The new quarterly JPMcollar is 'short 3410SPXput, and long 4'050/4500 SPX500 call spread >>> This collar while not intended to be directional (it's a hedge vs ETF's etc)... is not particularly bullish at all... with an expected upside cap of 4500 SPX by EOY... that is not even making it back to the high of year... Week ahead : no U.S government shut-down, we get to all get exited about it all again in 45 days...UAM strike is giving ideas to others : More than 75,00 union healthcare workers at Kaiser Permanente say they will strike on Wednesday if a new contract is not reached. The existing contract expired on Saturday. The union says if the strike happens, it will be the largest strike of healthcare workers in U.S. history, with picket lines in California, Oregon, Washington, Colorado, Virginia and Washington D.C. >> risk is there will be more of them, once some get big pay rise, others will fenzy theri chances... >>< NFP on Friday, Lagarde, Powell, RBA, RBNZ meetings and we go into Q4 with earning season upon us, will AI confirm ? will bond yields, inflation worry investors on those hefty valuations ? >>> big profit growth priced/expected for megacaps, but with higher yields, risk of further discount to be priced in Last Friday : 12-month core PCE inflation declined across all three buckets in August (goods, housing, non-housing services), but most notably in goods / Thread MS : The technicals and breadth (e.g., equal versus cap weight performance) for Consumer Discretionary stocks look particularly challenge d. We believe this price action reflects slower consumer spending trends, student loan payments resuming, rising delinquencies in certain household cohorts, higher gas prices, and weakening data in the housing sector. Our economists, who wisely avoided making the recession call earlier this year, see a weakening consumer spending backdrop. They forecast negative real PCE growth in 4Q and a muted recovery thereafter. While travel & leisure has been a bright spot for consumption, that dynamic may now be changing, according to our survey work B of A: “.. 520 central bank rate hikes past 24 months likely ain’t finished breaking stuff .. stay bearish/defensive & sell the last hike.” [Hartnett] FDIC quarterly banking report on bank losses for 3Q due in around 55 days (so by end Nov), unrealized HTM+AFS losses will be pretty ugly >>> U.S. Banks are facing roughly $600 billion of unrealized losses which accounts for roughly 25% of total banking capital, near the highest levels in history Fed’s Williams says interest rates ‘at, or near peak.’ But they won’t be coming down soon >>> The first FED cut is currently priced for August 2024 (top panel), or 337 days away/Thread - And finally, you don't often see those kind of news : “A female sea lion, known as Sally, escaped from her enclosure at the Central Park Zoo briefly on Friday, swimming out of the pool where she is kept when the heavy rains lashing New York City flooded the zoo grounds.” Equity markets look to be opening up slightly, by about 0.5% Top 5 things to watch in markets in the week ahead (yahoo.com) Congress avoids government shutdown but US could face another in 45 days. What that could mean for Florida - CBS Miami (cbsnews.com) Fed’s Williams says interest rates ‘at, or near peak.’ But they won’t be coming down soon. (msn.com) Moody’s warns of ‘systemic risk’ from leveraged lending market | Financial Times (ft.com) Jim Bianco on X: "1/2 When will the Fed start cutting rates? This chart is derived from market pricing. The first cut is currently priced for August 2024 (top panel), or 337 days away (bottom panel). https://t.co/t2tvvkf91o" / X (twitter.com) Holger Zschaepitz on X: "Stress in the financial system is rising: The value of global bonds dropped another $428bn this week as the interest rate world keeps repricing for a higher for longer. In past quarter, bonds lost ~$1.8tn in value and everyone is puzzling over who has the losses on their books. https://t.co/fDk8AO7875" / X (twitter.com) Artificial intelligence technology behind ChatGPT was built in Iowa — with a lot of water (cnbc.com) Nick Timiraos on X: "12-month core PCE inflation declined across all three buckets in August (goods, housing, nonhousing services), but most notably in goods Core goods: +0.5% Housing: +7.4% Core services ex-housing: +4.4% https://t.co/6LWHxrKNHE" / X (twitter.com) Top financial regulator seeks global clampdown on hedge fund borrowing | Financial Times (ft.com) should have thought about that a LONG time ago.. have a great start to the week Team PVM

Iconic Sycamore Gap tree at Hadrian's Wall cut down by 'vandals' All topped out short-term on the last fixings yesterday... rates-duration, USD, crude and Equity market found some buyers into 'those'..slightly oversold levels, pretty classic price action into quarter-end...moves 'faded' on last fixings...after such strong moves last few sessions... NOW, a mixture of risk with US core PCE ahead this afternoon (most important), UAW strikes and possible govt shutdown The UAW wants to emerge from its strike against Ford, GM and Stellantis with at least a 30% pay raise. At that level (lower than initial 40% demand), the union believes will satisfy members and organize non-union plants. That includes a cost-of-living allowance and a wage increase Fed's Goolsbee's remarks yesterday were relatively dovish . He cautioned against 'policy overshooting' while highlighting the way forward to achieve the Fed's mandate Taiwan reveals first domestically made submarine in defense milestone Swiss KOF Leading Indicator Sep: 95.9 much better than expected 90.5 Britain's economic performance since the start of the COVID-19 pandemic has been stronger than previously thought, with faster growth than Germany or France, according to revisions to official data released on Friday, good news! Italy's 10y risk spread over Germany rose to over 2OObps, for the 1st time since March with Italy 10y yield on course to 5%, definitely one to watch for in Q4 (credit etc) Dutch headline CPI fell 0.3% from a year ago >> read this carefully, negative dutch inflation, German inflation softened a little more than expected , Sep CPI 4.5% from 6.1% in Aug, The Bundesbank data confirms that German core inflation slowed markedly in Sep to around 2% MoM annualized, this was the lowest in 2 years and due to an outright fall in core goods prices, the first in 30 months, looks real, good signs. Eurozone inflation hits two-year low U.S 30Y mortgage: 7.83% >> make it stop! Nvidia Linked to Dawn Raid by French Competition Regulator, French agency announced the move on its website Wednesday The bests of Charlie Munger - 5mins video (see below) priceless The Fed’s ability to influence the economy depends on whether “people understand what we are saying,” Chair Jerome Powell said, highlighting the importance of work done by economic educators Markets : As mentioned yesterday, markets got a little too bearish (short-term positioning) and got to key support levels in NASDAQ 14500 area, SPX500 4230 (less than 1pct of 200dma) and the month-end flows are probably mostly out of the way by now...