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UK markets , Gilts and more. What was the real reason for the Bank of England's gilt market intervention? After last night’s headline from Bailey, earlier this morning in FT : Bank of England signals to lenders it is prepared to prolong bond purchases. Officials have privately indicated flexible approach if market volatility flares up >> maybe what Bailey thinks he is doing, and FT is about what he has to do… They are there to actually step-in if/when markets are disruptive, he can’t and shouldn’t say much more than this in this situation… Net net, it shows how Bailey is uncomfortable to buy Gilts under the ‘’financial stability’’ button, while trying to tighten monetary policy with inflation at 10pct…Almost an impossible mission, and all this due to the silly QE for years AND failing to hike much earlier when it was all pretty clear that inflation was popping its head back! .The reason, this UK scenario is interesting for all CB’s, is that it can easily happen elsewhere eventually (already has in parts) U.S : Used Vehicle Index has gone negative for first time since May 2020 Uber, Lyft shares sink after Labor Department issues proposal on gig workers (not what majority of Uber drivers voted for 2y ago) U.S CPI : IMHO, it is clearly going to take more than this week’s print or even more than 2months worth of data to shift most of the Fed’s view overall, but evidence keeps accumulating that ‘worst’ is very most likely behind us (from housing in particular, services, crude ish (crude back down to pre OPEC+ cut levels the other day and other commodities , 2-5y fwd inflation expectations much lower overall, IMG downgrades on growth, retail inventory glut etc etc…)… so definitely some pretty decent signs of softness out there JGB’s trading – or lack off ‘’JPN’s 10y government bonds did not trade for 3rd day in a row’’ Countering Brainard previous day, yesterday Fed’s Mester said : I do not expect the Fed to lower rates in 2023, Size of Fed rate hikes will depend on economic conditions, I anticipate slow growth in the coming years, The biggest risk is that the Fed does not raise interest rates dufficiently, The economy's biggest challenge continues to be high and persistent inflation, The Fed has made no progress on lowering inflation.. >>>> a reminder that most of them 12months ago said, there will be no rate hikes in 2022…(a transition might be round-the-corner but they won’t flip till it's too late…) Saudi Arabia Defied US Warnings Ahead Of OPEC+ Production Cut – WSJ… U.S. Officials Asked Saudi Arabia to Delay OPEC+ Production Cut for a Month RBA Assistant Governor Luci Ellis gave a speech this morning detailing the RBA's thinking around the neutral cash rate, which it estimates to be around 2.50%. With the cash rate at 2.60% following the October 25bp hike, the RBA is therefore right near neutral according to Ellis , which was a large part of the reason for the central bank reducing the pace of its rate hikes from 50bp to 25bp. Ellis reinforced the message that the RBA is going to be a bit more cautious with its rate hikes going forward given the cash rate will be moving into restrictive territory. The IMF cut its 2023 global economic forecast. Growth is projected to slow to 2.7% as the war in Ukraine, inflation, and covid recovery weigh on the global economy. IMF criticises Kwasi Kwarteng again saying govt’s tax cuts and energy support package has made the Bank of England’s battle against inflation more difficult Bank of Korea hiked 50bps to 3% Retail Inventory glut is about to get ugly/Forbes "Flows suggest investors believe market may have bottomed: client flows into US equities last week were 3rd-largest since '08... Our view? More volatility likely ahead." - BofA Markets : USDJPY 146+ to some 24ywar lows, BoJ ‘intervened’ near 145 last month – Hard to fight on your own against the mighty USD while Fed is in hiking mode, FOMC minutes becoming always ever so important, and with G20 coming up in mid-November – long way away in these markets. Another mini run