The Situation Remains Fluid.

If you were looking for clarity on anything in terms of policy and/or geopolitics, today was most assuredly not your day.

See if you can divine anything that even approximates a coherent message from these soundbites from a presser Trump held on Monday afternoon with Mitch McConnell:

Again, if you can explain exactly what it is he was trying to communicate in all of that please do send us an e-mail, because we would love to hear someone attempt to tie all of it together.

 

Stocks held up fine because they’re stocks and stocks don’t fall. The Russell underperformed (again).

Stocks

USDJPY went nuts as machines and human beings battled it out to see who could make sense of conflicting headlines about North Korea which hit just as Trump was in mid-ramble and also as the wires were lighting up with news about Taylor and Yellen:

USDJPY

Treasurys were similarly choppy around the Taylor chatter, but ultimately it’s worth panning out for some context with the CPI miss on Friday:

Yields

Gold moved lower midday and the decline accelerated just as the Taylor headlines hit:

Gold

As far as the Fed goes, here are the latest betting odds:

Chair

Our money is still on dark horse candidate Krusty:

Krusty

Spanish stocks fell after Catalan President Carles Puigdemont basically refused to clarify whether he has or hasn’t declared independence. That means he’s got until Thursday to un-declare whatever it is he hasn’t declared or else Madrid will do something, although it’s not 100% clear what just yet.

IBEX

This is the third straight day of losses for Spanish equities.

Oil rose on jitters about the possible impact the conflict between Baghdad and Erbil could have on supply. We got a couple of assurances that flows won’t be meaningfully interrupted, but needless to say, there’s no way to know that for sure. U.S. officials sought to downplay the clashes between government forces and allied militias on one side and the Peshmerga on the other.

Oil

Trump said he’s not going to take a side, probably because he has no idea what a “Kurd” even is. “We don’t like the fact that they’re clashing,” he told reporters on Monday. He actually said that. “Chuck” gets it though:

PPI and CPI data out overnight continued to support the idea that China’s economy is holding up well although there are questions about how sustainable that will ultimately prove to be following the Party Congress.

ChinaPPI

“The economy has pretty strong momentum now, monetary policy remained loose ahead of the 19th Party Congress, and the environmental cleanup has cut the supply of commodities,” Shen Jianguang, chief Asia economist at Mizuho said, before cautioning that “this is not sustainable. Deleveraging will be moving up on the agenda after the congress.”

The Nikkei was up for an absurd 10th day in a row, as investors position ahead of Sunday’s election which isn’t expected to bring anything in the way of change that would adversely affect markets.

Nikkei

“People are looking for a reason why the Japanese equity market is so bullish but there isn’t one single reason, it’s lots of reasons all adding up,” Hong-Kong based Andrew Clarke, director of trading at Mirabaud Asia Ltd. said overnight, adding that “we are well on our way to 25,000 in six months time or less.”

This should go without saying, but this is just people making things up at this point. There’s no rhyme or reason to these predictions anymore. For whatever it’s worth, here’s some historical precedent for the Nikkei around elections:

NikkeiElection

Oh, and there’s a bull market in “BTFD” stories…

BTFD

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3 thoughts on “The Situation Remains Fluid.

  1. In the interview before the Rose Garden, his body language was interesting. Folded arms, defensive. I’m betting something was going on behind the scenes in regards to a military action in Iraq. The Rose Garden was a smoke screen -or- ‘Schaff’ deterrent from the media dissecting the first interview. #bestguess, #noclue.

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