>>>> same price action on USD and duration/USTyields which seem to have done 'enough' for now near 4.5-4.6% in 10's, equities (big 7's in particular) don't mind steeper curves SPX500 still on trend, just about, chart below, as long as 200dma holds nearer to 4210, markets will feel nothing has changed, same NASDAQ 1450 Aug lows levels USdollar topped out into quarter-end fixes... : 0.9200CHF, 1.0500 EURO, 1.2150 GBP, 1.3500CAD and 0.6400 AUD. USDJPY nearer to 150JPY also has 'fears of intervention' to potentially put a top there - early days though! Crude : similar price action >>> prices so key for Q4, inflation and all, crude above $100 on a sustained basis is not good for growth globally either UST10's same price action hit a 4.66 or so yesterday, backing off about 10bps again overnight, always hope that 'we are getting there'' finally.. >>>> HOWEVER, estimate of US Treasury ballooning borrowing requirements for 2024FY to go even higher, this IS the big worry still going forward: supply (a known known but the supply is on the increase still) Explainer: US government shutdown nearing, its impact, what next | Mint (livemint.com) Powell Says Public’s Understanding Key to Fed Impact on Economy (yahoo.com) Austan Goolsbee on X: "“Inflation still needs to come down. But we also can’t lose sight of the fact that the Fed has the chance to achieve something quite rare in the history of central banks—to defeat inflation without tanking the economy." @PIIE: https://t.co/KYyfav10oO https://t.co/i2kdX2YuXn https://t.co/S4XPCDyFq3" / X (twitter.com) USD picture fairly similar in few pairs ... here is an example : AUD/USD survives another "death trap" this week | Forexlive Yen intervention a hard sell even as 150/dlr 'red line' beckons | Reuters What went right this week: ‘spectacular’ renewables boom keeps 1.5C in sight - Positive News - Positive News UK economy performed stronger than expected in first quarter (cityam.com) which is it ?.. Welcome to Britain – where nothing works except the metaphors of decline | Evening Standard Sunak expected to limit powers of councils in England to curb car use | Transport policy | The Guardian Sycamore Gap tree at Hadrian's Wall cut down by 'vandals' - BBC News iconic tree gone, why why why... pathetic Taiwan reveals first domestically made submarine in defense milestone - The Korea Times US quietly acknowledges Iran satellite successfully reached orbit as tensions remain high | AP News Coinbase CEO Brian Armstrong: 'Ditch your JPMorgan Chase accounts' - CityAM Nope! nothing wrong with a bit of diversification though Apple's iPhone 15 Pro Draws Overheating Complaints (businessinsider.com) Taxpayers Stuck Paying the Bills for Oligarchs’ Seized Yachts and Mansions - WSJ Ray Dalio says the U.S. is going to have a debt crisis (cnbc.com) Nvidia French Offices Raided by Antitrust Authority, WSJ Says - Bloomberg Dividend Growth Investor on X: "The Best of Charlie Munger https://t.co/rEfYK5CYbn" / X (twitter.com) Charlie Munger and some of the best of his wisdom words ! priceless, gret 5 minutes I promise SPX500

Yields on 10's UST closed on new post 2007 highs yesterday, WTI closed at the highest level for over 12mos and the euro looks to be breaking through 1.0500 - key long-term level >>> ALL about credit now, ( the like sof #JNK #HYG ) which is beginning to move, perhaps the surprise is how well behave they have been so far...relatively speaking, so beware, this IS key for Q4 Tesla CEO Elon Musk Slams Biden For Supporting UAW Demands: 'Sure Way To Drive GM, Ford And Chrysler Bankrupt' >>> suspect Elon fears that his work force calls him out with big wage increase too... Petrobras is recruiting Chinese banks to finance its deepwater oil expansion in a sign of growing ties between Brazil’s state-controlled oil company and the world’s second-biggest economy The US Department of Justice escalates a probe into Credit Suisse and UBS over suspected failures that allowed Russian clients to evade sanctions Fed's Kashkari confirmed his hawkish stance , in terms of the dot plot, reiterating his views from his essay from Monday, his base case seems to be one more hike later this year (5.625% for 2023) and no rate cuts in 2024 (5.625% for 2024) . That means Kashkari's 2024 dot was the second highest. Fed's Bowman's rate expectation appeared to be the most hawkish on the Committee based on recent speech China Evergrande has suspended trading on its shares as well as the shares of its other units listed in Hong Kong. This is occurring in the midst of continued debt troubles and reported police surveillance of its chairman Costco is selling gold bars : CEO said "I've gotten a couple of calls that people have seen online that we've been selling gold - 1 ounce gold bars, yes, and when we load them on the site, they're typically gone within a few hours and we limit two per member." The WGA is calling its new deal "exceptional ." Here's why. Hollywood writers have secured a better deal on pay, AI, and residuals JPMORGAN: “.. we are not saying that the situation now is the same as in 2007-2008 .. But signs of stress are beginning to appear. .. lags are longer this time, which has resulted in complacency and broad acceptance of the soft landing, or even no-landing, thesis ..” (Kalonovic - he may get his day, though he's always been bearish) Percentage of credit card and auto loan balances transitioning to serious delinquency have surpassed pre-pandemic levels/Fitch Nikki Haley unveils economic proposal while slamming both parties over government spending >>> ''If Congress doesn’t pass a budget, they shouldn’t get paid. No budget, no pay'' Markets : Leverage and higher interest rates don't mix well Bond markets : beginning to look like the biggest sell-off in history..certainly the pace of it >>> which may well have been exaggerated with quarter-end flows and since FOMC reset (+50bps in 2024) and markets giving up and accepting the 'high for longer' which we've talked about for over 6months >>> we may well go to 5% in 10's UST, but proceed cautiously from here, take some profits, if you followed the advice and went short bonds, steeper play etc.. USDollar stayed firm on yields diff, and got another BID tone into quarter-end, similar story, well flagged , we may correct a little softer into October, but the differential remain the same, BoJ will eventually capitulate, but again market need to perhaps challenge them 150JPY+ first, USDCHF has doen some very good work after the 'SNB hold', woul dnot be shocked if we go towards 1.0000 now though >>> tough to be short usd, it's very expensive.. Crude rallied 2-3pct again y'day!, WTI 95$, reaching the levels we talked about 3months ago ...now the whole street is getting pretty bullish, staying with it, key whether Saudi were to increase prod >>> Oil is back to where it was a year ago but the US SPR now has 250MM fewer barrels of emergency oil Equity markets : we reached Aug lows on QQQ and bounced yesterday off those levels, reaching slightly oversold levels in SPX500 and Nasdaq (most oversold since Nov 2002 - but let's face it we hardly moved last 3-6months, so we got very easily into oversold level..), SPX500 200dma is around 4200, is the first big line of support for going into Q4 Many pointing out still that the equal weighted S&P500 is now flat for the year, while the big '7' are up about 80% BTP-Bund spread approaching uncomfortable levels again (credit..) Overall, we remain cautious on macro side, as higher rates are definitely biting, lag effects, slowly hitting home Carl Quintanilla on X: "JPMORGAN: “.. we are not saying that the situation now is the same as in 2007-2008 .. But signs of stress are beginning to appear. .. lags are longer this time, which has resulted in complacency and broad acceptance of the soft landing, or even no-landing, thesis ..” [Kolanovic] https://t.co/4M9JQ7ORgJ" / X (twitter.com) Tesla CEO Elon Musk Slams Biden For Supporting UAW Demands: 'Sure Way To Drive GM, Ford And Chrysler Bankrupt' - Stellantis (NYSE:STLA), Tesla (NASDAQ:TSLA), Ford Motor (NYSE:F), General Motors (NYSE:GM) - Benzinga U.S got its manufacturing back, and now it also has the Unions that are back in a position of force, asking for big wage increases, can't blame them, but this will complicate things, we had 3 to 4 decades of globalization and manufacturing in China, with the West hunting for the cheapest labor forces, it's all but over..., onshoring is great and welcome, but it comes at a higher price... Nikki Haley unveils economic proposal while slamming both parties over government spending (msn.com) Petrobras Taps Chinese Banks to Finance Deepwater Oil Expansion (yahoo.com) UBS, Credit Suisse Face Growing Probe over Alleged Russian Sanctions Evasion - Bloomberg Binance, the World’s Biggest Crypto Firm, Is Melting Down - WSJ Not a good sing when top execs leave tha firm Winklevoss twins secretly withdrew $282M in Gemini assets before Genesis collapse: sources (nypost.com) Donald Trump may no longer be able to do business in New York (qz.com) Allegedly , if nominated, he could even govern from prison...if we get there, certainly the journey to next election will be lively! Greece to tap into undocumented migrants to curb labour squeeze (yahoo.com) Evergrande and Subsidiaries Suspend Trading (finews.asia) Costco is selling gold bars and they are selling out within hours (cnbc.com) More Brits forecast to turn to gold and silver for wealth creation (thearmchairtrader.com) Here’s what to know about the WGA’s new deal with Hollywood studios (qz.com) Hotel rates in New York City likely to go up with Airbnb rentals gone (cnbc.com) US steps up probe of Credit Suisse and UBS over sanctions breaches - SWI swissinfo.ch WTI EUTOstoxx50 DOW Jones

