Episode summary
No Fed Guidance. No Quarterly Reports. No Data You Can Trust. Who Wins When You Know Less?
Excess Returns
· · 58 min · Hosts: Cameron Dawson, Dave Nadig, Matt Zeigler
Summary
The discussion centers on a world where investors may know less, later, and with less confidence. The host and guests argue that the Fed’s reduced forward guidance and a possible hike create unusual uncertainty, especially for the front end of the curve, where volatility could rise and hit floating-rate borrowers, private credit, and other levered structures tied to short rates. One guest says this is not automatically “bad,” but it is clearly more volatile and less predictable.
They extend the same argument to corporate disclosure and market transparency. If the SEC pushes quarterly reporting to semiannual reporting, one guest argues that it would widen the information edge for large professional investors while making markets less efficient for retail traders. They also connect this to the end of QE and balance-sheet reduction: less liquidity may lower forward returns, but it could also change active management dynamics and create new opportunities for asset gatherers.
The conversation then turns to moral hazard and the next crisis. The guests speculate that the Fed could eventually backstop private credit, strategic infrastructure, or other assets with enough systemic pain attached. They also argue that economic data itself has degraded since the pandemic, making forecasting feel more like divination than analysis.
Key takeaways
- One guest argues that no Fed forward guidance means more uncertainty and likely more volatility in front-end rates.
- The guests think semiannual corporate reporting would advantage deep-pocketed professional investors over retail traders.
- The discussion frames QE’s end and balance-sheet shrinkage as a likely drag on future returns, even if it helps active managers.
- The guests expect the next crisis to reveal what the Fed deems too important to fail, possibly including private credit or strategic infrastructure.
- Cameron Dawson says deteriorating data quality has made economic analysis more like art, or even divination, than science.
Notable quotes
“We know that Wars has been very clear, no forward guidance, but he's also taken that as no forward guidance, no reaction function as well”
“I think all of this movement away from transparency and frequency of disclosure is just flatout bad for investors”
“The idea I think is that in just like the bond manager who says ah you know I kind of like a Fed that doesn't tell me what it's going to do because that gives me vol to play with”
“So where this used to be so much more of an art than a science, it's even more of an art and actually it's like an ugly art”
“my favorite parlor game is what ends up on the Fed's balance sheet in the next crisis”
How the episode opens
Those other podcasts, they're clickbait, but this this is clickbait. Should market professionals ever have private conversations out in public? Well, only to prove that all we know is that we don't know nothing.
We've got three roles on this show. We have one pre-agreed upon topic we pick in advance. While we're live, nobody Googles nothing and everybody brings a surprise topic to the table.
Anything goes. Who's with me today? It's the Derek Civers of macro.
You know what I'm saying? CD Baby, which is not where I bought Metallica's black album, but I did personally tape those hits off the radio. Thank you very much.
Which I think even Derek Civers would appreciate. It's a long way to tie me to your outlook for New Edge back to this show when she's not riding IPO lightning or mastering market puppets. She's the CD baby of click beta.
Cameron Dawson, welcome back.
I know you got that reference from. — Yes, yes, yes, indeed you do. — Quick. — I did my homework. Who? Who's that that I see? dancing with myself, readying, steadying, and going cuckoo for macro puffs. The Billy Idol of ETFs, the King Rocker of Click Beta himself, Mr. Generation SpaceX. That's right, Dave Nodig. Welcome back.
Generation SpaceX is good. I can steal that for something. — I am upset that it took me this long to come purple with that reference. Be perfectly. — And I realized my I like almost made a major musical error cuz you're like dancing with myself. I was like, "Oh, it's going to be Robin themed." And then obviously that's dancing on my own. So very very different. But I was like if you could draw a Robin themed intro for Dave be very impressed.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- fed forward guidance uncertainty
- reduced market transparency
- corporate disclosure gaps
- qе liquidity and active management
- owning physical media and journaling
Companies and tickers mentioned
- Newedge Wealth
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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Excess Returns, this episode and its artwork belong to Excess Returns. Octagon is not affiliated with the show; this page is an independent summary.
