Global Macro


Kyle Bass on wrong currency short as Chinese debt “metastasises”

From Kyle Bass today via Reuters: Hayman Capital Management founder Kyle Bass on Thursday said he remains short the Chinese yuan despite the country’s latest change to the guidance rate, because he believes credit bubble problems are “metastasizing.” “What the public narrative is and what they have been doing behind the scenes are two completely


Macquarie on a world without wages

Brace yourself, the following is not happy reading. About working horses & people ‘There was a type of employee at the beginning of the industrial revolution whose job and livelihood largely vanished in the early 20th century. This was the horse. The population of working horses actually peaked long after the industrial revolution… there was


Fed hikes, oil crashes, Australian dollar roars!

Things are heating up. The Australian dollar roared against USD and EUR: As well as commodity currencies: This despite gold getting thumped: And oil crashing: Copper falling: And big miners getting pulverised: EM stocks were stable: Bizarrely, US high yield rose as oil crashed. EMHY was not so lucky: US bonds were sold and the


Poor old Japan: Low unemployment, less crowded, cheaper housing

By Leith van Onselen For more than a decade, the Productivity Commission has debunked the common myth that immigration can overcome population ageing. For example: PC (2005): “Despite popular thinking to the contrary, immigration policy is also not a feasible countermeasure [to an ageing population]. It affects population numbers more than the age structure”. PC


The perfect storm for stocks

The AUD was strong against developed market currencies last night: And emerging: Gold was firm: Brent weak: Base metals weak: Big miners weak: EM stocks stable: High yield bogged down with oil: US bonds sold: European spreads were stable: And stocks eased: Deutsche takes a useful look at where global markets are poised: …[it] seems


The seven black swans

DXY is still weak, EUR strong and CNY, whoa, is suddenly breaking upwards: Commodity currencies were generally weak: Gold is threatening higher: Brent is threatening lower: Base metals are still trending down: As are big miners: EM stocks were spanked: US high yield is ignoring oil, the EM plod goes on: US bonds were bid


Weekend Links 27-28 May, 2017

Surrealist Landscape, Peter Purves Smith, 1938, National Gallery of Victoria   China Regulator urges China banks to save ailing companies – The Boosterism Behind China’s Silk Road Story– Bloomberg China’s Addiction to Debt Now Threatens Its Growth – NY Times PBOC plans to adjust yuan fixing methodology as Fed interest rate rise looms –


Bitcoin: Ponzi gone global

I haven’t written on bitcoin for a while despite it going nuts: The reason is very straight forward. This is a global ponzi scheme and that’s the end of it. As a super-national currency, the only appropriate comparison with bitcoin is gold or other hard assets that hold their value when sovereign paper money does


Fed repriced on fading US inflation

Except DXY which keeps breaking lower as Fed expectations reset. Euro hit new highs: Commodity currencies rallied: Gold too: Brent softened: Base metals rose: Big miners too: EM stocks a little: US high yield joined in, EM not so much: US bonds were flat: EU spreads closed: US and EU stocks lifted: And the bonus


UK Tories’ immigration reform a good model for Australia

By Leith van Onselen Over the past 20 years, net overseas migration into the UK has surged from below 100,000 to around 300,000 people annually: Much like in Australia, this surge in immigration has created all manner of problems for the incumbent UK population, including massively expensive housing (especially in London, where most migrants go),


Buy the f’n impeachment!

DXY rose overnight: Commodity currencies fell. BRL was poll-axed on political strife: Gold eased: Brent firmed: Base metals still look weak: Big miners were mixed: EM stocks were poll-axed by Brazil: High yield plods on: US bonds were sold a little: European spreads widened: US stocks were bid while European eased earlier: Buy the f’n


Markets impeached

DXY was hammered last night as euro and the yen soared: Commodity currencies were mostly weak: Gold soared: Oil rose too: Base metals were mixed: Big miners hit: EM stocks pounded: High yield too: US bonds were bid big: European stocks pulled back, US were hit hard: Markets impeached! Via the FT: Impeachment is not


Push now on for TPP 2.0

By Leith van Onselen The Turnbull Government’s hopes of resurrecting the Trans-Pacific Partnership (TPP) trade deal have received a boost, with member nations meeting in Vietnam this weekend to discuss a way forward without the US. From The Australian: Since President Donald Trump withdrew the US from the deal Japan has shown signs it would


Rotation to Europe soars

DXY is sinking and the euro soaring: Commodity currencies lifted: Gold too: Brent softened: Base metals were mixed: Big miners flew: EM stocks too:  But not high yield: US bonds were sold: European spreads tightened: US stocks fell a bit and Europe broke out big: The MB Fund rotation to Europe is powering. It appears