When looking at U.S. markets, I think there’s a little bit from both of those areas that can be helpful. During periods of fiscal dominance, the general trends are that 1) governments often try to restrict the flow of capital in subtle or overt ways, 2) asset prices are often not as nominally bearish as you might expect since the denominator is

One of the primary themes that I’ve frequently written about going back to 2020 and that has guided a lot of my investment decisions, is the concept that the United States is in the process of entering fiscal dominance.

This means that fiscal deficits are larger and more impactful for the economy and for financial markets than they used to be, and

There’s no single best way to quantify it, but if I had to point to one set of charts, I would say that fiscal dominance occurs when annual public deficits exceed the sum of annual net bank lending and annual net corporate bond issuance on a sustained basis, especially without having been caused by a recession.