There is a moment in every policy cycle when the trade press stops reporting facts and starts reciting liturgy. September 21, 2026 felt like that moment. A tweet crossed my desk: the Fed hiked, core PCE is still 3.3%, and the Shiller P/E is near dot-com territory. It was delivered with the flat affect of someone reading a weather report during a hurricane. But those data points were not unrelated. They were a single sentence with a missing verb. The market still believes in cuts.
Kevin Warsh's Federal Reserve raised rates by 25 basis points on September 16. Core PCE has now spent 65 months above the 2% target. Diesel is $6.50 per gallon, an all-time high. The Strait of Hormuz has been offline to roughly 20 million barrels per day, about a fifth of global supply. And somewhere in the settlement machinery of CME futures, traders are still wagering that the next move is lower. That is not a forecast. That is a photograph of a nervous breakdown.
Let me be clear about the status of this analysis. Parts of this scenario conflict with known facts if you read it as a literal dispatch from the present. There is a Kevin Warsh chairing the FOMC. There is a 25bp hike after years of tightening. There is a Supreme Court defeat followed by the re-imposition of Section 301 tariffs. I am going to treat these as scenario assumptions, not confirmed headlines. The analytical value is not in prediction; it is in the architecture of the crisis. Strip away the names and dates, and the structure is instructive: a supply shock, a central bank forced into tightening, a market addicted to loosening, and an administration whose trade policy is throwing fuel onto the same fire the Fed is trying to extinguish. That is the macro equivalent of a feedback loop.
This is what Trumpflation looks like when it stops being a gas story. It stops being about the price at the pump and starts being about the price of everything else. It stops being a single-sector shock and becomes a structural challenge to the entire policy framework. The label itself is an admission of failure. If inflation were truly transitory, we would not need a new name for it. The name is the tell.
I have spent my career tracing narratives through markets, from the 2017 ICO frenzy to the AI-crypto convergence of 2026. I have learned that the most dangerous narrative is not the one that is obviously false. It is the one that was true yesterday and is now quietly decaying. The market's belief in rate cuts is exactly that kind of narrative. It was reasonable when inflation looked like a demand-driven blip. It becomes delusional when supply shocks keep compounding.
The Modal Error in the Fed's Playbook
Textbooks teach the Taylor rule as if inflation were a demand-side fever. When overheating demand pushes prices higher, raising rates chills the patient. But the current setup is not a demand problem. It is a series of cost shocks rippling through the economy. Tariffs raise imported input costs. The Hormuz closure raises energy and fertilizer costs. Geopolitics raises food costs. In each case, the price increase is a supply-side shift, not excess demand.
When the central bank responds with contraction, it does not repeal the supply shock. It suppresses the demand that might have absorbed it. The result is not a return to 2% inflation. The result is stagflation with an interest-rate anchor. This is the dirty secret of cost-push inflation: the medicine tastes like the disease. A 25bp hike does not lower the cost of fertilizer. It lowers the income of the people who need to buy food. It does not reopen Hormuz. It raises the cost of capital for every business that depends on that shipping lane.
Core PCE at 3.3% for 65 months is not a cyclical blip. It is a sign that inflation expectations have been re-anchored at a higher level. Five and a half years is enough time for households, unions, and CFOs to adjust their behavior. They have signed contracts with inflation clauses. They have built pricing models with a 3% floor. They have stopped waiting for the old regime to return. A single hike in September cannot reverse that. It may even entrench it if the market reads the move as political, not technical.
The deeper problem is that the Fed's policy rate is entering what I would call a secondary restrictive zone. The first restrictive cycle compressed the most speculative parts of the economy. This second push is hitting the parts that are essential: working capital, agricultural credit, logistics financing. That is why the transmission is effective but distorted. It does reduce demand, but it reduces demand for the wrong things. It punishes inventory building, small-margin businesses, and capital-intensive industries before it touches the inflation engine itself.
Based on my audit experience in the 2022 bear market, I learned that you cannot understand a protocol by looking only at its native token. You have to understand where its liquidity resides, how its incentives pay out, and what happens when the faucet turns off. The same is true for a macro economy. The Fed is not fighting inflation. It is fighting where inflation lives. And inflation now lives in the supply chain, not in the consumer demand curve.
