Offshore
Photo
Quiver Quantitative
JUST IN: Representative Ro Khanna has signed Rep. Luna's discharge petition to force a vote on a congressional stock trading ban. https://t.co/UijSN6w6po
tweet
JUST IN: Representative Ro Khanna has signed Rep. Luna's discharge petition to force a vote on a congressional stock trading ban. https://t.co/UijSN6w6po
tweet
Offshore
Photo
Quiver Quantitative
JUST IN: A brand new account on Polymarket just bet $40K that the Fed won't lower interest rates later today.
They will win $1.6M if they are correct. https://t.co/ywAytWNzKI
tweet
JUST IN: A brand new account on Polymarket just bet $40K that the Fed won't lower interest rates later today.
They will win $1.6M if they are correct. https://t.co/ywAytWNzKI
tweet
Offshore
Photo
Quiver Quantitative
JUST IN: Representative Haley Stevens has introduced Articles of Impeachment against Secretary RFK Jr. https://t.co/wssWFCKCx9
tweet
JUST IN: Representative Haley Stevens has introduced Articles of Impeachment against Secretary RFK Jr. https://t.co/wssWFCKCx9
tweet
Offshore
Photo
EndGame Macro
25 Keeps the Narrative Intact And 50 Breaks It Wide Open
My base case is still a 25 bp cut today. Not because everything is fine, but because the Fed knows how much the size of a move shapes the story. A quarter point cut says, “We’re easing because the cycle is slowing, and we’re doing it on our terms.” It keeps the tone calm and intentional which is exactly what they want heading into a fragile part of the year.
A 50 bp cut lands completely differently. Anytime the Fed has gone that big like in 2001, late 2007 and after major shocks in the late ’80s and early ’90s the market’s reaction has followed the same arc. At first, there’s relief with cheaper money, quicker easing, a little bounce in risk. But that doesn’t last, because people immediately start asking why the Fed felt the need to move that aggressively. And once that question hangs in the air, the psychology shifts. Big cuts rarely read as confidence; they read as concern. They tell the market that something underneath is weakening faster than we thought.
That’s why I don’t think Powell touches 50 today. A move that size would overpower whatever message he tries to deliver at the podium. Instead of steady, planned easing, the headline becomes “why did they panic?” And once markets start trading that narrative, you can’t reel it back in with a press conference.
So 25 isn’t just a policy choice, it’s the cleanest way for them to preserve the illusion of control.
tweet
25 Keeps the Narrative Intact And 50 Breaks It Wide Open
My base case is still a 25 bp cut today. Not because everything is fine, but because the Fed knows how much the size of a move shapes the story. A quarter point cut says, “We’re easing because the cycle is slowing, and we’re doing it on our terms.” It keeps the tone calm and intentional which is exactly what they want heading into a fragile part of the year.
A 50 bp cut lands completely differently. Anytime the Fed has gone that big like in 2001, late 2007 and after major shocks in the late ’80s and early ’90s the market’s reaction has followed the same arc. At first, there’s relief with cheaper money, quicker easing, a little bounce in risk. But that doesn’t last, because people immediately start asking why the Fed felt the need to move that aggressively. And once that question hangs in the air, the psychology shifts. Big cuts rarely read as confidence; they read as concern. They tell the market that something underneath is weakening faster than we thought.
That’s why I don’t think Powell touches 50 today. A move that size would overpower whatever message he tries to deliver at the podium. Instead of steady, planned easing, the headline becomes “why did they panic?” And once markets start trading that narrative, you can’t reel it back in with a press conference.
So 25 isn’t just a policy choice, it’s the cleanest way for them to preserve the illusion of control.
WATCH LIVE TODAY: Press conference with #FOMC Chair Powell at 2:30 p.m. ET: https://t.co/1uJrua5Yif
https://t.co/FJa6TblbC1 https://t.co/4KvqVjHSM1 tweet
Offshore
Photo
WealthyReadings
Both $SE and $MELI keep falling. Both trade below my assumed fair value. Both can go much lower.
In both case, their e-com are under pressure. Competition is pushing them to defend market share and that often means sacrificing margins short term to onboard and retain customers. Protect their market shares.
None of this is new. It has happened before, it is common in this sector, and it is not going away anytime soon.
The challenge is that we may be entering a softer period. When that happens, the market doesn't maintain high premiums because those premiums are tied to expectations of future cash generation.
A margin squeeze creates uncertainty around those future cash flows.
Will they come out of this stronger? Will they regain margins? Will cash generation recover? Or is this the start of something more structural in part of their business?
That’s what the market is pricing in today. Until it gets clarity - and that could take several quarters, multiples are unlikely to return to their highs and will probably drift toward their lows - or stabilize.
At that point, either the stocks will get too cheap to ignore - like what we are seeing with some sectors today, or margins will rebound because at the end of the day, both companies are world-class and not easily knocked off.
I’m not worried about the businesses long term. But in the short to medium term, I am cautious on the stocks. So for now, I’m staying patient.
tweet
Both $SE and $MELI keep falling. Both trade below my assumed fair value. Both can go much lower.
In both case, their e-com are under pressure. Competition is pushing them to defend market share and that often means sacrificing margins short term to onboard and retain customers. Protect their market shares.
None of this is new. It has happened before, it is common in this sector, and it is not going away anytime soon.
The challenge is that we may be entering a softer period. When that happens, the market doesn't maintain high premiums because those premiums are tied to expectations of future cash generation.
A margin squeeze creates uncertainty around those future cash flows.
Will they come out of this stronger? Will they regain margins? Will cash generation recover? Or is this the start of something more structural in part of their business?
That’s what the market is pricing in today. Until it gets clarity - and that could take several quarters, multiples are unlikely to return to their highs and will probably drift toward their lows - or stabilize.
At that point, either the stocks will get too cheap to ignore - like what we are seeing with some sectors today, or margins will rebound because at the end of the day, both companies are world-class and not easily knocked off.
I’m not worried about the businesses long term. But in the short to medium term, I am cautious on the stocks. So for now, I’m staying patient.
tweet