on GBP and it is really getting into cheap long-term levels, doesn’t look that way right now, but it never does in the short-term storm. The USDollar is too strong overall and is clearly starting to kill growth in the rest of the world 1 to 2 year time deposit also getting really attractive for small investors, when you start getting into the 5pct 2y fix deposit, this isn’t bad (UK) SPX500 trading around those 200dma levels 3590 area, perhaps a make or break with FOMC minutes and U.S CPI tomorrow. Risk sentiment all very low/oversold and that might be the good news together with BofA comment above, earnings reports kicking off properly now too The big issue with CB’s these days, not just UK, is that it’s run mostly by folks with little or NO long-term market experience, at the most important time in history (probably), since they themselves created this monster with the 25trn of QE the last 10+ years, ignoring that rate hikes were needed no later than 9-12months ago, that basically inflation was temporary and there were no need for hikes in 2022…And the Fed proceeded with the fastest and sharpest hiking cycle in the pace of 6months, ever…will they be wrong again by hiking too much now ? Saxo/Steen and Co >>> ''start'' to consider/look for signs of peak inflation/peak FOMC/peak rates over next few months, USD is killing growth in RoW, clear signs of slow down economically, consumers retrenching etc, risk FED does too much now https://www.coppolacomment.com/2022/09/what-was-real-reason-for-bank-of.html What was the real reason for the Bank of England's gilt market intervention? https://www.ft.com/content/87a5b7bf-6786-427f-89d6-96b736dcb814 Bank of England signals to lenders it is prepared to prolong bond purchases Officials have privately indicated flexible approach if market volatility flares up >>> many UK pension funds feel BoE intervention in the domestic bond market should be extended to Oct 31 ''and possibly beyond'', said the UK Pensions and Lifetime Savings Association (PLSA) With yields on UK inflation-linked debt having risen by some 64 bps in just one day yesterday - the sharpest spike seen since 1992 - bond investors must be wondering what on earth is going on. Are the UK's problems isolated events? Not likely. http://spkl.io/60134nbMt https://twitter.com/paulwaugh/status/1580100932724875265 Rees-Mogg claims that the market turbulence of past fortnight has nothing to do with the Govt. "It's much more to do with interest rates than it is do with a minor part of fiscal policy"….of course he does… mind boggling https://twitter.com/LizAnnSonders/status/1579432118446624768 Year/year % change for Used Vehicle Index has gone negative for first time since May 2020 – chart https://www.cnbc.com/video/2022/10/11/uber-lyft-shares-sink-after-labor-department-issues-proposal-on-gig-workers.html Uber, Lyft shares sink after Labor Department issues proposal on gig workers https://twitter.com/BondHack/status/1579780468102541313 If all the Credit Suisse CDS tourists want to see an actually gnarly chart: here's French grocer Casino's five-year CDS going/gone to the moon https://apnews.com/article/russia-ukraine-inflation-health-economy-international-monetary-fund-79b2ba468054025b28a8ab28ac676734 IMF dims outlook for 2023 global economy amid Ukraine war Zelensky called on G7 countries to speed up supplies of air defence systems and impose price caps on Russian energy exports as his country’s infrastructure and civilian neighbourhoods faced a second day of missile strikes. https://ft.com/content/5de6908c-c097-4a71-965a-66a56b234267 https://www.theguardian.com/business/2022/oct/11/power-giants-to-face-windfall-tax-after-all-as-liz-truss-delivers-u-turn Power giants to face windfall tax after all as Liz Truss delivers U-turn https://www.standard.co.uk/news/world/nasa-asteroid-dart-spacecraft-mission-space-debris-b1031982.html?utm_medium=Social&utm_source=Twitter#Echobox=1665515840-2 ‘Watershed moment for humanity’: Nasa hails success of asteroid mission that was test to save planet Nasa says its spacecraft managed to nudge