BBG - That's a headline ! : the average of all U.S. bonds are trading at 86 cents to the $ (including all USTs, corps bonds, mortgages and al) >>> Hedge Funds continue to short treasuries at historic levels while asset managers are building their largest long positions ever recorded! (have charts if you need them) Nearly 700 US banks now exceed the 2006 Commercial Real Estate (CRE) loan concentration guidance/Thread OpenAI is reportedly raising funds at a valuation of $80 billion to $90 billion P ressure on China Evergrande intensifies ; chairman under police watch, risk of liquidation FTC calls Amazon a monopolist in massive antitrust case (...which could last years?) A top European Union official says the social network X, formerly known as Twitter, is the biggest source of fake news and urged owner Elon Musk to comply with the bloc’s laws aimed at combating disinformation More Japanese companies are moving their production facilities from China to Japan , fearing further disruptions from the novel coronavirus pandemic as well as the increasing friction between Washington and Beijing The Senate voted to advance a short-term funding bill Tuesday to avoid government shutdown The 10y UST bond is down about 3% YTD, this would represent the 3rd consecutive annual decline, which has basically never happened (down 4% in 2021 and 18% in 2022) Fed's Kashkari revealed his interest rate "dot" from the latest SEP : one more hike this year, and only one cut next year under his modal outlook for the economy MS’s Mike Wilson calls this economy “purgatory land.” “This is the most difficult part of the economic cycle. What you can argue is the late-cycle can persist for a lot longer than people have expected.” Markets : Investors have to 'adjust' to Treasury yield curve at higher levels than anticipated few weeks back, pre FOMC >>> makes me think of 2010-12period, when the market was constantly asking, wondering when ZIRP, NIROP and QE would stop...it took a decade.....now we are going to wonder for a decade whether rates go down and how far ? >>> so all in all, there is no doubt that higher rates are biting hard on consumers and various businesses, more downside risk than upside risk overall USD stays bid, if it was to really rally hard on further risk-off, beware the likes of MXN (posiitoning..), CNH, EMG, AUD, even CAD For equity markets : a higher for longer period of rates in this 'late cycle', means a continuation of 'quality investments, balance-sheets' remain a preference vs 'growth at any costs' kind of company M arkets continue to allocate funds to government bonds, TLT etc hoping for a return to a disinflationary environment, IMHO, we could very well go back to a world that needs 1 to 2% real rates, so on 3% US inflation (as an example), the markets will require more of a 5% yield in 10y UST than a 3% yield, particularly with the fiscal situation that is not going to improve in a hurry.. Nick Timiraos on X: "Minneapolis Fed President @neelkashkari reveals his interest rate "dot" from the latest SEP: one more hike this year, and only one cut next year under his modal outlook for the economy He also takes up his long-run rate projection to 2.5% from 2% https://t.co/VIbsMAN1ni https://t.co/otIOpvntyU" / X (twitter.com) If ever 'investors' need to cash in' on the big winners of 2023, a quick reminder that they are still up big YTD: (not saying it will happen, just pointing out where profits 'may' be taken, as the divergence between TLT and QQQ is pretty extreme, and could well matter/correct in the intermediate term) NVDA +180% NFLX +30% AMZN + 50% META + 150% AAPL + 32% MSFT + 30% Jesse Felder on X: "'If you buy the S&P500 today, you are basically buying a handful of companies that make up 34% of the index and have an average P/E ratio around 50.' https://t.co/G8nJ9GuTUK https://t.co/Ldz0pcHsUx" / X (twitter.com) Stock Market Is Stuck in a Late-Cycle ‘Muddle,’ Morgan Stanley’s Wilson says - Bloomberg OpenAI is reportedly raising funds at a valuation of $80 billion to $90 billion | TechCrunch Russia is increasingly using China’s currency to evade sanctions | Financial Times (ft.com) The Kobeissi Letter on X: "JUST IN: Nearly 700 US banks now exceed the 2006 Commercial Real Estate (CRE) loan concentration guidance. What is the CRE loan concentration guidance? It's guidance by the FDIC for the amount of exposure that small banks should have to CRE loans. Currently, small banks hold… https://t.co/ZYCcDLy45o" / X (twitter.com) Pressure on China Evergrande intensifies; chairman under police watch, risk of liquidation | Reuters Credit card losses rising at fastest pace since Great Financial Crisis (cnbc.com) Outlook for Public and Private Markets - Apollo Academy 'ten downside risks to the U.S economy' - many well documented lately already, but imho not entirely priced in, lag reaction in markets from higher rates ... JPMorgan to settle Jeffrey Epstein suit by Virgin Islands (cnbc.com) $75mio.. FTC calls Amazon a monopolist in massive antitrust case (siliconrepublic.com) Tesla faces EU probe over China EV subsidies: FT (yahoo.com) Musk's X is the biggest purveyor of disinformation, EU official says (qz.com) Seems bang on For some Japan firms, era of cheap production in China is over | The Asahi Shimbun: Breaking News, Japan News and Analysis Target says rampant theft forcing it to close 9 stores | Fortune Senate votes to advance short-term funding bill to avoid government shutdown | The Hill SPX - while sub 4350 area, we should be heading towards 200dma which is around 4200 area, once/when trendline supports gives way on weekly chart - with quarter-end flows and ODTE things can happen pretty swiftly

FED >>> no recession in sight, yet, rates stay high for longer, if not much longer (depends how you define 'much longer''), as a LOT can happen between now and mid 2024 (when about 2 cuts are expected into end of 2024), the U.S economy will remain vulnerable to UAW strikes, government shutdown and higher yields, higher mortgages, credit cards funding etc >>> >>> The Fed is forecasting FedFundRate in Dec 2024 to be at 5.1%, with inflation down to 2.5%, if this forecasts stands correctly, it will be the longest period of restrictive monetary policy since the 205-2007 period Moody's : A U.S government shutdown would underscore institutional and governance weakness, and would be credit negative for the U.S sovereign ECB's Lagarde : Interest rates will stay high 'as long as necessary JPMorgan’s big call that oil could spike to $150 within a “higher-for-longer” energy macro outlook >>> Jerome Powell is scheduled to speak again this week on Wednesday right at market close 4PM South American leaders issue ultimatum on EU trade pact Telegraph/How Greek shipping oligarchs are reaping billions from Putin’s war. Rise of Russian shadow fleets has eroded the effectiveness of the G7’s oil price cap For many nationalist parties like Spain’s Vox and Germany’s Alternative für Deutschland, Giorgia Meloni’s rise to power offers both a playbook and a cautionary tale . In her first year in office, Italy's far-right prime minister dispelled fears she would break with NATO and fiscal rectitude. But inaction in dealing with the country’s long-term economic problems will make the rest of her term much harder JP Morgan CEO Jamie Dimon says the world is not prepared for the worst case scenario of interest rates rising to 7% and stagflation setting in Chinese government probe casts new doubt over Evergrande restructuring FT-Global trade falls at fastest pace since pandemic. Demand for goods exports weakens on the back of higher inflation, rate rises and spending on services Markets : If credit starts to move , equity markets will continue to struggle, kind of obvious, but this is key, if long-end sell-off doesn't calm down, we will get some sort of credit events in few places and USD could suddenly take a big leg higher too.. HYG chart below TLT trading back to April 2011 lows around $90 - whaoo - is this enough !!? we must be getting there USD looks to go bid into quarter-end, major US invest house adding to the view... together with higher yields and potential risk-off, USDMXN again, AUD at risk, USDJPY going to test BoJ nearer to 150JPY, USDCHF making a nice push since SNB hold (more to come ? back towards 'par' over next few months ? quite possible, unless something changes fundamentally on USD side.. Equity markets can unlock very quickly when you consider that Zero-day options are now HALF of the S&P 500 options market >>> key going into quarter-end is $, FXEMG, VIX too low (too many shorts) and Credit, all lead by UST 's as always Bonds, duration lower, steeper, in fact yesterday 2's rallied while 20s 30's sold off (over 10bps higher in yield terms! 