Tag: finance

After two gloomy days for stocks at the start of the month which led to the worst December for the S&P since 2008, markets rebounded around the globe following an unsourced Bloomberg report that said the trade negotiations with China are still very much on track “according to people who wish to remain anonymous” (such as Larry Kudlow), yet who apparently are too worried to reveal that they have a different agenda than the president. In any case, the lack of new trade deal pessimism coupled with a report that Chinese Ministry of Commerce spokesman said officials are in “close contact” with U.S. counterparts, even though China officially reiterated that the US must rollback existing tariffs to agree to a Phase 1 deal, was sufficient for global stocks to extend their levitation for a second day and for Reuters to proclaim that…

Indeed, the latest batch of headlines around trade suggested the world’s two largest economies were closer to agreeing how many tariffs would be rolled back in a “phase one” trade deal, while President Donald Trump said talks with China were going “very well”. This more optimistic tone around trade helped Wall Street’s main indexes snap a three-day losing streak in the previous session, putting the benchmark S&P 500 index just 1% away from an all-time high hit last week. Of course, things could turn sour fast: if no agreement is reached soon, around $160bn in tariffs on Chinese goods would come into effect from Dec. 15.

Or as DB’s Jim Reid put it:

We are living in a pre-December 15th world where one headline or tweet on trade has the ability to turn a good day into a bad one and visa-versa. The same story has the ability to wipe or add hundreds of billions (even trillions) from/to the value of global financial assets. That’s what we’re dealing with at the moment.

At 7am, Dow e-minis were up 104 points, or 0.38%; S&P 500 e-minis were up 11 points, or 0.35% and Nasdaq 100 e-minis were up 37 points, or 0.45%.

In the US, shares of tariff-sensitive semiconductor companies looked set to rise for the second straight day, with Micron Technology, Advanced Micro Devices and Nvidia gaining between 1% and 1.3% in premarket trading. Among stocks, Dollar General Corp jumped about 5% after the discount store chain raised its full-year profit forecast.  Nike shares climbed 2% after a report said Goldman Sachs upgraded the sportswear maker’s stock to “buy” from “neutral”, while Tiffany which is being bought by Louis Vuitton owner LVMH, nudged 0.5% lower after the luxury jeweler fell short of analyst’s estimates for quarterly sales.

European stocks were also a sea of green, as the Stoxx Stoxx Europe 600 rose as much as 0.5%, extending earlier gains, along with U.S. index futures. Most sectors were in the green, led by healthcare +0.9% and retail +0.8%; travel & leisure little changed.

Earlier in the session Asian stocks climbed, led by technology companies; most markets in the region were up, with Australia leading gains and South Korea slipping. Japan’s Topix rose, driven by electronic firms and drug makers, as Prime Minister Shinzo Abe announced a $239 billion stimulus package to support growth. The Shanghai Composite Index closed higher, with China Life Insurance and Foshan Haitian Flavouring among the biggest boosts. The Sensex gained for a second day as India’s central bank defied expectations for a rate cut and kept borrowing costs unchanged

There is other stuff besides trade too: after lackluster readings on domestic services sector activity and private payrolls growth on Wednesday, traders are also awaiting the Labor Department’s non-farm payrolls data due Friday.
Treasuries added to their losses from Wednesday, and were modestly cheaper across the curve, dragged lower by wider losses across bunds and gilts over early European session. Yields were higher by at least 1bp vs Wednesday’s close, 10-year by 1.7bp to ~1.79%; 10-year gilts and bunds underperformed by ~1bp. Indian government bonds tumbled after its central bank unexpectedly left interest rates unchanged.

In FX, the Bloomberg Dollar Spot Index headed for a fifth day of losses. The pound rose for a fifth day against the greenback as expectations grow for a Conservative victory in next week’s election, while the euro stayed near $1.11 as real money interest lent support.

 

Market Snapshot

• S&P 500 futures up 0.1% to 3,115.50
• STOXX Europe 600 up 0.1% to 403.67
• MXAP up 0.5% to 163.97
• MXAPJ up 0.6% to 521.04
• Nikkei up 0.7% to 23,300.09
• Topix up 0.5% to 1,711.41
• Hang Seng Index up 0.6% to 26,217.04
• Shanghai Composite up 0.7% to 2,899.47
• Sensex up 0.02% to 40,857.88
• Australia S&P/ASX 200 up 1.2% to 6,682.95
• Kospi down 0.4% to 2,060.74
• German 10Y yield rose 1.3 bps to -0.302%
• Euro up 0.1% to $1.1092
• Brent Futures down 0.08% to $62.95/bbl
• Italian 10Y yield rose 0.4 bps to 0.942%
• Spanish 10Y yield rose 1.6 bps to 0.458%
• Brent Futures down 0.08% to $62.95/bbl
• Gold spot up 0.02% to $1,474.91
• U.S. Dollar Index down 0.1% to 97.52

