Recession Debate Ramps Up
New market launches, debt ceiling panel and FOMC Whisper
GDP is rising, the labor market is still strong and unemployment is at a record low. Everything you don’t see when you’re in a recession. Yet the media, your aunt and your Uber driver all say otherwise.
This week, we'll overview the latest markets that just dropped. Then, we'll preview the upcoming panels we have on trending market topics, as well as a report on the state of predictions across our leading economic markets.
Stay tuned until the end where we have a political -- community -- announcement for you. Let's dive in.
This Week's Market Launches
Featured: Will the debt ceiling be raised or suspended?
The debt ceiling is an important mechanism for Congress to exert control over government spending and to ensure that the government does not run up too much debt. However, recent controversies have highlighted the need for a broader discussion about the role and effectiveness of the debt ceiling in the current political and economic environment.
Markets currently think the limit could see change:
By December 31 (94% Yes)
By June 9 (36% Yes)
🏛️ Will a new Supreme Court justice be confirmed by 2024?
No - 87%
Yes - 13%
📈 Will a Congressional stock trading ban become law by 2024?
No - 81%
Yes - 19%
🏦 What will the European Central Bank set the main refinancing rate rate to at their Feb 2, 2023 meeting?
2.5% or higher (99%)
2.75% or higher (98%)
3% or higher (88%)
☀️ Will 2023 be the hottest year on record?
No - 80%
Yes - 20%
🎥 What will win Best Picture at the Oscars?
Everything Everywhere All at Once (leading with 66%)
The Banshees of Inisherin (24%)
The Fabelmans (8%)
🎥 Who will win Best Supporting Actor at the Oscars?
Ke Huy Quan (leading with 92%)
Brendan Gleeson (8%)
Brian Tyree Henry (3%)
🎥 What will win Best Adapted Screenplay at the Oscars?
Women Talking (leading with 46%)
Glass Onion: A Knives Out Mystery (25%)
🎥 Who will win Best Actress at the Oscars?
Cate Blanchett (leading with 57%)
Michelle Yeoh (50%)
Ana de Armas (3%)
🎥 Who will win Best Supporting Actress at the Oscars?
Angela Bassett (leading with 73%)
Kerry Condon (30%)
Jamie Lee Curtis (13%)
🎥 What will win Best Original Screenplay at the Oscars?
Everything Everywhere All At Once (leading with 40%)
The Banshees of Inisherin (25%)
Triangle of Sadness (11%)
🎥 Who will win Best Actor at the Oscars?
Brendan Fraser (leading with 55%)
Colin Farrell (32%)
Austin Butler (28%)
🎥 Who will win Best Director at the Oscars?
Todd Field (leading with 51%)
Steven Spielberg (44%)
Daniel Kwan and Daniel Scheinert (39%)
Upcoming Forecasting & Analysis Panels
The calendar of economic events is ramping up, and so is our our calendar of tools to help your trading. That's why we've added two new Twitter Spaces to our schedule.
Debt Ceiling Debate: 1/26 at 1 PM EST
Deep dive on the debt ceiling showdown. In recent years, there have been controversies surrounding the debt ceiling, with some arguing that it should be eliminated entirely, while others argue that it is necessary to keep government spending in check.
If the debt ceiling is not raised, the government would not be able to borrow any more money and would have to rely on existing revenue to fund its operations. This could lead to default on debt payments, and could have severe economic consequences.
We'll be discussing these consequences and many more on the panel.
FOMC Live Coverage and Analysis: 2/1 at 1:30 PM EST
Strategize for the FOMC before the release.
Six days from today, the Federal Reserve will hold the first Federal Open Market Committee (“FOMC”) meeting for the calendar year 2023. Inflation has been steadily subsiding as a result of the extremely aggressive monetary policy of the Fed which has been raising the benchmark “Fed funds” rate beginning in March 2022. The Fed had maintained its benchmark rate between 0 and 25 bps for an extended time, even though inflation in 2021 was spiraling out of control quickly approaching a 40-year high. This year, forecasters are back to predicting when the first rate hike cut will come.
The Space begins 30 minutes before the announcement and ends 30 minutes after, in order to best optimize your trading strategies. Set a reminder below.
February FOMC Whisper
The Kalshi Whisper is that the Federal Reserve will hike rates by 25 bps to 4.50-4.75% at their February 1 meeting, with 97% confidence. That projection represents a substantial change from earlier this month: markets projected a 50% chance of a 50 bps hike early in January. Those probabilities fell to 25% after the December jobs report was released on January 6, and down 10% after the December inflation report was released on January 12.
Read the full report over on our Fed Dashboard.
We have a winner!
We’re excited to finally announce the winner of the Kalshi Election Forecasting Challenge (EFC), Preston Pagel! Preston, an aspiring criminal defense attorney, is currently a first-year law student at Northern Illinois University. A self-described “numbers guy”, he’s been interested in politics since childhood and says he may one day run for office. To win the EFC, Preston nailed every senate seat in his forecast, and only missed 11 house seats.
This put him in a 7-way tie for first, but he pulled away by making the most accurate forecast for the margin of victory in Georgia’s senate runoff, the tiebreaker in the contest. Preston says he looked closely at 2020 election results as well as redistricting data to calibrate his forecast. Among his incredible predictions was his call for Democrats to win Ohio’s 13th Congressional District, which 98.9% of submissions missed.
As the winner, Preston received a $25,000 prize, which he says will mostly go towards law school, but he’s also used it to fund his first-ever trip to Washington D.C. this Spring — the first of many, we hope!
That's all for this week. Happy trading!