Is the Economy Running Too Hot? | Macro Mondays: August 10, 2026

Andreas Steno and Mikkel Rosenvold are back to unpack a seemingly contradictory macro setup, with the economy running hot despite slowing jobs growth and fading inflation. They break down Andreas’ latest convictions on where we are in the business cycle, and whether Kevin Warsh and the Fed are misreading the setup. Let Monarch do your financial 'spring cleaning' for you! Use code REALVISION at Monarch.com to get your first year half off at just $50. Today’s sponsor is Plus500 US. Take your trading to the next level with cross-market contracts, from precious metals to key indices, and more. Whether you’re a seasoned trader in the Futures arena or brand new, Plus500’s user-friendly trading platform offers you the advanced tools, market insights, and quick execution you’ve been looking for. Get started with Plus500 for as little as $100 at https://us.plus500.com. Trading in futures involves the risk of loss. 🔥 Get 𝗙𝗥𝗘𝗘 𝗔𝗖𝗖𝗘𝗦𝗦 to Real Vision https://rvtv.io/3YOZZUe #macromondays #macro #markets #investing #realvision #mikkelrosenvold #andreassteno #stenoresearch #federalreserve #kevinwarsh #businesscycle #interestrates #markets #finance Learn more about your ad choices. Visit podcastchoices.com/adchoices

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• 1:08Speaker 01

  Sometimes it's maybe good, sometimes it's maybe shit.

• 1:30Speaker 01

  Hello there, welcome to Real Vision and welcome to Macro Mondays. My name is Miroslav. I'm your host for the show as usual and with me I have also as usual Andreas Steno. Welcome to the show Andreas, how are you doing?

• 1:44Speaker 02

  Good, Regal. It's like 30 minutes since we left each other at the office, but I'm still good.

• 1:51Speaker 01

  That's great, that's great. People can probably look past that. Andreas, I want to get straight into the free. We have a lot of good stuff to talk about today. But everyone's, everybody's eyes obviously on the inflation numbers coming out this Wednesday. So let's get straight into the free Andreas. Year over year, the market expectation is at 3.4%, slightly down from last month. What's your expectations? Let's have a number here.

• 2:18Speaker 02

  Well, I can start by saying that the market has converged towards our now cost. So I can see that the headline inflation is 0.1 on the month and the core inflation is 0.2. We have a couple of zeros in our now casting. So we're still below the market, but slightly less so than a week or two ago. So in a sense, I think the market has actually converged towards our view, which is a bit of a surprise to me, but yeah. As said, our now casting is incredibly soft again. And I think a lot of people underestimate the impact of the tariffs being paid back to corporate America,

• 2:58Speaker 02

  which is a big game changer to the reverse scenario that we had for most of this year and last year with tariffs being paid net-net. Because obviously, if you're a company receiving a lot of tariffs paid back now, there's no urgency to raise prices. And I think that's exactly what we're seeing in our data right now. So you were asking about the dollar to begin with. I think we'll have a soft dollar week upcoming, given our view on inflation.

• 3:30Speaker 01

  That didn't really answer my question for a number, Andreas.

• 3:32Speaker 02

  Yeah, a couple of zeros, I said a couple of zeros.

• 3:34Speaker 01

  Okay, we'll dive much more into that. Also, your view on the timeline for the business cycle. You published a very interesting article on that and what's or who might be the executioner for the business cycle. We'll dive a little bit into that, Andreas, and obviously also talk about the job numbers coming out last week. Before we get to that, Andreas, a little bit of fun here. You just sent me this tweet, I saw it yesterday as well. You get these a lot, these map tweets on X. Why isn't this a country? Why doesn't this country do that? Are they stupid? And this is essentially a suggestion that Germany, the Netherlands and our country of Denmark

• 4:15Speaker 01

  and half of Belgium, the Flanders region, should join together as a country, would have twice the economy of the UK and France. I guess that's probably correct. The Dutch king, the Dutch king would become president. Frankfurt would become the capital and our prime minister, Mette Fijl, would become chancellor somehow. What'd you say, Andreas? Note the omission of Berlin, the Brandenburg area, which is probably getting annexed by Poland or what? I don't know.

• 4:48Speaker 02

  Yeah, that was why I laughed when I saw this map, because the way that they've just left out Berlin is absolutely amazing. I mean, for those who haven't been to Berlin, it's basically an economy made up by basket weavers and finger painters. So I get why you don't include it.

• 5:02Speaker 01

  That's rough, but yeah, I get it.

