Global Macro


Why China loves Trump

Via Bloomie: Donald Trump has argued frequently of late that China is rooting for Joe Biden come November’s U.S. presidential election. In Beijing, however, officials have come around to support four more years of Trump. Interviews with nine current and former Chinese officials point to a shift in sentiment in favor of the sitting president,


India disappears into virus

Via the excellent Damien Boey at Credit suisse: No reliable official Indian data for April or May. The Indian Ministry of Statistics & Programme Implementation (MSPI) has halted the official releases of industrial production (IP) and consumer price index (CPI) estimates, providing instead “quick” estimates of IP, and partial food CPI data. Specifically on the IP data, The MSPI has


OECD is not happy

Via the OECD: The lockdown measures brought in by most governments have succeeded in slowing the spread of the virus and in reducing the death toll but they have also frozen business activity in many sectors, widened inequality, disrupted education and undermined confidence in the future. As restrictions begin to be eased, the path to


Assessing the global recovery

Via Rabobank Coronavirus causes deepest economic crisis since the Great Depression Summary COVID-19 is expected to result in contraction of the global economy by 4.1% in 2020 This means that the corona crisis will be the deepest economic crisis since the Great Depression in the 1930s We expect a relatively limited recovery in 2021, as


UN: Smallest nations the world’s happiest

In another strong rebuke to the mass immigration ‘Big Australia’ cabal, the United Nations has released its World Happiness Report, which reveals that nations/cities with small populations are the world’s happiest: The 2020 report ranked 156 countries by how happy their citizens perceive themselves to be, based on their evaluations of their own lives… Since


Lies, damned lies, and PMIs

Via FTAlphaville comes a point I’ve been making repeatedly myself: The purchasing managers’ indices are among the world’s most closely watched economic indicators, moving markets and provoking policymakers to act. And with good reason. The polls — most of which are compiled by data firm IHS Markit — offer an early sign of how well,


AEP: No v-shaped recovery for the West

Via Ambrose Evans-Pritchard: The V-shaped recovery in East Asia is sadly no template for the blundering West. The near euphoric rally on global equity markets is based on a fundamental fallacy. Most of Europe and North America are not pursuing the policies that enabled China and the Pacific Rim – with big variations – to


Restaurants go extinct

Globally and for the foreseeable future. First it was China where eating out is still down one third nearly three months after reopening: Now the US looks, if anything, even worse, via The Economist: COVID-19 HAS infected every sector of the global economy. But perhaps none has been hit as hard as the restaurant industry.


Study: Employers use skilled visas to slash wages

The Economic Policy Institute has released research showing that the United States’ temporary skilled visa scheme (H1B) has been used by employers to undercut local workers’ wages. The analysis is based upon the Department of Labor’s Occupational Employment Statistics (OES) survey, which constructs a distribution of wages for each occupation in a specific geographic location. The


Gargantuan output gaps upon us

Via FTAlpahville: The output gap is a concept we got familiar with during the global financial crisis. But it’s time to revisit it, in some detail. One reason the measure often gets overlooked in mainstream headlines is because it doesn’t sound all that consequential. Yet it is. Arguably more so than ever. Encumbering its popularity,


Encouraging results for Remdesivir. Or not

From Gilead: Gilead Announces Results From Phase 3 Trial of Investigational Antiviral Remdesivir in Patients With Severe COVID-19 — Study Demonstrates Similar Efficacy with 5- and 10-Day Dosing Durations of Remdesivir — FOSTER CITY, Calif.–(BUSINESS WIRE)–Apr. 29, 2020– Gilead Sciences, Inc. (Nasdaq: GILD) today announced topline results from the open-label, Phase 3 SIMPLE trial evaluating 5-day and


Dr Doom: Global economy lost decade ahead

Via Nouriel Roubini: After the 2007-09 financial crisis, the imbalances and risks pervading the global economy were exacerbated by policy mistakes. So, rather than address the structural problems that the financial collapse and ensuing recession revealed, governments mostly kicked the can down the road, creating major downside risks that made another crisis inevitable. And now that it has


China industrial profits destroyed

Via China’s NBS: 1 – 3 months, the national scale industrial enterprises realized a total profit of 7814.5 billion yuan, fell 36.7% (on a comparable basis, see Note II), a decline of more than 1 – 2 narrowed in February 1.6 percent. 1 – 3 months, above-scale industrial enterprises, state-owned holding enterprises realized a total profit of 2226.7 billion yuan, fell 45.5% ; joint-stock enterprises realized a total


Ray Dalio on credit and history

Ray Dalio with another of titanic missives: Money, Credit, and Debt. Note: To make this an easier and shorter article to read, I tried to convey the most important points in simple language and bolded them, so you can get the gist of the whole thing in just a few minutes by focusing on what’s in bold.


South Korean exports tank

One of those bellwether indicators for global demand: I have been wondering how the North Asian electronics supply chain has been holding up. A few visits to my local Officeworks has shown shelves cleared of items for a home office build-out. This may have provided some support for the global tech supply chain of which


Credit Suisse: Financial crisis over

Via Zoltan Pozsar at Credit Suisse: The Fed’s liquidity injections are working. Global dollar funding conditions have eased, and U.S. dollar Libor-OIS spreads started to tighten. We don’t think that lower prices on the CPFF or the MMLF are necessary for Libor-OIS to tighten more – other factors can tighten it further. First, positive Libor-Libor


Too bullish IMF measures depressionary shock

Via the IMF: The world has changed dramatically in the three months since our last update of the World Economic Outlook in January. A rare disaster, a coronavirus pandemic, has resulted in a tragically large number of human lives being lost. As countries implement necessary quarantines and social distancing practices to contain the pandemic, the world has been


Is the WHO China’s puppet?

The United States has threatened to pull its funding from the World Health Organization (WHO), claiming that it has been badly corrupted by China. This view has been backed up by Stanford University’s Lanhee J. Chen: The World Health Organization isn’t just “China centric,” as President Trump called it on Tuesday. It is also broken