The Return of Irrational Exuberance and Asset Bubbles

The Latest Meme Craze Is Flashing a Warning to Wall Street
https://www.wsj.com/finance/stocks/stocks-head-for-a-meme-reversion-c67ddd2d
Hectic trading in Krispy Kreme and OpenDoor signals the return of reckless overconfidence.
 
Wall Street ‘euphoria’ sparks bubble warnings
https://www.ft.com/content/2450c892-3b9e-431e-a352-1d01df269617
Analysts point to signs of market froth as bitcoin soars and ‘meme stocks’ re-emerge.
 
The Hottest Business Strategy This Summer Is Buying Crypto
https://www.wsj.com/finance/currencies/crypto-treasury-e7ae573c
Small companies are raising billions of dollars to buy bitcoin and other, more obscure cryptocurrencies. What could possibly go wrong?
 
Of Meme Stocks and Main Street
https://www.wsj.com/opinion/meme-stocks-markets-main-street-investing-trump-tariffs-economy-business-56dff4e4
Wall Street is doing great, but small business not so much. 

Resource Misallocation at the Global Level

The World Has Too Much Steel, but No One Wants to Stop Making It
https://www.nytimes.com/2025/07/25/business/steel-overcapacity-china.html
A global plunge in prices, led by increased production from China, and U.S. tariffs threaten steel manufacturing, which has long been a symbol of national might. 

Why Minorities Have Shifted to the Political Right

Obama Won Record Numbers of Nonwhite Voters. This Is How the Democrats Lost Them.
https://www.nytimes.com/interactive/2025/07/24/opinion/minority-voters-trump-right.html
One in five voters who cast a ballot for Donald Trump in 2024 was a person of color. Why? 

Europe Faces Threats on Multiple Fronts

Europe faces an economic war on two fronts
https://www.telegraph.co.uk/business/2025/07/25/europe-economic-war-two-fronts-china-greater-danger/ 

Government Finances in Advanced Economies Resemble a Ponzi Scheme

The debt supercycle has reached its final leg
https://www.reuters.com/commentary/breakingviews/debt-supercycle-has-reached-its-final-leg-2025-07-25
Edward Chancellor:
As the cycle nears its end, a country is typically beset by chronic fiscal deficits. Low domestic savings and current account deficits render it dependent on foreign lenders. As lenders become wary, the average maturity of the public debt shortens. The central bank finds it impossible to set interest rates at the level which balances the needs of both creditors and borrowers. Once interest rates rise, governments’ debt servicing costs become increasingly onerous. Government finances come to resemble a Ponzi scheme, with new debt being issued to service old borrowing. That pretty much describes the situation which several advanced economies, including Britain, France and the United States, find themselves in today.
 
Inflation risks are taking Britain towards the debt-crisis cliff edge
https://www.telegraph.co.uk/business/2025/07/20/inflation-risks-are-taking-britain-towards-the-debt-crisis/
As interest payments pile up, our public finances resemble a Ponzi scheme. 

The bond market maths does not add up for governments
https://www.ft.com/content/22090918-f767-4496-ab9a-d9e92ec6cece
Higher yields look probable, forcing countries to pay more to fund their ever-growing deficits.

The Fed and the Dollar

The Fed Needs to Tread Carefully with This Strange Dollar
https://www.bloomberg.com/opinion/articles/2025-07-24/the-fed-needs-to-tread-carefully-with-this-strange-dollar
The currency’s uncharacteristic behavior is another reason for Powell to ignore Trump and stay cautious on rate cuts. 

The More Trump Pressures the Fed, the Less Likely He Gets Lower Rates
https://www.wsj.com/economy/central-banking/trump-fed-pressure-rate-cuts-8e91185f
If the president thinks the Fed is hard to deal with, wait until he tries to negotiate with the bond market.

Economics and Foreign Policy

What economics can teach foreign-policy types
https://www.economist.com/finance-and-economics/2025/07/24/what-economics-can-teach-foreign-policy-types
Hegemons should care about even puny countries.