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Reading Between Interest Rate Expectations

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Recently I read an interesting article by Alfonso Peccatiello titled “The Maradona Theory of Interest Rates”: https://themacrocompass.substack.com/p/the-maradona-theory-of-interest-rates The idea: the Federal Reserve could play “Maradona ball” with rates - sound hawkish at times, dovish at others, and in the end barely move at all. Since markets were braced for movement, the act of maintaining rates becomes more impactful. (The name comes from Maradona’s second goal against England in 1986: defenders expected him to pivot left or right, so he ran in a straight line through them. The theory was coined by Mervyn King - who, notably, is now co-leading the Fed’s new communications task force under Chairman Warsh. Alfonso suggests this makes Maradona ball a live possibility.) What the market is actually pricing Markets don’t price a single rate path - they price a probability distribution across many possible paths. Futures only give you the probability-weighted average, and an average hide...
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The Future Power Bottleneck in the Development and Deployment of AI – Another Catalyst for Market Woes?

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The pressure on ROIs (return on investments) in AI is acute and large by nature. When CoreWeave’s $9.9 billion AI data centre out in Texas faced a 2 month construction delay in mid 2025, around $14 billion was wiped from its market cap in five weeks.     For context this site – although consuming enough continuous power to run a small city (260MW capacity) – was one in a portfolio of 41 sites.     There is much debate around whether the sell-off was also driven by belated reporting by CoreWeave – having not admitted the delay earlier – or potentially concerns around honesty in scale of the problem and cause. Thunderstorms were in part to blame according to CoreWeave – “delay in concrete pouring” - but weather reports show that there were only three days of thunderstorms at the site between June and September.     Perhaps the cause of delay was something more sinister for investors like technical issues or money problems.     Either way, the CoreWe...
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