Monetary Matters with Jack Farley
Monetary Matters with Jack Farley

Time to Reduce Equity Risk: Why Underappreciated Macro Risks Could Derail the Bull Market | Warren Pies

August 26, 2026

AI Summary

5 min read

Warren Pies, co-founder of 314 Research, downgraded U.S. stocks from overweight to neutral roughly two weeks before this conversation. The move came after the S&P 500 hit 7,800, right as earnings season wound down. Pies had been bullish since mid-April, and the call had worked. But now, he argues, the market is entering a window—August 15th to October 15th—where seasonals, market structure, and underappreciated macro risks align against further upside. He is not outright bearish, but he sees the risk-reward as two-sided for the first time in months.

The Fed: A Coin-Flip Meeting That Markets Are Underpricing

The central macro risk, in Pies's view, is the Federal Reserve's September meeting. He calls it a genuine coin flip. The odds of a hike collapsed from 75% in July to around 30% after the last round of data, but Pies argues that the market's dovish reaction was overdone. His firm's nowcast for core PCE points to a 0.28% month-over-month print—hardly the kind of number that lets the Fed declare victory.

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What you'll learn

  • 1 (00:44) **Warren Pies Introduces the "Macro Takeover" Thesis** - Warren Pies, co-founder of 314 Research, explains why he downgraded stocks and why macro risks are re-emerging after a strong earnings season.
  • 2 (06:56) **Fed Hike Odds Are Mispriced: A "Coin Flip" Meeting** - Pies argues the market has become too complacent about the September Fed meeting, which he believes is a genuine coin flip.
  • 3 (10:38) **Political Pressure and the Risk of a Fed Mistake** - Pies explains how political pressure, not just data, could push the Fed to hike in September, creating a "Fed mistake" scenario.
  • 4 (14:54) **Why a Hike Won't Lower the 10-Year Yield** - Pies challenges the popular view that a Fed hike would stabilize long-term rates by restoring credibility.
  • 5 (25:26) **Certainty of a Hike Would Mean Underweight Stocks** - Pies clarifies that if he were certain of a September hike, he would be underweight equities, not just neutral.
  • 6 (27:20) **Tech Leadership is Critical for the Next Leg Higher** - Pies explains why the bull market needs tech (semis and hyperscalers) to reassert leadership to move higher.
  • 7 (29:58) **Cracks in the AI Armor: Lab ARR and GPU Data** - Pies details specific data points suggesting near-term AI demand may be ebbing.

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Guests on this episode

Warren Pies

Show Notes

Learn More About Unlimited HFGM Global Macro ETF $HFGM: https://unlimitedetfs.com/globalmacro


In this episode of "Other People's Money," host Max Wiethe welcomes back Warren Pies, co-founder of 3Fourteen Research, to unpack why macro risks are suddenly taking control of the stock market. Pies explains his tactical decision to downgrade stocks and commodities to neutral, shifting capital into cash as the market enters a historically weak seasonal window between August 15th and October 15th. The conversation dives deep into the Federal Reserve's true reaction function, the mispriced odds of a September rate hike, and the hidden political pressures driving the committee's choices. Furthermore, they discuss the critical data behind the AI build-out, including H200 GPU availability and the potential impact of major lab IPOs like Anthropic on the broader software sector.


Save $500/year on Caliban AI from 3Fourteen Research: https://www.3fourteenresearch.com/monetary-matters


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Timestamps:

00:00 Intro

01:21 Why Macro Takes Over

03:19 Earnings Season Structure

05:43 Upcoming Macro Catalysts

08:24 Fed Hike Odds Mispriced

10:37 Political Pressure on Fed

15:29 Sponsor Break HFGM

17:45 Coin Flip Meeting Dynamics

19:42 Rates Curve and Term Premium

24:54 How to Position in September

26:53 Tech Breadth and AI Cracks

30:17 Lab ARR Reality Check

34:40 Tech Leadership Needed

38:17 Data Center ROI Debate

40:36 Election and Policy Risk

43:44 AI Issuance Scapegoats

47:35 Energy as Diversifier

51:48 Anthropic IPO Impact

55:01 Software Versus Semis

58:28 Pair Trades and Correlations

01:01:19 Fade Macro Risk Playbook

01:02:55 Conclusion

Monetary Matters with Jack Farley

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