• 5:05Speaker 02

  So in that sense, you know, everything business related is ex-Berlin in Germany. I think that's reasonably fair to say. Sorry to the Berliners calling in here. We're having a bit of a laugh at your expense. But having said that, I actually think that, you know, it's always difficult with timelines, right? But I think it's an underestimated scenario that we will see some sort of formal alliances within the EU among, for example, this group of countries. I think it's reasonable to expect such a move over decades. Because, you know, especially since the UK left the European Union, this exact group of countries have in some cases searched for new alliances within the European Union.

• 5:50Speaker 02

  So I think that's why you see these, of course, satirical approaches to how to set up a new country. I don't think it will be a new country, but it could be some sort of informal alliance. And I wouldn't root that out.

• 6:02Speaker 01

  Actually, the most staggering, the most important part of this image and this proposed border is the one that you probably paid the least attention to. And that's the borders through the North Sea. Because you only have to move that maybe 500 miles to the west and then you get all Norway's oil. So that's probably the most important part of this map now, Andreas. We were absolutely not going to enter into a union with Germany. We've fought a lot of wars to stay out of that. And we're absolutely not going to take back those areas of Sweden that's proposed here. So now, a little bit of fun there, Andreas. Let's get back to the macro picture, lots of stuff going on. Let's start with our now casting, Andreas. Inflation, US inflation still at floor levels.

• 6:45Speaker 01

  So Andreas, we were, as you mentioned earlier, we're not sitting in the same room. We were earlier today, so you're back at home now. So how should I ask you, this room you're in right now, is the energy inflation there with you or where is it? It's nowhere to be seen.

• 6:58Speaker 02

  So you told me before we went out there that we should refrain from talking too much about Iran this week because it's getting almost annoying to talk about it on a weekly basis. Having said that, as I've alluded to for probably a month or so, I don't think we see any major tightness in oil markets. If you look at the dated oil prices, it's, you know, between friends roughly flat versus the front month future. So in that sense, if you have, you know, a physical market that is roughly on par with the future one month ahead, the physical market is not telling you to bring those barrels forward, if you know what I mean. They're not telling you to bring those barrels out of storage.

• 7:42Speaker 02

  And that's been my main message since we've approached this second memorandum of understanding that there is actually not a lot of risk premia surprise out of the energy market right now because there's no panic. So I, you know, it's anybody's guess when we get a new deal around the Strait of Hormuz. It seems like the US is just willing to, you know, throw everything at that deal around the Strait. It's almost the thing to solve now. Who cares about nuclear weapons and all of that? It's 10 years down the line anyway. And therefore, when you look at flows right now through the Strait of Hormuz,

• 8:24Speaker 02

  especially if the source that Axios referred to on Friday in their story about the question is right, we're talking 7 to 8 million barrels a day, which is more than you get if you look at, for example, Kepler shipping data and so on and so forth. And I've said this throughout, watch the curvature, watch the fiscal market because there's a lot of unaccounted flows. And it remains the case if we trust the sources from within Pentagon. And I think we could just as well trust that because the fiscal market is telling the same story. So I'm saying a couple of things here. No, there's no energy panic right now. The physical market is doing okay.

• 9:06Speaker 02

  Of course, there's a slight scope for prices to mean revert lower over time. But, you know, China will likely be a constant floor under the market here. We have seen a pickup in refiners rates in China, meaning that they're importing more than they did during the peak panic. China was basically the country that balanced the market back then. And therefore, you know, it won't be a straight line lower here. I think the most likely scenario for oil is that we chop around without major direction from here. So is the energy inflation in the room with us? I actually think energy prices will, you know, they

• 9:45Speaker 02

  Yeah, be a slight drag on inflation this month. So, you know, it is a benign impulse for inflation, but not major. The big benign impulse from from energy in year-on-year terms will arrive late this year and obviously into Q1 next year, since we start to compare versus the peak of the Iran war back in March, April, right? So it's one of the main points I've made in this business cycle analysis. Everyone is so focused on central banks ending the cycle now because they're, you know, most central banks are moving in the direction of hikes. But what if this energy shock is just over? I think it is, you know. In short, I think the energy shock is over.

• 10:25Speaker 02

  It's been over for a while. Yeah. What will that be central bank? Will that lead central banks to, you know, abandon this hiking path into next year? In such case, we could prolong the business cycle for a long while, right?

• 10:38Speaker 01

  Yeah, because what data points to hike right now, Andreas? Okay, the inflation or the growth parameter here looks relatively soft. But but and the inflation through what data points to a hike here, really? I'm really struggling to understand that.

