Macro Afternoon

A fairly mixed end to the trading week here in Asia following last night’s US inflation print and the latest ECB meeting which embiggened US stocks to new highs but hasn’t quite translated into firm moves across other stock markets so far. The USD is losing ground against all of the majors, but particularly Euro and Pound Sterling going into the London session as gold nudges back above the $1900USD per ounce level. Meanwhile Bitcoin is consolidating here after pushing up through the $38K level but can’t make a new weekly high as it reverts back to its start of week position as another line of resistance builds:

The Shanghai Composite is about 0.5% lower, retracing back below the 3600 point level as Yuan appreciates against USD while the Hang Seng Index is doing a lot better, up 0.5% to finish at 28902 points. Japanese stocks are in hesitation mode yet again as Yen becomes stronger, with the Nikkei 225 closing with a scratch session at 28948 points as the USDJPY pair pulls back below the 109.50 midzone after its very mild breakout overnight, with momentum remaining in the negative zone:

Australian stocks cap off a solid week with the ASX200 closing 0.1% higher and remaining above the 7300 point level at 7312 while the Australian dollar finally aligns with other major currencies and is lifting against USD to push above the mid 77 level but still a smidge below its intrasession and previous weekly highs that are acting as resistance:

Eurostoxx and S&P futures are steady going in the London open with major currency strength holding back Euro bourses while the four hourly chart of the S&P500 showing a desire to advance on last night’s record high:

The economic calendar finishes the week with UK GDP figures, then the US Michigan consumer sentiment survey.

Have a good weekend and stay safe (and south of the border please Victorians!)

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Comments

    • They understood the computational aspect very well and used it as a wizard of Oz like screen to do what most humans would not aka remove the altruism to satisfy a rigid ideological view to policy that many humans would not want to be a part of ….

      • The Wizz of Ozz

        What flavour of corn syrup are we on tonight why don’t you call your self big Red roo it suits you more as skippy was a doe Ray me or are you that way inclined girly man

  1. Urgh I went into the big smoke today. Aka Warnambool. It was horrible.

    Too. Much. Traffic.

    I won’t be doing that again if I don’t have to. But I needed to check out curtain material samples. But the good news is I’ve obviously acclimated to my new environment very nicely if I’m having that reaction to Warnambool 😊

    • Popcod it rolls like S. Kings Bucky Balls and there is no escape from it … the past or what one considers some version of the past is steam rolled by the future … its inevitable … because markets …

    • call me ArtieMEMBER

      Hi Popcod. Here is my huge fold of the cards. Publicly. On this forum. I finally bought real estate.
      Like you, I have bought a place out in the country. My first ever home of my own. I will move there in September. It’s in the Ovens River Valley in N. E. Victoria. A few acres with a comfortable house and nice views. Close to Myrtleford and Bright.
      I have had huge anxiety about leaving the city behind (no more Belgian beer!) but I think it will be good to just take care of a small piece of land that is my own, Look after the local wildlife, etc. You know.
      Wish me luck, Artie

      • Yay go Artie! Woohoo!!! Congratulations and best wishes for the future! I have no doubt if you’ve done your sums, and have really good push from Melbourne factors, and good pull to that location factors AND you have the right attitude that you’ll be fine and it should turn out into a successful life change for you.

        I have not had a single second where I have had even the slightest regret, felt uncomfortable, felt unsafe, felt unwanted in the area etc and it took me over 6 weeks before I felt even a skerrick of loneliness, and that was mild and lasted for only a couple of hours (actually I was glad to feel that way cos I thought things were going WAAAY too well). I moved not knowing anyone in the region or having work lined up, and I started work 2.5 weeks after moving and everyone has been willing to engage me in conversation. I have no doubt local friendships will develop in time. I already feel like this is my community and my ‘place’ even if I haven’t yet been able to get out into it. But I did do an awful lot of emotional and mental preparation before the move. If you want to chat more privately let me know and I’ll send you my contact details.

        BTW I’m sure you can get your Belgian beer delivered. Online shopping is awesome these days though the postage costs are much more painful than to metro locations. Maybe you’ll have an excellent local craft brewery and you can become best mates with them

      • You won’t miss belgian ale – it’s pretty easy to make a decent facsimile. I’m currently drinking a very nice homemade Belgian pale ale & just in the process of brewing a Dubbel. Best thing? Using only the best ingredients, it runs out to three bucks a pint.