Top Overnight News from Bloomberg

• Japan announced a stimulus package amounting to around 26 trillion yen ($239 billion) spread over the coming years, with fiscal measures around half that figure
• ECB Governing Council members, who collectively lowered the key rate to minus 0.5% shortly before Draghi’s term ended, are increasingly portraying it as a necessary evil that shouldn’t be compounded
• Federal Reserve officials won’t allow the 2020 presidential election to sway their monetary policy decisions and will keep interest rates on hold for the next two years, according to economists surveyed by Bloomberg
• German factory orders unexpectedly declined, suggesting Europe’s largest economy is still struggling to overcome a manufacturing slump and fend off recession
• India’s central bank defied expectations for an interest rate cut, keeping borrowing costs unchanged to assess the effect of its policy after five reductions this year
• Chinese officials are in “close contact” with U.S. counterparts on trade negotiations, Ministry of Commerce spokesman Gao Feng said, while reiterating that tariffs should be reduced proportionately as part of a phase-one accord
• Adrian Lee & Partners, among the largest active currency management firms with over $14 billion in assets, announced Wednesday the launch of a Global Macro Alpha Fund, which will invest in equities and fixed-income alongside currencies at a time when historically-low levels of volatility are making it difficult for some in the industry to make profits from foreign exchange

Asian equity markets were mostly positive as they took their cue from global peers after the trade mood flip-flopped once again to a more positive tone yesterday. ASX 200 (+1.2%) was led by outperformance in the tech and energy sectors amid the trade optimism and recent 4% surge in crude prices, with banks also welcoming the RBNZ’s increased capital requirements as some now expect a lower impact than they had previously anticipated. Nikkei 225 (+0.7%) was underpinned by recent currency moves and with Japan set for a multi-trillion stimulus package, as well as talks with South Korea this month to address the trade spat. Elsewhere, Hang Seng (+0.6%) and Shanghai Comp. (+0.7%) were also lifted on the trade hopes and following the announcement of measures to support the Hong Kong economy, but with gains capped given the lack of actual meaningful breakthrough on the trade front and amid continued PBoC liquidity inaction. Finally, 10yr JGB were initially lower on spill-over selling from USTs and as demand was sapped by the gains across equities, although prices were later rebounded which was helped after the results of the 30yr JGB auction showed slight improvements across all metrics.

Top Asian News

• Japan’s Abe Says Stimulus Opens Path to Future Growth
• India Central Bank Surprises With Pause as Inflation Spikes
• Hedge Fund Sends Letter to Korea Lawmakers on Stock Value Boost

Major European bourses (Euro Stoxx 50 +0.6%) are higher as the market maintains a positive risk tone as it awaits further news on the US/China trade front and the outcome of today’s OPEC & JMMC meetings. The FTSE 100 (-0.1%) is again the laggard, amid a firmer Pound. Elsewhere, the CAC 40 (+0.4%) is holding up well despite France being hit by nationwide strikes, as workers across a range of professions protest French President Macron’s proposed pension reforms. Subsequently, a walk out by air traffic controllers has however resulted in some airlines being hit; Air France (-1.0%) said it was axing 30% of internal flights and 15% of short-haul international routes and easyJet (-0.8%) reportedly cancelled 223 domestic and short-haul international flights and warned that others risk being delayed, although yesterday’s approximate 4% rally in crude oil prices is also likely weighing on airlines in general – other names including IAG (-1.1%) and Deutsche Lufthansa (-1.2%) are also lower. Elsewhere, luxury names including Hermes (+1.6%) and Swatch Group (+1.6%) are on the front foot after Kering (+1.6%) reportedly held explanatory talks with Moncler (+9.2%) regarding a potential combination, which would mark continued consolidation within the sector following LVMH’s (+0.9%) buyout of Tiffany & Co. last month. Sectors are mostly in the green, barring Tech (unch.), Materials (unch.) and Telecoms (-0.1%), the latter weighed by continued underperformance in Orange (-0.7%), with the Co. still suffering following yesterday’s disappointing dividend outlook. In terms of other individual movers; Novartis (+0.7%) shares are underpinned by the news that around 90 innovative new molecular entities are emerging from the Co.’s institutes for BioMed research. Elsewhere, Fiat Chrysler (-0.9%) shares are under pressure after reports that the Co. is in talks with Italian tax authorities regarding an audit, which added that the Co. may be liable for up to USD 1.5bln in “exit tax”. Metro Bank (+0.6%) shares are supported following the resignation of its CEO Donaldson, who will be replaced by Frumkin on an interim basis. Finally, negative broker moves for Siemens (-0.7%), Berkley Group (-0.6%), Vinci (-0.5%) and Tullow Oil (-0.2%) weighs on their shares.

Top European News

• Credit Suisse Wins Order Keeping Critical Report From Prosecutor
• New CEO of U.K.’s Worst Stock of 2019 Will Have Work Cut Out
• Surging Green-Bond Demand Starts Tempting East Europe Borrowers
• Telecom Stocks Drop as Italian Finance Probe, Orange Weigh

In FX, sterling remains on a firmer footing in early EU trade, with the latest poll (Savana/ComRes) showing the market-friendly Conservatives maintaining its lead over Labour vs. the prior survey as election day looms. Aside from that, little pertinent news flow thus far to influence price action. GBP/USD extends gains above 1.3100 before hitting a wall just under the 1.3150 mark, ahead of resistance in the form of a Fib level at 1.3168 followed by 1.3185. Meanwhile, the EUR derives support from a marginally softer USD and largely side-lined a slump (and significant miss) in German industrial orders, albeit the country’s construction PMI indicated a decent rebound. EUR/USD continues to eke modest gains to session highs just under the 1.1100 mark (1.1078-93 intraday range thus far), with hefty options eyeing today’s NY cut – EUR 1.0bln between 1.1090-1.1100 and EUR 2.4bln around 1.1110-25.