• 10:55Speaker 02

  Well, inflation from a couple of months ago did.

• 10:58Speaker 01

  Yeah.

• 10:59Speaker 02

  And I think, you know, Williams of the New York FOMC is probably not as important of a voice as he as he was during the Powell reign, because he was he was closely connected to Powell, right? But he basically said that he was, you know, against just looking in the V of you mirror on inflation, taking a decision now in September. So I think that was kind of the first important voice within the committee stating that maybe the updated projections for September will look a lot softer for inflation, which I think will be the case for most central banks, because, you know, remember the assumptions made back in early June for most of the big central banks?

• 11:41Speaker 02

  They included oil prices around $115 or something like that in their central projection, right? And we're so far below that. So in most cases, we're even below the mild inflation scenario for most of these central banks, just watching oil, right? So I think the updated staff projections, when the big central banks meet in September, will be key to understanding what's ahead for the central banks. And those staff projections will, all else equal, given where oil trades right now, and given the prospects of a second memorandum of understanding, probably look a lot

• 12:18Speaker 02

  softer. So our data, and I've been saying that for a month, Rob, the probably, and I said, let me underscore this, probably tells the Fed that it should cut, not hike. I'm not saying that they will cut, but they probably should, given what we observe. And therefore, you know, I I struggle to see the case for an interest rate hike from the Federal Reserve, and I think they will admit so in September as well. But it's still early days. And, you know, there's a lot of time between now and that meeting.

• 12:59Speaker 03

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• 13:16Speaker 01

  Yeah, still a few data points to navigate from. But we're getting close to that. Obviously, going to be a big one on Wednesday. Let's turn our focus a little bit towards the growth parameter here in dress. And obviously, also talking into the piece, the article on on the business cycle that you wrote here. If you look at our now cast parameter here, the or now casting here, the growth parameter has rolled over quite significantly over the summer. Are you worried about this? Should there have been a stronger World Cup effect for the US growth? Or what are we looking at here?

• 13:49Speaker 02

  I'd actually argue that this is the exact World Cup hangover effect, right? It was also what we saw in in Friday's job report. We had a pretty nasty print in leisure and hospitality. And what a lot of people got wrong about the World Cup is that you don't see the World Cup impact in the exact month of the World Cup. You see pre-World Cup in many ways. First of all, due to technicalities around methodology, right? If you book a ticket in March for, you know, and a domestic ticket, a flight ticket between a couple of the cities hosting the World Cup,

• 14:29Speaker 02

  it will turn up as a sale in March to a large extent, and it will also turn up as inflation in March if you pressure up prices. And the reason why that impacts the business cycle in the way that it's probably done here is that, you know, a lot of the activity and a lot of the payments are obviously, you know, front running the actual event, right? It's not like you decide, oh, oh, there's a World Cup, and then you decide 24 hours ahead of the game, right? It's something you plan. So I think a lot of the impacts was already seen during March and April and May. And if you look at

• 15:09Speaker 02

  the rate of change now, now casting back on page five, Meg, it it probably peaked somewhere late May, right? And, you know, remember, this is a rate of change where we always measured the rate of change versus the month prior, right? So I mean, if we drop below 50, it just means that we're kind of leveling off a little versus a pretty solid economy during the second quarter. So I I'm yet to be worried. And I think this is natural. You know, it is the hangover effect, the hangover impact of of the World Cup. Having said that, if you look at some of the more sort of longer leads, and, you know, I'm not going to unpack all of it here, because, you know,

• 15:54Speaker 02

  you can read the full article in the Pro tier at Real Vision and that now costs like here, right? But if you look at central banks and the reaction function from central banks and how that typically impacts the business cycle, I think there is a scope for, you know, more medium term stating that the business cycle could peak in rate of change terms in the fourth quarter of this year. But I'm not ready to say that the business cycle is over. It would require a lot more hikes from a lot of the big central banks before we get there. But it could sort of take

• 16:36Speaker 02

  the steam out of the economy a little bit into into the fourth quarter. And again, I'm talking about the peak from a rate of change perspective. It doesn't necessarily mean that we go from peak to recession, right? A lot of people misunderstand that. But but for markets, it's typically a relevant turning point. It's you kind of turn the page when you go from momentum up to momentum down, right? And in some cases, some would argue that we already saw that through July. I think it's a little bit more technical in nature, won't be saw in July. And my best guess is that we have another euphoric market coming up before New Year's, but we'll have to see. What I'm mostly

