Geopolitics: "There’s no obvious path from here"
MS Geopolitics Analyst
As a student of geopolitics and a strategist whose practice relies on unraveling its complexities, what I can say with confidence is this: there’s no obvious path from here, so we must be humble and flexible in our thinking.
- Michael D Zezas, CFA
Quick Comment: One mindset we have been operating on is higher oil prices mean renewed goods inflation and a more hawkish Fed. That has been true so far. But… the Geopolitical backdrop is now war based. And Morgan Stanley reminds us, higher oil prices due to war are usually combined with broader economies seizing, which calls for a more dovish Fed. We gamed this out very broadly yesterday in the section titled How does government react to wars?.
But Morgan’s Michael D Zezas confirms this in Sunday’s Geopolitical note.