Focuses on inflation and Fed cuts. Expects good inflation data, notes Fed prioritizes core CPI (ex-food/energy). Highlights a strong disinflationary tailwind from slowing shelter prices/rents. Believes the Fed has room to cut, possibly starting when Vice Chair Warsch takes over for the June meeting.

Acknowledges uncertainty and data dependency. Notes a closure of the Strait of Hormuz and oil at $120-$150 would reorder things. Highlights a favorable offset: US energy independence has strengthened the dollar, making imports cheaper and helping inflation.

Argues this time is structurally different due to 1) US energy self-sufficiency, reducing import dependence, and 2) a >50% drop in the energy intensity of the US economy. Cites the lack of a recession after the Russia/Ukraine oil spike as evidence of greater insulation.

Concedes there would be an impact. Quantifies it: gasoline 50-60 cents higher could shave 0.1-0.3% off GDP; $2 higher could take 0.8-1.0% off GDP. Also notes the political impact ahead of midterms. States the situation is 'very, very undecided' and highlights the critical unknown of Strait of Hormuz access.