November 7, 2024 - 2:30pm
Market reports on Wednesday morning were dominated by the powerful rally in US assets across a range of classes, from stocks to crypto. However, the distribution revealed some interesting trends.
Shares in companies connected personally to President-elect Donald Trump, such as his media company, went parabolic. Those in companies which share close personal ties to him, or were seen to be favoured by him, like Elon Musk’s Tesla, as well as crypto, oil and the banking sector have equally taken off. But those seen to be in his crosshairs, from renewables and shipping companies to any sector that will be affected by import tariffs, slumped.
What this suggests is that investors are anticipating a personalised form of government — something akin to the way Vladimir Putin manages his oligarchs, in which case a savvy management strategy would be to keep Trump happy. That will deliver handsome returns to the well-connected. Yet it may not be so good for the broader economy, since there’s no guarantee these players will necessarily be the most efficient or innovative.
The really big story, though, may be what’s happening in the corner of the market that is sitting out the party: bonds. Prices on US Government paper plunged on Wednesday, driving yields up by double digits and continuing an upward trend in interest rates that has been underway for weeks. Investors, anticipating an asset bubble and rising inflation, are starting to compensate by raising the interest rate they expect to get on loans to the American Government.
But, at a deeper level, investors are also growing anxious that the US may be losing control of its debt. With a national debt bigger than the economy, fuelled by a fiscal deficit that amounts to an additional 6% of GDP each year, bond investors had already begun souring on the US. When the Federal Reserve started cutting interest rates last month despite the economy remaining buoyant, investors further concluded that the central bank had abandoned the fight against inflation.
Given that it still holds the world’s principal reserve currency, the US won’t experience a Liz Truss moment of soaring bond yields, for the simple reason that the rest of the world will continue to buy US assets — not least if the interest rates on offer there are higher than they are back home. That tolerance of US profligacy is what has enabled Democratic and Republican administrations alike to operate with an unlimited tab.
But it may just be that some kind of limit is now coming into view. Trump plans to cut taxes and raise tariffs, both measures which would boost inflation, but says he’ll compensate by cutting spending. American governments always say that. Then they keep spending more.
If interest rates continue climbing this way, something will have to give. Either the Fed will have to allow inflation to rise and thereby inflate the debt away by debasing the currency, or it will have to follow bond yields higher and return to raising interest rates. The former would give the lie to Trump’s central promise to solve inflation on day one. The latter would burst the asset bubble, and lead to a crash as big as the bull market which preceded it.
Either way, the party today may well lead to pain tomorrow, and the wilder the celebrations, the uglier the eventual reckoning. There’s lots of money to be made stateside at the moment, but the trick will be to know when to get out.
John Rapley is an author and academic who divides his time between London, Johannesburg and Ottawa. His books include Why Empires Fall: Rome, America and the Future of the West (with Peter Heather, Penguin, 2023) and Twilight of the Money Gods: Economics as a Religion (Simon & Schuster, 2017).
jarapley
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Subscribe^Yes, O.F. are tremendous heroes.^
Any strike against the porn industry should be lauded, even by such a clumsy monster as Ofcom. It may go some way toward redeeming their treatment of Mark Steyn.
Unfortunate choice of words: “Poster-child”. And:
“strictest age-verification protocols for visitors of any site in the word.”
Really? Do any of these articles ever pass before the eyes of a real editor before they go live?
So what is the motivation for going after only fans if it is actually one of the best on age restrictions, and if this is known to Ofcom?
Is it an error? Is it a soft target? Is it because only fans empowers women and we live in an oppressive patriarchy (tongue in cheek on that one)? The article seems incomplete without an answer to that question.
If I had to hazard a guess, yes, your third suggestion: the open, unapologetic and tenable commercialisation of female sexual agency it enables is an affront to the usual suspects, who have no particular problem with commercialising pornography…so long as men/big business, somewhere and somehow, can keep controlling and ticket-clipping it. Another striking thing about OnlyFans beyond being the most responsible porn platform around is that it’s also the most autonomous and direct business model for the content creators (overwhelmingly young, attractive women). The sleazy, exploitative sites that exist in the illegal and/or demi-monde internet are, paradoxically, a kind of back-handed affirmation of traditionally repressive and sanctimonious moralities. The patriarchy has never truly objected to women commercializing their sexuality. Just so long as they remain illicit, hidden and shameful with it.
OnlyFans’ and its contributors’ main sins seem to be a) being unapologetic about their business model and, for the most part b) unharmed and often very rewarded for it. Bad girls! They must be shamed and punished.
Adding a perhaps different slant to this: perhaps we are uncomfortable with the idea that some women use their sexuality to exploit men without being constrained to do so. This should perhaps be obvious, but it runs entirely contrary to the narrative of prostitution (and other sex work) as exploitation of women by their clients.
There is just too much on only fans that is too obviously exploitation of weak, even vulnerable, men by women. I’m sure it has always been thus, but as with so many things the internet lays it all bare.