10's 4.55 - highest since Oct 2007 Remember that 100y Austria, trading at 63 now.. The 1.25% due 2050 UST trading at 47cents too ... whaooo Given what bonds/duration is doing, beware #credit #spx500 and #emgfx #VIX Macro/FX Watch: Dollar remains bid on yield and safety | Saxo (home.saxo) USD remains bid on yield and safety '''AND quarter-end imho..'' Moody’s Warns US Government Shutdown Would Be Negative for Credit Rating - Bloomberg UAW Strike Expansion Did Not Target Pickup Production But Dealerships (yahoo.com) Interest rates will stay high 'as long as necessary,' the European Central Bank's leader says (qz.com) Global trade falls at fastest pace since pandemic | Financial Times (ft.com) Behind The Memo: Fewer Losers, or More Winners? - The Memo by Howard Marks | Podcast on Spotify top 30mins - love it - what's your risk tolerance ? Wall Street Is Hoping $100 Oil Ain’t What It Used to Be - WSJ JPMorgan analyst sees oil price surge as high as $150 - The Statesman Michael Pettis on X: "1/2 The purpose of an efficient bankruptcy process is to return assets and resources as quickly as possible to the productive economy and to reduce the considerable financial distress costs associated with insolvency. https://t.co/K3VqizwmmI" / X (twitter.com) Otavio (Tavi) Costa on X: "A total bloodbath in Treasury notes, bonds, and mortgage-back securities again: Here is a reminder that these instruments account for over 80% of the Federal Reserve's balance sheet. If they were to be reevaluated using a mark-to-market methodology, the Fed's assets could be… https://t.co/x0YNQez2iJ" / X (twitter.com) Gunjan Banerji on X: "Long-term protection on US, Euro equities is very cheap --SocGen https://t.co/0Om13IsDM7" / X (twitter.com) never really been cheaper ! if you need it Senior Nomura banker barred from leaving China, report says - The Japan Times Not a great time to be an investment banker working for a foreign firm ! would you want to go and work there ? South American leaders issue ultimatum on EU trade pact | Financial Times (ft.com) The Battle Over Spain’s Next Government - Bloomberg Inheritance tax cut could save Sunak £300m, analysis suggests (thelondoneconomic.com) probably just normal The inside story of the mini-budget disaster - BBC News what a farce this was! expensive farce Julius Baer Teams Up with Swiss (finews.com) Charlie Bilello on X: "New: The Week in Charts ‼ -- Are Higher Rates Here to Stay? -- $33 Trillion in National Debt -- Good Times & Bad Times for Bond Market Investors -- Will There Be a "Soft Landing?" -- Why Rising Rates Haven't Hurt Many Companies Yet -- And more... 📺: https://t.co/49Ox96pJqr" / X (twitter.com) video How Greek shipping oligarchs are reaping billions from Russia’s war (telegraph.co.uk) Francesco Sassi on X: "🇷🇺Russia has succeeded in avoiding🇺🇸🇪🇺🇨🇦🇯🇵G7 sanctions on most of its oil exports, a shift in trade flows, boosted by crude rising towards $100 a barrel. The Kremlin's strategy is de-facto countering Western efforts to curb energy revenues to stop the invasion of🇺🇦Ukraine https://t.co/3Pi67hu4tn" / X (twitter.com) Meloni’s Italian job is a lesson for EU’s right | Reuters Gatwick airport cancels more than 160 flights and imposes cap amid air traffic control staff shortages (msn.com) headline seems a little more worrying than reality, but still - please no HYG - there are many different way to look at credit - that's one of them - key supports around here TLT

- So we got a hawkish pause from the FED, bonds/duration sold-off as expected and eventually equity markets weakened and closed on lows on Friday night >>> if the US government shuts down for a couple of weeks, nothing dramatic, BUT it WILL increase probability of a decent slowdown in Q4, the rates market will react and price it >>> risk of AI fade, FTC antitrust case against AMZN (was flagged earlier this month), VIX dealers still massively short, have semis topped ? plenty of charts now popping up on X and in my emails : ''nasdaq100 breaking own, NVDA breaking down, semi conductors double top, etc etc etc....... bottom line markets stayed overbought for months with the magnificent 7's, they can remain oversold for a while too FED is cutting staff after more than a decade of payroll growth >>> markets currently pricing in that the FED is done (maybe another 25bps in Nov or Dec), on hold till the middle of 2024 and then about 2 cuts priced in for the rest of 2024 - seems fair! "Only thing outperforming Nasdaq YTD are Japanese banks ; irony is Japanese banks are discounting higher rates, and US tech betting on lower rates." Hartnett (Buffet bet on Japanese banks helped clearly..) SPX500 : 7 of the largest market cap are up about 50% in 2023, the remaing 490+ are flat or down >>> bottom line if you buy the SPX today or the 7's, you are buying a bunch of companies that make up 34% of the index and have an average P/E ratio of about 40-50.. that's expensive The Fed's balance sheet hit its lowest level since June 2021 this week, down $941 billion from the peak in April 2022 Russia's Foreign Minister Lavrov said that Ukraine's peace plan as well as the latest U.N. proposals to revive the Black Sea grain initiative were both "not realistic." This week's economic calendar : in focus : IFO tomorrow, US conf board consumer conf (slightly lower exp) and US new homes sales (loss of momentum likely due to rates), Wed durable goods, Thursday US GDP second revision + annual revisions, German CPI and Friday main events probably with US core PCE data, JPN CPI and Euro area HICP inflation. McCarthy’s House speakership hangs by a thread as US shutdown looms | Kevin McCarthy | The Guardian The FTC may file an antitrust lawsuit against Amazon as soon as next week (yahoo.com) AI Fantasy Fades as Wall Street Reels From Real-World Rate Jump - Bloomberg Carl Quintanilla on X: "PIMCO: “The chances of a government #shutdown are increasing – our odds had been at ~65%+ odds (i.e., more likely than not), but after the last few days, folks on the Hill are now putting the odds of a shutdown between 80-99%.” [Cantrill] (1/2)" / X (twitter.com) Charlie Bilello on X: "The Fed's balance sheet hit its lowest level since June 2021 this week, down $941 billion from the peak in April 2022. Changes in the Fed's balance sheet since 2002... https://t.co/nthHi0D4RA" / X (twitter.com) Campaign to rejoin EU gathers strength at protest march | The Independent UK ministers scrap energy efficiency taskforce after six months | Energy efficiency | The Guardian madness As planet gets warmer, ski gondola maker goes urban - The Local Semi conductors