the asteroid out of its natural orbit https://www.welt.de/politik/ausland/article241531277/Greta-Thunberg-bezeichnet-moegliches-Abschalten-von-AKW-in-Deutschland-als-Fehler.html Greta Thunberg bezeichnet mögliches Abschalten von AKW in Deutschland als Fehler - Greta Thunberg calls the possible shutdown of nuclear power plants in Germany a mistake. Top ! https://www.pv-tech.org/greece-runs-entirely-on-renewables-for-the-first-time-in-its-history/ Greece runs entirely on renewables for the first time in its history https://www.rte.ie/news/newslens/2022/1011/1328450-new-zealand/ New Zealand outlines plans to tax livestock burps, farts! https://www.forbes.com/sites/gregpetro/2022/10/07/retail-inventory-glut-is-about-to-get-ugly/?sh=3ceb54073d48 Retail Inventory Glut Is About To Get Ugly https://www.spiegel.de/politik/deutschland/ukraine-hat-deutsches-luftabwehrsystem-erhalten-iris-t-a-c3302cf3-1b72-4ab4-9741-6baf379b082c?d=1665498694&sara_ecid=app_upd_903PVrz5TZlGJuLWLqJDVijRko558t&sara_ecid=soci_upd_KsBF0AFjflf0DZCxpPYDCQgO1dEMph Ukraine hat deutsches Luftabwehrsystem erhalten https://saxostrats.podbean.com/e/all-eyes-on-boe-and-the-uk-gilt-market/ and Today's slide deck: https://bit.ly/3yyo7gp - Today we talk about the continuing weakness in equities with the latest jolt coming from BoE Governor Bailey's comments that UK pension firms must get their house in order by Friday as the central bank is planning to step away from the market. We also cover today's oil market and the expected forecasts from IEA and EIA, the grains markets and finally gold that attempting to bounce back from its recent decline. We also cover stocks to watch which today are Intel, Chr Hanse, and LVMH. Finally, we cover today's earnings release from PepsiCo and the economic calendar with a focus on US PPI figures and FOMC Minutes later tonight

Fed's Lael Brainard says monetary tightening will lower inflation over time. Federal Reserve Vice Chair Lael Brainard on Monday reiterated the U.S. central bank's plan to continue tightening monetary policy until there is clear evidence that inflation has slowed down, warning the U.S. economy will likely slow further as a result of elevated interest rates >>> Brainard is an economist, and is thus painting a slightly less hawkish picture than Powell of ‘lets hike and hike more because today’s CPI and NFP are still strong.. Brainard noted that Americans' savings have also dwindled faster than the Fed anticipated, suggesting there could be a pullback in spending soon – she remains definitely more dovish than most FOMC participants GS : 99% of outstanding mortgages have interest below last week’s Freddie Mac survey rate Food & Agri world food prices down again in Sep – that’s fastest 6months move down since GFC BoE : pre-open this morning - The Bank has announced that it will widen the scope of its daily gilt purchase operations also to include purchases of index-linked gilts.[1] This enhancement to our operations will be in effect from 11 October 2022 until 14 October 2022. Index-linked gilts will be purchased via a separate auction each day (1st time ever BoE buys index-linked bonds), in addition to the Bank's existing daily conventional gilt purchase auctions >>> all this, now we also know that UK PM and Chancellor were warned by HIS think tank that they may need fiscal tightening of more than $60bn to stabilise UK’s public finances / Times >>> UK yields ‘dropped’ about 5bp after these measures, not exactly a great vote of confidence, yet anyway. Kwasi Kwarteng will be questioned by the House of Commons at 14:30 UK time, live on BBC Parliament (this is a scheduled session) Jamie Dimon says UK government deserves benefit of the doubt after sparking market turmoil Josep Borell (EU high Rep) : A surging US dollar is making basic goods in other countries unaffordable unless central banks follow the US Federal Reserve’s lead, he explained >>> the reality is ECB should have hike long ago, similarly to BoJ, they are printing still with YCC at 25bps and wondering why JPY is so weak, it is quite extraordinary