The Diddy trial starts today. Can I start a conspiracy theory linking the timing of the apparent U.S. - China trade deal and the Diddy trial just for fun? Of course I can, this is precisely why the world invented AI chatbots. Don’t believe me? Read on.
All Worlds Collide: Diddy, Tariffs, and the Sino-American Butterfly Effect
Call it a coincidence. Call it choreography. But tomorrow, two very different headlines hit the tape:
The trial of Sean “Diddy” Combs begins.
The U.S. and China are reportedly set to announce a major trade deal.
Now, I’m not saying Xi Jinping personally scheduled the trade announcement to distract from the Bad Boy Entertainment saga. But I’m not not saying it either.
Think about it. Diddy was once a symbol of American excess: champagne, private jets, velvet ropes. A walking export of 2000s capitalism. Meanwhile, China was quietly cornering the global supply chain while Diddy was cornering the VIP booth. Two empires rising in parallel—one built on rare earths, the other on remixes.
Fast forward to 2025, and both face a reckoning. Diddy, in court. China, in a geopolitical standoff with its biggest customer. And what happens? Their plotlines converge. Same day. Same news cycle. It’s like Crash, but with more tariffs.
You think this is random? You think some butterfly didn’t flap its wings in Shenzhen in 2004, causing a yacht to be rented for a Diddy party, which triggered a dollar carry trade, which juiced Chinese exports, which necessitated rebalancing, which led to the trade war, which now resolves itself right as Diddy goes on trial?
Please. Wake up.
This isn’t chaos. This is choreography. Or maybe it’s just capitalism doing what it does best: remixing everything—scandal, commerce, culture—into one beautiful, bewildering beat.
Anyway
Markets are optimistic ahead of the soon to be released details of the U.S.-China trade deal details, will the optimism carry the day, we’ll find out soon.
We head into the day with the S&P at 5,659 and the 2Y and 10Y Treasury yielding 3.93% and 4.41% respectively.
The Week Ahead
Features inflation data, retail sales and lots of Fedspeak.
Mon: Trade Deals and Geopolitics (remember India and Pakistan, Ukraine and Russia, Israel and Hamas?)
Tue: CPI
Wed: Fedspeak
Thur: PPI, Retail Sales, Powell, Industrial Production
Fri: Housing starts and Building Permits, UofM preliminary
XTODs:
XTOD: Years ago in the first edition of "The Ascent of Money" @nfergus laid out the interdependency brewing. He called it "Chimerica:. I suppose now one of the underlying questions is "If China is our lender - have we or have we not become too big to fail?" ; in the same way that a bank with loan out that is a substantial portion of a bank's assets - can't let the customer fail else the bank dies too. There probably was a time in the not too distant past where "if America sneezed, China caught a cold" due to the interdependence. That is the open question - has that window passed, or not?
XTOD: So you’re telling me we got the rest of the world to do the lowest value, lowest profit margin, most capital intensive, and most cyclical parts of economic activity. And in exchange, they gave our companies the cheapest priced goods in the world to resell and thrive off of. Which then gave our companies the time to pursue the actual high value parts of economic activity (you know, like Silicon Valley, Wall Street, military R&D, etc). And all we had to do was give them IOU’s for an imaginary currency unit that we would only ever pay them back in worthless real terms in, if we ever repaid them at all. And… we were the ones that demanded this system come to an end?
XTOD: So your firm pays $25K per year for your Bloomberg Terminal but you only use it to look at stock price charts and read news headlines all day?
XTOD: Pope Leo XIV explains his choice of name: "... I chose to take the name Leo XIV. There are different reasons for this, but mainly because Pope Leo XIII in his historic Encyclical Rerum Novarum addressed the social question in the context of the first great industrial revolution. In our own day, the Church offers to everyone the treasury of her social teaching in response to another industrial revolution and to developments in the field of artificial intelligence that pose new challenges for the defence of human dignity, justice and labour."
XTOD: If you don't prioritize your life, someone else will.
https://x.com/KiteVC/status/1921576282481119698
https://x.com/SpencerHakimian/status/1920298689509404679
https://x.com/BoringBiz_/status/1920911703107109032
https://x.com/VaticanNews/status/1921186921838997935
https://x.com/GregoryMcKeown/status/1921309278037754013
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