      • The Traveling Wilbur

        Congrats. Smart move.

        Speaking of the local wildlife, I hear the locals round your new parts have developed a promising alternative application for sheep.

        Wool.

        • ErmingtonPlumbingMEMBER

          Hmmm,…..Wilbur!

          I I was enjoying this nice thread and the rural solidarity contained within and then you had to throw in a sheep shagging comment!

          Geesh!

          • The Traveling Wilbur

            Multitasking.

            And you should be proud of me. Just for omitting any Deliverance references if nothing else.

      • Local tip, stay away from Bright on the weekends and holidays (when lockdown ends) it is overwhelmed by Melb folk.
        Do all your shopping at Myrtleford, it is way cheaper than Bright, for the above reason.
        Give yourself a full day when you go up Mt Buffalo (even that is not long enough).
        Make sure you drive/ride the ‘Gap’ ASAP.
        Gum Tree Pies are the best you will find.
        Bright has its own Brewery that you should check out.
        King Valley is a great drive with some great wineries along the way.

  2. Lets have some fun …

    https://crankyuncle.com/a-history-of-flicc-the-5-techniques-of-science-denial/

    So how much of this afflicts readers at MB – ????

    Too further that thought …

    https://www.theatlantic.com/science/archive/2021/06/the-brain-isnt-supposed-to-change-this-much/619145/

    So in summation I would ask some ponder what rolls around in there heads … who and why its there … sorta like the Q&A episode of late ….

    PS should add China is moving away from the ridiculous GPD metric …

  3. MathiasMEMBER

    Its FRIIIIDAY.

    Another week passes… weeks just merging into an all line chart blurrrrrrr
    https://www.youtube.com/watch?v=-5O7XbHDRwQ

    Covid. Hmm. Think I’ll stay home this weekend. Do some gardeny weedy things and play with the birdsies. No surfing for me this weekends, I thinks.

    Just another day of absolutely nothing in Australia. Same sh*t. Except now its Friday.

    Ham and Pineapple tonight, I think… because I havent had it in ages… and time for a Weekend Beer.

    Yep. Friday. Same as the past 15 years.

      • MathiasMEMBER

        I usually dont surf at the family beaches. I usually drop by a mates place, turf his behind in the car and find some nice quiet spot. I buy him a burger and he usually shuts up ha ha. People are annoying and when Im out with the boys, we ha ha… have a tendency to get a little rowdy lol. We arent bad people but we do like our fun times ha ha. The odd bonfire. Burn down half the bush. Depends on what mood we are in.

        I just avoid the nude beaches. Never going there again. When you say hi to a bloke and he stands to attention, it kind of ruins the conversation real fast. Yeah, there are woman… but its always the fat ones that want to parade. The logic is if they are ugly, then your just a misogynist and its your fault they are ugly. I leave em be. When I go out, I just like to see good waves.

        eh… cant complain… I guess.

          • MathiasMEMBER

            I try to avoid that.

            What seems to be the officer problem?

            ” independent thought ” … whats that? I call it getting old.

          • Your ability to think and consider others whilst you satisfy some primal urge you don’t understand …

          • MathiasMEMBER

            > Your ability to think and consider others

            But skip… I hate to lay this on you… Im not into you. Have you thought about your local bar?

            I live in a Country called Australia, skip. Most of this people in this country would gladly drag a knife across my throat if it meant some kind of personal gain or benefit. I have considered others. I’ve considered most people in Australia are all a$$holes?

            There are some good people around but they are far and few between. Liberals have basically wrecked this nation and if your an MB reader ( as I assume you are because your here ), then you must also be aware of what that futures going to look like.

            To be totally fair, Im not here to make friends skip. Im here to make some money, to learn about the country I was born in and figure out how I can enact some change against all the threats that seem to be facing it ( there is a lot ). If you are here to tell me that ScoMo’s a really great bloke, the Boomers are really wonderful people and Woman are just victims who are sorely misunderstood, then sorry mate… I got no time for you. I got 14 dead mates who would say otherwise. On the other hand, with a name like ‘skip’, I can only suppose you do have some kind of attachment to the country your on. You want to talk about a way forward through all this mess, how to depose this wretched government and how we are going to make a change for the better, then Im all ears mate ;p

            I dont need friends mate. I’ve got enough. Im just here to stop other Aussies from suiciding. I’ve seen my share and I dont want to see anymore. If you think Im being too harsh and rude, then maybe you and me can go visit the cemetary sometime.