BoJ unchanged, focus for any major change remains for Q1 2024 >>> USDJPY could very well push higher and higher and test the BoJ resolve, eventually triggering intervention again nearer to 150JPY >>> next focus is UAW strike, Debt ceiling deadline 1st October, higher for longer now broadly accepted by all, but market need digesting it !, the risk is they keep rates higher for longer and we eventually get some sort of hardish landing The UAW strike against automakers could be expanded unless there is major progress in contract negotiations by today So Switzerland stopped hiking rates and the Bank of England followed suit. What do they have in common? Private sector vulnerabilities /Thread UST 1.25% 2050, trading at 48cents, have we ever seen this ? suspect never . TLT closes at lowest price since April 11, 2011 UK says grounds to clear Microsoft's Activision deal An Australian union alliance called off strikes at Chevron's two major local liquefied natural gas projects , agreeing to resolve disputes that had threatened to disrupt around 7% of global LNG supplies Why the US banking crisis is prompting a fresh regulatory crackdown Azerbaijan says it sees amnesty for Karabakh fighters who lay down arms EV charging needs big improvements soon if the auto industry’s transition is going to work Prime Minister Justin Trudeau said Canada must stand up for the international rules-based order after accusing Indian agents of orchestrating the murder of a Canadian Sikh leader Eurozone September flash services PMI 48.4 vs 47.7 expected Chinese EV startup Nio bets on car connectivity with new smartphone. Device allows drivers to control door locks and display searched routes Markets : In FX, USDCHF pushed through resistance on SNB hold . USD stays firm overall, watch out for USDJPY again Bonds, duration, long-end, steeper, markets repricing/repriced the higher for longer another nudge up >>> fiscal position is pretty bleak in many places, so long-end reacted, as expected, definitely more risk going forward with some sort of 'premium' repriced by funds and investors to hold duration bonds, keep an eye on credit >>> markets have to hope that UST 10's at 4.50 is enough for now ! or we will get a potentially nasty credit event Equity markets showing signs of breaking down technically, watch out Europe, huge levels around here in EUROstoxx50, DAX etc, NVDA >>> the trouble is many charts look similar to the ones below, massive ramp up in H1, topping out in Q3, what next ? - see charts below, it's all the same, which make is pretty binary and dangerous into quarter-end Crude staying firm on still strong data, US claims yesterday were lower at 201K (exp 220K), EU NatGas prices lower finally as Ozzie strikes come to and end GOLD, Silver actually holding up very well in all this.. Interest rates staying 'higher for longer' means at least through 2026 for the Fed (yahoo.com) Seems everyone is coming to our long held view/conclusion - high for longer, maybe much longer, when it's consensus it is when we should notice (plenty of time, unless something big breaks, bonds continue softer, fiscal irresponsibilities ! ) Tech IPOs get 'meh' response from Wall Street: Arm, Instacart, Klaviyo (cnbc.com) US Treasury Buyback Plan to Boost Market Resilience, Josh Frost Says - Bloomberg this will come at a good time to cushion markets in 2024.. Bank of England joins US Fed in keeping interest rates unchanged after inflation declines (qz.com) March Banking Crisis Focuses Attention on Non-Banks - IG UK Singapore is now the world's freest economy, displacing Hong Kong (cnbc.com) Alf on X: "So Switzerland stopped hiking rates and the Bank of England followed suit. What do they have in common? Private sector vulnerabilities. Switzerland ranks bad on private sector debt levels and trends, and the UK faces sizeable mortgage refinancings in 2024. Macro matters. https://t.co/jlXVXW9Vjm" / X (twitter.com) Strikes end at Chevron's Australian LNG facilities | Reuters UK says grounds to clear Microsoft's Activision deal | Reuters AI risks destabilising world, deputy PM to tell UN - BBC New s Tax cuts 'virtually impossible' at present, says Jeremy Hunt - BBC News The branded staple foods costing up to 910% more than their budget counterparts | UK News | Sky News (1) Michael Pettis on X: "1/2 "History tells us a receding tide grounds all boats. Contrary to Krugman’s contention, the adage that when China sneezes, the world catches a cold, remains true." History teaches no such thing. Japan's economy represented in the early 1990s the... https://t.co/ypxcpDH3mR" / X (twitter.com) Florida nurse practitioner convicted in $200 million Medicare fraud (cnbc.com) Isn't there any controls..??..how is this even possible.. Zelenskyy makes his case at the U.S. Capitol for more war aid as Republican support softens (cnbc.com) -- Ukraine war live updates: Latest news on Russia and the war in Ukraine (cnbc.com) India-Canada row: Justin Trudeau repeats allegation against India amid row - BBC News More Assets Unveiled in Singapore’s Laundering Scandal (finews.asia) The expansion in fam offices last couple of years, went a little to swiftly New Zealand is trying to get Americans to move there—here's why (cnbc.com) Azerbaijan says it sees amnesty for Karabakh fighters who lay down arms | Reuters EV charging needs big improvements in U.S. (cnbc.com) many parts not ready and it's got expensive of late, hence some issues popping up... Chinese EV startup Nio bets on car connectivity with new smartphone - Nikkei Asia All bee colonies in Switzerland are sick, warns specialist - SWI swissinfo.ch Good grief! Qatar’s World Cup FIFA Bribe Documents Exposed - Tablet Magazine Strewth ! whishing you a super Friday and great weekend ahead Team PVM DAX EUROstoxx50 SPX500 NASDAQ NDIVIA

In 1791, Thomas Jefferson said: "To preserve our independence, we must not let our rulers load us with perpetual debt. If we run into such debts, we (will then) be taxed in our meat and our drink, in our necessities and in our comforts, in our labor and in our amusements''...sounds familiar ? Powell : We are prepared to raise rates further if appropriate. The FOMC is not decided whether it’s reached a peak or not, Powell says. Markets are pricing in 50% of another rate hike this year >>> high(er) for longer, hawkish pause, how long higher etc AND the key IS employment from here on, not so much inflation (which is sticky, known known), for now the message is: one more hike this year and less easing in 2024 German carmakers in the line of fire of possible EU-China trade war/FT NATO fractures : In U-Turn, Poland announces it will no longer arm Ukraine The Federal Reserve may need to raise interest rates 3 more times warns Vanguard Sweden’s central bank hiked interest rates for the eighth consecutive time on Thursday, taking the main rate to 4%, as the country continues to battle high inflation Norway's central bank raised its benchmark interest rate by 25 basis points (bps) to 4.25% on Thursday to curb inflation, as widely predicted, and, in a surprise move, said it would likely hike again in December SNB has entered "wait and see mode" it said on Thursday after a surprise decision to pause its current cycle of interest rate hikes (low inflation and strong CHF..) Markets : Equity markets breaking down technically , leaders like NVDA below 50dma etc, beware going into quarter-end, rates, usd, all about momentum, on the other side #URA doing just fine in this environment.. UST 10's 4.43% - high(er) for longer, much longer? even 10's JGB's at a huge 74bps... (its huge when it was 10 not long ago), highest since 2013, long way to go in the duration game, fiscal irresponsibility etc etc USD stays firm(er), EMGFX could come under pressure, or a lot of pressure if yields continue to move higher..and force USD higher, watch out the likes of USDCNH 7.35 area for sentiment.. (one has to like MXN, but it's probably still a pretty crowded trade out there) Euro zone bond yields rise to multiple-month high after Fed rate decision (yahoo.com) Goldman Sachs pushes its forecast for Fed rate cut to Q4 2024 | Reuters Nick Timiraos on X: "Powell on the neutral rate: "We know it by its works." "It’s certainly plausible that the neutral rate" has shifted higher in the short term, "and that’s part of the explanation for why the economy has been more resilient than expected." https://t.co/tEYykCyg0m" / X (twitter.com) Sweden's central bank raises rates to 4%, in line with expectations (cnbc.com) Swiss National Bank in wait and see mode after pausing rate hikes (yahoo.com) Oil Prices Could Hit $120 Per Barrel on Further Supply Cuts: JPMorgan (businessinsider.com) UK's new online safety law adds to crackdown on Big Tech companies (qz.com) Charles Norton on X: ".