really.. Bunds on the move too, 10y yields around 2.32 (from 2.22 yesterday), as German government mentioned yesterday to be more open to ‘joint issuance of European bonds’’, though the story was later denied China gives clearest sign yet it will stick with zero-Covid strategy The most powerful buyers in Treasuries are bailing – all at once. From Japanese pensions and life insurers to foreign governments and US commercial banks, where once they were lining up to get their hands on US government debt, most have now stepped away. And then of course there’s the Federal Reserve, which a few weeks ago upped the pace that it plans to offload Treasuries from its balance sheet to $US60 billion a month, is this not going to impact the USdollar eventually…? US President Joe Biden and G7 leaders will hold a virtual meeting today to discuss their commitments to support Ukraine amid yesterday's series of missile attacks on Ukrainian cities, – White House Scholz : ‘’we will discuss inflation reduction act with the U.S, there must be no customs war’’ MS : “.. companies will have to take more significant action on labor--i.e., layoffs. Early warning signs on that front are emerging as evidenced by the recent drop in job offerings” — which leads jobless claims by ~4 months. [Wilson] Markets : UST 10y back to 4% - lots of talk of buyers of Treasuries ‘on strike’ (very heavy hedging price for JPN investors for example..) USD remains strong(er), anyone who thinks ‘G20’ may say or do something, should play it via options. As long as other CB are not hiking and/or Fed tells everyone they ‘nearly’ done at least..it is going to be hard to turn Equity markets, main indexes struggling on higher yields, bond market dislocation, these markets though also offer opportunities in many names, which are big solid cash flow generators, as markets (ETF’s) selling doesn’t discriminate between solid and weak balance-sheet, yet anyway Gold should be one of the early movers, if/when market sense an issue with UST volatility and thus USDollar Maybe a relatively weak earnings season (expected) with (pretty sure they will) large U.S companies blaming USD strength (amongst other things) ‘may’ shift the Fed tone sooner or later ECB’s Lane, BoE’s Cunliffe and RBA’s Ellis due to speak today – amongst other things Economic Calendar (tradingeconomics.com) https://www.foxbusiness.com/economy/feds-brainard-warns-higher-interest-rates-will-slow-us-economy Fed's Brainard warns higher interest rates will further slow US economy Brainard: Interest rates will need to remain elevated for 'some time' The economy has already cooled significantly in the U.S., with gross domestic product – the broadest measure of goods and services produced in a nation – contracting by 1.6% in the winter and 0.6% in the spring. Brainard noted that Americans' savings have also dwindled faster than the Fed anticipated, suggesting there could be a pullback in spending soon. Fire sale of UK plc underway: Goldman Sachs and Blackstone plotting to snap up British assets on the cheap as panicky UK pension funds flee http://dlvr.it/SZsqdf https://saxostrats.podbean.com/e/back-at-the-brink-do-we-go-over/ Today we look at equity markets back at the cycle lows just ahead of earnings season as treasury yields and a strong US dollar continue to pressure. We also discuss unrealistic earnings expectations for the coming batch of earnings reports, the large banks' massive unrealized losses on bond portfolios that will hamper buyback programs and dividend generosity, the ongoing dicey situation for UK gilts and sterling as sentiment and policymaker credibility continue to struggle, crude oil & gas, FX focus, TSMC's ugly day and more https://uk.finance.yahoo.com/news/fed-williams-sees-rates-heading-144604966.html Last Friday : Williams acknowledged that the Fed’s actions had international consequences and said he was in contact with his counterparts at foreign central banks, who also face high inflation. But he stressed that the Fed’s focus was its domestic goal to restore price stability.