MacroVoices #277 Daniel Lacalle: Inflation, Recovery Outlook, Energy, Digital Currency & More

Episode Summary

Executive Summary: Macro Voices episode 277 centers on a post-FOMC market reset: Eric Townsend and Patrick Ceresna see the S&P 500 trend still intact, the dollar in consolidation, oil unusually strong, gold hit hard on hawkish Fed language, and Treasury yields range-bound. Guest Daniel Lacalle argues inflation is sticky but not runaway, tapering is largely nonsensical, ESG is often marketing, and CBDCs pose serious surveillance and policy-control risks. The episode frames secular inflation as likely, while debating whether it becomes destabilizing.

Main Topics: Post-FOMC market reaction and equity trend: Eric and Patrick discuss the quick selloff in equities after the FOMC and conclude the broader uptrend remains intact, with dips still being bought and the S&P 500 near highs. Inflation outlook and the macro regime: Daniel Lacalle and Eric debate whether current inflation is transitory or the start of a secular inflationary era. Daniel sees persistent inflation pressures, while Eric leans toward a longer-term inflationary cycle but not necessarily hyperinflation. Oil strength, inventories, and demand uncertainty: Crude oil remains the standout bullish commodity, supported by tight supply and inventory draws. However, Delta-variant uncertainty and potential hedging are major wild cards for demand. Gold, real yields, and Fed taper fears: Gold was sold off sharply on hawkish Fed signals, but both the host and guest view the weakness largely as an opportunity if central-bank policy ultimately stays inflationary and supportive of higher gold over time. Dollar and Treasury yields in consolidation: The dollar index and 10-year yields are seen as range-bound amid policy uncertainty. Both speakers view the moves as noisy consolidation rather than a confirmed trend change. ESG and capital allocation: Lacalle argues ESG is a valuable principle but is often used as marketing to rebrand weak businesses. He stresses that profitability and sound cash flows are essential for genuine sustainability. Cryptocurrencies, CBDCs, and monetary control: The discussion expands from crypto to central bank digital currencies and private digital money, with concerns about surveillance, programmable money, and intensified central-bank or tech-platform power.

Key Arguments: Eric Townsend argues the S&P 500’s primary trend is still up because every dip continues to be bought, despite stretched valuations and technical weakness. Eric views the dollar’s recent moves as consolidation and uncertainty, not a durable trend, because markets are still figuring out how to price massive fiscal deficits and Fed intervention. Oil remains his strongest bullish macro view due to inventory draws, backwardation risk, tight supply, and potential summer demand strength, though he is hedging because of Delta-variant uncertainty. Gold’s selloff is seen as a reaction to fears of higher real yields; Eric treats it as a buying opportunity because he expects ongoing central-bank and government stimulus over time. Daniel Lacalle argues inflation is not transitory because price pressures were already present pre-COVID and are showing up in commodities, food, utilities, and other consumer essentials. Lacalle says tapering logic is inconsistent: if the recovery is truly strong, stimulus should end; if recovery is weak and indebted, tapering is politically and economically implausible. Lacalle contends runaway hyperinflation is unlikely because aging demographics, debt, and technology remain disinflationary forces. Lacalle warns that ESG investing often disguises bad businesses under a fashionable label, and that sustainability requires profits, not marketing. Both speakers see CBDCs as dangerous if used to expand state control, with Eric adding that Silicon Valley-controlled digital money could be an even bigger long-term threat than central banks. Patrick’s chart work suggests the post-FOMC selloff may be either a temporary snapback or the start of broader sector rotation away from commodities/value and back toward growth/FANG names.

Data Points: Macro Voices episode: 277 - Episode number stated in the introduction Recording date: June 24, 2021 - Episode recording date S&P 500 support level: 34-day moving average - Eric says the selloff stopped near this moving average US dollar index level: around 92 - Patrick notes the dollar hovering near this handle Dollar downside trigger: below 89 - Eric says a break below this level would signal a real trend change Dollar upside trigger: above 94 - Eric says only a materially higher level would convince him of an uptrend WTI crude price: above 74 intraday / around 73 - Oil price referenced during the market wrap Oil inventory change: 7.6 million barrels draw - Weekly crude inventory draw excluding SPR adjustment Oil inventory change incl. SPR: 8.2 million barrels draw - Including the small Strategic Petroleum Reserve draw Cushing inventory change: 1.8 million barrels draw - Specific draw at Cushing, Oklahoma Gasoline inventory change: 2.9 million barrels draw - Weekly gasoline inventory draw Distillates inventory change: 1.75 million barrels build - Only build among major refined products Gold price support area: 1760 area - Gold selloff low after the FOMC 10-year Treasury yield: around 1.50% - Current yield level discussed in the wrap Yield panic threshold: 1.75% - Eric says markets panic when yields approach this level XME (metals/mining ETF) move: up about 100% since November - Patrick highlights the strength in mining equities FANG index futures move: up about 17% in the last month - Patrick notes recent outperformance of large-cap growth Oil price year-to-date move: up about 40%+ - Lacalle cites oil’s rapid rise as a drag on disposable income Lumber peak: $1,700 - Patrick references lumber’s prior parabolic high Lumber drawdown: 50% in two months - Shows sharp reversal from peak levels Copper support level: around $4.50 - Patrick discusses a failed buy-on-dip zone Potential August crude draw: more than 100 million barrels - Patrick cites an external analyst forecast for monthly U.S. inventory draws Abra Silver resource base: over 140 million ounces silver equivalent - Sponsor message about Abra Silver Resource Corporation Capital gains tax article count: 1 linked article - Mentioned in the Research Roundup summary

Pivotal Quotes: "I think it's all noise until we get a break below 89, or I don't even know what the number is on the north side. It's probably at least 94." — Eric Townsend: On whether the US dollar index has started a real trend change "The tapering debate is completely nonsensical. There's not going to be any tapering." — Daniel Lacalle: On Fed policy and whether central banks can realistically withdraw stimulus "What they're basically saying is that they will be able to generate more and more persistent inflation quicker and without any control." — Daniel Lacalle: On central banks describing the benefits of CBDCs and the transmission mechanism of policy

Implications: Listeners should expect continued volatility around policy shifts, but the larger macro setup still favors inflation-sensitive assets, especially oil. Gold and growth stocks may see tactical rotations, while CBDCs and ESG remain major structural debates with political, financial, and societal consequences.