💥"Yippy" Kay Yay, Mother...💥
Royal Paper + Dolphin Company File. Dialyze Direct to Come? Plus more.
Callback to Wednesday morning’s edition, which captured the state of post-”Liberation Day” markets up to that point:
As we published that piece, Bill Ackman was about-facing on President Trump, Jamie Dimon was on Fox Business dropping the dreaded “R” word and stock futures looked bleak. Wait … maybe “bleak” isn’t the right word for it. We’ll let President Trump explain it:
That’s right: people were getting “yippy”!
And so President Trump announced a 90-day pause on tariffs!!
Well, tariffs other than (i) a blanket 10% and (ii) a huge increase for China:
For its part, China indicated it intends to bolster tariffs on all US goods from 84% to 125% starting yesterday, April 12, 2025. And then went on to troll the sh*t out of us.
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Despite these obviously meaningful two-way tariffs (which effectively end all trade between the US and China) …
… the markets breathed a massive (financial) sigh of relief. Which looked something like this:
… and this:
… and this:
This movement in the VIX from Wednesday to Friday is pretty wild:
So while we’re back from the brink of watching NBA playoff games on TV like Johnny a plebe to shopping for Lakers playoff tickets, we might want to go for the nosebleed seats. Because, as of week’s end anyway, things still looked a bit whacky out there — not like Tuesday/Wednesday wacky, but wacky nonetheless.
The consumer is showing some signs of cracking:
And now, despite indications that Jerome POW-ell’s preferred inflation measure (PCE) will look tame (in large part due to a precipitous fall in airfare), the market is betting that the Fed stays put:
Higher for longer, baby!
Secondaries are rattled from all of this:
Look, things can change on a dime — much like they did over the course of this week and again on Saturday when the administration announced additional tariff adjustments related to electronics.
With each passing day President Trump could carve out more and more types of goods from tariffs. And with the 90-day reprieve, President Trump’s team could land scores of favorable new trade deals; he could even get on the phone with China’s President Xi Jinping and work something out. Still — and not to state the obvious — all of the volatility and uncertainty is making ‘25 look increasingly promising for RX professionals. Or as Oaktree Capital Management’s Howard Marks recently put it:
In Oaktree’s markets, fear of defaults (not unfounded) has caused risk compensation in the form of yield spreads to increase substantially, leading to a meaningful increase in the available yields on credit. At the same time, we anticipate a higher incidence of distress and increased demand for bespoke capital solutions, meaning we’re likely to invest our latest opportunistic debt fund faster than otherwise would have been the case.
⏩One to Watch: Dialyze Holdings LLC ⏩
Let’s start with this one.