What turns 2025’s headwinds into 2026 tailwinds—and what still argues for caution? Host Sonali Basak sits down with Torsten Slok, Chief Economist and Partner at Apollo Global Management, to unpack sticky ~3% inflation and a “higher for longer” policy backdrop, the fragile labor market amid falling immigration, fiscal forces pushing up long rates, and how AI’s uneven trajectory could reshape portfolios. Slok also explores the growing role of stablecoins in the Treasury market and why diversification beyond AI-exposed assets remains essential.
Highlights:
- Why 2026 could see growth tailwinds (policy changes, AI/data center buildout, lower oil, weaker dollar, World Cup effects).
- Sticky inflation near ~3% and a cautious Fed keeping front-end yields elevated.
- Labor supply as the swing factor: immigration’s drop and a lower break-even job growth rate.
- AI’s uncertain macro impact—risks if it disappoints, disruption if it scales.
- Fiscal dynamics and issuance mix driving higher long rates; stablecoins as new T-bill buyers.