@EricBalchunas reporting on the #uranium ETFs this morning on BBG. Seems potential for AUM to hit $10 bill in the next 24 mo's. Yes, please! $URNM $URA $SPUT https://t.co/2jP1ZK0f4L" / X (twitter.com) Greg Ip on X: "1/ I get why auto workers think they deserve a raise, or fewer hours. Isn't everyone else getting that? But the reality is the opposite: pay must track productivity and American factory managers' and workers' productivity is not keeping up. My column. https://t.co/VUqXiB2x3q" / X (twitter.com) California's crypto bill: much still needs to be done (thearmchairtrader.com) German carmakers in the line of fire of possible EU-China trade war | Financial Times (ft.com) Instacart's shares briefly sink below their IPO price | Fortune similar price action for ARM.. The Remainers’ last economic argument against Brexit has crumbled (telegraph.co.uk) Radical-Liberals and People’s Party have largest 2023 campaign budgets - SWI swissinfo.ch Poland says it will no longer supply Kyiv with weapons (cnbc.com) What are the best hotels in the world? See the list of the top 50 (cnbc.com) Fab places! it's good to dream.. have u been to any of them ? Blessed to have been in two of them! How Wales became an unexpected leader in the food and drink industry - Financial Times - Partner Content by Food & Drink Wales (ft.com) Love Wales, a little Switzerland.. Investor Alex von Tobel: Lessons from Harvard ‘Happiness Lab’ (cnbc.com) NASDAQ at risk of having a proper breakdown

FOMC : "Supply-side constraints exemplified by the autoworkers’ strike & rise in oil prices will cast a hawkish shadow over the FOMC meeting that starts today. Powell is likely to embrace some version of the higher-for-longer policy that is increasingly being priced in:" Citi analysts >>>''high(er)-for-longer'' the name of the game.. BoE : markets have priced in another 25bps in this cycle, again the real key is how long is 'high-for-longer', softer UK CPI this morning, but its still 6.7%, Core CPI (ex fuel/food) at 6.2% down from 6.9% in July & below expectation of 6.8% Canada's annual inflation rate accelerated for the second month in a row in August, increasing 4 per cent as the price of gasoline surged, quick reminder inflation is far from dead, ahead of all those CB meetings.. ECB QT continues with balance sheet shrinking by another €17bn to €7,135.7bn, lowest since Mar2021 Switzerland ups economic growth forecast for the year but revises lower 2024 projection White House no longer sending top officials to Detroit for UAW strike talks this week (strange..).. , Ford & GM 'temporary' layoffs Markets : Crude off a few pct on some chatters that Saudis will ease back on cuts in Q4 >>> as the likes of PIMCO and JPM talking about 'oil supply shock' coming USD remains firm, UST yields on highs going into FOMC, imho, 'higher-for-longer' has almost become a well known talked view, whether fully price is very hard to tell, beware a quarter-end bond rebalance (buy bonds - which has been mentioned-too early for facts), and equity markets are 'struggling' in the face of firmer rates - will reassess post Powell presser tonight UST 10's 4.36 almost 2007 highs - some bond specialist beginning to argue it's a little overdone going into FOMC and quarter-end Canada's inflation rate accelerates again, jumping 4 per cent in August (msn.com) Swiss Government’s New Inflation Forecast Backs Another SNB Hike - Bloomberg Michael Pettis on X: "1/4 "Beijing has been continuously cutting China’s US debt holdings since early 2022." The author of this article is basing this rather unlikely claim on the fact that the PBoC's official holdings of US T-bills are down. https://t.co/9DszQgNF6W via @scmpnews" / X (twitter.com) Ford and GM Temporarily Lay Off Hundreds of Workers (yahoo.com) UAW strikes: White House officials not going to Detroit for auto talks (cnbc.com) Europe Must Cut Down on Its Dependence With China, Baerbock Says (yahoo.com) Holger Zschaepitz on X: "#ECB QT continues w/balance sheet shrank by another €17bn to €7,135.7bn, lowest since Mar2021. ECB's total assets now equal to 51.4% of Eurozone GDP vs Fed's 30.2%, SNB's 111.5%, or BoJ's 126.8%. Even if interest rates do not rise further, this does not mean that monetary… https://t.co/YfMlMTxeuT" / X (twitter.com) Labour need to find ‘incentive’ for EU to reopen Brexit deal, expert warns (cityam.com) It sure will become an interesting debate, but probably not until after the next election Net zero latest news: We won’t save planet by bankrupting Britain, says Braverman (telegraph.co.uk) Sweden braces for 'economic winter' as government unveils cautious budget - The Local Sounds worse over in Sweden, but signs of stagflation in many places Uber: EU rules will see us pull out of "hundreds" of European cities - CityAM Shame Google, DoD built an AI-powered microscope to help doctors spot cancer (cnbc.com) Whitest parts of England and Wales have 144% more local paths, study finds | Communities | The Guardian magic! Why so Many Buildings in Singapore Are Covered in Plants (businessinsider.com) Be back later online, have a great day Team PVM

The UAW union said that it will announce further strikes at GM, Ford and Stellantis plants if serious progress isn't made by Friday, Ford’s Canada workers threaten to join US union on strike (once it starts..) >>> “In the last four years, the price of vehicles went up 30%. Our wages went up 6%, The CEOs got 40%. There were billions of dollars in shareholder dividends. So our wages aren’t the problem,” Fain U.S : 81% of full-time workers want a 4-day work week – and they’re willing to make sacrifices to get it The World is struggling to make enough D iesel / BBG Greece is making a killing selling ships to Russi a. The world’s largest ship-owning nation is profiting from the sale of aging vessels, while enabling Moscow’s sanctions evasion The US Housing Market Index moved back below 50 in September, indicating a sharp decline in homebuilder confidence. Rising mortgage rates have crushed affordability and consumer demand. 32% of builders reported cutting home prices in September, up from 25% in August German 30y bond yields at 2.84%, highest levels since 2011 , markets slowly adjusting to 'high-er-for-longer' in long-term inflation expectations German banker with links to Scholz charged in €280mn tax fraud. Co-owner of private bank MM Warburg is on trial for his part in the cum-ex dividend scandal ECB policymakers want to soon start discussing how to tackle the multi-trillion-euro pool of excess liquidity sloshing around banks , with raising reserve requirements a possible first move, six sources told Reuters RBA warns on Chinese economic contagion, soaring petrol prices . A spillover from China’s weak economy and surging petrol prices pose significant challenge to taming inflation, the RBA has cautioned The U.S. is actively looking for ways to blunt one of China’s best tools of influence: international loans Big tech is now the most crowded trade in the latest Global Fund Manager Survey by BofA - Huawei’s chip breakthrough poses new threat to Apple in China — and questions for Washington FOMC - most likely scenario is Fed on hold and leave tightening 'in play-data dependent, inflation etc'' - imho Markets : ARM up 25% on day 1, down 10% last couple of days (Berstein to underperform), NVDA (the one everybody chased) down through key supports, AAPL 175$ key area, S&P 500 lost the 50D moving average on Friday and today it lost the 20D, The Ratio of US Small Caps to US Large Caps is at its lowest level since January 2001 etc etc, lots of noise but the NASDAQ been flat for 3months WTI & Brent continue to sit comfortably above the US$90 levels , Iran now exports at least 1.5 million barrels of oil a day, more than three times as much as it did in 2019, corn closed at lowest price since December 2020, but olive oil prices exploded to a record high and now, cocoa prices are nearing a 44-year high, and sugar prices have risen to a 12-year high...strewth! Key FX Tech levels - see Saxo's update below UST 2y 5.06% - highest in 17years >>> Fed’s June 2024 meeting hit a new high for this cycle at 5.18%, crude , sticky inflation, ''high-er for longer'' Technical analysis Key Supports Resistances EURUSD GBPUSD EURGBP Dollar Index | Saxo Group (home.saxo) VIX on lows and MOVE index (bond