• 17:16Speaker 02

  proud of, if you dial back to our now cast, Meg, is that, you know, we've probably, and I say probably because I don't have data on every single forecast on earth, we've probably been the best inflation forecaster on earth with our now class thing technique this year. We've also been a very good forecaster of PMIs. And a lot of people then say, okay, what's what's sort of the timeline from your now cast to forecasting the actual events to predicting market outcomes afterwards? And it's something that we'll have we'll have to fine tune on a running basis. And I admittedly, to some extent, fell asleep at the wheel in July, when I saw this drawdown in the

• 17:59Speaker 02

  data. But it's it's becoming clearer to us that we have an incredible lead on the market with this data. We're talking six, seven weeks between we observe something and until we actually see that impacting the actual economic key figures coming out from the Bureau of Labor Statistics, etc. So the whole task that we set out to solve here, that we wanted to sort of be ahead of the official releases, we've solved that. Now we need to figure out exactly how to use that for trading. But we're getting there. And, you know, it's tasked with different layers, if you know what I mean. But, you know, we've been calling inflation six, seven weeks in advance, growth

• 18:41Speaker 02

  six, seven weeks in advance, very solidly since launching this. And therefore, I'm very comfortable with with the data that we're showing here.

• 18:50Speaker 01

  Also, because you have a four to six week lag until it shows up in official numbers. And then you sometimes have a four to six week lag until it shows up in decision making sometimes, because sometimes you need one or two, three prints to be sure of that direction. So that is obviously something to watch, Andreas. Absolutely. So I just want to flag one of our most requested charts that we do on a regular basis in here.

• 19:14Speaker 02

  Yes.

• 19:16Speaker 01

  The Korea one. So, so what are you seeing out of Korea? I know you update this almost every day, Andreas. It's the first thing you do, you know, it's released weekly, right? The South Korean expert numbers.

• 19:29Speaker 02

  Yeah, every 10 days, right? So.

• 19:31Speaker 01

  10 days. Yeah. Yeah. So it's not a daily thing for you. I know that. But still, every time it's out there, you're tweeting about it. What are you seeing out of out of South Korea?

• 19:42Speaker 02

  I I'm not going to take full credit for that. But, you know, me among like a handful of very AI interested macro strategists have highlighted this 10 day figure from from the Korean economy as the one to watch. And when I had to update. The the subcategories of the export index from South Korea. I typically ask Claude to to ping their API. Claude told me that it could no longer access the South Korean custom service API, probably because a lot of people have started doing it. So um so I I need to figure out a way to update this automatically from now on.

• 20:25Speaker 02

  But yeah, tomorrow morning, we'll get the the the the first 10 days of August. Uh, the the end of July was incredibly strong again. Uh, the the beginning of July was weak, and that's why it's difficult to see. But I've tried to point an arrow to the difference between June and July. But we had a small setback in July, mainly due to the first weeks of July, while the end of July was incredibly strong. Uh, so I'm, you know, it would be so interesting to see whether August has has reaccelerated again. Uh, because this is the chart. It, you know, it's almost a cycle within this cycle, if you know what I mean. Everyone's watching this, uh, because if if the export data out of South Korea rolls over, it's probably also

• 21:10Speaker 02

  a sign that we've peaked from a rate of change perspective um in in the export data overall, when you look at the AI trade, right? Um, having said that, um, if you look at semiconductor exports from South Korea, they're up 160%, something like that year over year. Uh, of course, we'll meet the rate of change wall of worry at some point. I mean, uh, the Jap, sorry, the Korean economy cannot double its exports every year. It's it's it's, you know, it's just simple math by the end of the day, right? Because the Korean economy is not small, and they've doubled their export in a year, more than doubled in in specifically in semiconductors. That's not sustainable.

• 21:55Speaker 02

  If if if they increase exports 25% from this base, it's still a remarkable increase, right? Remember the nominals here. Um, so I've said that for once, I actually think this wall of worry around the rate of change is one to discard, because when you have such extremes, look at the peak here in the dark blue. It is an extreme that is far more extreme than what we've ever seen in history. Uh, so if we grow from that base, it's still an incredible growth in nominal terms. Uh, and one that is, by the way, not accounted for in forward pricing.

• 22:36Speaker 02

  Because if you look at, if if you look at forward pricing of everything related to this export trade out of Korea, um, it is priced to flat line. So it's basically pricing the dark blue line to go to zero.

• 22:50Speaker 02

  So if it goes to 25 or 50, there's a big upside potential still. Um, if you if you look at forward pricing, it and and that's so, that's basically the most weird thing about this economy right now. Everyone has sort of concluded, okay, the rate of change has peaked. Fair enough, um, it doesn't take a genius to make that conclusion. Um, it may be wrong still, by the way, but it doesn't take a genius to make that conclusion. That will happen soon.

