Mapping Macro Liquidity and How AI Is Changing the Transmission Mechanism

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Today, Jaymes and I mapped the entire macro liquidity framework, how AI is changing the transmission mechanism, and why this credit cycle melt up has more left in it than positioning is prepared for. Real interest rates are 30bps from going negative and AI is retooling both the financial market and the underlying economy at the same time. See the full thread on the credit cycle I referenced in the video here: LINKLIVESTREAM RECORDING FROM TODAY:Today’s Livestream: Main Talking Points1. 80 percent of returns in most asset classes come from macro. Every individual stock and the broad market decomposes into market returns, sector returns, and fundamental returns. Market and sector returns are macro driven. Fundamentals stack on top. If you can map the macro regime correctly, you are already capturing 80 percent of the available return before you even pick a name. That is why the entire framework starts at the macro level and works down.2. Melt ups are not driven by sentiment or euphoria. They are driven by liquidity and credit. Sentiment can move a single low float stock. It cannot move an entire market. What drives broad based melt ups is the combination of financial market liquidity expanding and credit being injected into the underlying economy at the same time. Both of those are happening right now, and AI is the reason both pipes are open simultaneously.3. AI is functionally injecting credit into the economy without a bank. That is the single most underpriced macro variable. When AI lets you spin up a company, market it, and build a brand with less upfront capital, that i…