Forward Guidance, Released on 5/14/25

In this episode, Luke Gromen joins the show to discuss the trade agreement with China, why the U.S. can’t afford real interest rates, and how the bond market—not policymakers—is now setting the rules. We also explore the hidden costs of decoupling from China, the inevitability of dollar devaluation, why any attempt at fiscal austerity is doomed, and more. Enjoy!

00:00 Introduction
01:38 China Trade Deal
08:09 Balance of Trade IS Currencies
10:45 Ads (Blockdaemon, Arkham, Ondo)
12:08 Gold, Yuan & USD
15:36 China Market & Competitive Edge
20:06 Global Bifurcation
24:51 Southeast Asia & Industrial Policy
29:23 Ads (Blockdaemon, Arkham, Ondo)
31:23 US Fiscal Endgame
35:56 Treasury Tools
41:06 Why Issue Any Long Duration?
43:40 The Fed’s Next Move
45:38 Austerity Risk
51:06 The Trend Hasn’t Changed

Luke Gromen is a graduate of the University of Cincinnati and received his MBA from Case Western Reserve University. He earned the CFA designation in 2003. Luke provides strategic consulting services for corporate executives and is the founder of The Forest For The Trees, LLC, a macro/thematic research firm catering to institutions and individuals.

  china trade deal, economy, investing, luke gromen, tariffs, trade deal, trade war, Trump