The Hidden Tax of Section 301
Imposing tariffs under Section 301 after losing in court is not trade policy. It is a workaround. It is a way of raising revenue without legislation. Tariffs are a regressive consumption tax. Lower-income households spend a larger share of their income on goods with imported content. When importers pass the cost to consumers, the price level rises, and the Fed is left holding the blame.
The fiscal authority and the monetary authority are now pointing in opposite directions. The White House is increasing inflation; the Fed is increasing unemployment. That is not a policy mix. It is a civil war conducted through economic instruments. The market understands this, which is why it cannot properly price either policy. Every valuation is a guess about which department of the government is lying more convincingly.
There is a hidden fiscal dimension to tariffs that almost no one mentions. They are a source of government revenue at a time when deficit reduction has become politically impossible. A tariff is a consumption tax with the political advantage of not being called a tax. It is paid by the consumer, collected by the importer, and credited to the Treasury. It is a shadow VAT that falls hardest on the people who cannot reprice their labor. This alone is enough to explain why the administration is willing to soak up the legal defeats. The policy is not about trade. It is about revenue and protectionism wearing the same costume.
But the revenue argument is self-defeating. Tariffs narrow the tax base by suppressing real consumption. They push prices up, which forces the Fed to keep rates higher, which strengthens the dollar, which makes imports even more expensive in local currency terms. The circularity is brutal. A tariff creates inflation, inflation creates hawkishness, hawkishness creates dollar strength, dollar strength creates more imported inflation. The policy does not merely fail. It actively manufactures its own new excuses.
The Second-Round Effect: Diesel, Fertilizer, and the Long Tail
Energy shocks rarely stay in the energy sector. Diesel is the blood of the supply chain. Every truck, tractor, and container ship that moves goods burns it. When diesel hits $6.50 per gallon, the cost embeds itself in every physical product. This is not a single CPI component. It is a tax on gravity itself. The price of moving matter from one place to another has changed, and that change flows into everything.
Fertilizer is the second-round amplifier. One-third of the world's traded fertilizer passes through the Strait of Hormuz. Cut that artery, and the next planting season becomes an inflation event. The chain runs energy to transportation to fertilizer to crops to food to core inflation. This is why headline inflation can cool while core stays sticky. The headline benefits from base effects and volatile energy prices rolling over, but core has already ingested the shock.
The spread between headline and core is where the truth hides. It tells you that the market is looking at last year's energy number while the economy is eating tomorrow's food bill. The spread is the market's way of admitting that the inflation problem has been repackaged, not solved. It was once a story about the pump. Now it is a story about soil, shipping lanes, and the slow digestion of intermediate goods. That is a much harder story to reverse.
This is the textbook case of second-round effects. First-round effects are visible and dramatic: gasoline prices spike, headlines scream, politicians make promises. Second-round effects are quiet and lethal: rental contracts renegotiated at higher rates, food producers repricing wholesale menus, logistics firms adding fuel surcharges to every invoice. By the time these ripple outward, the original shock is already old news. That is why the 65-month duration of the core PCE overshoot is so damaging. It shows that the economy has fully internalized a higher inflation path.
Wages are the missing variable. In a stagflation scenario, the wage-price spiral is not a hypothetical. It is the mechanism by which inflation becomes a permanent resident. Workers see their real incomes falling, they demand raises, employers pass the higher labor cost into prices, and the central bank is confronted with a choice between validating the spiral or breaking it with a harsh recession. The article that fed this analysis barely mentions wages. That omission is not a minor gap. It is the most dangerous blind spot in the entire debate because it is the variable that determines whether the 1970s ending is a replay or a farce.
The Fiscal-Monetary Collision
Every central banker's nightmare is political subordination. With Warsh at the helm and tariffs coming from the administration, the market will read every FOMC decision as a battle inside the government. The moment rate decisions become a referendum on trade policy, the central bank loses its most important asset: credibility. Warsh's perceived hawkishness is not the real story. The real story is that he is perceived as political. A political central banker is a contradiction that markets can tolerate for a while, but only until the contradiction starts showing up in volatility indexes.
The 1970s analogy is not exact. Volcker had a clearer enemy. Inflation was the enemy. Today the Fed has several enemies: inflation, an administration that is feeding inflation, and a market that refuses to believe the Fed means it. The difference matters because it changes the cost of victory. Volcker needed to break expectations. Today's Fed may need to do that while also navigating a jurisprudence crisis over tariff authority, a geopolitical rupture in the Persian Gulf, and a fiscal situation that no one wants to discuss.
