Pimco's Fels Says Trump Doesn't Want to Start a Trade War

The transcript discusses the potential dissipation of a trade war and the initial meeting between leaders, focusing on trade and North Korea. It analyzes the Fed's passive and predictable approach to reducing the balance sheet and the risks of a hawkish policy mistake. The impact on equities and high yield markets is highlighted, along with changes in the yield curve and market reactions. The ECB's policy strategy is examined, with expectations for Draghi's dovish speech to maintain the yield curve's stability.

What is the main focus of the initial meeting between leaders as discussed in the first section?

• Discussing military strategies

• Understanding each other's policies

• Making major decisions

• Starting a trade war

How does the Federal Reserve plan to reduce its balance sheet according to the first section?

• Aggressively and unpredictably

• By selling all assets at once

• Passively and predictably

• By increasing interest rates

What is a potential risk mentioned in the second section related to the Federal Reserve's policy?

• An increase in employment

• A hawkish policy mistake

• A decrease in inflation

• A stable equity market

According to the third section, what is crucial for the ECB when changing its policy?

• Increasing inflation targets

• Ignoring currency fluctuations

• Gradual tapering of bond purchases

• Immediate interest rate hikes

What could make it easier for the ECB to exit its current policy, as mentioned in the third section?

• Higher inflation

• A stronger euro

• A weaker euro

• Lower employment