🎙️ podcast Analysis November 24, 2025 Exchanges by Goldman Sachs

The Fed Pause Trade: Why Markets Are Mispricing Rate Cut Expectations

Gold Mining Regional Banks Treasury ETFs
Tickers
2 Picks
Conviction HIGH
Risk Profile 2.0/10 (MODERATE RISK)
Horizon 6-12 months

Executive Summary

Market Consensus: Fed will cut rates 2-3 times in 2026, with high probability of December cut. Variant Perception: Former Dallas Fed President Rob Kaplan argues markets are dramatically overestimating cut probabilities. His core thesis: neutral rate is 3.5-3.75% (not 2.75%), inflation is structurally higher at 2.75-3%, and current 3.75-4% Fed Funds rate leaves little room for cuts. This creates a contrarian setup where: 1) Gold benefits from Fed independence concerns and sticky inflation, 2) Reg...

Key Investment Opportunity

Gold Mining Contrarian Play on Fed Independence Risk

Kaplan identifies Fed independence concerns as a key driver of gold's 50%+ rally, separate from traditional inflation hedging. This represents a structural shift in gold's risk premium that markets are treating as cyclical. With Fed approaching neutral rate while inflation remains sticky, gold miner...

...and 1 more investment opportunities

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