The bond market is already sensing this. Long-term yields face upward pressure from two directions: inflation expectations and term premium. If the market begins to question fiscal sustainability, the term premium will widen, and the yield curve will bear-steepen. That is a brutal signal. A bear steepener says the market believes the economy is weakening while long-term inflation is rising. It is the fixed-income version of screaming into the void.
The fiscal-monetary collision also undermines the Fed's forward guidance. The market is supposed to trust the dot plot, but the dot plot is now hostage to what the administration does next. If the White House imposes another round of tariffs, the Fed will have to update its forecasts. If the Supreme Court strikes down the tariff law again, the Fed will have to update its forecasts again. Monetary policy becomes an endogenous response to trade litigation. That is not independent central banking. That is a worker on a factory line watching the temperature gauge while someone else plays with the thermostat.
The Expectation Gap
Here is the single most important number in macro finance right now: rate futures price cuts, while the Fed hikes. This is not a forecast or a view. It is an empirical gap. Billion-dollar portfolios are constructed on the assumption that the Fed will reverse course. The equity market, especially the AI complex, is trading as if the only question is how soon the cuts arrive. But the FOMC has just raised rates. It did not announce a pivot. It not only signalled discomfort with inflation, it acted on that discomfort.
The expectation gap is the core finding of this entire scenario. It is the point where asset pricing and policy paths refuse to look at each other. When that gap eventually closes, it will close violently. This is what I mean by a de-rating event. Prices do not need to decline on bad news. They can decline simply because the discount rate that justified them was imaginary. The AI rally is the most crowded expression of that imaginary discount rate.
Liquidity is the ghost in every valuation; look for where it lives before you trust the number. An AI model with genuinely transformative productivity gains is not being priced as a productivity investment. It is being priced as a duration asset. Its present value is a mathematical function of the discount rate. When the Fed hikes, the present value of every distant cash flow falls. The technology does not change. The narrative does not change. The valuation changes because the discount rate changes. That is not a thesis. That is arithmetic.
The Shiller P/E only reinforces the concern. Near dot-com highs, valuation is no longer an argument about fundamentals. It is an argument about psychology. The market is not saying the future will be wonderful because of the data. It is saying the future will be wonderful because it has to be. That kind of reasoning is the fertilizer of bear markets. It grows tallest right before it topples.
Let me explain this through the lens of my own consultancy work. I have spent the last two years building narrative-velocity dashboards that integrate LLM sentiment with on-chain data. The single best predictor of a narrative flip is not the content of the story. It is the certainty with which the story is repeated. When everyone uses the same phrase, eats the same thesis, and ignores the same signal, the story becomes infrastructure. And infrastructure is expensive to change. The AI trade today is infrastructure in that sense. It is not a set of positions. It is an identity. That is what makes it so fragile.
The market's rate-futures curve is the most honest liar I know. It lies because it must, because the alternative would force every levered portfolio to immediately reprice. It is honest because that repricing is inevitable. The gap between what the curve says and what the Fed does is not a statistical quirk. It is a deferred loss. The longer it is deferred, the larger it becomes.
A Tax on Optimism
If you want a one-sentence explanation of what is happening, it is this: the U.S. is taxing optimism. Section 301 tariffs are not a tax on China. They are a tax on the future, collected in the present through higher input costs. The optimism that built the global supply chain, that assumed energy would flow, that assumed legal institutions would guarantee property rights, is now being monetized. Every tariff, every legal workaround, every administrative pivot away from the rule of law is a transfer from future growth to present political convenience.
This is the deeper meaning of the title of the source article: Trumpflation is no longer just a gas story. The gas story was simple. Close the strait, watch the pump price rise, wait for it to fade. The new story is about institutional decay as an inflation mechanism. It is about a government that uses trade law as a crowbar and a central bank that is forced to mop up the mess. That is not a business cycle. That is a regime change.
The irony is that tariff policy is advertised as a way to bring manufacturing home. In practice, it raises the cost of every input that manufacturing needs. Steel, aluminum, machinery, semiconductors, fertilizers, plastics, and packaging all become more expensive. The domestic producers who are supposed to benefit also face higher costs. If they cannot pass those costs to customers, their margins collapse. If they can pass them, their customers are the same households that are supposed to be enjoying the new golden age. Protectionism is a Ponzi scheme of good intentions. The promised jobs arrive only after the consumer has been impoverished enough to no longer afford the goods being produced.
