MacroVoices #557 Michael Every: The Blue Tsunami Lands on Markets... and Geopolitics

The U.S. midterm election results, characterized by a Democratic sweep of Congress, signal a potential shift toward a more constrained American foreign policy and a reevaluation of the nation's role as a global hegemon. This political realignment introduces significant volatility, as the U.S. faces potential legislative gridlock and internal conflict that may embolden geopolitical rivals in the Middle East and Ukraine. While markets initially reacted with optimism, the underlying reality suggests that energy prices and refining capacity remain vulnerable to ongoing conflicts and supply chain disruptions. Furthermore, the necessity of tariffs for domestic reindustrialization remains a critical tension point, as the U.S. struggles to balance economic affordability with the requirements of its military-industrial complex. These developments suggest a departure from established economic playbooks, forcing investors to navigate a landscape where traditional correlations between geopolitical risk and market behavior are increasingly unreliable.