vols) , same picture - how long does this last ? Holger Zschaepitz on X: "Bond volatility, as measured by MOVE index, has dropped to lowest in 18mths, since before 1st hike in Fed funds rate. That suggests startling calm, and also in its own right tends to make liquidity easier to come by & financial conditions more lenient, BBG's @johnauthers writes. https://t.co/Yd1VBZVPLF" / X (twitter.com) Central banks head for peak rates — but inflation battle is not over (cnbc.com) Getting there, but long way long way to go (does not mean rates go higher, but steeper is very well possible IMHO, if not likely, as fiscal worries will persist!...) UAW justifies wage demands by pointing to CEO pay raises. So how high were they? (yahoo.com) 81% of workers want a 4-day week. What they're willing to do to get it (cnbc.com) Michael Pettis on X: "1/3 "Whatever the eventual outcome, it is clear that industrial policy and protectionism are once again respectable — on both sides of the Atlantic." Actually mercantilism has been driving trade on both sides of the Atlantic and Pacific for decades. https://t.co/3lfRMnSWUj" / X (twitter.com) IBM CEO says AI will impact white-collar jobs first (cnbc.com) Huawei's chip breakthrough poses new threat to Apple in China (cnbc.com) 5 September 2023 | Minutes of the Monetary Policy Meeting of the Board | RBA and Inflation, interest rates: Chinese economic contagion, soaring petrol prices, keep RBA vigilant | news.com.au — Australia’s leading news site How Biden is countering China with India, Vietnam without saying so | Fortune Ukraine war live updates: Latest news on Russia and the war in Ukraine (cnbc.com) Societe Generale vision falls flat as Europe's banks falter (msn.com) German banker with links to Scholz charged in €280mn tax fraud | Financial Times (ft.com) Homebuilder sentiment goes negative for the first time in 7 months (cnbc.com) Hunter Biden sues IRS over tax information disclosures (cnbc.com) Greek Ship Sales Help Russia Evade Sanctions (foreignpolicy.com) ECB to tackle excess liquidity in next stage of inflation fight -sources (streetinsider.com) SocGen was a weak spot in the financial sector yesterday Societe Generale Shares Fall After Bank Outlines New Strategic Plan - MarketWatch The dark secrets of Switzerland’s largest gold refinery - SWI swissinfo.ch UBS Looking to Investors for More AT1 Bonds (finews.asia) link.cnbc.com/public/32746232 The data is clear: private equity returns have come largely through multiple expansion in recent years, rather than from revenue and margin growth," Bain Iran prisoner release: Five Americans released are en route to the US | CNN Politics US-Iran Relations Are Thawing. It Could Lower Oil Prices. | Barron's (barrons.com) Daring or delusional? Starmer seeks to woo Europe with talk of new Brexit deal | Keir Starmer | The Guardian 1,300 clean power projects with permission awaiting construction, say councils | Local Government Association Post Office Horizon victims offered £600,000 of compensation | Business News | Sky News Finally ! Beautiful pics Northern Lights spotted over East Midlands - BBC News Musk says Twitter, now X, is moving to monthly subscriptions (cnbc.com) No proof politicians debanked over views - watchdog - BBC News Artist Who Turned in Empty Frames Ordered to Pay Back $75,000 (businessinsider.com) Bonne journée Team PVM

FOMC, PBOC will also set 1 to 5 y rates on Wed, on Thursday we have BoE, SNB, Norway, Sweden and Turkey CB meetings, and BoJ on Friday >>> market pricing in a 50% chance of a Fed hike this year and 3 cuts in 2024, which is the key for long-term sentiment Goldman on interest rate cuts in 2024: " We see cuts as optional because our analysis suggests that most of the impact of higher interest rates is behind us , meaning that the economy does not need cuts to avoid recession" Taiwan's TSMC has told its major suppliers to delay the delivery of high-end chipmaking equipment , as the world's top contract chipmaker grows increasingly nervous about customer demand, two sources familiar with the matter said FT-Companies ease off on share buybacks as rising interest rates push up cost s. Growing pressure to invest and regional banking turmoil also deterred companies from purchasing their own shares WSJ-The U.S. Lost 4.1 Million Days of Work Last Month to Strikes. Even before the UAW walkout , the number of days lost to work stoppages had risen to its highest level in more than two decades, American workers are striking at a pace not seen in nearly a quarter-century >>> big shift in bargaining power back to labor >>> Sanders: "Serious discussions" should take place on four-day workwee Keir Starmer vows to seek rewrite of Brexit deal – but rules out rejoining single market, UK Housing Prices falling at the fastest rate in 14 years (good news for would be buyers!) US and China officials meet in Malta ahead of possible Biden-Xi summit. Yicai reports "dire" fiscal conditions among cash-strapped local governments , and discusses some of the things they are doing to raise revenue, including selling off assets to deal with difficulties from a shortfall in income Australia miners BHP, Fortescue race to curb iron ore dependence China's military hierarchy under spotlight after defence minister disappears The U.S Tech sector is currently trading around 25x forward earning s, up from 20 at the end of 2022 and an average of about 18 over the last 10+ years ECB's Kazimir: May need peak rates for `Winter, Spring, Summer' - Premature to place bets on first rate cuts, he hopes we've seen last hike "China is the single biggest energy trader, buying 20-26% of global coal, crude oil and li quified natural gas" Funflation' is here to stay as live events fuel economy: Bank of America Markets : Equity markets closed off their highs on Friday, U.S strikes looming too + TSMC delays >> NVDA through key levels, Adobe, AMZN, MSFT all gave up a decent 3-4% ground, it's been nearly 100days without SPX selling off more than 1.5% >>>> inflation has come down, as fast as expected, but the U.S strikes now could slow growth in the U.S, clear risk to some sort of Q4 slowdown >>> AAPL below 50 and 100dma ($174-175 area) - it matters for overall sentiment China's CSI hit lowest level YTD (property sector worries still) USD has had a strong 9 week run, rarely goes on for much longer, for whichever reason Bonds still not finding much love Overall, Oil up, bonds lower with a slight steepening in there, Fed's Clarida was hawkish still, probably 1more hike for choice and further steepness on worrying fiscal stance Macro and FX: Central banks bonanza this week | Saxo Market Call (podbean.com) Biden's national security adviser secretly meets China's foreign minister in bid to ease strained ties (yahoo.com) TSMC tells vendors to delay chip equipment deliveries, sources say | Reuters Billionaire investor Ray Dalio sounds the alarm on US debt and says bonds aren't a good long-term investment (yahoo.com) Americans think inflation is coming down. That could help the Fed (yahoo.com) 'Funflation' is here to stay as live events fuel economy: Bank of America (yahoo.com) Australia miners BHP, Fortescue race to curb iron ore dependence - Nikkei Asia The Kobeissi Letter on X: "According to Apollo, housing affordability just hit a new all time low. Houses now are ~30% LESS affordable than they were in 2008, the largest housing bubble in history. The median monthly house payment is about to pass $3,000 for the first time in history. All as prices are… https://t.co/SBIabYtpN9" / X (twitter.com) Companies ease off on share buybacks as rising interest rates push up costs | Financial Times (ft.com) Apple iPhone 15 launch: an inflection point for Wall Street? (thearmchairtrader.com) Apple witnesses strong demand for iPhone 15 series in China, but challenges persist amid competition from Chinese rivals - Global Times First two cargo ships arrive in Ukrainian port after Russia's exit from grain deal (qz.com) Keir Starmer vows to seek rewrite of Brexit deal - but rules out rejoining single market (inews.co.uk) Poland imposes EU ban on all Russian-registered passenger cars (qz.com) Home workers will be first to lose jobs to AI, Oxford study warns (telegraph.co.uk) China's military hierarchy under spotlight after defence minister disappears | Reuters Local Chinese Gov'ts See Fiscal Income Growth Slow in August (yicaiglobal.com) The Hits Just Keep On Coming: China Suffers Biggest FX Outflow Since 2016 Amid Sudden Surge In Capital Flight | ZeroHedge some interesting data in there As Slovakia's trust in democracy fades, its election frontrunner campaigns against aid to Ukraine | AP News Officials ‘raised concerns with Buckingham Palace’ about Boris Johnson’s conduct | Evening Standard have a great start to the week Team PVM

