Canada's economic past involved casually selling oil at discounts to the US and natural gas at discounts to the US because building infrastructure for other markets was 'too complicated'; these days are now over due to geopolitical shifts.

Energy costs have remained contained, keeping OECD inflation in the 2.5-3% range rather than breaking out; energy is the inflation component with highest sticker shock and immediate wage-impact feedback loops because people see gas prices daily and quickly demand wage increases, making energy price spikes the biggest portfolio risk.

Powell is not being political in maintaining a hawkish stance; rather, he is making a rational assessment that inflation has been above the Fed's 2% target for over 39 months, unemployment is low at 4-4.1%, and financial conditions are loose with crypto and equities at all-time highs, so rate cuts are not justified.

In 2022, Biden released strategic petroleum reserves to bring energy prices back down from a spike, preventing prolonged inflation; Trump's response to a future oil spike at $120/barrel is uncertain—he could either release reserves like Biden did, or restrict US energy exports and implement energy protectionism, potentially creating a world with structurally higher global energy prices.

President Trump firing the Bureau of Labor Statistics Commissioner for calling the jobs numbers 'rigged' and 'concocted' is concerning because it sends a signal that the White House only wants good news and yesmen, risking the administration becoming separated from economic reality—a pattern seen in Argentina and Greece during crises.

The US dollar is now positively correlated to global risk, meaning when US equities decline, the dollar declines with them, making US assets suddenly less attractive to foreign investors compared to the previous 15 years when the dollar served as a safe-haven currency that would rise during downturns.

Economic growth depends on the number of workers multiplied by the productivity of workers; if you have fewer workers due to immigration crackdowns or increased uncertainty, you must achieve significantly higher productivity growth to maintain strong GDP growth, otherwise weak growth will result.

The primary reason for weak US job numbers is increased uncertainty among entrepreneurs, who require predictability and clear rules to commit to investment; tariffs creating changing price uncertainty at suppliers like Home Depot are causing businesses to pause projects rather than capital costs or energy costs, which remain cheap.

Data reliability is a critical concern for foreign investors; having the US President question the truthfulness of official economic data sends a 'harrowing message' to international investors because it mirrors the argument Westerners use to avoid Chinese investment due to data untrustworthiness, except now applied to the US.

The Fed's hawkish tone despite holding rates unchanged, two FOMC dissenters for the first time in 30+ years, and the resignation of a governor indicate that political pressure on the Fed to cut rates is opening doors for different opinions than historically seen when FOMC tended to agree uniformly.

Powell will likely serve out his term as Fed Chair because Trump will use him as a 'perfect scapegoat' for economic slowdown from tariffs and protectionism; if Trump replaced Powell immediately and the economy fell apart in 6 months, responsibility would fall on Trump, so keeping Powell allows Trump to blame the Fed for any recession.

Within 12 months, a new dovish Fed chairman will take power with a mandate to cut interest rates, and other FOMC members will be willing to support rate cuts, meaning the Fed will become significantly more dovish whether Powell is replaced tomorrow or in a year.

Gavelson identifies as an 'inflationista' and believes inflation is an ongoing problem; official US inflation of 2.5-3% understates true inflation because medical insurance is reported as cheapest in 20+ years, auto insurance is rising due to car prices increasing from tariffs, property taxes are up 25% in Toronto over 5 years with 6.9% increases in 2025, and food inflation is perpetually high.

Some costs have declined to zero (like international phone calls via WhatsApp), but these zero-cost categories cannot fall further; meanwhile, costs that continue rising (insurance, taxes, food) cannot offset the historical benefit of categories that fell to zero, causing real inflation to exceed measured inflation.

If energy prices spike to $120/barrel due to Middle East or Russia developments, inflation could quickly rise to 3.5-4%, ending rate-cut expectations, causing bond market selloffs, and driving severe equity corrections in stretched stocks trading at negative cash flow or 10x+ sales and 40x+ earnings.

If Trump chooses nationalist energy export restrictions instead of SPR releases, creating cheap energy only in the US while global energy prices spike, the outcome would be 'absolutely devastating' for many investor portfolios globally.

The DXY has declined approximately 10% year-to-date, with much of the weakness occurring around 'liberation day' when tariffs were implemented across trade partners; Gavelson does not forecast absolute DXY levels but identifies the trend as down, with the dollar overvalued by roughly 20%.

When the US dollar weakens structurally, emerging markets outperform; China is in a structural bull market due to government fiscal stimulus, the easiest monetary policy ever, and was the best-performing major stock market in the prior year; financials outperform globally during weak-dollar periods as firms expand balance sheets.

Commodities are grinding higher in the weak-dollar environment, with the exception of oil and energy; Gavelson prefers trend-based thinking over absolute price forecasts, focusing on directional movement and correlation patterns.

China produces more than twice the electricity per day than the US; China consumes more beef than the US; China consumes more cars than the US; therefore the Chinese economy is 'absolutely not in shambles' and the narrative of economic collapse is incorrect.