Cassandra’s tragedy was that her prophecy of doom (that Troy would fall to the Greeks) was correct, but she was destined to be ignored. Nobody wants to be Cassandra. The trick for would-be prophets, if there is one, is to vary the heavy toll of doom with the lighter notes of good news when there is any. At Fathom, we try to do that, and generally succeed. And it’s worth recalling that, in the history of the species, the best
There is a puzzle at the moment over the discrepancy between oil futures, which look modestly encouraging, and futures for Fed funds and other policy rates, which do not. Both sets of futures jumped when the spot price of oil went up at the start of the Iran conflict in February. Since then the spot price of oil has fluctuated as news of the conflict has ebbed and flowed, but the oil market has been firmly in backwardation over the
Every transaction, every asset, that is denominated in a particular currency, has an impact on the nation issuing that currency. It’s all part of the same economy. But what if the same country issues more than one currency? This is probably a closer approximation to the Chinese situation: one currency for use at home; another one for use abroad. Two circulations. Does this mean there are two Chinese economies? Not quite: there is only one issuer. Questions around the solvency
France is the euro area’s swing voter: where France goes, the euro area as a whole tends to follow. It’s not just the canary in the coalmine, it’s the miners at the coalface. That is why it’s concerning when, as now, France shows signs of stress. Many sovereign bond yields are rising rapidly, but French bond yields are popping relative to everyone else right now. This note takes a look at why. It’s not about growth; it’s not about inflation;
Now that you can make almost infinite words at pretty much zero cost, does that mean that the value of a word is now zero? Not good for professional writers, or strategists, or anyone who communicates the value of their work through words. Is it a resistance to this displacement, which is causing increasing backlash against AI writing? (‘Slop’)? Or is it perhaps a sense that a lot of what it is to be human is expressed in language, and
Anthropic has released a series of economic scenarios which lay out what alternative pathways for AI development might mean for the wider economy. They’re a good read, and have been widely covered in the press. Anthropic might be a multi-billion dollar company, but it certainly isn’t the first to produce such scenarios — let me tell you that Fathom was doing that four years ago! Despite the huge changes that have happened since our report, it’s interesting to see how
When I visited Canada in March 2025, the prevailing view was that the stance of the Trump administration would push Canada into a long, deep recession. Nothing of that sort has so far occurred: in fact, the economy is performing adequately. I recently wrote about the puzzle of the Canadian Loonie not moving in response to higher oil prices. Since then, oil prices have bumped around (they are now back up above $100pb) and the Loonie still hasn’t moved. I
The AI boom whose epicentre is the US economy has been driven by extraordinary valuations of the principal AI companies and by colossal fixed investment supporting their growth. The US economy has diverted its resources into the AI industry: what if it’s a bubble? What if it’s all predicated on the delivery of something (artificial general or super-intelligence, AGI or ASI) that will never arrive? If the bubble bursts, it will hurt the US but, as usual, it will probably
Let’s play. Those words, delivered to a small group of like-minded people you trust, are the surest way I know of finding a creative solution to some problem. But the mood that makes play possible is fragile: one difficult person, one sharp comment, and it vanishes like a soap bubble and you will struggle to recover it. So when we set out to invite a room of 100 people to play, it was with some trepidation. These were highly successful,
A few months have passed since we were last obsessing about tariffs, during which time there have been a couple of other items dominating the news. Those items (the conflict in Iran, the new British PM) are a bit stale, so it seems it’s time to have another go with tariffs. Perhaps this season will be more interesting? We’ll see, but the early signs are not encouraging. Canada, the country probably most vulnerable to US tariffs, looks like it’s going