• NZD, AUD, CAD – Mixed trade down under with the Kiwi buoyed by the RBNZ’s attempt to bulletproof its financial system via a capital requirement hike in order to withstand economic volatility. The Central Bank also gave lenders an extra two years to raise the required capital and flexibility on how they raise it. NZD/USD remains underpinned but has subsided a bulk of its overnight gains with the pair still in the green but back below its 200 DMA (~0.6540), having hit resistance around 0.6562-65. Meanwhile, the Aussie remains lacklustre on the back of further sub-par data, this time in the form of retail sales and trade balance, with the former printing flat and the latter a smaller surplus than had hoped. AUD/USD remains in the red and closer to the bottom of the current intraday band (0.6855-31) with the pair’s 100 and 50 DMAs (0.6814 and 0.6811 respectively) in the way of the psychological 0.6800. Elsewhere, the CAD remains modestly firmer in the aftermath of yesterday’s BoC hawkish hold and upbeat view on the economy, although traders will be eyeing BoC’s Lane on the docket later today (1245GMT) who is likely to speak on the economy. USD/CAD remains sub-1.3200 having touched a base around 1.3180.
• DXY, JPY – The broad Dollar and Index remain under pressure given the recent string of downbeat data and ahead of the monthly US jobs report tomorrow. DXY manages to stay afloat above 97.50 (just about) having clocked in a current range of 97.49-60 with little in terms of scheduled data/speakers to influence price action. Finally, USD/JPY is relatively flat and just a whisker away from the 109.00 mark, albeit above its 200 DMA at 108.87, with USD 1.4bln in options set to expire around 109.00-15.

In commodities, crude markets eke mild gains as the complex consolidates following yesterday’s strong price action and with participants cautious as they await the outcome of today’s JMMC and OPEC meetings; the former has already begun, while the latter is scheduled to begin at 14:00 GMT. Tomorrow OPEC+ will meet and the final decision on the cartels production cuts will be made. Sources this morning suggested that OPEC+ are to discuss deeper oil output cuts of more than 400k BPD as the main scenario, news which triggered some fleeting upside in crude markets and something which has been alluded to by the Iraqi oil minister on multiple occasions in recent days. This contrasts somewhat with the reported consensus amongst OPEC minister yesterday that a deeper cut will “be harder to pull off this time”. Russian Oil Minister Novak has so far declined to reveal the country’s stance for the upcoming OPEC+ meeting, but the country is expected to resist any push for further cuts; “Russia’s reluctance to deepen the cuts at the risk of compromising its market share and undermining the predictability of its oil rent is now well-known,” said Aperio Intelligence, adding “Russia’s strategy will be to seek to preserve the status quo without either overplaying its hand or overreaching”. Moreover, the country is also pushing to have its condensate output to become exempt from its quota, a request which may prove contentious, especially with Iranian Energy Minister stating that condensates of gas in the OPEC quota system is not a OPEC discussion. In terms of other crude specific news flow; the latest Platts Oil Survey revealed that OPEC pumped 29.65mln BPD of crude in November, with 11 quota members achieving cut compliance of 145%. The survey found that Iraq and Nigeria are still supplying in excess of the cap but are moving closer to compliance. Poor compliance by these members is a point of frustrations for the Saudis; just yesterday, it was reported that the Saudis are threatening to increase production back to its quota level, rather than reducing production by more than is required, due to growing frustration with those not complying with the existing OPEC cut agreement. Thus far, the Saudi’s have shouldered the bulk of the cuts, with recent analysis suggesting that without the Saudi’s overcompliance, OPEC+ compliance would be just 70%. On a different note, Goldman and Barclays provided some updates oil market forecasts; Goldman expects a Brent-WTI differential of USD 4.50/bbl in 2020, from the YTD levels of close to USD 7.0/bbl, while Barclays forecasts Brent to average USD 62/bbl and WTI to average USD 57/bbl for Q4 2019 and 2020. Moving over to metals; gold is slightly lower, amid a lack of demand for havens, but is relatively rangebound about the USD 1480/oz level. Meanwhile, positive risk tone has underpinned copper, which has this morning managed to eclipse yesterday’s USD 2.6655/lbs high, albeit only slightly.

US Event Calendar

• 7:30am: Challenger Job Cuts YoY, prior -33.5%
• 8:30am: Initial Jobless Claims, est. 215,000, prior 213,000; Continuing Claims, est. 1.66m, prior 1.64m
• 8:30am: Trade Balance, est. $48.5b deficit, prior $52.5b deficit
• 10am: Factory Orders, est. 0.3%, prior -0.6%
• 10am: Factory Orders Ex Trans, prior -0.1%
• 10am: Cap Goods Ship Nondef Ex Air, prior 0.8%; Cap Goods Orders Nondef Ex Air, prior 1.2%
• 10am: Durable Goods Orders, est. 0.6%, prior 0.6%; Durables Ex Transportation, est. 0.6%, prior 0.6%

DB’s Jim Reid concludes the overnight wrap

We are living in a pre-December 15th world where one headline or tweet on trade has the ability to turn a good day into a bad one and visa-versa. The same story has the ability to wipe or add hundreds of billions (even trillions) from/to the value of global financial assets. That’s what we’re dealing with at the moment.

Indeed it was another see-saw day for markets yesterday as investors took heart from a Bloomberg report that said the US and China were moving closer towards a trade deal, even amidst the tougher rhetoric between the two sides over non-trade issues in recent days. So carrying on the theme, a couple of journalists writing this story basically helped add around $561 billion to global equity markets yesterday given the market cap of global equities.

