It’s Quiet Out There: G-20 Leaves Markets Feeling “Damp And Grey”

It feels quiet out there. Maybe a little too quiet. There’s plenty of G-20 banter about the US/Trump having “won” at the weekend gathering in Germany. In this context, “winning” means successfully getting the “resist all forms of protectionism” language removed from the communique. Remember, in Trump/Navarro make-believe land, free trade is a bad thing, so telling everyone…

“I’d Tax Every Benz,” “It’s A Corpse That Still Moves”: Are You Getting The Truth On Trade?

“At the same time, tariffs would weigh on US growth. If we assume that Mexico and China retaliate with equivalent tariffs, this would substantially reduce demand for US exports, depressing US GDP by around 0.7pp by 2019. In fact, tariffs would likely hit US GDP so sharply that the Federal Reserve would be prompted to reduce interest rates to cushion the blow—despite an increase in inflation.”

“Run-For-Your-Life Affair” Continues In France, Fed’s Mester Hints At Hikes, US Vacations

“This weekend was an all-out, run-for-your-life affair.” That’s from Yves-Marie Cann, head of political studies at pollster Elabe, and it underscores just how smoothy things are going in France. That’s called sarcasm. I told you on Sunday that things were looking more tumultuous than ever on the French political scene, and that assessment has been underscored…

Markets Relieved After Trump/Abe Meeting, Reflation Narrative Intact

Well, it was all aboard the reflation train right out of the gate in early Asian trading last night with USDJPY jumping with 10Y yields and futs, following what counts as a “successful” high level summit these days. As I noted last week, the fact that Trump didn’t physically assault Japanese PM Shinzo Abe (well,…

Daily Kickstart (Chinese FX Reserves Fall Below $3 Trillion, Euro On The Back Foot, Senate Weighs Risk Of School Grizzly Attacks)

The “big” news overnight should have been Chinese FX reserves just like China should be back in the global spotlight more generally as it becomes increasingly apparent that the PBoC is leaning towards financial stability at the possible expense of growth (i.e. they’re in tightening mode). Overnight we learned that Beijing’s FX reserves fell below the magic $3…