“We’re all working on our own to make the decisions to bring the economy back into balance,” he said >>> kind of emphasized that it is our USdollar (U.S) and it is your problem (RoW – rest of the world) >>> of course the right reaction would be for other central banks to hike (or to have hiked a lot sooner..) but in the face of recession, the have been very slow and hesitant to hike, even with inflation near 8pct say (headlines and yes I think we can agree things will moderate soon but still – they have been far too late and that’s partly -not only- reason for current messy situation) https://www.thisismoney.co.uk/money/mortgageshome/article-11298863/House-prices-fall-12-2024as-average-mortgage-rates-reach-6.html House prices could drop 12% by 2024, analysts warn, as average mortgage rates reach 6% and limit what buyers can afford >>> house prices went up 15-20pct last 18months…so there is room for lower and back to pre Covid levels, if that’s so nothing too dramatic.. https://www.tradingview.com/chart/SPX500/QSQ07ntB-Short-S-P500-bear-market-starting/ SPX500 chart and 200dma level https://www.afr.com/markets/debt-markets/the-most-powerful-buyers-in-treasuries-are-bailing-all-at-once-20221010-p5boqd The most powerful buyers in Treasuries are bailing – all at once https://tradingeconomics.com/united-states/government-bond-yield 10y UST yields back to 4% -chart https://www.thenews.com.pk/latest/998732-us-rate-hikes-feeding-risk-of-global-recession-borrell US rate hikes feeding risk of global recession: Borrell "Everybody’s running to increase interest rates — these will bring us to a world recession," EU’s top diplomat warns https://www.cnbc.com/video/2022/10/10/we-are-getting-ready-to-deploy-our-recession-playbook-says-legendary-investor-paul-tudor-jones.html?__source=sharebar|email&par=sharebar We are getting ready to deploy our recession playbook, says legendary investor Paul Tudor Jones >>> recession last usually approx. 1year, stocks fall on average 10%, shirt-term rates like 2y UST will fall first to possibly signal FED stops hiking or hikes a lot slower, once the 2yUSt peak, the USDollar peaks https://twitter.com/LizAnnSonders/status/1579432385073930240/photo/1 chart and more in the thread - Six consecutive monthly declines for global food prices … Food & Agriculture World Food Price Index fell by 1.1% in September and is decisively rolling over https://www.cnbc.com/2022/10/11/jpmorgan-ceo-says-uk-government-deserves-benefit-of-the-doubt.html Jamie Dimon says UK government deserves benefit of the doubt after sparking market turmoil https://apnews.com/article/russia-ukraine-business-explosions-germany-baltic-sea-9d117262bffdcbd7d49e902f138a71ce Germany opens investigation of Baltic gas pipeline blasts https://uk.news.yahoo.com/berlin-no-plans-support-joint-172719472.html Berlin has no plans to support joint EU debt for loans – source https://www.scmp.com/news/china/politics/article/3195541/china-gives-clearest-sign-yet-it-will-stick-zero-covid-strategy China gives clearest sign yet it will stick with zero-Covid strategy Public had expected shift away from stringent Covid-19 measures after 20th party congress However, People’s Daily commentary signals leaders are determined to continue pandemic controls after pivotal political meeting this month

NFP was on highs but close to expectations, bond sold-off hard, equity markets responded and gave back nearly all of the big short-covering rally we saw earlier last week, rates were already moving higher with ‘ease’ in the middle of the week, Fed speakers stuck to their guns, US CPI, FOMC minutes and much more this week (see below) Fed minutes "May provide more insight into the central bank’s aggressive efforts to fight inflation. And there’s a key measure of US producer prices is due Wednesday, followed by the University of Michigan’s monthly consumer inflation expectations on Friday."-BBG, on U.S "CPI is forecast to have risen 8.1% in Sep from a year earlier vs. 8.3% in Aug, according to economists surveyed by Bloomberg. Core CPI is projected to rise 6.5% on a year-over-year basis and fall to 0.4% month over month."