Citing “people familiar with the talks”, the article said that the US negotiators thought a phase-one deal would be finished before December 15, when US tariffs on China are scheduled to increase, and that President Trump’s comments the previous day that a deal could wait until after the US election next year shouldn’t be taken as an indication the talks were stalling. Meanwhile, China’s Foreign Minister Wang Yi has said on whether the trade talks can be finished this year that “it depends. China’s stance is very clear. There is hope, as long as it is based on mutual respect and equal consultations.” Elsewhere, Mr Trump has now said that talks with China are going very well before adding, “We will make a lot of progress.” Overnight, CNBC also reported, citing people familiar with the talks, that President Trump’s son-in-law Jared Kushner, who helped bring the US-Mexico-Canada trade agreement to fruition, has increased his direct involvement in the negotiations with China over the past two weeks.

The situation remains highly changeable, but markets nevertheless rallied with the S&P 500 up +0.63% to end a run of 3 successive declines. Trade-sensitive stocks led the advance, with the Philadelphia semiconductor index up +1.55%, its strongest performance in over a week, while the NASDAQ (+0.54%) and the Dow Jones (+0.53%) also closed higher. Energy stocks were the strongest performers among US equities thanks to oil’s advance, with WTI (+3.98%) and Brent Crude (+3.60%) experiencing their best day since the aftermath of the Saudi drone strike in September that saw Brent rally +14.61% in a single session. The move was partially driven by expectations that OPEC will announce an expanded cut to output at today’s meeting, plus US inventories later in the day showed a larger-than-expected drawdown. It was a similar bullish equity story in Europe, with the STOXX 600 up +1.18% to end a run of 4 successive moves lower.

With the risk-on attitude, sovereign bonds sold off on both sides of the Atlantic, with 10yr Treasuries +5.5bps to 1.771%, while the 2s10s curve steepened by +2.1bps.Canadian bonds were the worst performer, +9.5bps after the Bank of Canada’s decision (more on which below), while in Europe 10yr Bunds (+3.3bps), OATs (+3.7 bps) and Gilts (+7.2bps) all lost ground. Higher rates helped bank stocks however, with the S&P 500 banks industry group +1.31% in its best performance for a month, while the STOXX Banks index in Europe was also up +2.08%.

In overnight news, Japan’s PM Shinzo Abe announced a total stimulus package amounting to JPY 26tn (c. $239 bn) spread over the coming years to support the economy. Remember that without a package fiscal would be tightening with tax increases. The total is perhaps bigger than expected but the fresh fiscal measures are not. Of the total, JPY 13.2 tn would be fiscal measures, according to a draft stimulus document seen by Bloomberg. Despite the big headline figure, the initial reaction to the package has been muted given that the headline stimulus figure for such announcements in Japan are typically inflated with promised loans and private-sector assistance and as details indicated that the actual central government spending is just JPY 7.6tn (per Bloomberg). Yields on 10y JGBs are up +1.3bps to -0.045%.

Asian markets are following Wall Street’s lead this morning with the Nikkei (+0.79%), Hang Seng (+0.36%) and Shanghai Comp (+0.41%) all up. The Kospi is down -0.45%. Elsewhere, futures on the S&P 500 are trading flat while the yield on 10y USTs is down -1.6bps.

In other positive news for trade, the House Democrats said overnight that a deal on the stalled U.S.-Mexico-Canada free-trade agreement is within reach and urged Mexico to accept a compromise on labor-rights enforcement. Mexico’s top trade negotiator, Jesus Seade, met yesterday in Washington with his US counterpart, Robert Lighthizer, in an attempt to resolve final details and they are again going to meet today. Elsewhere, in France, unions representing a broad sweep of workers across the country are going on an indefinite “greve,” or strike, starting today in opposition of Prime Minster Macron’s plan for an overhaul of the pension system. So one to watch.

Bloomberg also reported overnight that Elizabeth Warren is drafting a bill that would call on regulators to retroactively review about two decades of “mega mergers” and ban such deals going forward. According to a draft of the bill reviewed by Bloomberg, the proposal would expand antitrust law beyond the so-called consumer welfare standard to also consider the impact on entrepreneurs, innovation, privacy and workers.

Back to yesterday, and the main data releases were the final services and composite PMIs for November from around the world. In terms of the numbers, the Euro Area composite PMI was revised up to 50.6 (vs. flash 50.3), although this strength was somewhat dependent on the country, with Germany revised up to 49.4 (vs. 49.2 flash) while France was revised down to 52.1 (vs. 52.7 flash). In the periphery, where we didn’t have the flash readings as a guide, Italy’s composite PMI fell into contractionary territory at 49.6, its lowest level in 7 months, while Spain saw an increase to 51.9, a 3-month high. On the services PMI for the Euro Area, this was also revised up, now at 51.9 (vs. 51.5 flash).

Turning to the US, and the non-manufacturing ISM index for November fell to 53.9 (vs. 54.5 expected). In a more promising sign, the employment component rose to a 4-month high of 55.5, but this was a contrast to the more negative message from the ADP report of private payrolls, which saw the weakest employment gain in 6 months, at just +67k (vs. +135k expected).

Here in the UK, with just one week now until the general election, sterling was the strongest performing G10 currency for the second day running, up +0.85% against the dollar at its highest level since May. In fact against the euro, sterling was at its highest level since May 2017, way back when the country was in the midst of the last general election campaign. In recent weeks, sterling has been supported by investor hopes that a Conservative majority at the election will support a smooth ratification of the Withdrawal Agreement through Parliament, taking away some of the short-term uncertainty over the Brexit process. The sole poll yesterday came last night and showed a 10pt lead for the Tories – unchanged from the previous poll and in-line with the poll of polls. Sterling was also helped by the PMI revisions, with the composite PMI revised up to 49.3 (vs. flash 48.5).