The Contrarian Lens: What the Consensus Gets Wrong
The consensus view, as presented in the underlying macro analysis, is bearish: inflation is sticky, policy is trapped, equities are vulnerable. I largely agree with the mechanics. But the contrarian angle is sharper than the conclusion. The real risk is not inflation or recession. It is the erosion of the public's ability to distinguish between government actions and market consequences. Once the fiscal authority and the monetary authority are seen as adversaries, every piece of data becomes a political weapon. Inflation numbers get quoted selectively. Rate decisions get read as coups. Yield moves get mocked as panic. In that fog, even a genuinely good quarter of productivity growth becomes uninvestable because no one trusts the frame.
That is why the AI narrative is so fragile. A bear market is truth's sandpaper. It strips away the belief that tariffs can make a country rich without first making it poorer. It strips away the belief that a central bank can solve a supply shock with demand-side tools. It strips away the belief that a technology's potential can be separated from the rate environment in which it is valued. The AI-alchemists promise to transmute compute into growth, but alchemy fails when the intent is hollow. If the intent is merely to justify a multiple, the spell is already broken.
What would change my view? If Hormuz reopens, if diesel prices collapse, if core PCE prints three consecutive declines of more than 20 basis points, and if the rate-futures market finally aligns with the Fed's hawkish stance without a liquidity crisis, then the expectation gap closes peacefully. That would be a genuinely bullish outcome. But peaceful closings are rare in macro history. Gaps usually close through pain: a bear market, a policy error, or a geopolitical event that redraws the map. The market lights by themselves are not enough.
The Structure of Market Consequences
Now let me walk through the transmission chain from this policy collision to an actual portfolio. Equities are the first victim. The Shiller P/E is near a generational extreme. The AI complex is short-duration in narrative terms but long-duration in valuation terms. The moment the market accepts that there will be no cuts, the multiple compresses. The cash flow from AI is real but mostly in the distant future. Distant futures are the first to be discounted. This does not require a business failure. It requires only a change in the expected path of interest rates.
Bonds are the second victim, but only for long maturities. Short-duration cash and money market funds benefit from higher rates. Long-term Treasuries face a bear steepener. Inflation expectations push up the front end of that movement and the term premium pushes up the back end. The middle of the curve is where the pain lives. The investor who bought a five-year Treasury expecting safety will receive interest, watch the price fall, and wonder why the hedge did not work.
Commodities are the standouts. Energy, particularly diesel and refined products, are directly elevated by the Hormuz closure. Agricultural commodities are next because of the fertilizer shock. These are not speculative narratives. They are physical realities. Food supplies are measured in months, not in forecasts. The market can defer the price increase for a season, but not forever. When the next crop report arrives, the numbers will speak.
The currency is complicated. High rates usually mean a strong dollar. High inflation usually means a weak dollar. When both are present, the dollar follows whichever narrative is louder at the moment. In a liquidity crunch, the dollar strengthens because everyone needs to pay dollar-denominated debts. In a fiscal-crisis event, the dollar weakens because everyone questions the liability side of the U.S. balance sheet. The range of outcomes is wide, which is another way of saying the current uncertainty is not being priced at all.
Gold and inflation-linked bonds become cheap portfolio insurance. They do not rally in every stagflation scene. They rally when credibility fails. The problem is that credibility is an intangible. It does not appear in a price chart until it has already been spent. Those who wait for confirmation will pay more than those who understand the structural argument.
Defensive equities are the last refuge. Low-valuation, high-dividend, stable-cash-flow companies behave like short-duration assets. They benefit from a rising rate environment because they do not need the future to arrive before they pay you. They look boring. Boring is what you want when the macro regime is asking questions it cannot answer.
What to Watch Next
The next FOMC meeting is the tripwire. The dot plot will tell us whether the committee sees one hike or two. But the more important signal is whether Warsh uses the press conference to directly address the tariff policy. If he criticizes the White House in public, the political collision becomes undeniable. If he refuses to answer, the market will fill the void with darker interpretations.
