Released a podcast with Bankless this week [listen here], it’s my favorite crypto podcast by far. We covered a wide range of topics, including a discussion on the infrastructure we’ve been building and will be bringing to market.
Dusted off an anecdote from 2022 (see below), back when we saw the infrastructure opportunity beginning to present itself. It’s always kind of interesting to look back through time to see how mega macro trends emerge, develop, unfold.
I take late summer off from writing. Making more space for family, reading, wandering. Wishing the same for you. All the very best, Eric
Week-in-Review: Mon: US new home sales 652k (630k e). Trump insisted on maintaining the terms of South Korea’s recent tariff agreement, despite lobbying efforts by President Lee Jae Myuing in their first in-person meeting. Trump moved to remove Fed Governor Lisa Cook. S&P -0.4%. Tue: US durable goods orders -2.8% (-3.8%e), US cons conf 97.4 (96.5e). Hungary bank rate decision 6.50% as exp. Trump and Cook prepare for legal fight as Cook indicated intention to challenge Trump in court. Howard Lunick suggests US looking at defense industry after Intel deal. S&P +0.4%. Wed: Russia unemp rate 2.2% (2.3%e), IP 0.7% (1.5%e). South Korea base rate 2.50% as exp. The 50% US tariff on some Indian goods took effect, as the EU seeks to fast track legislation to remove tariffs on US industrial goods to meet Trump demand. S&P +0.2%. Thu: US GDP annualized QoQ 3.3% (3.1%e), US jobless claims 229k (230k e), cont claims 1954k (1966k e). Eurozone M3 3.4% (3.5%e). Japan jobless rate 2.3% (2.5%e). Egypt deposit rate 22.0% (23.0%e). Cook sues Trump, with lawyers suggesting that a clerical error was behind the mortgage dispute. S&P +0.3%. Fri: US UMich Aug sent 58.2 (58.6e). Japan housing starts -9.7% (-9.8%e). US federal appeals court ruled most of Trump’s global tariffs illegal but allowed tariffs to stay in place while the case is subject to further review. Brazilian President Lula authorizes process for retaliatory measures against 50% tariff. S&P -0.6%.
Weekly Close: S&P 500 -0.1% and VIX +1.14 at +15.36. Nikkei +0.2%, Shanghai +0.8%, Euro Stoxx -2.0%, Bovespa +2.5%, MSCI World -0.4%, MSCI Emerging -0.6%, Bitcoin -7.1%, and Ethereum -9.8%. USD rose +1.2% vs South Africa, +0.9% vs Indonesia, +0.8% vs Chile, +0.8% vs India, +0.6% vs Russia, +0.4% vs Turkey, +0.4% vs Mexico, +0.3% vs Euro, +0.2% vs Sterling, +0.1% vs Yen, and +0.1% vs Brazil. USD fell -0.8% vs Australia, -0.6% vs Canada, -0.5% vs China, and -0.4% vs Sweden. Gold +2.9%, Silver +3.0%, Oil +0.5%, Copper +1.4%, Iron Ore +2.4%, Corn +2.1%. 10yr Inflation Breakevens (EU +1bp at 1.73%, US -1bp at 2.41%, JP +2bps at 1.58%, and UK +3bps at 3.06%). 2yr Notes -8bps at 3.62% and 10yr Notes -2bps at 4.23%.
July Mthly Close: S&P 500 +1.9% and VIX -1.36 at +15.36. Nikkei +4.0%, Shanghai +8.0%, Euro Stoxx +0.7%, Bovespa +6.3%, MSCI World +2.5%, MSCI Emerging +1.2%, Bitcoin -7.4%, and Ethereum +15.8%. USD rose +1.3% vs Turkey, +0.7% vs India, +0.6% vs Russia, and +0.2% vs Indonesia. USD fell -3.4% vs Sweden, -3.1% vs South Africa, -3.0% vs Brazil, -2.5% vs Yen, -2.3% vs Euro, -2.2% vs Sterling, -1.8% vs Australia, -1.2% vs Mexico, -1.0% vs China, -0.8% vs Canada, and -0.6% vs Chile. Gold +5.0%, Silver +9.5%, Oil -6.1%, Copper +3.8%, Iron Ore +2.5%, Corn +1.6%. 10yr Inflation Breakevens (EU -6bps at 1.73%, US +2bps at 2.41%, JP +6bps at 1.58%, and UK -3bps at 3.06%). 2yr Notes -34bps at 3.62% and 10yr Notes -15bps at 4.23%.
