"Citadel's Ken Griffin cautioned that America's market rally is being propped up by policies better suited to a recession than a growing economy. Speaking in New York, he said fiscal and monetary policies have created a "sugar high" that masks underlying risks like inflation and dollar weakness. Despite booming equities, Griffin pointed to gold's record surge-up more than 50% this year-as evidence investors are quietly hedging against U.S. sovereign risk."
"U.S. businesses and consumers are waiting to feel the effects of President Trump's 'One Big, Beautiful Bill Act' which the White House has described as the "largest tax cut in history for middle and working-class Americans." In addition, the Oval Office has been pressuring the Federal Open Market Committee (FOMC) to cut the base rate significantly (despite inflation staying persistently above its 2% target) in the face of a slowing jobs market-saying the current rate of 4% to 4.25% is more restrictive than necessary. At its last meeting, the FOMC capitulated and axed interest by 25bps, creating cheaper borrowing for consumers, businesses and the government itself."
U.S. fiscal and monetary policies have created a "sugar high" that is propping up equity markets while masking underlying risks such as inflation and a weakening dollar. Gold has surged more than 50% year-to-date, signaling investor hedging against sovereign risk. Heavy investment in AI and the tech sector is bolstering market strength, and consumer spending remains resilient despite sticky inflation and a softer jobs market. A proposed large tax cut aims to boost middle- and working-class incomes. The Federal Open Market Committee cut rates by 25 basis points to 4.00%–4.25%, lowering borrowing costs for households, businesses, and government.
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