Saturday, October 12, 2019
Weekly Commentary:
What the Heck is Happening
in the Cayman Islands?
by Doug Noland
Full article here:
http://creditbubblebulletin.blogspot.com/2019/10/weekly-commentary-what-heck-is.html
Full article here:
http://creditbubblebulletin.blogspot.com/2019/10/weekly-commentary-what-heck-is.html
My short version
is below
Ye Editor
is below
Ye Editor
For the week ending
October 11, 2019:
S&P500 increased 0.6% (up 18.5% y-t-d)
Dow Industrials gained 0.9% (up 15.0%)
Dow Utilities fell 1.4% (up 21.6%)
Dow Transports jumped 2.6% (up 12.2%).
S&P 400 Midcaps gained 0.7% (up 15.2%)
Small cap Russell 2000 rose 0.7% (up 12.1%).
Nasdaq100 advanced 1.2% (up 23.9%).
Biotechs were little changed (down 0.1%).
With bullion down $16,
the HUI gold index dropped 3.4%
(up 27.1%).
the HUI gold index dropped 3.4%
(up 27.1%).
U.K.'s FTSE rallied 1.3% (up 7.7% y-t-d).
Japan's Nikkei jumped 1.8% (up 8.9% y-t-d).
France's CAC40 rose 3.2% (up 19.8%)
German DAX surged 4.2% (up 18.5%).
Spain's IBEX 35 advanced 3.5% (up 8.6%).
Italy's FTSE MIB rallied 3.2% (up 21.0%).
Brazil's Bovespa gained 1.2% (up 14.1%)
Mexico's Bolsa declined 0.5% (up 3.8%).
South Korea's Kospi index rose 1.2% (up 0.2%).
India's Sensex increased 1.2% (up 5.7%).
China's Shanghai jumped 2.4% (up 19.2%).
Turkey's Istanbul National 100 sank 4.3% (up 8.5%).
Rssia's MICEX added 0.6% (up 14.3%).
Over the past year,
Fed Credit contracted
$228bn, or 5.5%..
$228bn, or 5.5%..
M2 "narrow money"
gained $891bn, or 6.2%,
ver the past year.
gained $891bn, or 6.2%,
ver the past year.
The Bloomberg Commodities Index
gained 1.2% this week (up 2.4% y-t-d).
gained 1.2% this week (up 2.4% y-t-d).
Spot Gold fell 1.0% to $1,489 (up 16.1%).
Silver dipped 0.5% to $17.544 (up 12.9%).
WTI crude rallied $1.89 to $54.70 (up 20%).
Gasoline surged 4.2% (up 24%)
Natural Gas sank 5.9% (down 25%).
Copper jumped 2.6% (unchanged).
Wheat gained 3.6% (up 1%).
Corn rose 3.4% (up 6%).
October 11 – Bloomberg (Jenny Leonard, Saleha Mohsin, Josh Wingrove and Shawn Donnan):
“The U.S. and China agreed on the outlines of a partial trade accord Friday that President Donald Trump said he and his counterpart Xi Jinping could sign as soon as next month. As part of the deal, China would significantly step up purchases of U.S. agricultural commodities, agree to certain intellectual-property measures and concessions related to financial services and currency, Trump said Friday at the White House. In exchange, the U.S. will delay a tariff increase due next week as the deal is finalized, though new levies scheduled for December haven’t yet been called off.”
“The U.S. and China agreed on the outlines of a partial trade accord Friday that President Donald Trump said he and his counterpart Xi Jinping could sign as soon as next month. As part of the deal, China would significantly step up purchases of U.S. agricultural commodities, agree to certain intellectual-property measures and concessions related to financial services and currency, Trump said Friday at the White House. In exchange, the U.S. will delay a tariff increase due next week as the deal is finalized, though new levies scheduled for December haven’t yet been called off.”