Core PCE is the next data point. The threshold is simple: if it stays above 3.3% for another three months, the expectation gap hardens. If it breaks above 3.5%, the entire policy framework shifts. The Fed will have no choice but to tighten into a slowdown, which is the definition of a policy error made under pressure. The pain index, inflation plus unemployment, will rise faster than either variable alone.
Rate futures are the real-time lie detector. Watch for the moment when the market prices a hike as more likely than a cut. That repricing is the event. It will not be announced by any central bank. It will simply appear in the curve one morning, tiny and ignorable. Then it will grow. The portfolio damage will not happen on the first repricing. It will happen on the second, when levered funds are forced to sell their most liquid assets to meet margin calls.
Hormuz is the external weather system. No central bank can reverse it. No Supreme Court can rule it open. The shipping data is not a rumor. It is a physical fact. Watch ship-tracking services, not newspapers. When the strait reopens, expect a violent spike in energy volatility, first down, then up, as supply chains frantically rebalance. Do not confuse that spike with the return of normalcy.
Diesel prices deserve daily attention. Diesel is the blood pressure of the economy. At $6.50 a gallon, every physical product carries an embedded tax. If diesel continues to set records, it does not matter what the national CPI headline says. Core inflation will keep digesting the shock for months. The base effect is not your friend when the absolute level is still rising.
The Shiller P/E can stay high for years, so do not use it as a timing tool. But do respect it as a risk indicator. The higher the multiple, the larger the drawdown when the expectation gap finally closes. A market can stay irrational longer than you can stay solvent, but it cannot stay solvent with a discount rate that is moving against it every time the Fed speaks.
Tariff jurisprudence is the silent variable. Watch the appellate rulings. If the tariff authority keeps losing in court, the administration will escalate into emergency powers, which will trigger a constitutional crisis. That would be the most inflationary outcome of all, because it would directly attack the predictability of property rights. Business investment would freeze. Long-run supply would shrink. The stagflation picture would stop being an economic scenario and start being an existential one.
The Human Costs Hidden in the Spread
It is easy to talk about Shiller P/E ratios, term premiums, and rate futures as if they were abstract objects. They are not. Behind every percentage point of core inflation is a family that has renegotiated its food budget twice. Behind every point of the pain index is a worker who is told the economy is strong while watching his paycheck lose purchasing power. The real-estate wealth effect has become a wealth tax for younger buyers. Higher rates suppress construction, suppress inventory, and force renters to bear the cost of the Fed's battle against a problem that monetary policy cannot solve.
The inequality channel matters more than most macro commentary admits. Inflation punishes the unhedged. The wealthy own assets that respond to inflation: stocks, real estate, commodities. The working class owns claims on labor and cash, both of which are crushed by a supply shock. The Fed is left in the impossible position of protecting the currency and punishing the currency's most vulnerable users at the same time.
That is the secret sauce of stagflation's political toxicity. It is not the inflation itself. It is the sense that the rules have been rigged. A tariff is a tax on the poor that is passed by a government pretending to defend the poor. A rate hike is a tax on the leveraged that is imposed by a central bank pretending to defend the purchasing power of the poor. Both instruments are honest individually. Together, they are a sandwich of mutually canceling lies. The result is not a policy. It is a mood. And the mood is what the market ultimately prices.
Why This Cycle Is Different
Every cycle claims to be unique. This one actually is. The combination of a contested Fed chairmanship, a trade-policy war conducted through statutory workarounds, a maritime chokepoint closure, and a technological narrative as powerful as AI has no clean historical analog. The 1970s had the oil shock but not the AI miracle. The dot-com bubble had the technology mania but not the inflation. The 2008 crisis had the leverage but not the supply-chain collapse. This cycle has all of them at once.
That is why the standard playbooks fail. A value investor looks at high Shiller P/E and short-sells technology. A macro trader looks at inflation and buys gold. A geopolitical trader looks at Hormuz and buys energy. Each trade is sensible in isolation. None of them addresses the core disease: the expectation gap. The gap is not just a market anomaly. It is an accounting disagreement between the federal government and the Federal Reserve. The government is collecting a tariff and calling it trade policy. The Fed is raising rates and calling it inflation control. Both are engaged in the same act of imaginative accounting. The market is caught in the middle.