The Canadian dollar took 2nd place to sterling yesterday, up +0.73% against the US dollar after the Bank of Canada left rates unchanged yesterday at 1.75%. Although in line with expectations, the market took the message to be somewhat hawkish, with the statement from the BoC saying that there was “nascent evidence that the global economy is stabilising”. Looking forward, they said that future decisions would “be guided by the Bank’s continuing assessment of the adverse impact of trade conflicts against the sources of resilience in the Canadian economy”.

Elsewhere, US Treasury Secretary Mnuchin sent a letter to the OECD arguing against unilateral digital services taxes like France’s recent measure. This follows Friday’s report from the USTR which said that the French proposal is discriminatory against US firms. Mnuchin’s letter pushed for multilateral measures via the OECD. For more on the OECD plans see our report on the future of corporate taxes from a few weeks back here .

To the day ahead now, and we’ve got a number of data releases, starting this morning with German factory orders for October, along with the country’s construction PMI for November. We’ll also get the Euro Area’s retail sales figures for October, as well as the final GDP and employment readings for Q3. Then from the US, there’s the October trade balance and factory orders data, along with the final reading for October durable goods orders and non-defence capital goods orders. Finally, there’ll be the weekly initial jobless claims, and from Canada October’s international merchandise trade. In terms of central banks, we’ll hear from the ECB’s Makhlouf, while the Fed’s Quarles will be testifying before the Senate Banking Committee on supervision and regulation.

Moving higher for a fifth straight session, the pound climbed to fresh cycle highs on Thursday after the London open, as expectations for the return of a Tory majority after next week’s snap vote have helped bolster the British currency, which has risen 9% off its lows.

The pound’s torrid pre-election rally has brought the currency to its highest level vs the dollar in more than 7 months, and its strongest level vs. the euro in 2 years.

Cable climbed another 0.2% on Thursday to trade above $1.31 for the first time since May 7. If it holds its gains until the end of the session, it will mark the pound’s longest winning streak (five sessions) since June.

As the FT explains, a Conservative majority is the more market-friendly outcome because it would promote greater certainty: PM Johnson would finally be able to push through his version of the withdrawal agreement negotiated with the EU27, allowing the UK to officially begin the process of separating from the EU, and initiating the next round of negotiations on the nature of the trade deal.

“Rarely have voters been asked to pass judgment at such a critical time for the economy and for financial markets,” Ruth Gregory, a senior economist at Capital Economics, told the FT.

But Johnson’s pledge not to extend the Brexit transition period beyond the end of next year could create problems for sterling bulls down the line.

After the currency’s initial rally, attention would shift “very, very quickly,” Willem Klijnstra, currency analyst at Legal & General Investment Management, told the FT. His firm has been neutral on its sterling exposure since September. “If we do get a Conservative win then we are straight back to Brexit.”

The pound has risen sharply since October, when Johnson successfully pushed for the snap vote, ending a period of market chaos instigated by his insistence that the UK could leave the EU without a deal.

Vice President Joe Biden and his team have seized on Tuesday evening’s now-infamous ‘hot mic’ moment featuring Justin Trudeau, Boris Johnson, Emmanuel Macron and Dutch PM Mark Rutte and transformed it into a campaign advertisement claiming that the rest of the world is laughing at President Trump.

The world is laughing at President Trump. They see him for what he really is: dangerously incompetent and incapable of world leadership.

We cannot give him four more years as commander in chief. pic.twitter.com/IR8K2k54YQ

— Joe Biden (@JoeBiden) December 5, 2019

They supplemented the moment by sprinkling in clips from cable news, Trump’s speech at the 2019 UN General Assembly and other moments where world leaders were purportedly less than impressed with Trump’s performance (they also used a clip from when the Polish first lady shook Melania Trump’s hand, bypassing Trump’s outstretched hand, which she probably missed because she didn’t see it – not because it was some kind of intentional snub).

The advertisement concludes with a campaign stump speech spoken by Biden: “The world sees Trump for what he is: Insincere, ill-informed and corrupt…dangerously incompetent and incapable, in my view, of world leadership.”

While we would like to give Biden’s team credit for the swiftness with which they pushed out their ad (they will no doubt be followed in time by the rest of the Democratic pack), it’s still impossible to ignore that this is the exact same messaging that Hillary Clinton used in 2016 (though Trump hadn’t yet served a term in office then) and – as one twitter wit pointed out –

Vice President Joe Biden and his team have seized on Tuesday evening’s now-infamous ‘hot mic’ moment featuring Justin Trudeau, Boris Johnson, Emmanuel Macron and Dutch PM Mark Rutte and transformed it into a campaign advertisement claiming that the rest of the world is laughing at President Trump.

Biden’s video has been viewed nearly 4 million times in its first eight hours of life…not too shabby.

The world is laughing at President Trump. They see him for what he really is: dangerously incompetent and incapable of world leadership.

We cannot give him four more years as commander in chief. pic.twitter.com/IR8K2k54YQ

— Joe Biden (@JoeBiden) December 5, 2019

They supplemented the moment by sprinkling in clips from cable news, Trump’s speech at the 2019 UN General Assembly and other moments where world leaders were purportedly less than impressed with Trump’s performance (they also used a clip from when the Polish first lady shook Melania Trump’s hand, bypassing Trump’s outstretched hand, which she probably missed because she didn’t see it – not because it was some kind of intentional snub).