October 7 – The Hill (Niv Elis):
“The federal budget deficit for 2019 is estimated at $984 billion, a hefty 4.7% of gross domestic product (GDP) and the highest since 2012, the Congressional Budget Office (CBO) said… The difference between federal spending and revenue has only ever exceeded $1 trillion four times, in the period immediately following the global financial crisis. The deficit, which has grown every year since 2015, is $205 billion higher than it was in 2018, a jump of 26%. The CBO has warned that the nation's debt is on an unsustainable path.”
“The federal budget deficit for 2019 is estimated at $984 billion, a hefty 4.7% of gross domestic product (GDP) and the highest since 2012, the Congressional Budget Office (CBO) said… The difference between federal spending and revenue has only ever exceeded $1 trillion four times, in the period immediately following the global financial crisis. The deficit, which has grown every year since 2015, is $205 billion higher than it was in 2018, a jump of 26%. The CBO has warned that the nation's debt is on an unsustainable path.”
October 8 – Bloomberg (William Edwards):
“U.S. small-business sentiment fell to near the lowest level of Donald Trump’s presidency… The National Federation of Independent Business’s optimism index declined 1.3 points to 101.8 in September, the third drop in four months… While the gauge remains elevated by historical standards, it’s the lowest since March and close to January’s 101.2, which was the weakest since Trump’s term began in early 2017.”
“U.S. small-business sentiment fell to near the lowest level of Donald Trump’s presidency… The National Federation of Independent Business’s optimism index declined 1.3 points to 101.8 in September, the third drop in four months… While the gauge remains elevated by historical standards, it’s the lowest since March and close to January’s 101.2, which was the weakest since Trump’s term began in early 2017.”
October 8 – Reuters (Jane Lanhee Lee and Manas Mishra):
“U.S. venture capitalists are expected to pour over $100 billion into startups for a second straight year, following the record sum invested in 2018… During the first three quarters of the year, venture capital firms had already invested $96.7 billion in 7,862 funding deals, according to… PitchBook Data Inc and National Venture Capital Association. In 2018 it invested a record $137.6 billion.”
“U.S. venture capitalists are expected to pour over $100 billion into startups for a second straight year, following the record sum invested in 2018… During the first three quarters of the year, venture capital firms had already invested $96.7 billion in 7,862 funding deals, according to… PitchBook Data Inc and National Venture Capital Association. In 2018 it invested a record $137.6 billion.”
“General Electric said… it was freezing pension plans for about 20,000 U.S. employees with salaried benefits, as the industrial conglomerate makes another drastic move to cut debt and reduce its pension deficit by up to $8 billion.”
October 8 – New York Times (Amy Qin and Julie Creswell):
“For international companies looking to do business in China, the rules were once simple. Don’t talk about the 3 T’s: Tibet, Taiwan and the Tiananmen Square crackdown. No longer. Fast-changing geopolitical tensions, growing nationalism and the rise of social media in China have made it increasingly difficult for multinationals to navigate commerce in the Communist country. As the National Basketball Association has discovered with a tweet about the Hong Kong protests, tripwires abound. Take the ‘wrong’ stance on one of any number of issues — Hong Kong, Taiwan, Korea, Japan, for instance — and you risk upsetting a country of 1.4 billion consumers and losing access to a hugely profitable market. Now, multinational companies are increasingly struggling with one question: how to be apolitical in an increasingly politicized and punitive China.”
“For international companies looking to do business in China, the rules were once simple. Don’t talk about the 3 T’s: Tibet, Taiwan and the Tiananmen Square crackdown. No longer. Fast-changing geopolitical tensions, growing nationalism and the rise of social media in China have made it increasingly difficult for multinationals to navigate commerce in the Communist country. As the National Basketball Association has discovered with a tweet about the Hong Kong protests, tripwires abound. Take the ‘wrong’ stance on one of any number of issues — Hong Kong, Taiwan, Korea, Japan, for instance — and you risk upsetting a country of 1.4 billion consumers and losing access to a hugely profitable market. Now, multinational companies are increasingly struggling with one question: how to be apolitical in an increasingly politicized and punitive China.”
