Charts of the Year - December '22

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The Big Picture Charts

Deglobalization

We published this one in last month’s Charts of the Month (COTM), but given its level of importance today, and even more so in the future, I wanted to resurface it in this last publication of the year to 1) point out that this may be one of the most important yet least discussed visuals of the past few decades, and 2) to remind everyone that as the world appears to be deglobalizing for the first time in our lifetimes, we launched our inaugural edition of Lykeion Research last week, where we’ll be covering this deglobalization (or as Jacob puts it, “reglobalization”) theme through the lenses of Geopolitics and Macro. Make sure to check it out as this in-depth report will build off of our weekly newsletters and will also include a monthly Ask Me Anything with our authors, Jacob Shapiro and Roger Hirst, after each report comes out.

Refinancing Interest Expense

I wrote about U.S. government debt and the fed funds rate back in the June edition of COTM, where the focus of that section was on the constraint mechanism of what the Fed wants to do vs. what the Fed can do.

This chart is unique in that it helps clarify this view: 50% of all U.S. government debt is set to mature in the next 3 years or less, and the current weighted average coupon on all debt is 1.7%. The effective Fed Funds Rate as of today is 4.33%, the 2-Year is about the same, the 5-Year is 3.95%, and the 10-Year is 3.84%. As current debt matures, it must be refinanced at current market rates.