The advertisement concludes with a campaign stump speech spoken by Biden: “The world sees Trump for what he is: Insincere, ill-informed and corrupt…dangerously incompetent and incapable, in my view, of world leadership.”

While we give Biden’s team credit for the swiftness with which they pushed out their ad (they will no doubt be followed in time by the rest of the Democratic pack), unfortunately, we doubt his message will be very effective at winning over swing voters.

I remember when John Kerry triumphed over Bush with this winning message https://t.co/04Itmqi9qY

— looking for CoD teammates on Raya (@ByYourLogic) December 5, 2019

Unsurprisingly, all the big-name “we’re with her” dems and donors were impressed by the ad and it’s “smart” and “powerful” message.

very cool pic.twitter.com/lLPlsB5x0O

— Brendan O’Connor (@_grendan) December 5, 2019

And some political reporters were there ready to point out why this isn’t a “smart” strategy.

oh my god these guys are so dumb. this is just what hillary tried to do!!!! fuck!!!! https://t.co/aowbpLGLSF

— guy fieri 2020 campaign manager (@libbycwatson) December 5, 2019

But it was a great attempt at regaining relevance for Biden at a time when the national conversation has already moved on to the next round of centrist challengers who are ready to take his place at the top when he strokes out on live TV.

Authored by Jason Ditz via AntiWar.com,

The 1949 NATO Treaty never attempted to single out a specific enemy for the alliance to fight against, and while it was clear at the time the Soviet Union was the focus, the lack of specificity has meant numerous attempts in recent history to add enemies, or make up new things for the alliance to do.

During this week’s NATO meeting, they are going to officially add a new nation to the list of “challenges,” in the form of China, with NATO chief Jens Stoltenberg saying NATO has to “tackle the issue” of China’s growing capabilities.

China is a major military and economic power, though not hostile to any NATO member nations. That China is a Pacific nation makes them a strange enemy for an alliance supposedly focused on the north Atlantic to single out.

NATO, however, is at a crossroads trying to figure out its identity and purpose, and China’s sheer size makes it an attractive target to justify NATO’s continued existence.

Which isn’t focused just on China. NATO is continuing to set out plans for military confrontations with Russia, and likewise is cobbling together cases for NATO to focus on terror wars across the world.

Update 2: After being accused of being “two-faced” by President Trump, Canadian PM Trudeau has come up with an excuse for his

Canadian Prime Minister Justin Trudeau downplayed comments he made about president Donald Trump that were caught on camera on Tuesday.

“Last night I made a reference to the fact that there was an unscheduled press conference,” Trudeau said Wednesday during a press conference in London. 

“It was certainly notable and I’ve had a number of good conversations with the president over the course of this day and yesterday,” he added.

Asked about his comment about Trump aides’ jaws dropping, he said: “We were all surprised and I think pleased to learn that the next G-7 will be at Camp David, I think that was an unscheduled announcement.”

So Trudeau basically explaining it away as just another miscommunication.

The implication of Trudeau’s “jaws drop to the floor” explanation is that WH staff either didn’t know Trump had decided the G7 would be at Camp David, or just didn’t know he would announce it Tuesday. https://t.co/IUlZLv0gHz

— Ben Pershing (@benpershing) December 4, 2019

* * *

Update: President Trump isn’t one to let criticism go unanswered, and in keeping with tradition, the president called Trudeau “two-faced” Wednesday during a meeting with German Chancellor Angela Merkel in response to the hot mic video where Trudeau was seen bad-mouthing Trump to Boris Johnson and Emmanuel Macron.

“He’s two-faced,” Trump told reporters. “I find him to be a very nice guy, but the truth is I called him out on the fact that he’s not paying 2% and I guess he’s not happy about it.”

Trudeau was likely blowing off steam after Trump questioned the Canadian prime minister about how much his country spends on defense during a bilateral press event on Tuesday.

* * *

In an edited clip released by the Canadian Broadcasting Corporation, Justin Trudeau, Emmanuel Macron and Boris Johnson were all caught on a hot mic appearing to ridicule President Trump after a day of rambling press conferences that took world leaders off guard.

At the beginning of the clip, Johnson can be heard inquiring about why Macron was late to a meeting earlier that day, when Trudeau butts in, exclaiming that Macron had to factor in a 40-minute diversion apparently caused by Trump.

If you ever wondered what world leaders chat about in private, well here at NATO they’re gossiping about #Trump.

Leaked Video shows Canada’s Trudeau (with a 🍺), France’s Macron, UK’s Johnson making fun of Trump’s long pressers and his staff reactions: pic.twitter.com/5E0KISv1jo

— Joyce Karam (@Joyce_Karam) December 4, 2019

The world leaders were joined by Princess Anne, the Queen’s daughter, who naturally was invited to the Buckingham Palace reception where the footage was taken. Dutch Prime Minister Mark Rutte also appears to be in the scrum. At one point, Rutte can be heard laughing while saying “fake news media”.

Though Trump’s name isn’t heard spoken, the subject of their gossipy little pow-wow is pretty clear. At one point, Trudeau can be heard telling his pals about how a certain leader’s team members’ jaws dropped when he launched into a rambling tangent during a press conference.

A loosened up Canadian PM Justin Trudeau, seen sipping from a glass of beer, could barely contain himself, gesturing wildly and shouting “You just watched his team’s jaws drop to the floor!”

It’s likely that Trudeau is referring to his joint press conference with President Trump, where the president veered wildly off-topic and answered questions about the burgeoning impeachment inquiry while lashing out at his democratic rivals.

