Via The Guardian: White House chief strategist Steve Bannon has given an unusual interview in which he claimed there was no military solution for North Korea, the far right was a “collection of clowns” and the left’s focus on racism would allow him to “crush the Democrats”. Bannon, who has been called the mastermind behind Donald Trump’s nationalist
As said this morning, the Fed hedged dovish minutes today with this: This overall assessment incorporated the staff’s judgment that, since the April assessment, vulnerabilities associated with asset valuation pressures had edged up from notable to elevated, as asset prices remained high or climbed further, risk spreads narrowed, and expected and actual volatility remained muted in
The DXY reversed last night as Fed minutes came in dovish: The Aussie dollar roared: But fell against other EMs: Gold took off: Brent fell: But base metals went nuts (as did iron ore): Big miners followed: And EM stocks: High yield firmed: US yields fell: European too: European stocks bounced, US a little: DXY
From the NYT: President Trump’s main council of top corporate leaders disbanded on Wednesday following the president’s controversial remarks in which he equated white nationalist hate groups with the protesters opposing them. Soon after, the president announced on Twitter that he would end his executive councils, rather than put “pressure” on executives. The quick sequence
Via the Fed: The July jobs report from the U.S. Bureau of Labor Statistics brought welcome news on wage growth: Median weekly earnings rose 4.2% on an annual basis, the fastest pace seen since 2007. The underlying story about wage growth may be even better than the headline number suggests, according to updated work by
The memory-free Australian press likes to couch Donald Trump as a random mad man taking America down untrodden paths to disaster. In truth he is something more complex and less easily judged for the dependent ally. Leaders do not spring from holes in the ground. They are their political culture, parties and people manifest. Through
By Leith van Onselen Left-leaning magazine, Vanity Fair, has published a well-argued article laying the Democratic (left) case for restricting immigration into the United States: With stricter border enforcement, employers would immediately start to feel a reduction of available labor, as is already happening… With the share of low-skill workers becoming smaller, many sorts of
by Chris Becker The most important economic event on the calendar came and went on Friday night, the US monthly employment data print, or “nonfarm payroll” or NFP. It was a good print, coming in slightly over expectations, but didn’t fire up stocks nor bonds after the release. Here’s the sticky from the BLS via Calculated Risk:
by Chris Becker Is the civil war in the White House – bigger than the first one back in 1860 according to Trump – over with the dumping of freshly minted mini-me Anthony Scaramucchi? Was The Mooch sacrificed for the greater good by incoming Chief of Staff John Kelly? Does anyone want to work at
by Chris Becker Friday night saw the release of the much anticipated second quarter US GDP print with the Bureau of Economic Analysis (BEA) reporting 0.6% growth, or 2.6% annualised. While this was much better than the first quarter, and only slightly below expectations, the so-called acceleration is seasonal and does not represent a new
Via Citi: Balance sheet reductions and tapering Since 2008, central bank balance sheets across advanced economies (AEs) have expanded dramatically (e.g. Fed balance sheet went from 6% of GDP in 2007 to around 25% of GDP in 2015 and the ECB balance sheet went from 13% of GDP in 2007 to around 38% currently) and
Via Westpac: In recent months, uncertainty over the outlook for US inflation has grown. From a peak of 2.8%yr in February, headline CPI inflation abruptly fell back to 1.6%yr in June. Similarly core inflation (which excludes the impact of food and energy) slowed from 2.3%yr in January to 1.7%yr. Albeit only available to May, the
From The Hill: Rep. Brad Sherman (D-Calif.) formally introduced an article of impeachment against President Trump on Wednesday that accuses the president of obstructing justice during the federal investigation of Russia’s 2016 election interference. This is the first time a lawmaker has offered an impeachment article against Trump, and it comes as Democrats have debated whether it is
Via Politico: President Donald Trump is increasingly unlikely to nominate Federal Reserve Chair Janet Yellen next year for a second term, four people close to the process said. National Economic Council Director Gary Cohn is now the leading candidate to succeed Yellen as the world’s most important central banker, these people said. Yellen begins two
Via Citi: Today’s release of a series of emails by Donald Trump Jr., President Trump’s son, and the subsequent reaction by financial markets and in the news media has again highlighted one of this year’s key political risks: concerns about durability of the Trump Administration, and its ability to pass the pro-business legislative agenda that
Following a sharp selloff of US tech shares, concerns about a NASDAQ bubble 2.0 are climbing. Via Societe Generale: The sell-offs themselves are not particularly unusual, but the uniformity of the prices moves all on the same day indicates a market driven by price chasing momentum, with investors heading for the door all at the
The Aussie dollar took off Friday night against the USD and firmed against EUR: It also rose against most EMs: Gold broke out: Brent broke down: Base metals were mixed: Big miners were flat: Em stocks hit new highs: US high yield is firming as EM stalls: The US yield curve was crushed: European spreads
Via Deutsche: Summary The common wisdom is that Fed tightening combined with tapering could lead to greater volatility. The reality is far more complex, it is more like a driver shifting gear to adjust his deceleration as he coasts to the red light. If he doesn’t he might just have to hit the brakes hard.
Got the lurgy today so limited posting. Fed minutes were out last night: …Importantly, PCE growth was expected to pick up to a stronger pace in the spring, which would be more consistent with ongoing gains in employment, real disposable personal income, and households’ net worth. …Members generally judged that it would be prudent to
By Leith van Onselen VOX has produced an interesting study on the US health system where, despite spending by far the most in the world, health outcomes are poor by developed world standards, partly due to the overuse of expensive low-quality drugs: Abstract: Despite higher per capita healthcare spending, US health outcomes compare poorly with
Citi says it’s all a storm in teacup: A report from the New York Times citing a memo alleging that President Trump asked former FBI Director Comey to end an investigation into Russian links has roiled markets. Concerns about Congressional reviews, potential special prosecutors and a deeper inquiry into the allegations could paralyze the
New York Times: President Trump asked the F.B.I. director, James B. Comey, to shut down the federal investigation into Mr. Trump’s former national security adviser, Michael T. Flynn, in an Oval Office meeting in February, according to a memo Mr. Comey wrote shortly after the meeting. “I hope you can let this go,” the president
DXY broke support and sank Friday night. Euro soared: Commodity currencies mostly rose a bit: Gold held on: Brent roared back: Base metals had a muted bounce: Big miners benefited from short covering: EM stocks bounced: High yield is fine: US bonds were sold but the curve flattened: European spreads tanked a Marine Le Pen
Cross-posted from Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for April. The consensus, according to Bloomberg, is for an increase of 185,000 non-farm payroll jobs in April (with a range of estimates between 150,000 to 225,000), and for the unemployment rate to increase to 4.6%. The BLS
I generally take Ambrose Evans-Pritchard with a grain of salt but this can’t be ignored: Global recession risk rises as the US and China tighten into the storm Equity investors across the world are positioned for the nirvana of synchronised and accelerating global expansion led by China and the US. What they may instead get