In my experience, markets are not efficient at pricing policy storms. They are efficient at pricing the aftermath of the storm. The current regime is still in the eye of the hurricane. The wind is calm enough to make equities feel safe. The valuations are high enough to encourage complacency. The Fed insists it is doing what is necessary. The fiscal authorities insist they are doing what is necessary. Every wet finger in the air agrees that the problem is external, temporary, or both. That is the definition of a setup for a repricing event.
The Contrarian Synthesis
The more I work with this scenario, the more convinced I am that the biggest risk is not the wrong decision from the Fed or the wrong trade from the market. The biggest risk is that both institutions remain rational within their own frames while refusing to acknowledge the other's frame. The Fed is rational when it says inflation is too high. The market is rational when it says a rate cut is necessary to sustain current asset prices. The government is rational when it says tariffs protect domestic industry. The problem is that three rational actors cannot be correct simultaneously if their desired outcomes are mutually exclusive. Someone has to break.
The question is who. The market is the most flexible of the three. It can break in a week. The Fed is slower. It can hold out for years but will eventually capitulate if the political pressure becomes unbearable. The government is a structure of legal fictions. It can break only through a constitutional crisis, an election, or a civil society refusal to accept the fictions. The most likely path is therefore market first, then Fed, then government. That path is also the most painful, because it means millions of portfolio losses are the first signal of a deeper institutional fracture.
If you want safety in that environment, you cannot just be long or short. You have to be hedged across the entire balance sheet. You need assets that benefit from inflation: energy, agriculture, gold, TIPS. You need assets that benefit from illiquidity: cash, short-dated Treasury bills. You need assets that benefit from disappointment in equities: options, volatility, and defensive dividend payers. You do not need one thesis. You need a portfolio that can survive a thesis becoming irrelevant.
Alchemy fails when the intent is hollow. That is the sentence I keep coming back to in 2026. The market is attempting a kind of alchemy when it prices AI as a low-rate asset. The government is attempting alchemy when it prices tariffs as a free lunch. The Fed is attempting alchemy when it prices a single 25bp hike as a cure for 65 months of inflation. The intent in each case is to transmute a painful tradeoff into a pleasing outcome. The base metals have not changed. They have only been arranged in a prettier pattern.
The polymath in me has watched this movie many times in different costumes. In 2017, it was ICOs. The code was real, the distribution was real, the community enthusiasm was real. But the valuation required a permanent inflow of fresh believers. When the inflow stopped, the narrative collapsed. In 2021, it was NFT floor prices. The cultural energy was real, the identity formation was real, but the floor was a liquidity phantom. In 2026, it is the AI-driven equity market. The productivity potential is real, the geopolitical benefits are real, but the discount rate is a fantasy. The names change. The structure does not. A bear market is truth's sandpaper, and it is only a matter of time before it rubs the shine off this cycle's favorite object.
What Would Restore Confidence
I am not a permanent bear. I am a narrative hunter. I hunt for the moment when the story flips. What would flip this story toward a healthy resolution? First, a genuine opening of the Strait of Hormuz that lasts for more than a month. Second, a legal settlement that gives tariff policy a stable constitutional foundation rather than a workaround. Third, a Federal Reserve that can normalize its reaction function without being seen as a political ally of either party. Fourth, a rate-futures market that begins to price reality without a crisis.
Each of these is possible. None is certain. The odds are not the point. The point is that the market currently behaves as if all four have already happened. That is not a healthy posture. It is a dream being lived while awake. The dream is pleasant because it avoids the pain of the tradeoff. But the tradeoff has not been avoided. It has only been deferred, and the interest on that deferral compounds in the form of expectation risk.
The Takeaway
Watch the next FOMC meeting. Watch whether Warsh's dot plot admits another hike. Watch whether the rate-futures market is forced to reprice in the same direction. Watch Hormuz and diesel, because the Fed cannot steer them. Watch the spread between headline and core, because it reveals whether the shock is still being absorbed. These are not forecasts. They are tripwires. The macro regime has already changed even if the public narrative has not caught up.
Narratives don't break when the story changes; they break when the tellers start believing their own myth. The market believes in cuts. The administration believes in tariffs. The Fed believes in a single hike. One of these beliefs is now a fossil. Which one will be the fossil is not the question. The question is whether you have already positioned yourself for the wake-up call. In this cycle, the safest position is not bullish or bearish. It is awake.