Good post, thanks.
Likewise yours. Yes, not being cute, but I probably haven’t done enough, or exhaustive enough, research into OnlyFans to be confident it’s all grrr-girl capitalist empowerment and feminist agency in play! (Give me a grant and I’ll spend two years becoming an expert though…)
Yes, my post above not-with-standing, I have never really bought into feminism’s ‘sexual license = sexual empowerment’ narrative. Not collectively, as a ‘net good thing’ for women. (For some, sure – invariably the wealthy, educated, privileged ones). For most women it’s always felt (to me, anyway) more like a posh version of just another ‘external moral authority’ (once the church, nowadays ‘progressive’ consensus) demanding that women grant bullying lothario blokes everything sexually they want, as their (same-old) masculine entitlement…only calling it ‘progressive equity virtue’ rather than ‘regressive patriarchal oppression’. I have just seen too many seriously creepy, ‘sensitive, caring’ men use their ‘feminist’ credentials to get trusting women into bed…and then treat them like dirt (in the timelessly charmless way of the worst of our gender), and without even invoking the traditional civic ‘consolation prizes’ (a requisite marriage giving financial stability, at least the public expressions and accoutrements of moral and ethical obligation, an embraced ethical duty of care to resulting children, etc).
Some smart feminist – maybe it was Greer – once said that feminist’s worst ever strategic blunder was to mistake ‘becoming more like men’ for genuine gender equality. I think there’s something in that. And maybe the epidemic of young girls who think they must transtion to being actual ‘men’ is some logical endpoint extreme of that early misstep. Warm regards David.
Just did a quick check on the CEO of Ofcom. One Melanie Dawes.
I think we can fairly say she leans feminist rather than the reverse. It seems unlikely that her policy would be: go after Only Fans because it empowers women; turn a blind eye to “patriarchal” porn sites.
In so far as her ideological position is influencing Ofcom actions it is more likely to be motivated by feminist rather than patriarchal ideology.
Nope. Diversity and Inclusion Champions are the employed promoters of transgender activism, which is antifeminist. Encouraging the idea that men can become women and gain access to women’s exclusive spaces – sports, refuges, prison cells, dating sites – is systematically destroying the gains women have made in the past 50 years. The DEI practitioners also tend to agree with the ‘Sex work is work’ ideologues too.
Yep, I’d echo this. Actually, in a weirdly counter-intuitive inversion, my gut instinct is that the most overtly and aggressively ideological ‘feminists’ aren’t really feminists at all. I think their feminist ‘props’ are opportunistic, cosplay ones only, deployed (as with all the more zealous ideologues) in the much more banal, universal (and gender-neutral) pursuit of narcissistic self-interest. In that sense, someone like Dawes, psychologically and intellectually, will be – or is likely to be, I can’t say I actually know – more like the arch-typical bullying patriarchal narcissists she affects to oppose. Scratch the feminist rhetoric and crusading posturing of all ideologues and I reckon you’ll find a common psychic and emotional engine room.
So it follows entirely that a ‘feminist’ like Dawes could easily – inevitably, probably – end up being objectively anti-women’s interests, if the ideological, political and civic trends and ‘feelz’ of the moment provided more fertile bullying traction. The same would apply to the many ‘progressive’ male ideologues who have flipped from lifelong (professed) support for women’s rights, to enabling their erosion, simply because there’s more ‘low-cost zealotry’ and thus narcissistic grandstanding to be got from the trans cult.
The same figures, by the way, will seamlessly transfer their need for moralistic bullying power away from the temporarily useful men-without-willies and women-with-them, the second the righteousness of their current bandwagon fades, and a new one comes along.
There are many “feminisms” and one can be sure that a generously funded feminist like Dawes numbers among the elite shock troops of the global oligarchy
Not unreasonable point at all, but on balance I would tend to follow Unherd Reader’s counter-intuitive but I think empirically very strongly-evidenced reasoning. See my response to
his hertheir points!**See, gender-neutral language can have its spiffing uses. Why yes, thank you, Judith Butler!
It’s a trophy scalp.
Perhaps the focus of the investigation isn’t so much on the patrons but rather on the sellers—how can anyone be sure that the player isn’t a minor? Or maybe the investigators are seeking data to determine who the buyers are so they can be blackmailed tomorrow?
This title is misleading and clickbaity. Well done, Unherd. I clicked. Happy now?
I also clicked because WTF but if the author to be trusted I learned that prohibition and age verification actually work which made me ever more convinced that our tech overlords and state bureaucracy profit from the pornography
Unless it’s changed since you posted what’s misleading about it? The writer is defending Only Fans against Ofcoms treatment of it
I didn’t even know how strict they are but investigating a paid site immediately made me suspicious that it’s about protection of minors. It’s like investigating the single regulated landfill amidst piles of smoking garbage