            If you dont like my ethics, you might feel more comfortable over at Martin Norths channel. Plenty of people over there who care about nothing except house price profits. You might fit right in ;p

            The only people I care about are the people I know around me. Im sorry skip but its just the way it is. Call it Tribalism or whatever you like but this Country turned on me and thats how I treat it.

            Im not exactly sure what all that means for me but time will tell. I never thought many things would happen in life and yet here I am. We all adapt to whatever roles life ends up giving us.

          • MathiasMEMBER

            Disagree with me on Monday Skip.

            Its the weekend. I’ll have my morning coffee then and I’ll be more receptive. I got better things to do then sit here all weekend. You can troll me on Monday.

            Might go watch a movie.

            Hope you enjoy your weekend bud. Hope its not to cold for you.
            ( There you go. I can be nice occasionally. )

          • Mathias…

            “But skip… I hate to lay this on you… Im not into you.”

            Who said I was and what does that have to do with anything regardless save your next special plea about being jail gang banged and now a proud member of that philosophy.

            Next you elaborate that your only meaning in life is to make money to obviously drown all the other emotional demons in your like and then expect others to give a fk about you one way or another … then again anyone that mistakes three screens for reality already has issues …

        • Sweep its a cornucopia of funding and geopol antics with past political issues eg. supporting Nazis in the Ukraine or WMD seems something to consider before the brain starts to foam ….

          • Remind me again why all the western corps fell over themselves to get a toe hold in China – ????

          • Sweeper why would I use the methodology of those like Von Newman, Nash [pre diagnosis] and Mac McNamara – ????? – especially when the subject is so convoluted, with so many actors, even before one starts considering anything about labs – which are a drama even before covid.

            What has happened and important to note is this event has made people look harder at whats going on and even question engaging in certain activities, especially if ***profit only*** driven, and then the entire shape of the market along with critical Mfg and logistics to respond to massive fat tail events.

            But sure some people are more inclined to seek where to pin the proverbial tail whilst blindfolded because they feel[tm] that is the most burning issue at hand – one way or another ….

  4. MathiasMEMBER

    Huh… Sydney again… surprise surprise. Its like it was some kind of secret that Sydney was crime central of Australia.

    Man arrested trying to board flight to Dubai over $7 million in cash found under floor
    https://www.abc.net.au/news/2021-06-11/man-arrested-over-millions-in-cash-found-under-floor/100208588

    $7 million… wow. Thats a lot of money.

    Robodebt suicides. The answer’s obvious. They are too honest and dont deal enough drugs.

    Robodebt condemned as a ‘shameful chapter’ in withering assessment by federal court judge
    https://www.abc.net.au/news/2021-06-11/robodebt-condemned-by-federal-court-judge-as-shameful-chapter/100207674

    There you go boyz and girlz. If you want to get ahead in Australia, learn to deal drugs… because working for a living gets you nowhere.

  5. Diogenes the CynicMEMBER

    Ok have to go out with the in-laws to a Japanese restaurant. Need some solid intel what Japanese beer should I order with the food?

  6. Currently, my beer of choice is Asahi Super Dry Black. I have it on reasonable authority that kegs are filled with brew from Japan, while bottles may be made in Australia (Brisbane?). I have tried both, and I think that might be right, with on tap having a discernible edge. Either way, a glass of Asahi Black ain’t bad at all.

  7. Arthur Schopenhauer

    The Friendly Jordie’s got a pair.

    Bruz’s lawyer would be better off playing an unfazed straight bat, with good humor. No hope of neutralizing the Jordie’s antics with their current performance, IMHO.

  8. The Traveling Wilbur

    https://www.theguardian.com/australia-news/2021/jun/11/australian-researchers-discover-why-only-two-heads-of-echidna-pen1s-become-erect-at-one-time

    To open link, copy and paste link into browser and fix spelling of p e n i s. Spamfilter.

