
Why are markets thriving despite negative news?
Yes. You know what I mean? Yeah. But, you know, I think the central hypothesis remains sometime in the next couple of months. They managed to get the straight open. Oil never touches 150. Yeah. And we all breathe a big sigh of relief. There is a right tail that is awful. And we should talk about that.
What impact will rising energy prices have on the economy?
But the central hypothesis, the most likely outcome, I think it's markets friendly, given everything else we know about the economy and what the market is doing now and so forth.
Well, let me throw you a curveball, Rob Armstrong, because just before we came to record this show, a headline broke.
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Chapters
5 chapters
1
What is the main topic discussed in this episode?
0:01–4:13
2
Why are markets thriving despite negative news?
4:13–4:34
3
What impact will rising energy prices have on the economy?
4:34–7:00
4
How is Donald Trump's influence perceived in market trends?
7:00–22:41
5
What are the implications of the UAE leaving OPEC?
22:41–23:26