Stanley Druckenmiller slams Janet Yellen for ‘biggest blunder in Treasury history’: Failing to lock in rock-bottom interest rates
GM is slowing EV production amid labor strikes and “evolving” demand. The automaker says it will save $1.5 billion next year by punting production to 2025
Panasonic reduces production of electric vehicle batteries
BoJ raised inflation forecasts for the next 3years and kept policy pretty much unchanged, slight tweak, which is a little strange..JGB's continue lower 95bps, JPY still weak, 'flexible cap at 1%'', so it's not a cap really..!
Ueda: Don't think long-term rates will come under pressure to exceed 1%, looks like the market will test them
Citi argues if fiscal sustainability becomes a priority..higher corp taxes may become more palatable than spending cuts. .. The effective tax rate for the S&P 500 hovered around ~35% through the 1990’s. The average .. following the 2017 tax cuts was dropped to about 19% ..”
JPMORGAN: “.. excess household liquidity (cash-equivalent assets) has fallen from peak of $3.4T to $1.0T and should largely be exhausted by 2Q24. Importantly, even as of 2Q23, nearly all the inflation-adjusted excess cash sits with the relatively affluent (top 20%).” [Dubravko]
IMF : China's property sector crisis could intensify, posing a complex policy challenge. If property prices fall too rapidly, bank and household balance sheets will deteriorate, with potentially severe financial consequences
German inflation data pretty soft yesterday and economy shrinks slightly in Q3, increasing pricing/expectations that ECB could cut as early as March 2024
Markets :
SPX500 : while we remain below 200dma around 4235, markets will not feel the urge to buy and reduce risk on rallies, negative gamma below 4100 kicks in as well
USDJPY testing BoJ again, JGB's are lower (95bps 10y) and JPY is lower too, which is slightly puzzling, although all yields are rising again
Crude pretty steady still
Credit, a lot more being written about it these days, warnings coming through thick and fast, as 'high for longer' is going to impact many weak balance-sheets going forward into 2024 and 2025