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PVM BITs | State of the Union 2019

Updated: Apr 18, 2019



  • UK is still going round in circles over Brexit - UK’s Int Trade Secretary Liam Fox has so far flown over 400k miles - the equivalent of 16 times around the globe - and still hasn't delivered a single trade deal (said 18months ago it was going to be the easiest thing to do..). Promises of a so-called 'Global Britain' is shown to be nothing more than an empty slogan….. Hard Brexiteer Tories say only acceptable way forward is to remove backstop -- MP Steve Baker says ‘Malthouse compromise’ not May’s proposal will win ERG’s support....British call to scrap Irish backstop deal is unreasonable wishful thinking: Irish FM Coveney....yups, get on with it ! compromise…and just when you thought it couldn't get any more fraught - Lord Trimble plans to take govt to court over the Brexit deal claiming the Irish protocol inc the backstop contravenes the Good Friday agreement…and anyway HMRC has decided to wave EU goods through in a No Deal - to keep trade moving. No checks at 20 ports. Will last for a "temporary" period

  • November US factory orders -0.6% vs +0.3% expected, ISM Prices Paid by Business went into freefall in January (chart)

  • NYT - Schumer and Sanders: Limit Corporate Stock Buybacks…"Some may argue that if Congress limits stock buybacks, corporations could shift to issuing larger dividends. This is a valid concern — and we should also seriously consider policies to limit the payout of dividends, perhaps through the tax code."

  • U.S. rates : futures markets are pricing 83.5% chance that the Fed leaves its policy interest rate unchanged at 2.25-2.50% throughout the year. Odds for a 25bps hike has increased from 1.9% to 5.8%, while a 25bps cut has fallen from 21.0% to 10.4% over the last 3/4 days..

  • Two years into Donald Trump’s presidency, the man who has profited most from the era is his foremost nemesis in the business world (chart)

  • Crypto trader boss dies with password to clients' £110mAustralia services PMI for January falls to 44.3 from previous 52.1 – RBA unchGOOGL CapEx up 80% from $3.8BN in Q4 2017 to $6.8BN…tax cut working?..

  • Grim news for the economy of France from the Markit PMI this morning. "“January data pointed to an even faster decline in service sector activity than in protest-hit December.Output fell at the quickest pace since February 2014, "

Markets : ….risk helped by lower vols/VIX..as long as FED remains patient…decent growth, decent wage growth, low inflation, goldilocks, till FED changes it’s tune..

  • HYG – credit spreads narrowing, EMG rallying, BoAML FM survey showed U.S. credit investors turned bullish credit spreads for the next 3months (..that’s the reaction from 4th Jan Powell ‘patient’ speech..), HYG saw largest weekly inflow in 2 years (chart), as long as the FED stays ‘patient’…

  • VIX – on lows, the VVIX (vol of vol) is at lowest since July 2017

  • Equity markets still grinding higher (low vols, FED patient etc)

  • WTI trying again $55+USD mixed to slightly higher, CHF and JPY soft, more around ‘risk-on’ on low vols, carry



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