PM @JustinTrudeau while @realDonaldTrump is asked about the impeachment hearings/story #cdnpoli pic.twitter.com/UFpTz3Xt6t

— Mike Le Couteur (@mikelecouteur) December 3, 2019

However, Trump participated in several press conferences yesterday, not only with Nato General Secretary Jens Stoltenberg, but also with Boris Johnson, Trudeau, and a memorably tense news conference with Macron.

Regardless, CNN was all over the hot mic clip, pushing it as evidence that the US hasn’t regained its status in the world.

And it of course belies Trump’s frequent claim that he has made the US respected again https://t.co/TTuZoGMhUP

— Jim Sciutto (@jimsciutto) December 4, 2019

Meanwhile, on Wednesday, leaders wrapped up the two-day summit with a draft communique that made on thing clear: The rest of Nato wants to keep Trump happy, and is much more concerned about what Trump wants than what the president of France wants right now, BBG reports.

The draft showed that leaders made “burden sharing” – Trump’s top priority re: Nato – the centerpiece of the communique.

It has been over 7 years since the European Central Bank’s key deposit facility rate was positive, and just a few weeks ago it was lowered to a record low of -50bps.

Source: Bloomberg

And during that time, European bank stocks have suffered greatly…

Source: Bloomberg

As Cornelius Riese, co-CEO of Frankfurt-based DZ Bank A.G. (Germany’s second-largest by assets), observed, negative rates indeed “have a huge impact on banks.” Riese ventured to offer some gentle criticism of Draghi & Co.’s grand policy experiment:

“Maybe at the end of the story, in three to five years, we will notice it was a historical mistake.”

Well, it appears we are about to reach the vinegar strokes of that ‘historical mistake’, as Bloomberg reports, German banks are breaking the last taboo: Charging retail clients for their savings starting with very first euro in the their accounts.

While many banks have been passing on negative rates to clients for some time, they have typically only done so for deposits of 100,000 euros ($111,000) or more. That is changing, with one small lender, Volksbank Raiffeisenbank Fuerstenfeldbruck, a regional bank close to Munich, planning to impose a rate of minus 0.5% to all savings in certain new accounts.

Another bank, Kreissparkasse Stendal, in the east of the country, has a similar policy for clients who have no other relationship with the bank; and a third, Frankfurter Volksbank, one of the country’s largest cooperative lenders, is considering going even further and charging some new customers 0.55% for all their deposits is considering an even higher charge.

“The floodgates are open,” said Friedrich Heinemann, who heads the department on Corporate Taxation and Public Finance at the ZEW economic research institute in Mannheim.

“We will soon see a chain reaction. Banks that do not follow with negative interest rates would be flooded with liquidity.”

It appears that European banks are coming around to the fact – and preparing for it – that negative rates are here to stay (especially under Lagarde who has already opined that there is nothing wrong with negative rates).

Bank CEOs across Europe have expressed their anger at the ECB’s policy over the last few months.

The ECB’s imposition of negative interest rates have created an “absurd situation” in which banks don’t want to hold deposits, rages UBS CEO Sergio Ermotti, arguing that this policy is hurting social systems and savings rates.

Oswald Gruebel, who served as Credit Suisse CEO from 2004 to 2007 and as UBS Group AG’s top executive from 2009 to 2011, has slammed ECB policy in an interview with Swiss newspaper NZZ am Sonntag.

“Negative interest rates are crazy. That means money is not worth anything anymore,” Gruebel exclaimed.

“As long as we have negative interest rates, the financial industry will continue to shrink.”

And finally, Deutsche Bank CEO Christian Sewing warned that more monetary easing by the ECB, as widely expected next week, will have “grave side effects” for a region that has already lived with negative interest rates for half a decade.

“In the long run, negative rates ruin the financial system.”

The German savings rate was around 10% in 2017, almost twice the euro-area average, but one wonders what will happen now that even mom-and-pop will have to pay to leave their spare cash in ‘safe-keeping’. Will deposit levels tumble in favor of the mattress? Or, as some have suggested, gold will get a bid as a costless way of storing wealth

Authored by Paul Joseph Watson via Summit News,

Dozens of elderly residents were forced to leave their apartments in an area of Stockholm after the block was closed, only to be re-opened again for migrants to replace them.

Residents at Dianagården were told they would have to leave because the toilets in the facility were 5cm too small to comply with regulations.

However, soon after the 48 apartments were emptied, they were filled with newly arrived migrants.

“It was later revealed that politicians planned that immigrants would instead move into the premises,” reports Fria Tider.

In 2015, Sweden accepted more refugees per capita than any other country, and despite worsening problems with sexual assaults, grenade attacks and violent crime, the inflow shows no sign of being seriously restricted.

A recent opinion poll found that the anti-mass migration Sweden Democrats are now the most popular party in Sweden. The Sweden Democrats would get 24.2% of the votes if an election was held today, beating the ruling Social Democrats.

Back in October, Leif Östling, former CEO of trucking company Scania, warned that Sweden is heading towards civil war due to uncontrolled mass immigration.

“We’ve taken in far too many people from outside. And we have. Those who come from the Middle East and Africa live in a society that we left almost a hundred years ago,” he said.

*  *  *

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Sell-side analysis was never perfect.

Banks’ competition for lucrative deal flow has always ensured that the “Chinese wall” that’s supposed to exist between the front office and research department is about as impenetrable as a sieve. And then there’s the overpowering pressure for analysts to conform to the consensus, which works like this: If you conform to the consensus, then when everyone is wrong, you don’t look so bad, and you don’t need to worry about losing your job as head analyst.

