Macro Mondays — "Most-Hated Rally Ever?"

Host: Andreas Steno Larsen (A)
Co-host: Mig Rosemal (B)
Date: September 16, 2025

Episode Overview

This week's episode dives deep into the "most hated rally" in global equity markets—a period of surprisingly solid returns despite investor skepticism and geopolitical uncertainty. The hosts dissect the upcoming pivotal Federal Reserve (Fed) decision, the market’s strangely reluctant sentiment, the global CapEx (capital expenditure) cycle with a focus on AI and data centers, the state of US-China relations, and shifting currency dynamics. The pair provide actionable macro perspectives, address trade positioning, and keep the tone lively and irreverent with candid takes and memorable quotes.

Key Discussion Points & Insights

1. Setting the Stage: A Big Macro Week (00:18 – 03:01)

• Fed Decision Looming:
  The episode opens with anticipation over the Fed’s interest rate decision. While markets expect a 25 basis point cut, the range of economist forecasts is wider than usual.

• Market Resilience Despite Pessimism:
  September, typically a weak month, is delivering strong returns. US indices (Nasdaq, Japan, China) are logging new highs “against all odds.”

  Notable Quote:
  “This is probably the most hated rally that we've seen in years.” — Andreas (03:20)

2. Skeptical Sentiment & Reluctant Participation (03:01 – 04:13)

• Investor Reluctance:
  Institutional investors remain wary, doubting the rally’s durability, especially under the Trump administration.

• International View:
  Skepticism is even more pronounced in Europe and Asia regarding the US rally.

  Notable Quote:
  “It cannot be true that the Trump administration can sort of oversee these kind of returns… but it doesn’t really matter as long as the earning cycle, the business cycle picks up amidst all of this turbulence and noise.” — Andreas (03:38)

3. Cycle Positioning & the 'Bumblebee Economy' (04:13 – 06:06)

• Bumblebee Analogy:
  The US economy is likened to a bumblebee: “It isn’t supposed to fly, but no one has told it that, so it’s still flying.” — B (04:15)
• Recession Watch:
  A nod to ongoing bearish forecasts (“the greatest recession in a century should be coming up mid-October”), questioning the reliability of such predictions.

4. AI CapEx Cycle & Market Narratives (05:27 – 11:13)

• Front Page 'Economist' Effect:
  Discussion of the Economist magazine’s AI cover: is this a contrarian top signal? Andreas thinks not, citing the lack of major positioning in AI among levered institutional investors.

  Notable Quote:
  “It’s been more than a decade since I subscribed to that shitty paper.” — Andreas on The Economist (08:13)

• Underlying CapEx Asymmetry:
  The AI/data center CapEx cycle is booming, while “real economy” sectors are still holding back, mainly due to tariff uncertainty. A surge in broader CapEx may be imminent once trade regimes are clarified.

  Notable Quote:
  “We’re likely going to see a forced CapEx cycle in everything from manufacturing to farming… now that tariffs are in place.” — Andreas (09:43)

5. US-China Relations & Trade Realities (11:13 – 15:50)

• Signs of Thaw Amid Ongoing Rerouting:
  Despite improvements (e.g., TikTok deal, more “conciliatory” rhetoric), underlying trade flows between the US and China remain subdued, with “very, very subdued” commodity flows and strategic diversification continuing.

• Tariffs as a Strategic Lever:
  Trump’s recent suggestions tying China tariffs to the Russia-Ukraine war are dissected as mostly rhetorical, requiring G7 coordination that’s politically unrealistic.

  Notable Quote:
  “Both parties have accepted that this needs to be managed. You cannot just, you know, pull the rock from under that relationship in a matter of minutes.” — Andreas (13:44)

6. Federal Reserve Meeting: Market Expecations & Risks (15:50 – 22:18)

• Consensus vs. Outliers:
  Polymarket odds suggest a 90% probability for a 25bp cut, but some reputable forecasters (e.g., Bloomberg Economics) call for no cut, making the outcome less “given” than markets presume.

