When SpaceX IPOs in June, this should finally provide all investors with an opportunity to express their views, including the pessimists who so far have not been able to express their views. Or, does it? Maybe not for SpaceX. Nasdaq specifically changed its rules to accommodate this listing. NASDAQ inclusion within 15 days is estimated to trigger about $7 billion of passive demand. S&P 500 inclusion, if and when it comes, brings another $40-50 billion. And the initial float is only $75 billion. Once you include closet indexers, that number could easily exceed $100 billion. None of this capital expresses any view on whether SpaceX is worth $1.75 trillion. None of this demand is price-sensitive. It is completely inelastic, borrowing the Koijen-Yogo terminology. As a passive investor, I'm not super excited about funding space exploration, at least not at these valuations. This marriage of convenience between deep private markets and passive investing seems like one that is bound to be a rocky one. The whole idea of passive investing in public markets was that there was a deep pool of active investors who made sure prices in public markets were right. But there is limited price discovery in the private phase, because of the incentives of the institutional investors and the lack of shorting. And, given that companies can stay private much longer, companies that IPO are large enough to immediately attract tons of passive capital. Americans with a 401K will now provide immediate exit liquidity for the institutional investors who have been funding this venture. thetwocents.substack.com/p/h…

R.I.P. Christopher Sims (21 Oct. 1942 - 14 March 2026) - a giant in macroeconomics and one of the finest human beings I have ever met -

Everyone's warning about a US fiscal crisis. So why is the 10-year yield only 4%?

Together with Liran Einav and @motoyogo, we are organizing a conference for financial and IO economists on asset demand systems to better understand the equilibrium relation between asset prices and portfolio holdings on May 14-15, 2026, in Princeton.

What happens when we encourage AI use for research and use AI to review papers? We are running an experiment to find out: the UCLA Human × AI Finance conference! Write a finance paper with AI in 4 weeks (by 3/18). AI agents review the submissions: humanxaifinance.org/ 🧵 1/

What happens when we encourage AI use for research and use AI to review papers? We are running an experiment to find out: the UCLA Human × AI Finance conference! Write a finance paper with AI in 4 weeks (by 3/18). AI agents review the submissions: humanxaifinance.org/ 🧵 1/

Video message from Federal Reserve Chair Jerome H. Powell: federalreserve.gov/newsevent…