Global Trade and Finance 7: Rates, Trade & Global Risk
Author(s): Scott Douglas Jacobsen
Publication (Outlet/Website): The Good Men Project
Publication Date (yyyy/mm/dd): 2025/11/07
Michael Ashley Schulman, CFA, is Chief Investment Officer and a founding partner of Running Point Capital Advisors, a multifamily office delivering integrated investment, planning, tax, insurance, and estate services, based in Los Angeles, California. He oversees global macro research, asset allocation, and public- and private-markets strategies, including impact mandates. Schulman is a widely quoted commentator, frequently providing analysis to Reuters and other outlets on technology, energy, trade, and market structure. His work centers on translating macroeconomic trends, U.S. fiscal policy, and the global tech landscape into actionable guidance for families and entrepreneurs.
In this interview with Scott Douglas Jacobsen, Schulman describes the Fed’s rate cut as a cautious swivel rather than a pivot, OPEC+ maneuvers as a balance between cooperation and chaos, and China’s EV export permits as a geopolitical filter. Schulman highlights widening U.S. export controls, renewed tariff risks, and global shipping bottlenecks reshaping trade flows. He ties macro policy to consumer sentiment—arguing that culture, not spreadsheets, drives markets as much as rates do. For investors, his insights offer both levity and actionable foresight.
Scott Douglas Jacobsen: Did the Fed’s September rate cut to 4.00–4.25% mark a pivot?
Michael Ashley Schulman: A pivot? Not quite. It’s more like the Fed slowly rotating in a swivel chair, grudging, strategic, and very aware someone’s watching. Powell may have trimmed, but he’s not ready to mic drop and walk offstage humming Soft Landing: The Musical. Inflation is easing, yes, but core services are still stickier than a toddler eating honey. Investors hoping for a 2009-style slashing spree will be disappointed; it’s more grind than glide. For the average American? Don’t expect your credit card APR to suddenly stop haunting you.
Jacobsen: Can OPEC+ output increases and China’s storage flows tame crude prices?
Schulman: It depends, are we talking taming like Ted Lasso or like House of the Dragon? If OPEC+ and China manage oil prices calmly, cooperatively, and strategically, that’s an optimistic and well-meaning Ted Lasso outcome. If it turns into a dysfunctional, ruthless, power-hungry game riddled with manipulation, miscalculations, and unintended blowback, that’s a House of the Dragon outcome.
OPEC+ is increasing output in tiny steps, putting a ceiling on pricves. Meanwhile, China is putting a floor on prices by primarily buying more oil on price drops in order to build up its strategic reserves, even as its consumption of traditional transport fuels has plateaued; its stockpiling is a strategic move to enhance energy security, mitigate potential supply disruptions, and take advantage of lower-than-average global oil prices. There are also rumors that China has been bringing discounted crude in from sanctioned countries like Russia, Iran, and Venezuela, some of it re-branded as originating from other nations, such as Malaysia, to evade U.S. sanctions.
If demand rebounds or geopolitical tensions flare, oil could spike. For the average American, gas prices are still the one inflation metric that cuts straight to next month’s Thanksgiving table conversation.
Jacobsen: Will China’s requirement for EV export permits in 2026 reconfigure global auto flows?
Schulman: Absolutely yes. Beijing isn’t just regulating exports, it’s curating them for quality control and geopolitical signaling. Starting Jan 1, EV exporters will need licenses to do so. This cuts out sketchy resellers and promotes preferred brands. This means fewer super-cheap off-brand EV deals, better service and after-sales from the brands that do ship, and more cars redirected to countries with friendlier trade rules.
Expect downstream effects on global EV supply chains, especially for budget-friendly models headed to Europe and emerging markets. For U.S. automakers, it’s a domestic reprieve but a wake-up call to adapt or get out-hustled abroad. For European automakers, it smells like more pain. Investors should brace for disrupted pricing power and potential overcapacity in Western EV plants. For the average American it means no ultra-cheap EV imports.
Jacobsen: Why is the U.S. broadening export controls to subsidiaries of blacklisted firms?
