Medley Advisors

"Markets are struggling to forget that"

As midweek speculation built of a US retreat from Iran, oil prices dropped back to $100 and the dollar index eased by 1%.  Markets turned their attention to president Donald Trump's address to the nation on Wednesday 1 April in expectation of a near-term ceasefire with the Iranians. Instead, they got a promise "to hit them extremely hard over the next two ‌to ⁠three weeks ... to bring them back ⁠to the Stone Ages where they belong". Medley Advisors' policy analysts met the next morning for their weekly meeting to discuss this, market reactions, potential policy responses by the US and European central banks, Chinese economic resilience and the next move on tariffs and US withdrawal from NATO. The speakers are Andrew Besuyen on markets, Tim Jones on the ECB, Michael Redmond on the Federal Reserve, Brian Jackson on China and tariffs, and interjections from Pepijn Bergsen. "Even though this time is a little bit different, the memories of 2022 are still pretty fresh in people's minds," says Andrew Besuyen. "There was this coordinated hiking cycle that got really exacerbated by high energy prices so I think markets are struggling to forget that. So, each time we see oil prices rise, yields just keep climbing".  But last week, he says, “we saw that relationship between oil and yields start to break down. We saw oil continue to climb … but yields started to come off". If Brent spends a few days above $110, this could be "the trigger point for market starting to think about the growth downsides".

"No one knows how this ends"

Two weeks into the war between the US-Israeli forces and Iran, commodities and financial markets have whipsawed on every indication of a quick end to hostilities or signs of an extended energy-supply shock. To help clarify the outlook, Mohammad Darwazah, the head of Energy 360 at Energy Aspects, joined Medley Advisors' weekly meeting. In this edited version of the meeting, quizzing him and giving their own views (in order) are Pepijn Bergsen, Fernando Posadas, Andrew Besuyen and Dan Schwartz. "It all comes down to duration of the conflict and no one knows how this ends," said Darwazah. "Trump can declare victory unilaterally, but the Iranians are not going to live in a world where this could happen every six months so it's clear they're raising the costs sufficiently to try to deter the US and Israel from doing this again".

"No plan survives contact with the enemy"

Another week, another US tariff regime.   As expected, the US Supreme Court has ruled that the emergency tariff regime operated by President Donald Trump since April 2025 is unconstitutional. Just as expected was Trump's immediate swapping of his emergency powers for alternative executive authorisation. With this, introduced a global 10% tariff and promised to raise this soon to 15%.  Where does this leave the tariff-relief deals he struck during 2025? At their weekly meeting, Medley Advisors' analysts discussed this latest twist, what it means for Europe and the USMCA and how markets were more interested in Matt Schumer's X-hosted essay on AI.  In this edited version of the meeting, Michael Redmond was the host and was followed (in order) by Brian Jackson, Pepijn Bergsen, Tim Jones, Fernando Posadas and Dan Schwartz.  "No plan survives contact with the enemy," said Brian Jackson. "I think this is very descriptive of a lot of the best-laid plans of, let's say, the technocrats or bureaucrats in the Trump administration because Trump sometimes wants to be a lot more flexible than what a lawyer tells him".

"Trump is now starting to throw populist spaghetti against the wall"

With his job-approval rate hitting new lows, US president Donald Trump is pulling out every stop to avoid defeat in Congressional midterm elections in November. After six weeks that included military intervention in Venezuela and the threat of tariff hikes on European countries unless they agreed to the forced sale of Greenland, investors are asking what could happen next. Will Trump order an attack on Iran, walk away from the UMCA, step up pressure on the Federal Reserve, or act on his national security strategy for regime change in Europe? To discuss what lies ahead between now and the midterms, Medley Advisors brought together Michael Redmond ("Fed watcher"), Dan Schwartz (EA Head of Macro Markets) and Daniel Sternoff (EA Head of Executive Briefing). "Do we see more Greenlands and Venezuelas and so forth?" says Sternoff. "It's important to point out that Trump's main focus is of course, domestic, not international, even though he's hyperactive internationally ... One of the biggest motivations of American unhappiness is affordability and cost of living concerns and so Trump is now starting to throw populist spaghetti against the wall in a wave of initiatives ... It says a lot about where his head is".  The speakers, in order, are Tim Jones, Daniel Sternoff, Michael Redmond, Fernando Posadas, and Dan Schwartz.

"The TACO thesis is firmly embedded in markets"

The morning after US president Donald Trump reversed gears in Davos and (temporarily) dropped the US claim to Greenland, Medley Advisors held their weekly meeting to discuss policymaking and markets. "For me, the surprise was just how little markets actually reacted to this," said Dan Schwarz, the head of macro markets. "The TACO thesis is firmly embedded in markets at this point". The CBOE Volatility Index (VIX) had been coasting at 15 before Trump combined a Greenland acquisition with punitive tariffs on eight European countries and jumped to 20 - "a level you typically see in stressed markets, not even distressed markets," he added. "In terms of intensity and on a scale of one to five, if the tariff incident was a five ... this is like a two, maybe a three". The speakers, in order, are Tim Jones, Brian Jackson, Pepijn Bergsen, Dan Schwartz and Mario Lima.