-BBG >>>> The FED is rising rates at the fastest pace ever into a bubble, on top of it all, they still saying that they want the housing market to crash, having failed to stop QE early enough, and failed to start to hike in 2021 when inflation started to pop its head Global margin call hits European debt markets - Hedges blow up after risk gauges in Germany’s government debt market exceeded those of the 2008 world crash EU gas drops below €150/MWh to a three-month low. Driven by strong LNG arrivals, mild autumn weather and demand destruction. Russia's ability to shock much reduced with flows down 78% YoY., welcome news! UK : The central bank announced on Monday that it would introduce further measures to ensure an “orderly end” to its purchase scheme on Oct. 14. China's services activity falls for first time since May (from 55 to 49.3) PayPal pulls plan to fine customers $2.5K for promoting ‘misinformation’ UKR-RU : The embassies of the EU countries received an evacuation order from Kiev Markets : BUND/BTP spread at 2022 widest levels 257bp, German ‘Pfandbrief’ highest since 2011 too at 3.255, 10y mortgage rate now around 4% Bonds hit hard again last week, 8th negative week in a row for FI.. Gold ‘failed’ to break higher post NFP last Friday USD higher again post NFP, now UKR/RU situation clearly not helping ‘euro’ per say, could eurjpy come under pressure with the added risk of BoJ doing something in USDJPY ? (chart below just to put things in perspective) Crude steadily higher since OPEC+ cut Equity markets hit hard again post NFP with higher rates, duration particularly hit hard, weak start to the week, ahead of FOMC minutes and U.S CPI later on This week we are to going to get : At least 5 Fed speakers lined up already U.S PPI tomorrow FED meeting minutes on Wed Sep U.S CPI on Thursday Retail sales and consumer sentiment survey on Friday Volatile we will have – either way The current situation in markets Higher rates forcing fastest pace of falling prices in housing for 10years Equity markets down, duration hit hardest with higher rates and risk of recession in 2023 Commodities down on ‘risk’ of deflation UST yields almost making/made their move to natural level of 4 to 4.5%?.. https://s357.podbean.com/pb/32d9c078a280ddd674cb49f1e0d9b122/6343d05b/data1/fs56/5709963/uploads/2022_10_10_MarketCall_Slides.pdf?pbss=de4a2363-0c18-5238-a3ee-815269cd71fc and https://saxostrats.podbean.com/e/the-unbearable-tightness-getting-us-closer-to-the-peak/ The unbearable tightness getting us closer to peak yields >>> not what many in markets are looking for in markets right now Today we look at an ugly close to last week for equity markets after the market read a mostly uneventful September jobs report as negative for risk sentiment because the unemployment rate dropped back to the cycle low of 3.5%, driving treasury yields back toward the cycle highs and sending the US dollar higher again. Sentiment failed to improve in Asia as the week gets under way, with higher oil prices weighing and amplified by the stronger US dollar, while geopolitical jitters are more uncomfortable than ever. Precious metals, wheat, pondering peak tightness, the important event risks on the economic calendar and more are also on today's pod, which features Ole Hansen on commodities and John J. Hardy hosting an on FX. https://www.newsweek.com/putin-meet-security-council-after-crimea-bridge-explosion-1750216?utm_medium=Social&utm_source=Twitter#Echobox=1665389591 Putin to Meet With Security Council After Crimea Bridge Explosion https://twitter.com/Ole_S_Hansen/status/1579370314105966592 EU NatGas drops below €150/MWh to a three-month low. Driven by strong LNG arrivals, mild autumn weather and demand destruction. Russia's ability to shock much reduced with flows down 78% YoY. https://www.cnbc.com/2022/10/10/bank-of-england-announces-liquidity-measures-to-help-ease-pension-fund-issues.html Bank of England strengthens emergency stimulus to help ease market turmoil https://news.bitcoin.com/visa-partners-with-ftx-to-roll-out-crypto-debit-cards-in-40-countries/ Visa Partners with FTX to Roll Out Crypto Debit Cards in 40 Countries https://nypost.com/2022/10/09/paypal-pulls-plan-to-fine-customers-2-5k-for-promoting-misinformation/ PayPal pulls plan to fine customers $2.5K for promoting ‘misinformation’ https://www.bloomberg.com/news/articles/2022-10-09/gold-is-heading-east-as-a-falling-price-lures-asian-buyers The Gold Market’s Great Migration Sends Bullion Rushing East Western investors are dumping gold in response to rising rates. https://asiatimes.com/2022/10/global-margin-call-hits-european-debt-markets/ Global margin call hits European debt markets Hedges blow up after risk gauges in Germany’s government debt market exceeded those of the 2008 world crash The Government is still "thinking about" an energy-saving campaign, the Work and Pensions minister suggested this morning. Follow the latest on our politics liveblog: https://telegraph.co.uk/politics/2022/10/10/liz-truss-benefits-news-nicola-sturgeon-tories-kwarteng/?utm_content=telegraph&utm_medium=Social&utm_campaign=Echobox&utm_source=Twitter#Echobox=1665390472

GOLD – let’s see how goes after NFP >>>> could HIGHER VOLS and ILLIQUID blond market lead to a break up ion Gold safe heaven ? particularly as we approach 4 to 4.5% in UST which is very most likely going to be the top ? NFP – all about average earnings – any signs of them following JOLTS and markets should ‘like’ it (quite bizarre when markets look for bad data to push Eq higher, we are in one of those moments apparently..) Gold ‘breaking’ up on charts (clearly needs confirmation after NFP..) perhaps with the view UST 10year yields can do/go to 4-4.25 again but that being the top, XAU might be on to something from here OPEC+ move >>> the U.S and others are upset, in many ways, when you try to inflict a price cap on a commodity, the market usually finds a way to make you pay the ‘natural’ price Germany's relief plan could trigger UK-style bond meltdown in Euro nations. German Chancellor Scholz last week announced package worth €200bn designed to help w/soaring energy prices, including gas price brake & a cut in sales tax for fuel Fed must be 'singularly' focused on inflation, Mester says and Fed’s Waller Sees Additional Rate Hikes Into Early Next Year >>> overall message remains : it’s all about inflation Belarus bans consumer price rises in bid to tame inflation >>>> inflation is now illegal.. JPY : Japan’s top currency diplomate Kanda : making various efforts so as not to face a limit to ammunition in FX interventions Treasuries Liquidity Problem Exposes Fed to ‘Biggest Nightmare’. JPMorgan measure of Treasury-market depth continue to plunge >>> the UK’s issue the other day is the tip of the iceberg, and as we said should worry other countries in similar fiscal situation, so not surprising to read Scholz comments below and worries from the likes of JPM Markets : All about wage growth today, the actual number is quite irrelevant Equity markets rallied hard earlier in week (short covering), pausing last couple of days ahead of NFP Rates moved higher with relative ‘ease’ last few days, 10y say is 20bp higher, all petty much across markets, UK similarly etc >>> the main issue remain ‘liquidity’ or lack of, there is NO daily liquidity when mainstream large blocks of trades have to go through USD similar price action, weaker earlier in week, slightly higher last couple of days, awaiting payrolls Gold chart below Crude is up about 15% over last year (in USD terms), nothing dramatic ? maybe not, depending on which currency you look it can be up as much as nearly 50% for importers, such as Japan, and still about 25% in China, or 35% in Korea Electricity/gas prices slowly still heading lower in Europe VIX – a cheap punt, but nonetheless, 50K of the March’2023 150 calls! Traded last few days, at 20cents, in fact the highest strike in there is 180 Germany's relief plan could trigger UK-style bond meltdown in Euro nations. German Chancellor Scholz last week announced package worth €200bn designed to help w/soaring energy prices, including