DoubleLine Podcasts

MMM Episode 53: Geopolitical Risk and Markets, Moderating Hawkishness at the Fed

After reviewing the week in markets and macro news, Jeff Mayberry and Samuel Lau take up the market-moving capacity of geopolitical events for their Topic of the Week (16:14). For part of their research, they reference a Deutsche Bank report that analyzed selloffs of the S&P 500 in response to 25 geopolitical events post-World War II. Sam also looks at the behavior of fixed income, oil and gold during these stock selloffs. Interestingly, he notes, the stock-market selloffs were less severe in most cases than some might have expected and tended to be short-lived. The median selloff was a loss of 6%. Only four of the 25 geopolitical events resulted in drawdowns of greater than 10%. The worst event was the Middle East oil embargo of October 1973, which led to a 17% decline in a month’s time. The worst selloffs occurred in the context of already weak economic conditions and/or market trends. This episode of Monday Morning Minutes was recorded Feb. 18, 2022.

The inspiration for the hosts’ choice of topic was the market volatility in recent weeks around changing assessments of the likelihood of a Russian invasion of the Ukraine. The S&P 500 lost 1.6% for the week of Feb. 14-18 (2:08). In fixed income, Jeff and Sam take note of the steepening of Treasury curve (3:27) and spread widening in investment-grade corporates. Commodities (5:14) were up 1.6% with natural gas up more than 12%, perhaps in sympathy with the Russia-Ukraine-roiled nat gas market in Europe. The release of the dovish minutes of the Federal Open Market Committee (9:11) and remarks from Cleveland Fed President Loretta Mester and New York Fed President John Williams, Jeff and Sam say, contributed to markets dialing down the probability of a 50 bp rate hike at the FOMC’s March meeting.

The views and opinions expressed herein are as of the date recorded and should not be construed as an offer to buy or sell any securities. Such views/opinions may differ from those of DoubleLine Capital or other of its affiliates and are subject to change without notice. DoubleLine has no obligation to provide any updates or changes. The following audio presentations represent DoubleLine’s intellectual property. No portion of these presentations may be published, reproduced, transmitted or rebroadcast in any media in any form without the express written permission of DoubleLine. DoubleLine has no obligation to provide any updates or changes. To receive permission from DoubleLine please contact [email protected].

Neither DoubleLine nor any of its affiliates makes any representation or warranty as to the accuracy or completeness of the statements or any information contained in this podcast and any liability therefore (including in respect of direct, indirect or consequential loss or damage) is expressly disclaimed.

DoubleLine is not providing any financial, economic, legal, accounting or tax advice in these podcasts. The receipt of these podcasts by any listener is not to be taken as constituting the giving of investment advice by any DoubleLine entity or individual to that listener, nor to constitute such person a client of any DoubleLine entity. The portfolio risk management process includes an effort to monitor and manage risk, but does not imply low risk.



2002 N. Tampa St.
Suite 200
FL 33602



This is a Test!

DoubleLine is testing our emergency back-up plan. If this were a real emergency, DoubleLine would be posting news, updates, contact information, webcast or conference call information here to keep our clients updated on the situation. To contact DoubleLine, please click here.


Thank you for your request(s). You will receive slides after the webcast has started. Replay and Recap notifications will take several days following the compliance review.


    Please fill in your information below in order to open this article in your browser.

    I am an Institutional Investor [recaptcha]