Global Macro


A bull’s view of the Russian crisis

Goldman with the note. My own view is we’ll have suffered a credit event and global recession long before much of the below happens. — 1. Russia’s invasion of Ukraine—and the Western response to it—will exacerbate the supply-demand imbalance that lies at the heart of the global inflation surge. Reducing trade with a current account


Back to the 70s with a bullet

FTAlphaville with the note. — The news around Russia’s invasion of Ukraine is moving fast. To the extent that almost any article that one starts becomes horribly out of date by the time it’s finished. But one thing that can’t be denied is the volatility in commodity prices at the moment. This Monday morning, Brent


War and assets prices

TS Lombard with a solid if a plodding note to help frame Ukraine’s impacts. I personally think that long-tail outcomes such as credit events and global recession are much more likely than this analysis suggests. — ⚫ We are more cautious owing to the exceptional geopolitical uncertainty ⚫ Risk asset valuations have adjusted but not


Professor: Sanctioning China over Taiwan war too costly

Readers will recall Profesor James Curran, the most persistent China apologist of 2020/21: He is anti-American. He is confused by Keatingesque fantasy and “China is inevitable” propaganda. Is happy to sell Aussie freedoms for a few yuan more. Having been wrong for several years now, and having learned nothing from Australia’s comprehensive victory over China


Vladimir Putin may have just prevented WWIII

We all owe Vladimir Putin a drink. Ukrainian suffering aside, he has delivered the world an enormous favour in his bumbling invasion. How so? First, this: China’s top government officials have issued orders to prioritize energy and commodities supply security, sparked by concerns over disruptions stemming from the Ukraine-Russia war. Government agencies, including the country’s


How Russia is losing the propaganda war

Is our Vlad in trouble at home? Russians are being bombarded with very effective Russian-language anti-war propaganda. We’re seeing a lot about Zelensky etc. but Russians are widely viewing some HUGE celebrities with big, big follower counts coming out against the war. — Dr. Ian Garner (@irgarner) February 28, 2022 Russians are seeing these narratives,


Australia faces increased competition for migrants

In late 2017, the Canadian Government launched a massive increase in the country’s immigration program, announcing that one million migrants would be let in over the following three years, with an annual migrant intake of 340,000 considered the “new normal”. Canada’s immigration minister, Ahmed Hussen, claimed the new targets would lift immigration to nearly 1%


Who’s exposed to Russian reserves?

Goldman with the note. — Q: What restrictions on reserves were announced and what is the impact? In a coordinated release on Saturday night, leaders of the European Commission, France, Germany, Italy, the United Kingdom, Canada, and the United States announced new economic restrictions on Russia. Japan has since announced that it will also stand


Playbook to defeat China takes shape in Ukraine

The media handwringing over Ukraine is understandable in an age of pervasive private reporting, but it doesn’t change the facts: Any notion that dialectal history is now headed towards some light on the hill is dead. Any notion that liberal democracy is the unwavering future of humanity is dead. Any notion that globalisation and choruses


Another Lehman weekend…

Morgan Stanley remains hawkish: An old chestnut in commodity markets is that “the cure for high prices is high prices.” Prices don’t rise in perpetuity because ultimately they reach a level of price tolerance, which is followed closely by a drop in demand. Demand destruction then exerts a gravitational pull on inflation. This process isn’t


What is SWIFT and why will it destroy Russia?

FTAlphaville with the note: — Vladimir Putin’s declaration of war on Ukraine has revived calls to kick Russia out of Swift. The measure is seen as among the most severe that the US, EU and UK could take. Denying Russian banks access to Swift is far from a given. It would, for instance, undermine Europe’s


Ukraine short- and long-term implications

Pantheon Economics with the note. We can’t read the warped mind of Vladimir Putin, so we have no hard view on the final outcome of Russia’s invasion of Ukraine, though it’s always good to remember the old—Prussian—adage that no military plan survives its first encounter with the enemy. Some of the economic consequences, however, are


Putin vows “denazification” of Ukraine, smashing markets

Russian President Vladimir Putin has given a speech ordering “a special operation in Donbas”: Russian state media is also confirming. “I have declared a special military operation,” Putin said. Fox News is reporting that Russian forces have entered Ukraine from Crimea. Putin announced the Russian military action to ‘demilitarize’ Ukraine.” And further he provocatively asserted:


Global anti-corruption alliance lambasts sly ScoMo

A global, US-based anti-corruption alliance has threatened that it could pull Australia’s membership following the Morrison Government’s failure to implement anti-corruption measures: The Australian government signed up to the Open Government Partnership in 2015, a 78-country multilateral initiative designed to promote open government, fight corruption and empower citizen participation in policymaking. But Australia’s efforts since


Never invest in China #5464: Olympics write-off

The only good thing I can say about it was that China got good flogging by Norway and the US beat them again: Not that anybody cared: Through Tuesday, according to The Associated Press, an average of 12.2 million watched the Olympics in primetime on NBC, cable, or its Peacock streaming service, a 42-percent dip


Ukraine crisis over before it begins?

As various hysterics, led by “Psycho” Morrison, fearmonger over Ukraine, I am wondering this morning if the crisis isn’t already past its peak. Russia has invaded a small slide of Eastern Ukraine to “liberate” Russian-speaking peoples. Russia-backed separatists currently control less than half of the Luhansk/Donetsk region. It’s not clear which areas have been recognised


Send Australia’s excess vaccine doses to developing nations

Australian surgeon Dr Andrew Browning has expressed concern about the two-speed global rollout of COVID-19 vaccines. He says that most people in developed countries like Australia are now receiving a booster shot, while many people in developing nations remain unvaccinated. This, in turn, is leaving Australia (and other developed nations) exposed to virus mutations: Never


Is Ukraine priced in?

Goldman with the note. — We are asked increasingly how much (Ukraine/Russia) geopolitical risk premium is now priced into a range of global assets. It is always difficult to be precise, but in order to answer this question, in this Daily, we proceed in two steps. First, we examine how global assets moved during sharp


Your Ukraine war FAQs answered

Nomura with the note: Q. What would an escalation in Ukraine mean for markets? A. We believe an invasion of Ukraine from Russia would lead to a negative response from the US (and allies), which would lead to, at a minimum, significant sanctions. In our view, the resulting impact of sanctions (with the risk of