The yield curve un-inversion, not the inversion itself, is the phase historically associated with recession onset — we're currently in that window.PMI data shows a decelerating but not collapsing economy, with services offsetting manufacturing weakness.Leading indicators have been declining for 23 consecutive months, matching
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Regulation is legitimising crypto: MiCA, spot ETFs, and stablecoin rules bring institutional clarity.Bitcoin/Ethereum are institutional-grade: $68B ETF AUM validates BTC; ETH following via spot ETFs.Stablecoins are the regulatory frontier: $210B market under scrutiny; Tether’s reserve opacity is the biggest risk.The regulatory inflection pointFor most
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AI capex supercycle is real: $340B hyperscaler investment in 2025, growing 20%+ in 2026.Value chain analysis matters: TSMC, ASML, SK Hynix, Broadcom benefit alongside Nvidia.Cyclicality risk is rising: Deceleration from 23% to 8-12% growth would compress 37x SOX P/E.The semiconductor supercycle thesisThe global semiconductor
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$4.2T market is now mainstream: 6.2% of global bond issuance, up from 0.5% in 2015.EU GBS raises the bar: Mandatory taxonomy alignment and external review from Dec 2025.Greenium is real but small: 2bps secondary, 5-8bps primary. Not material for return-seeking investors.Evolution of the green
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Carry is compelling: 6.8% USD yield at 320bps spread, with EM inflation falling and rates cutting.Differentiation is key: Investment-grade EM vs frontier markets; commodity exporters vs manufacturing hubs.Distressed names offer asymmetry: Post-restructuring bonds (Sri Lanka, Ghana, Zambia) have 25-40% return potential.The macro backdrop for
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Historic concentration risk: 33% of S&P 500 in 7 stocks exceeds Nifty Fifty and dot-com peaks.Fundamentals justify premium—for now: Earnings growth (18% vs 8%), margins (28% FCF), and AI optionality support valuations.Broadening is starting: Equal-weighted S&P outperforming in Q4 2025; small caps rebounding.The concentration
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Terminal rate at 3.25-3.50%: Market pricing implies 2-3 more 25bp cuts in 2026.Soft landing base case intact: GDP 2.3%, unemployment 3.9%, inflation trending down.Watch core PCE and Sahm Rule: 0.2% m/m PCE and sub-0.5 Sahm reading keep easing on track.The easing cycle in contextThe
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Base case: $75-90 Brent: 60% probability of managed OPEC+ unwind with 1.2M bpd returned over 2026.India > China in demand: India overtakes China as top demand growth source; Chinese EV adoption at 45%.Energy equities undervalued: E&Ps trading at 40% discount to 5-year average EV/EBITDA
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Institutional adoption is structural: Pension funds and endowments entering means the capital is sticky and long-horizon.Supply squeeze amplifies demand: Post-halving supply of ~450 BTC/day vs $200-400M daily ETF inflows.Size at 1-5% via risk parity: Risk-parity frameworks suggest 0.5-1.5% allocation at current volatility.From fringe to
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Central banks are the new marginal buyer: 1,136 tonnes purchased in 2025, replacing Western institutions as price-setters.Supply deficit structural: 3,600t mine output vs 5,000t+ total demand; deficit met by ETF drawdowns.From hedge to core: Gold’s 3-year Sharpe ratio (1.42) now exceeds both equities and
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Structural not cyclical: The India-China divergence is driven by demographics and governance, not business cycles.Portfolio rebalancing is self-reinforcing: EM fund weights converging to 22% China, 20% India from 38%/8% in 2020.China contrarian play is risky: CSI 300 at 11x looks cheap, but structural capital
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Cheap on historical basis: PSEi at 12.5x vs 10-year avg of 17.8x; 30% discount.Rate cut timing is everything: BSP holds at 6% until CPI drops below 4%; market expects 75bps cuts.OFW remittances underpin: $39B in 2025 remittances support peso, housing, and consumption.The PSEi’s 2026
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