JPM is projecting 0 rate cuts in 2026 (Mar 19th).

Derivatives show~37% 0 rate cuts.

Here's the traditional winners and losers:

1. Banks / Stablecoins: $Circle(CRCL.US), $JPMorgan Chase(JPM.US), $Bank of America(BAC.US), $Wells Fargo(WFC.US)

- Interest from treasury, CCs, mortgage

2. High Cash vs. MC: Berkshire < $BRK.B >, $Etoro(ETOR.US), $Valens Semiconductor(VLN.US), and others

- Companies that sit on large piles of cash relative to MC, where interest rates make material difference to operational income.

- This is beneficial to a lot of brokerages, but also very nuanced eg. $Robinhood(HOOD.US).

3. Insurance: $Progressive(PGR.US), $MetLife(MET.US), $Allstate(ALL.US)

- Higher yields on bond portfolios

4. Value/Cyclical Stocks: $Exxon Mobil(XOM.US), $Caterpillar(CAT.US), $Deere(DE.US)

- Strong cash flow today + underlying commodities boost as well.

Losers:

1. Telecommunications & Heavy Industrials: $AT & T(T.US), $Verizon(VZ.US), $Altice USA (ATUS.US)

- Companies that carry massive debt loads to build out optic cables, 5G, etc.

2. Utilities: $Nextera Energy(NEE.US), $Duke Energy(DUK.US), $Southern(SO.US), $Select Sect Spdr Util(XLU.US)

- Utilities carry heavy debt to maintain power grids and partly bond proxies

3. Real Estate + REITs: $American Tower(AMT.US), $Realty Income MD(O.US), $BXP(BXP.US)

- Higher rates drive down the valuation of the physical properties themselves and harder borrowing for buying homes. Then government bonds > dividend yields.

4. Unprofitable / Speculative Tech: $Ark Innovation ETF(ARKK.US)

Nuanced:

Historically Mag7 like $NVIDIA(NVDA.US), $Apple(AAPL.US), $Microsoft(MSFT.US), $Amazon(AMZN.US) were neutral-winner as they were typically sitting on loads of cash.

But for the first time, some are going into debt for the AI buildout and are scaling like startups again (eg. $MetLife(MET.US)A 33%+ Y/Y revenue growth):

-> Cash-rich companies like $Apple(AAPL.US) are likely to be fine, $Microsoft(MSFT.US) + $Alphabet(GOOGL.US) (largely funded by operational income)

-> While $MetLife(MET.US)A, $Realty Income MD(O.US)RCL, and others may face more challenges (projected to take on debt long term)

However, despite short term volatility from projections + War in Iran:

One TACO could flip all the projections.

So, I would not bet on high interest rates or rate hikes or this trade.

And I don't think markets will either long term.

Source: Serenity