• 23:18Speaker 02

  Next question is, what happens with the nominal growth from here? In in all forward projections for companies related to this export trade, you basically see a flat projection in nominal terms, more or less, meaning that the market is undecided. Basically, okay, we've gotten here, and now we'll just plateau, and it will stay there.

• 23:44Speaker 01

  Yes, no more growth.

• 23:45Speaker 02

  Which which is the only scenario that, yeah, which is the only scenario that will not happen. Either grows or doesn't.

• 23:52Speaker 01

  This is a balance scenario, but it's true, yeah.

• 23:53Speaker 02

  Yeah, um, so

• 23:55Speaker 01

  This is the level of AI we have, it's not going to go anywhere.

• 23:57Speaker 02

  It's this is exactly where it would stay. And and uh, uh, so, you know, if you look at the hyperscaleism, the reporting season we had, etc., I mean, they're not slowing down, at least.

• 24:08Speaker 01

  Absolutely not.

• 24:09Speaker 02

  The the only question, uh, and I, you know, I've received that question a lot, is, you know, what does it take for them to slow down? Because um, of course, the market can kind of tell it, tell the executives of of some of these companies to slow down. And it started telling it, um, say, late June, early July. But then all of the big hyperscalers, they rebounded massively after their quarterly earnings, right? Um, even after some of them raised their capex guidance, uh, some of them in more creative ways than others. Having said that, when the market buys them after another, you know, strong wave of capex, uh, it's not exactly like you're sitting at sea level and say, okay, we don't, we won't do any more of this. Probably do more.

• 24:52Speaker 02

  Um, so I I think we have another quarter or two at least ahead of us, where they'll continue to raise the guidance. And then, um, yeah, we'll obviously have to see after 2027. But again, I can guarantee you, the only scenario that won't happen is that we'll stay exactly at this spending for AI and then just stay there for as long as we're alive. Um, that is the most bizarre assumption ever. Uh, but it's probably because you have some bulls and some bears, and the market is very undecided, right?

• 25:21Speaker 01

  Gustav and Andreas, again, for the full take on the outlook of the business cycle and and the timeline for the business cycle, uh, check into Real Vision's Pro Tour, when you can catch Andreas's full analysis with with loads of more data and and take some of this. Also, remember, if you want to be a Pro member on Real Real Vision, you can look forward to our roundtable conversation this Wednesday at 4:00 PM Eastern. We're joined, you are joined by Jamie Kooten, role pal, of course. I'm desperately trying to get out of a dinner date, and no one told my wife I said this. I'm just desperately trying to get out of that to join that. I'm not sure if I'm able to. Uh, but in any case, it's going to be a great watch, um, again, at at 4:00 PM Eastern on on Wednesday, where you um have the roundtable with Ro and Jamie.

• 26:06Speaker 01

  And obviously, uh, as every week, we uh publish our articles, especially look out for the Friday portfolio update, uh, which is very, very popular. Uh, we had a listener question on, uh, I'm I'm not going to have time to to get too much into here about the Turkey-Saudi-Pakistan Defence Pact. Um, I'm going to be writing about that in my weekly geopolitical update called The Drill, that's out every Wednesday. So we are covering that as well in Real Vision, essentially covering everything you need. So so go in there, realvision.com/pricing and check out your options. That's all we have for you this week. Uh, great to have you, Andreas. Um, any final thoughts or words of encouragement to to our listeners here?

• 26:45Speaker 02

  I I I can, I can say that we cover everything you need in relation to financial markets.

• 26:50Speaker 01

  Yeah, yeah.

• 26:50Speaker 02

  The other promise is, you won't get any diets or stuff like that.

• 26:56Speaker 01

  Absolutely, that's that's uh, that's a good um, a good way to round this off, Andreas. So anyway, uh, one thing I forget to say every week, if you're watching this on on YouTube, please like and subscribe to the channel, leave a comment with what you would like to hear more of on our cha- channel here. We are trying to to to expand that a little bit, so please leave your input or feedback for us here. Thanks to you, Andreas, for joining. Thanks to everyone for watching in. We'll be back next week.

• 27:26Speaker 03

  You obviously enjoyed the episode because you're here with me at the end. But listen, don't forget to go to realvision.com/join and grab a free membership. It's an incredible community packed with alpha, great investment ideas, and the research that you need to help you unfuck your future. So get started now, go to realvision.com/join.