Market Update Preview
Kevin Warsh ran his first FOMC meeting today, and it played out about how we should have expected: a dramatically pared-down statement, a more hawkish dot plot, and a clear signal that the new chair wants to keep markets guessing. We got a brief sell-off into the close, then a rebound — not much damage overall, with rates ticking higher.
I'll lay out why I think the market could genuinely benefit from a rate hike here (yes, really), the back-of-the-envelope math on how much interest income that adds to fiscal, and why the short-run picture still looks like a healthy pause rather than the start of something worse. We hit the levels we'd flagged, I trimmed a little risk, and I think we build a base here through the June tax drain before the next leg.
The bigger payoff this week is on the long-run side: oil's drop is buying the cycle more time, and I walk through the actual math of the credit cycle — why steady acceleration paired with collapsing fiscal is the real danger, why 2022 didn't cascade, and why this time will look different. Full breakdown below, including the updated cycle-top timing.
(Note: Below is a summary of the Market Update Video for 06/18/2026, click here to watch the video update)