2025 Year-to-Date Equity Index Returns: Greece +55.5% priced in US dollars (+37.6% priced in euros), Hungary +51% priced in US dollars (+29.3% priced in forint), Czech Republic +49.3% in dollars (+28.8% in koruna), Poland +48.7% (+31.7%), Colombia +46.4% (+33.8%), Spain +45.7% (+28.8%), Austria +41.8% (+26%), Israel +40.9% (+29%), Korea +40.7% (+32.8%), Italy +39% (+23.4%), Portugal +38.9% (+22.8%), Chile +36.3% (+32.6%), Germany +35.2% (+20.1%), South Africa +33.8% (+24.9%), Brazil +33.8% (+17.6%), Norway +33.7% (+18%), Mexico +32.7% (+18.6%), Ireland +30.7% (+15.6%), Vietnam +28.4% (+32.8%), Finland +28.4% (+14%), Belgium +27.2% (+12.5%), HK +24.6% (+25%), Euro Stoxx 50 +23.6% (+9.3%), Sweden +23.2% (+5.7%), UK +21.3% (+12.4%), Canada +21.1% (+15.5%), Singapore +20.1% (+12.7%), Switzerland +19% (+5.1%), France +18% (+4.4%), China +17.8% (+15.1%), Australia +16.4% (+10%), Netherlands +15.4% (+2%), Japan +14.5% (+7.1%), Taiwan +12.8% (+5.2%), MSCI World +12.7% priced in US dollars, NASDAQ +11.1%, S&P 500 +9.8%, Indonesia +8.9% (+10.6%), UAE +7.2% (+7.2%), Russell +6.1%, New Zealand +4.1% (-1.4%), Malaysia +1.5% (-4.1%), India +0.2% (+3.3%), Turkey -1.3% (+14.8%), Philippines -4.5% (-5.7%), Thailand -6.4% (-11.7%), Saudi Arabia -10.7% (-10.8%), Denmark -15.9% (-25.2%), Argentina -39.4% (-21.7%).
Anecdote (Sept 2022): “When I was younger, an M&A titan asked me a question,” said the Chairman. “What is the half-life of a good idea on Wall Street?” he said, motioning to me for an answer. Naturally I shrugged, avoiding humiliation. “One deal,” he said, raising a finger, smiling. The Chairman was sharing his latest read on macro trends, including more evidence of a phase change. Back in early 2021 he and I shared our views of the future. We both had an intuition that something Wall Street considered to be a remote possibility would in fact manifest as an inevitability. Such setups are the foundation for all mega macro trends, so I started betting accordingly, building investment products and infrastructure for the industry. “In my discussions with corporate boards and executive teams across Wall Street and in the entrepreneurial community the engagement on blockchain and the tokenization of assets has accelerated dramatically. The focus and intensity are remarkable,” said the Chairman. “The transition from floor trading to electronic trading that took place decades ago produced a few massive winners and left many behind. In the “history rhymes” category, Wall Street is figuring out that the move to blockchain infrastructure may bring the same threats and opportunities,” he said. “And think also of the transition from analog, clunky mutual funds to automated index funds, to more tax and execution efficient ETFs. That technology-enabled evolution of retail investing produced a seismic reordering in finance, with many losers and a few enormous winners. The forward-thinkers in the asset management industry are starting to realize that once core assets are tokenized, both ETFs and the already declining traditional mutual fund offerings will be competing with lower-cost, highly customizable digital SMAs (separately managed accounts),” he said. “Tokenized asset settlement efficiencies should be able to slash the costs of delivering customized portfolios to smaller investors, further democratizing access to high-quality asset management services,” he said. “For the past couple years, when asked about my interest in crypto and blockchain, these are all the things I’d tell executive teams – and anyone else – when they asked about the future. But just recently, they have started telling me this is the future, as they scramble to craft strategies to avoid being left behind,” said the Chairman. “Now you’re seeing the big asset managers announce deals and new products in this space. That makes it clear that the race is underway. And the best firms in finance see digital success as integral to their overall success, core to their future,” said the Chairman. “There is more. The race is not only in the private sector. US dollar hegemony is not a God-given right. It is the result of many factors – the often-cited economic strength, and rule of law – but also network effects, including scale and efficiency. Technological change presents threats to scale and yesterday’s efficiency. The Treasury, the Federal Reserve and Congress should realize there is an even bigger race to win.”
Good luck out there,
Eric Peters
Chief Investment Officer
One River Asset Management
Disclaimer: All characters and events contained herein are entirely fictional. Even those things that appear based on real people and actual events are products of the author’s imagination. Any similarity is merely coincidental. The numbers are unreliable. The statistics too. Consequently, this message does not contain any investment recommendation, advice, or solicitation of any sort for any product, fund or service. The views expressed are strictly those of the author, even if often times they are not actually views held by the author, or directly contradict those views genuinely held by the author. And the views may certainly differ from those of any firm or person that the author may advise, converse with, or otherwise be associated with. Lastly, any inappropriate language, innuendo or dark humor contained herein is not specifically intended to offend the reader. And besides, nothing could possibly be more offensive than the real-life actions of the inept policy makers, corrupt elected leaders and short, paranoid dictators who infest our little planet. Yet we suffer their indignities every day. Oh yeah, past performance is not indicative of future returns.