Weekly

The week that was, ending 29th June.

Mamdani won the Democrat primary to compete in November elections for New York Mayor. As much as Mamdani won the lazy Democrats fielded Cuomo expecting him to win. Mamdani will race off against Eric Adams now in November. Eloquent, young , progressive socialist offers change despite immense flaws in his plans and policies. The All-In podcast pointed out that the disenfranchised youth who has no skin in the game economically caused this lurch to fantasy politics. Of course, for New York this could be just a rotation in the cycle, it was a shit hole in the 70’s until strong men rebuilt it. The socialist lesson needs to be retold every generation. For the Democrats this is a nationwide trap, go towards Mamdani, and stay a party of opposition.

In related news, the Yookay has got a date with fiscal reality, and a collapse is possible. Interesting to hear Wes Streeting (Labour, Government) on radio this morning saying the tax burden was already too high whilst explaining the latest U-turn on Government policy to alleviate welfare spend. This country is in a unique position that means collapse could happen and is a useful canary in the coalmine for what could happen elsewhere. The global bond markets know this. The radical economic growth policies that could dig the country out of this mess is way beyond the current politicians regardless of colour.

The quick Trump/Iran action barring serious repercussions seems to have achieved its aims. China/Russia kept out, Iran weakened but with regime still in charge. Israel mollified. US no casualties or extended interaction. Also, US projection of might globally.

Bitcoin is intriguing, bumbling around 105-110k range. On the face of it good ongoing demand and recognition that it’s a relief to the global debt ponzi which is destroying purchasing power. Its not moving significantly higher though, and price action suggests that demand and supply are balanced, which goes against the narrative. Are OTC transactions destroying price discovery? If so that will change over time. There is a sense of frustration in the lack of its move up.

U.S. Economy Contracts: New GDP data indicates the U.S. economy shrank at a 0.5% annual pace from January to March 2025, marking the first quarterly decline in three years, signaling potential economic slowdown.

Federal Reserve Policy: Fed Chairman Jerome Powell emphasized a cautious approach to interest rate cuts, awaiting clarity on the economic impact of President Trump’s tariffs. Some Fed officials suggested possible rate cuts as early as July, with projections indicating two cuts in 2025, though inflation and unemployment forecasts were revised upward, and GDP growth was revised downward.

Stock Market Performance: The S&P 500 and Nasdaq hit record highs, with the S&P 500 up 4.4% and Nasdaq up 6.1% in June, recovering from April’s tariff-related selloff. Investor optimism grew due to a U.S.-brokered ceasefire between Israel and Iran, easing geopolitical tensions, and expectations of Fed rate cuts.

Trade Developments: The U.S. and China reached an agreement to expedite rare-earth shipments, mitigating some trade concerns. However, Trump terminated trade talks with Canada in response to its digital tax on tech companies, threatening new tariffs that could cost U.S. firms billions.

Travel Industry Trends: U.S. airport TSA checkpoint traffic declined 1.7% in May 2025 compared to the previous year, reflecting weakening travel demand. Global oil prices dropped after a perceived de-escalation in Middle East tensions, though recession risks remain elevated at 35% over the next 12 months.

China’s Economic Moves: China’s central bank pledged faster policy responses to economic conditions, and Beijing tied a cognac deal to EV tariff negotiations with Europe, signaling strategic trade maneuvers.

India’s Economic Outlook: India is projected to remain the fastest-growing economy among G7 peers, driven by a 61% trade surge and strong domestic demand, according to the PHDCCI.

Global Economic Sentiment: Concerns persist about potential stagflation, with 75% of global fund managers expecting economic challenges over the next year, exacerbated by trade tensions and geopolitical risks.