gas price brake & a cut in sales tax for fuel. https://cnb.cx/3ekWK2i https://tradingeconomics.com/commodity/eu-natural-gas TTF natgas https://www.bloomberg.com/news/articles/2022-10-06/energy-crisis-people-in-poland-burn-trash-to-keep-warm-in-coal-shortage?leadSource=uverify%20wall People in Poland Are Burning Trash to Stay Warm This Winter Russia’s war in Ukraine has exposed the vulnerability of Europe’s fuel supplies. In Poland, some households are hoarding garbage to replace their coal. https://www.ft.com/content/2ad6558d-57fb-41ad-be0b-477506c48cfa?segmentId=114a04fe-353d-37db-f705-204c9a0a157b Market jitters spur September flight to Treasury ETFs Government bonds including Treasuries accounted for 60 per cent of inflows, up from 20 per cent in August https://www.chicagofed.org/publications/speeches/2022/october-06-il-chamber-of-commerce Illinois Chamber of Commerce Annual Luncheon President Charles Evans joined the Illinois Chamber of Commerce for a moderated Q&A on the U.S. economy followed by an audience Q&A >>> rates like to peak 4.5% in Q1 2023 https://www.bbc.co.uk/news/business-63167922 Samsung warns of 32% hit to profits on chip slump https://www.finews.asia/finance/37792-credit-suisse-announces-debt-repurchase-offers?utm_source=newsletter_1773&utm_medium=email&utm_campaign=finews-asia-newsletter-07-10-2022 Credit Suisse Announces Debt Repurchase Offers Amid concerns about its financial health, Switzerland’s most troubled lender has announced offers to repurchase debt securities totalling billions of dollars…..long way to go in reducing debt… https://www.ft.com/content/c85e0afa-fdf4-499c-bb0d-6c106336ef0c Goldman Sachs pursues asset purchases in UK pensions fire sale US bank’s asset management arm targets retirement schemes’ illiquid holdings…“We’re seeing discounts of 20 to 30 per cent for a high quality portfolio [of stakes in private equity funds],” said Gabriel Möllerberg, a managing director at Goldman Sachs Asset Management. “It’s absolutely an opportunity.”…of course it is! https://uk.investing.com/news/economic-indicators/belarus-bans-consumer-price-rises-in-bid-to-tame-inflation-2773157 Belarus bans consumer price rises in bid to tame inflation VIX surge to 150 is day’s biggest options bet for ‘fear gauge.’ Trader pays $950,000 for 50,000 options wagering on VIX spike. Bet could be ‘cheap way to hedge’ against a market crash. https://bloomberg.com/news/articles/2022-10-06/vix-surge-to-150-is-day-s-biggest-options-bet-for-fear-gauge?sref=R17xFhjo https://www.bbc.co.uk/news/science-environment-63149957?xtor=AL-72-%5Bpartner%5D-%5Bbbc.news.twitter%5D-%5Bheadline%5D-%5Bnews%5D-%5Bbizdev%5D-%5Bisapi%5D&at_campaign=64&at_custom4=B277D272-4534-11ED-BAEC-A0EA4744363C&at_custom2=twitter&at_custom1=%5Bpost+type%5D&at_custom3=%40BBCNews&at_medium=custom7 New oil and gas at odds with green goals – report https://www.news18.com/news/business/germany-expects-recession-next-year-as-gas-crisis-bites-report-6114061.html Germany Expects Recession Next Year as Gas Crisis Bites: Report https://www.bloomberg.com/news/articles/2022-10-06/us-treasuries-liquidity-problem-exposes-fed-to-biggest-nightmare?sref=ZVajCYcV&leadSource=uverify%20wall Treasuries Liquidity Problem Exposes Fed to ‘Biggest Nightmare’ JPMorgan measure of Treasury-market depth continue to plunge - Bloomberg’s gauge of how far yields are from fair value rising Jan. 6 panel to hold rescheduled hearing next Thursday https://trib.al/ZoAj6sZ https://www.indy100.com/politics/nadhim-zahawi-question-time-putin?utm_content=Echobox&utm_medium=Social&utm_campaign=Main&utm_source=Twitter#Echobox=1665126896 Nadhim Zahawi laughed at for blaming Tories budget fiasco on Putin

PVM discusses "Growth vs Value", Single Stocks and our systematic approach to finding deep sustainable long term Value for our Client Portfolios.

In this interview with Bloomberg TV, PVM discusses our thoughts on Global Macroeconomics and how it drives our quest to build investment portfolios for our Clients with Better Metrics. We also discuss our latest single stock investments.