• Powell’s Delicate Balance:
  The hosts explain that the Fed Chair is incentivized not to surprise from expectations; beginning a cut cycle usually implies follow-through.

  Notable Quotes:

  • “When they start cutting, they typically mean business.” — Andreas (17:36)
  • “He’d much rather prefer his legacy is actually pretty okay, if he manages to get to the finish line in one piece next year.” — Andreas on Powell (19:17)

• Market Reaction Playbook:
  Markets will watch forward guidance for clues on more cuts; a “wait and see” or slower path would likely disappoint risk assets.

7. Dollar Positioning & Global Growth Shifts (22:41 – 27:06)

• On-Chain Payments vs. Traditional Systems:
  Jamie Kooch’s chart reveals that on-chain crypto transactions might surpass traditional payment networks (Visa, MasterCard, PayPal) as soon as 2026—a “tectonic shift.”

• Dollar Bets Concentrated Against EM FX:
  Much of the bearish US dollar positioning is vs. emerging markets, not majors (EUR, JPY, GBP), suggesting room for dollar weakness against developed-market currencies if global growth upticks.

  Notable Insight:
  “When we see such kind of uniformity in the growth picture, we typically see a weak dollar versus the other developed currencies.” — Andreas (26:45)

8. Trade Positioning & Portfolio Adjustments (27:06 – 28:38)

• Niche AI Trades:
  Andreas remains bullish on select AI plays, particularly sub-Nvidia bets with strong performance.
• Geopolitical Bets:
  Fracturing global supply chains present continued opportunities, especially in raw materials sectors amid Russia-related tensions.
• September Seasonality:
  Pushback on the notion that only late September is typically weak for markets; Andreas thinks the "bad" seasonal narrative may also prove mistaken this year.

9. Memorable Moments & Podcast Signature Humor

• “Sometimes Maybe Good, Sometimes Maybe Shit” (05:22):
  A running gag about the binary outcome of trade ideas.
• “If I'm donning that cap, run for the fucking hills.” — Andreas, referring to a novelty cap reading "Steno Was Right About Everything" as a contrarian top indicator if ever worn (29:24).

Timestamps for Major Segments

• Fed Decision Preview & Market Context: 00:18 – 03:01
• Investor Reluctance & ‘Most-Hated Rally’: 03:01 – 04:13
• Cycle Positioning & ‘Bumblebee’ Metaphor: 04:13 – 06:06
• AI CapEx & Market Narratives: 06:06 – 11:13
• US-China Relations & Tariff Games: 11:13 – 15:50
• Fed Meeting Scenarios & Reactions: 15:50 – 22:18
• On-Chain Payments & Dollar Positioning: 22:41 – 27:06
• Portfolio Adjustments & September Seasonality: 27:06 – 28:38
• Closing Banter & Contrarian Signals: 28:57 – 29:28

Notable Quotes

• "This is probably the most hated rally that we've seen in years." — Andreas (03:20)
• "It isn’t supposed to fly, but no one has, has told it that. So it's so still flying." — Mig (04:15 on the US economy)
• "We’re likely going to see a forced CapEx cycle in everything from manufacturing to farming…" — Andreas (09:43)
• "Both parties have accepted that this needs to be managed. You cannot just … pull the rock from under that relationship in a matter of minutes." — Andreas (13:44)
• "When they start cutting, they typically mean business." — Andreas, on the Fed (17:36)
• "If I'm donning that cab, run for the fucking hills." — Andreas (29:24)

Conclusion

In this wide-ranging, candid episode, Andreas and Mig challenge consensus pessimism, break down why this rally might still have legs, and highlight key macro inflection points. From Fed policy to AI investing, and the ongoing chess match of global geopolitics, the show delivers actionable macro strategy with memorable banter and transparency about the inherent uncertainty of markets: "Sometimes maybe good, sometimes maybe shit."