    Fenelon said the research was motivated by the behaviour of an echidna at the wildlife sanctuary, who had been observed alternating the use of his pen1le heads up to 10 times in a row.

    Fenelon noted similarities between echidnas and platypuses which have a two-headed pen1s covered with spines.

  9. “Individually rational and systemically irrational. And yes, when there is an upside/downside payoff asymmetry, it shouldn’t surprise that investors eventually incorporate this into their investment strategies. The problem of course is that the higher real-estate prices go, the more they distort the economy and the more urgent it is to get them to decline, but the more frightened the regulators are about the political and banking consequences of declining prices. Damned if you do and damned if you don’t, so do nothing.”

    Michael Pettis on China’s real estate bubble. Applicable to any real estate bubble.
    https://mobile.twitter.com/michaelxpettis
    His Twitter feed is a consistent source of insight and worthwhile comment.

  10. The G7 helped to build this low-tax world. Are they really ready to change it?
    Mark Blyth

    https://www.theguardian.com/commentisfree/2021/jun/11/g7-low-tax-finance-ministers-crack-down-avoidance

    The deals on the table look good as long as you don’t look too closely. That 15% rate applies only to firms that have profit margins above 10%. How easy is it for a firm to game its margins? Very easy. Moreover, words are cheap. Let’s remember that David Cameron pledged in 2010 that he would raise taxes on banks to pay for the financial crisis bailouts. That never happened. This time round, right after signing the G7 agreement, the chancellor, Rishi Sunak, sought exemptions for the City of London from the G7 taxes he had just signed up to. Meanwhile, Biden may never get the G7 agreement through Congress, and the EU will surely go back to “fiscal probity” through spending cuts rather than tax increases.

    Surveys show declining trust in governments everywhere, and a growing feeling that the economy is a rigged game. Both are not without justification. Governments took us down this low-tax rabbit hole, and they now promise to be the ones to dig us out of it. Given who funds their parties and their campaigns, I’m not holding my breath for any new Helmsleys to show up in the dock anytime soon.

    • I think that take is far too cynical.
      It is very hard to claim a low profit margin and maintain a high share price.
      Also, reality has set in. Cutting taxes in the G7 lead to a race to the bottom. It was never intended that tax cuts in the G7 would lead small GDP countries to try and out-compete on tax and steal tax residency. Biden is the real deal. He is a big believer in *tax* first then spend (anti-MMT). It is a great thing.

        • The Wizz of Ozz

          Are you sure the times they are a changing you must imbrace the service sector individually old mani smell money like taking candy from babes

        • Actually its the Democrats that wail about the budget far more than the republicans, they are Third Way, and tell the unwashed the ev’bal republicans made them do it … cuz bipartisanship ….

          Republicans on the other hand love spending MMT money on MIC, C-corps, anything that enriches the already wealthy whilst simultaneously under funding any social programs or government functions listed for privatization, cuz only individuals[tm] create wealth and as such are the best administrators of its distribution …

          Taxes LMMAO~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

      • I think Blyth’s take on it is not cynical, it’s a healthy skepticism when looking at how businesses operate and what’s been happening for the past few decades.

        Biden is definitely operating with intent. I’ve been impressed with his drive to push things through. If it works out he won’t get the credit he deserves. He seems to not care about PR the optics as much as most leaders. (That could just be due to following Trump.) I think he’s shaping up to be the most interesting US leader in my time (Clinton on).

        • Its mistaken to think the taxation issue is related to revenue for expenditure post facto … all developed sovereigns issue currency as tax credit full stop. The issue here is more about the race to the bottom and the incentives of capitalistic enterprise to bargain one state or nation against the other for the privilege of having them about eg. just like walmart did in America …

          PS read Michał Kalecki

  11. A week of Forex boringness… that inflation news made this week really really boring. As exciting as paint drying. Next week looks more fun, EURUSD short , NZDUSD short looks rather interesting ( avoids all the calendar news events ).

    Just gotta be cautious of the US Fed Interest Rate Decision on Wednesday. Consensus is Fed will hold but unless Im mistaken, an interest rate rise would empower the USD which in effect, just drives EURUSD down even further. Regardless of the outcome, EURUSD short has you trading ‘into the money’ so meh… either outcome seems win-win to me…

    Time to go practice my religious monk impersonations.

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