The ECB is set to decide whether to raise its key interest rate to a record peak in what should be its final step in the fight against inflation, or take a break as the economy deteriorates >>> 'faites vox jeux, rien de va plus!' markets had a 25bps priced in, before the data turned sour lately and expectations shifted to a 'hold', then markets more inclined towards a final hike after that HICP leak 2days ago.. + quadruple witching tomorrow for potential higher vol, UBS Strategists see more profit warnings, volatility in Europe The 1973 Oil Crisis And The Experts’ Circular Firing Squad, a very good commentary about how the ' the expert consensus' can get it all wrong.. / Forbes article below U.S CPI above on core and super core though, with quite a few segments flat or down, so something in this for all.. . markets had indeed expecting higher core so bond market shrugged it all off on the day.. GS: "Interesting to get this data where today where airfares drove the inflation (swinging to +4.9% from -8% in both Jun and Jul ) yet multiple airlines have come out talking about slowing bookings (y'day - AAL, UAL, JBLU traded down >4% ). " ARM: UK chip designer in $54.5bn market return Swiss authorities say they want to stop their banks laundering the cash of tax-evading tycoons, international gangsters and oligarchs CHF : Difficult conditions in important export markets such as Germany and China will weigh on the Swiss economy in the coming month s, according to Swiss Life economists, who have revised their growth forecasts downwards Nvidia CEO Jensen Huang sells another $27 million worth of Nvidia shares. He has now sold $70 million worth of shares over the last week >>> which is allowed! 'insider' selling sometimes does influence market sentiment overall though.. FT-‘Everything is tired here’: gloom spreads through German manufacturing. Disruptions compound longer-term structural problems including labour shortages and a lack of investment China's central bank has asked some of the country's biggest lenders to refrain from immediately squaring their FX positions in the market, and to run open positions for a while in order to alleviate downside pressure on the yuan >> in other words called ''capital controls'' Mexican lawmakers hear disputed testimony showing 'existence of alien life' ..! US govt spending increased 9% over the last year while tax receipts declined 8%, this is not something you should try at home ! "I think this meeting may go down in history as being very important for the future of civilization," Elon Musk said on the AI summit in Washington DC BoA on oil: OPEC+ cuts, Asia demand - "Brent prices could spike past $100/bbl" Markets : EURO >>> it's ECB day, half the pundits thing a hike, the other half does not, market has priced in a hawkish hike already, a 'sustained' rally in EURO after ECB looks difficult, and a move towards 1.0500 area more likely over next few weeks. USDCNH a little softer on PBOC controls, CABLE 1.2450 key med term support, AUDUSD up a little overnight on decent jod data, EURCHF lost downside momentum ? (lets see after ECB meeting) UST's not a whole lot diff, but 10's hit 2.32 or so on the CPI headline , again higher CPI was expected and priced...PPI next up today, at the end of the day core and super core CPI was higher, some will argue accelerating again.. Equity markets : if I had to pick a side, I would be 'cautious' into quarter-end, as we know though ODTE daily options can take us anywhere for the next 2-3pct on SPX or NQ WTI near $90 staying firm(er), unless something dramatic changes, looks to be heading higher towards $100 Cocoa hits highest closing price in 44 years! Guess no Heissi Schoki this winter ! The markets are dealing with higher interest rates (mortgages, credit cards and so on), higher gas prices, diesel, higher lending standards basically, key now is 'employment'^, which could derail this relatively positive market sentiment - goes both ways, but quarter-end usually bring decent volatility.. The 1973 Oil Crisis And The Experts’ Circular Firing Squad (forbes.com) Finally, self-reflection seems to rarely leave the therapist’s office. Communist regimes were famous for ‘self-criticism’ events, where those who disagreed with the Party line were made to acknowledge and apologize for their deviant thinking. The opposite is often true in the West, where analysis of failure is criticized as blame-seeking. Few like to dwell on past mistakes and most are reluctant to criticize their friends, colleagues, and/or organizations. The result is a borad failure to learn from mistakes, as M.I.T.’s Steve VanEvera pointed out two decades ago. UBS Strategists See More Profit Warnings, Volatility in Europe By Michael Msika (Bloomberg) -- UBS strategists expect European stocks to break out of their recent range to drop about 10% by the end of the year, as the risk of profit warnings for companies in the region is rising. “The 450-470 range may not last much longer” for the Stoxx 600, strategists Gerry Fowler and Sutanya Chedda write, seeing the benchmark ending the year at 410 index points — implying about 10% downside UBS analysis indicates weakening new orders and backlogs among European firms, raising the risk of profit warnings. More downside in earnings trends should also raise volatility, they say Bloomberg on X: "Tech tycoons with a combined net worth of roughly $550 billion gathered in the same room Wednesday for a Senate forum on the future and regulation of AI https://t.co/otlPQ1bPpm https://t.co/NFZq41FJM1" / X (twitter.com) Obscene power these guys have, it probably was just a fund raising exercise for politicos!! They have become So large over the last 20y, thanks to partly zero rates.. that it is hard to think they get told what to do or not to do by any politicians... The U.S vs Google will be interesting for that reason but it'll go on for months. The EU is fighting whether we like it or not and getting some results (mostly fines!) European markets live updates: ECB rate decision, stocks and data (cnbc.com) Charlie Bilello on X: "US government spending increased 9% over the last year while tax receipts declined 8%. Don't try this at home... Video: https://t.co/qmV7tpV0P5 https://t.co/JcAM89NeyF" / X (twitter.com) Liz Ann Sonders on X: "August CPI core services less housing (“super core”) confirming a reacceleration with +0.4% month/month increase (up from +0.2% in prior month) https://t.co/mOccncJsZn" / X (twitter.com) Switzerland To Act Against Dirty Cash? - The Globalist >>> ''But a heavy dose of skepticism is needed''.. indeed Outlook weakens for Swiss economy - SWI swissinfo.ch super strong CHF getting painful ‘Everything is tired here’: gloom spreads through German manufacturing | Financial Times (ft.com) 'Do not bet': China's central bank PBOC warns against yuan speculation (cnbc.com) That's as close as it gets to capital controls.. UBS Clears Out of Credit Suisse Tower in London (finews.asia) That was quick! ... no messing about there that's for sure Arm: UK chip designer in $54.5bn market return - BBC News EU chief calls for more engagement with Africa | Reuters China been there for a decade or more... so has Russia.. better late than never ! Taiwan slams Elon Musk, says it's 'not for sale' nor part of China (cnbc.com) Lidl swings to loss of £76m as fight to keep prices low offset by surging costs (cityam.com) Mexican lawmakers hear disputed testimony showing 'existence of alien life' | ITV News OH ! EURUSD - all about Christine this afternoon, lets see overall USD should stay firm(er), CABLE 1.2450 area key, on the other side PBOC would seem to have topped & controlled USDCNH