SONNY’S VIEW · MACRO RESEARCH
Macro Research
Long-form notes, published whole: framework, exhibits, sources and limitations. Start with the September rate-cycle piece; it is the shortest way into how I think. Nothing here is investment advice; the risk section at the end of each one says why.
NEWEST · SEPTEMBER 2026 · ECONOMIC MODELS
Growth cools, inflation holds, and the Fed's gauge disagrees.
Two VAR models, estimated on monthly data back to 1997, see the ISM PMI easing from 55.6 to 53.1 by April 2027 while staying in expansion, and Core CPI holding near 2.44%. The catch is Core PCE, the measure the Fed relies on: 3.3% in July, 0.9 points above Core CPI.
53.1
ISM PMI, April 2027 forecast
2.44%
Core CPI, held through April 2027
+0.9 pp
Core PCE above Core CPI, July
Forecast is the average of a VAR(2) and an AR(2). Source: FactSet, FRED, author’s calculations.
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THE FRAMEWORK
Where I currently stand
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THE SPINE · FROM THE H2 2026 OUTLOOK
The transmission chain, and what changed in it
Leading indicators transmit in a known order, set by interest-rate sensitivity: Housing → Orders → Profits → Employment. The further up the chain, the stronger the lead; employment is the last domino.
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The 2026 amendment is the first link. Housing never recovered, yet PMIs are in expansion because data-center capital expenditure has taken over as the engine that starts the chain. That substitution is what most of my current work is about, and it is why a rate decision now lands on the AI build-out instead of on mortgages.
The full framework: rates, geopolitics, the five percent target and the energy screen →