Big Bank Earnings
How are CEOs feeling
Shorter note this week as the family heads to Athens, Georgia, for the UGA–Ole Miss showdown. It should be a great matchup — plenty of SEC and playoff implications — and hopefully the Dawgs pull out the win to stay in the hunt for another SEC and National Championship run.
“Trust the signals, not the headlines—math has a longer memory than markets.”
All weekend, traders were hyperventilating about a Monday crash — and it never showed up. Trump dialed back his trade-war rhetoric, and the market gapped higher to start the week. Friday’s selloff now looks more like a positioning washout than the start of a breakdown. Too much leverage, too many late chasers, and a gamma flip to negative created the perfect storm — but it burned itself out fast.
In this market, flows are everything. If you’re not tracking dealer positioning, ETF flows, and gamma dynamics, it’s like trying to play golf with a wooden driver — you’re swinging hard, but the pros already have you beat.
For investors managing their own money, don’t get hung up on “good” or “bad” economic data. Focus on the rate of change — better or worse. That’s what drives assets, not the headline print. Right now, the rate of change looks set to improve into Q1–Q2 of next year as easy comps from ‘liberation day’ start rolling in. Layer on a likely government reopening, a more accommodative Fed, and a possible Supreme Court rejection of Trump’s tariffs, and you’ve got a slew of bullish catalysts that the market will have a hard time ignoring over the next six months.
As for the ongoing government shutdown, Kalshi odds now suggest it could drag into November. But there’s one pressure point that could force Trump’s hand: TSA agents. If they start calling in sick like they did in 2019 and airport lines turn into traveler nightmares, he’ll have no choice but to act. The last thing Trump wants heading into year-end is a public meltdown at the airports and his approval rating nosediving alongside it.
What I was reading and watching this week
Economic data still on hold with government shutdown we did hear J Powell fed chair on Tues.
Fed Chair Speech- Jerome Powell said today that the central bank may be nearing the end of its balance sheet runoff (QT) as liquidity tightens in money markets. He noted the U.S. economy is on a “firmer footing” than expected, though job growth remains soft, with low hiring and turnover. Powell emphasized a data-dependent approach to future rate cuts, balancing risks between lingering inflation and a weakening labor market. He also defended the Fed’s pandemic-era bond purchases, while acknowledging they “may have lasted longer than needed,” and reiterated that the Fed must retain its ability to pay interest on reserves to manage policy rates effectively.
The Main Course
Big banks kicked off earnings on Tuesday, and the CEOs has some prescient things to say about the consumer and what they are seeing when it comes to the economy-
