Macro Mondays – "Fed Cuts Coming or Crisis Brewing?"

Host: Mikkel Osenval
Guest: Andreas Steno Larsen
Date: November 17, 2025

Overview

This episode, hosted by Mikkel Osenval with macro strategist Andreas Steno Larsen, centers on current dollar liquidity concerns, the looming December Fed meeting, and what recent events suggest about central bank and market dynamics. They also discuss global supply chains, energy themes (especially solar), liquidity mechanics, and answer audience questions, blending serious analysis with a lively, candid tone.

Key Discussion Points and Insights

1. Market Volatility and Trading Realities

• 00:06–02:24: Mikkel sets the tone with a humorous analogy of trading: intended outcomes versus messy reality.
• Andreas: “It certainly looks like my trading for the past couple of weeks... I actually tried making a heart with the steamed milk... and it also looked like that.” [02:26]

2. US-China Trade Dynamics and Rare Earths

• 03:19–06:43:
  • Ongoing confusion about US-China deals, particularly on rare earths, with skepticism about actual real-world follow-through.
  • Andreas: "The trade deal that was signed between the US and China during Trump's first era was pretty decent on paper. None of it happened in reality, more or less right." [03:44]
  • Emphasis on the need for the US/EU to develop independent rare earth supply chains – agreements are only temporary stopgaps.
  • Solar and broader energy supply still fundamentally depend on Chinese supply chains, exposing the limits of decoupling.
  • Andreas: “If you plan on implementing solar in large scale in the US and in Europe, you cannot avoid the Chinese supply chain either.” [06:05]

3. Liquidity Stress and Repo Market Dysfunction

• 06:43–10:55:
  • Government is reopening, releasing “trapped” cash from the Treasury at the Fed back into private banking – near-term positive for liquidity.
  • But repo rates pricing above the Fed's standing repo facility indicate persistent underlying liquidity strain, especially in the narrow interbank market.
  • Why is the repo facility underused?
    • Not all market players can access it directly.
    • Banks may avoid its use to steer clear of the perception they are in distress.
  • Andreas: “Repo markets still signal that we're not out of the woods fully. ...the Federal Reserve will have to act either by expanding this facility... or by adding liquidity via purchases of assets.” [10:19]
  • Market is closely watching whether the Fed moves ahead of or at the December meeting.

4. December Fed Meeting: Cut or Hold?

• 10:55–16:36:
  • Mikkel brings up market-implied odds for a December cut (around 50/50).
  • Division within Fed committee—some for, some against further cuts, Chair Powell’s stance remains unknown.
  • Latest inflation and jobs data will be available just before/during December’s meeting, possibly confirming soft trends.
  • Andreas: “I would personally lean towards them cutting in December... Especially since ...the next official inflation print will be released ahead of the press conference... it looks incredibly soft.” [11:28]
  • If Fed also signals an ongoing easing bias or continues asset purchases, markets may rally. If the cut is presented as ‘one and done’, it could be perceived negatively.
  • Notable power delegated to New York Fed’s John Williams to take “technical” balance sheet action without formal FOMC vote.

5. Listener Q&A: Macro Strategy and Thematic Plays

• Michael Howell's View on Liquidity [18:46]:

  • Howell thinks 2026 could be tough for risk assets if the Fed doesn’t provide explicit QE.
  • Andreas: Pushes back, noting that steepening yield curves globally have shifted new credit creation away from central banks to commercial banks, boosting liquidity through private sector “carry.”
  • Quote: “What we've seen in Japan and Europe this year is a much steeper yield curve... that is a natural liquidity enhancer ... we've seen the liquidity and credit creation moving from central banks to private banks...” [19:35]

• Solar Stocks – Pure Plays vs. Picks and Shovels [21:47]:

  • Investors can access via direct solar companies or via ‘picks and shovels’ like NextTracker or ETFs (TAN).
  • US market seen as a strong 'catch-up' play vs. China/EU; small modular nuclear reactors seen as slow, solar and natural gas preferred for next 12-18 months.
  • Andreas: “I would probably prefer to be exposed to several parts of that supply chain and in particular to companies with a very strong US domestic footprint.” [23:20]

• Liquidity Jokes and Listener Banter [25:16]:

  • Listeners ask “when repocalypse?” and “when ISM over 50?”
  • Andreas: Repo stress isn’t 2019-style “apocalypse” risk, but watching closely; ISM could go over 50 “within two months from now.”
  • “I've gotten it wrong every single time...but let me provide you with my best guess... within two months...” [25:43]
  • On social media heckling: “You're fat and retarded. And I responded yes, you're right about both. But what has it got to do with this view?” [26:44]
  • Mikkel and Andreas plan to read humorous user ‘garbage’ in future shows.

Notable Quotes and Memorable Moments

| Timestamp | Speaker | Quote/Insight | |-----------|----------|--------------------------------------------------------------------------------------------------------------------------| | 02:26 | Andreas | "It certainly looks like my trading for the past couple of weeks. That video there..." | | 03:44 | Andreas | "The trade deal that was signed between the US and China... None of it happened in reality, more or less right." | | 06:05 | Andreas | "If you plan on implementing solar in large scale in the US and in Europe, you cannot avoid the Chinese supply chain..." | | 10:19 | Andreas | "Repo markets still signal that we're not out of the woods fully..." | | 11:28 | Andreas | "I would personally lean towards them cutting in December..." | | 19:35 | Andreas | "What we've seen in Japan and Europe this year is a much steeper yield curve... liquidity and credit creation moving..." | | 23:20 | Andreas | "I would probably prefer to be exposed to several parts of that supply chain, and... companies with a very strong US footprint."| | 25:43 | Andreas | "I've gotten it wrong every single time...but let me provide you with my best guess... within two months..." | | 26:44 | Andreas | "You're fat and retarded. And I responded yes, you're right about both. But what has it got to do with this view?" |

Important Timestamps

• Liquidity Crunch & Fed Discussion: 06:43–16:36
• Listener Q&A (Liquidity and Sector Bets): 18:05–26:44
• Solar & Energy ETF Picks: 21:47–24:19
• Humorous Social Media Mentions: 26:44–End

Tone and Presentation

The episode blends actionable macro insight with a friendly, offbeat, and occasionally irreverent style. Both hosts are candid about the unpredictability of markets and open about their own track records, combining technical analysis, long-term thematic views, and a willingness to laugh at themselves and the macro community at large.

Summary

This week’s "Macro Mondays" provides a frank, data-driven analysis of current liquidity strains, the likely Fed playbook into December, and top macro themes including energy supply chains and risk asset outlooks. The hosts balance technical depth with humor and clear, practical takeaways—offering essential context for both professional investors and curious macro watchers.