October 7 – Reuters (Ryan Woo):
“China’s services sector grew at its slowest pace in seven months in September despite a strong increase in new orders, as operating expenses continued to rise at the end of the third quarter… The Caixin/Markit services purchasing managers’ index (PMI) fell to 51.3 last month, the weakest s
“China’s services sector grew at its slowest pace in seven months in September despite a strong increase in new orders, as operating expenses continued to rise at the end of the third quarter… The Caixin/Markit services purchasing managers’ index (PMI) fell to 51.3 last month, the weakest s
October 6 – Reuters (Paul Carrel):
“German industrial orders fell more than expected in August on weaker domestic demand…, adding to signs that a manufacturing slump is pushing Europe’s largest economy into recession. Contracts for ‘Made in Germany’ goods fell 0.6% from the previous month, with demand for capital goods down 1.6%...”
“German industrial orders fell more than expected in August on weaker domestic demand…, adding to signs that a manufacturing slump is pushing Europe’s largest economy into recession. Contracts for ‘Made in Germany’ goods fell 0.6% from the previous month, with demand for capital goods down 1.6%...”
October 6 – Bloomberg (Divya Patil):
“As India’s shadow banking crisis deepens, it’s getting harder for investors to cut their losses in the sector’s debt. Mutual funds are in a particularly tough spot, given their large holdings of non-bank financing company bonds. That, in turn, threatens everyone from individual investors to conglomerates with money in the funds, underscoring broader risks to policy makers already grappling with an economic slowdown.”
“As India’s shadow banking crisis deepens, it’s getting harder for investors to cut their losses in the sector’s debt. Mutual funds are in a particularly tough spot, given their large holdings of non-bank financing company bonds. That, in turn, threatens everyone from individual investors to conglomerates with money in the funds, underscoring broader risks to policy makers already grappling with an economic slowdown.”
October 8 – Reuters (David Lawder):
“The global economy is experiencing a ‘synchronized slowdown,’ the new head of the International Monetary Fund said…, warning that it would worsen if governments failed to resolve trade conflicts and support growth. In a blunt inaugural speech since taking the helm of the global crisis lender on Oct. 1, IMF Managing Director Kristalina Georgieva said trade tensions had ‘substantially weakened’ manufacturing and investment activity worldwide. ‘There is a serious risk that services and consumption could soon be affected,’ she said.”
“The global economy is experiencing a ‘synchronized slowdown,’ the new head of the International Monetary Fund said…, warning that it would worsen if governments failed to resolve trade conflicts and support growth. In a blunt inaugural speech since taking the helm of the global crisis lender on Oct. 1, IMF Managing Director Kristalina Georgieva said trade tensions had ‘substantially weakened’ manufacturing and investment activity worldwide. ‘There is a serious risk that services and consumption could soon be affected,’ she said.”
October 9 – CNBC (Kevin Breuninger):
“Turkey has launched a military operation in northern Syria, Turkish President Recep Tayyip Erdogan said…, days after the Trump administration announced its controversial decision to pull U.S. troops out of the area. ‘Turkish Armed Forces together with the Syrian National Army against PKK / YPG and Daesh terrorist organizations in northern Syria… has started,’ Erdogan wrote on Twitter… ‘Our aim is to destroy the terror corridor which is trying to be established on our southern border and to bring peace and peace to the region’…”
“Turkey has launched a military operation in northern Syria, Turkish President Recep Tayyip Erdogan said…, days after the Trump administration announced its controversial decision to pull U.S. troops out of the area. ‘Turkish Armed Forces together with the Syrian National Army against PKK / YPG and Daesh terrorist organizations in northern Syria… has started,’ Erdogan wrote on Twitter… ‘Our aim is to destroy the terror corridor which is trying to be established on our southern border and to bring peace and peace to the region’…”
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