Schulman: It’s cutting out the loopholes. Wait, is that a mixed metaphor? Let me retry that. It is plugging the shell-game hole. The U.S. is saying that if we sanction the parent, we’re sanctioning the whole family tree. Think of it as geopolitical KYC or know your client. It’s a way to curb tech leakage, especially in AI and semiconductors, where one shadow office in southeast Asia can undo years of policy. For investors, it means higher compliance costs, more regulatory friction, and growing bifurcation in global tech. The average American may not feel it directly, at least not yet; but when your next smartphone or game box ships three months late and $75 pricier, this will be why.
Jacobsen: Is a second era of tariffs upon us soon?
Schulman: Oh, it’s coming like Taylor Swift’s next album, of wait, “The Life of a Showgirl” is already here! Whether it’s steel, autos, or green tech, both parties are flirting with tariffs as campaign foreplay. The threats of new and higher tariffs aren’t over, especially with rare-earth metals potentially held hostage. With China, Mexico, and the EU all in the crosshairs, this could become a bipartisan bidding war for who can protect “Main Street” more loudly.
Investors need to model new friction in global trade. Supply chains were just starting to un-kink and this could re-knot them as exemplified by Levi Strauss’s latest management statement. For the person on the street, tariffs are taxes in disguise.
Jacobsen: For the shipping detours through the Red Sea, Gulf of Aden, and Panama Canal, do these risk stalling global cargo growth?
Schulman: It may risk a “transitory” stall; more like a stop-and-go. We’re in a choose your own bottleneck era of logistics, or maybe let the roulette wheel choose it for you. If it’s not drought squeezing the Panama Canal, it’s Houthi drones, piracy off the African coast. Reroutes add time, fuel, insurance cost, and uncertainty. It raises freight costs, squeezes margins, and shifts pricing power to logistics firms, airlines, and railroads and makes a great case for bringing back zeppelins, something Airship Industries is working on for autonomous air freight.
Jacobsen: Can Argentina, Nigeria, and Egypt manage inflation without creating a crisis?
Schulman: That’s like asking if you can fly coach to Ibiza without turbulence. In theory, yes, in practice, good luck. Argentina is trying to Milei its way into libertarian orthodoxy, Nigeria’s FX reforms are about as smooth as a Kanye interview, and Egypt’s inflation has meaningfully cooled, enabling cautious rate cuts but it still walks a tightrope to meet IMF conditionality. Investors in EM debt are speed-dating volatility. It’s unlikely that you hold a frontier market ETF in your retirement plan, but if you do, maybe peek at its allocation before your next beach vacation.
Jacobsen: If the Bank of Japan hikes in October, how will capital flows adjust?
Schulman: A BOJ hike would yank a few threads from the global carry-trade sweater. A higher Japanese yield pulls money back home to Japan from riskier global assets, especially from U.S. bonds, Australian debt, and emerging markets. Higher JGB yields would lead to marginal rotation out of U.S. duration (or long dated investments). Those that care or are massively overleveraged are hedging yen risk.
Jacobsen: Anything else this week you want to comment on?
Schulman: Oh, where do I start? It’s been one of those weeks where macro, markets, and pop culture all felt like they were trading on margin. First, the Treasury curve is looking more like a Jackson Pollock painting than a signal generator; investors are hunting for duration at the same time the Fed is sort of easing but sort of not, and long-end yields are falling. That’s telling us something deeper; either the bond market sees softness ahead, or a large segment of the market is hedging for a recession that never shows up.
Second, let’s talk about Taylor Swift’s new album, “The Life of a Showgirl”. It sold more in a week than some sovereign bonds, which, frankly, says a lot about where consumer sentiment lives now; not in CPI or consumer price index prints, but in playlists.
It’s a reminder that while rates, supply chains, and geopolitics matter, confidence is cultural, and culture moves markets more than we like to admit. Investors should be paying as much attention to Swiftie data as to Fed dot plots because one of them is actually moving consumer behavior.
Truly enjoyed our chat. Thank you for the thoughtful interview and sharp questions. I appreciate the chance to unpack macro melodrama with a little levity and context. Always a pleasure trading insights and cultural references with someone who gets both.
Jacobsen: Thank you for the opportunity and your time, Michael.
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