Market Update Preview
Markets have done pretty much exactly what we thought they'd be doing — overpriced, but with flows still very supportive of the current price level, and the drift higher we called last update playing out on schedule. I think that continues for at least the next few days. But we're finally approaching the point in September where the summer flow window starts closing, and an inflection point arrives very soon. It's time to start taking the sell-signal tools seriously — and there's a specific stretch of September I'm now treating as the brittle zone, where a handful of conditions could stack into exactly the kind of setup you want to be positioned ahead of rather than react to. I walk through the sequence of signals I'm watching before getting defensive, and what would make me move early.
The headline segment this week is the Bessent buyback announcement. I lay out why I don't think it accomplishes what the administration wants, what the TGA mechanics actually imply (including why "this isn't QE" is only half right), and the deeper point the whole episode reveals — the one lever that would bring rates down, and why nobody in Washington will pull it. There's a free article coming with more of the mechanics, but the core argument is here.
Plus: the Flow Monitor's current read, the credit cycle's remaining innings, and — for the first time in a long while — a spot where I openly disagree with DeepMMT about what September looks like. Full breakdown below.
(Note: Below is a summary of the Market Update Video for 08/27/2026, click here to watch the video update)