But if you take a contrarian position and miss, then you’re at risk.

Unfortunately for those who have chosen to make a career in the research departments of big sell-side banks, new European banking regulations (MiFid II) are already forcing banks to reduce research department headcount, according to the FT.

Since MiFid forced banks to explicitly charge for research, new pricing structures being adopted by sell-side research departments have raised the cost for clients, forcing firms to pick and choose which banks they will continue paying for research.

The result? Wall Street research now comes with more fees than discount airlines.

And with fewer bodies in the research department, megabanks are increasingly being forced to dedicate limited resources to only the most lucrative businesses: I.e. large-cap companies who will bring in the research subscriptions from asset managers, and companies that might offer an M&A payoff.

At any rate, in less than a decade, the average number of analysts covering the biggest European companies has fallen by nearly a quarter, largely because of MiFid 2.

The average number of analysts who cover European companies with a market capitalisation of $100bn or more has dropped 22 per cent since 2011, according to StarMine numbers compiled by Bank of America. Those companies with a market value of $10bn to $100bn have seen their coverage contract by 26 per cent, it found.

The numbers underscore how investment banks prefer to focus their limited resources on companies of a size necessary to interest big asset management clients, or those that may yield dealmaking work for the banks themselves. Coverage is declining everywhere but the trend is particularly acute in Europe, where the introduction of the Mifid II regulatory package in January 2018 has forced asset managers to “unbundle” payment for research from trading business.

As a result of having to pay directly for research, many investment groups have sharply curtailed how much they use. But the impact has been felt everywhere.

The number of equity analysts working at the 12 biggest banks has fallen below 4,000, which risks leaving dozens of important companies without any analysts covering them.

As the head of research at JPM explained, Mifid II is going to make everyone more conscious of the research they’re consuming…and it’s also ratcheting up the competition to be the top ranked analysts.

“Mifid II has made everyone a lot more aware of the research they consume, whether they’re directly affected by Mifid or not,” said Joyce Chang, chair of research at JPMorgan. “You’re not going to call 10 analysts, you’re only going to call the top people, so we have to work hard to stay comprehensive…if you’re numbers five through 10, it will be harder to stay on everyone’s radar.”

While headcount is falling in research departments everywhere, Europe has been particularly hard hit. And with most banks bracing for an economic downturn by trimming fat wherever they can, the full-year number for 2019 will likely be even lower.

Authored by Robert Bridge via The Strategic Culture Foundation,

When it comes to protecting children, families and Russian traditions, Vladimir Putin has few rivals in the developed world. But will Russia be able to holdout forever against the globalists’ ultra-liberal agenda now threatening the planet?

Had Peter the Great known what strange ideas would come to fixate the Western mind, perhaps he never would have built his northerly city of St. Petersburg, designed to throw open a ‘window to the West’. Indeed, he most likely would have evacuated the swampland, ditched his Europe-inspired beard tax and retreated inland as far as possible.

There is some craziness in this world, however, that could not have been predicted 30 years ago, to say nothing of 300 years. The new realities have forced Russian lawmakers to reflect upon the future of Russian identity in the face of radical liberal tendencies emanating from the West like some modern plague.

“You said the word mother ‘can’t be replaced.’ It turns out, perhaps, it can,” Putin reminded delegates at a meeting of the Council for Interethnic Relations, a Kremlin advisory group.

“In some countries, they now have ‘parent number one’ and ‘parent number two.’ I hope we never have that (in Russia).”

The Russian leader’s comment elicited chuckles from the assembled officials, long inured to the occasional Western crackups. Yet that good-natured response masked the looming uneasiness that yet another crazy train has departed the Western station and is on a collision course with Russia, as well as the rest of the world.

#parent1Parent2 pic.twitter.com/oh5rKEmXPM

— Sentenza (@Perinetti_Yo) February 15, 2019

Indeed, Putin was referencing a law passed in France earlier this year that mandates schools refrain from using ‘mother’ and ‘father,’ substituting it for ‘parent 1’ and ‘parent 2’ in an effort to accommodate passage of a 2013 same-sex marriage law.

“We have families who find themselves faced with tick boxes stuck in rather old-fashioned social and family models,” said Valérie Petit, MP from the party of President Emmanuel Macron.

“For us, this article is a measurement of social equality.”

In case anyone thought that would settle the confusion, the issue has now turned to the question as to which parents will be designated ‘parent 1’ and ‘parent 2.’

Marine Le-Pen, leader of the far-Right National Rally, remarked that “the mask has fallen” from the Macron government regarding its views on family values.

Meanwhile, back in Russia, Putin began adjusting his country’s sails against such radical liberal experiments back in June 2013 with passage of a federal law entitled, ‘Protecting Children from Information Advocating for a Denial of Traditional Family Values’. Western media outlets quickly pounced on the legislation, portraying it as dangerous to homosexuals, even warning they risked arrest if they visited the 2014 Sochi Olympics.

Vladimir Putin, today: “You said the word mother ‘can’t be replaced.’ It turns out, perhaps, it can. In some countries, they now have ‘parent number one’ and ‘parent number two.’ I hope we never have that (in Russia).”pic.twitter.com/O7mS7YNtfI

— Bryan MacDonald (@27khv) November 29, 2019

As Harvey Fierstein argued in the New York Times, for example, Putin’s ‘anti-gay’ law means that “any Olympic athlete, trainer, reporter, family member or fan who is gay — or suspected of being gay, or just accused of being gay — can go to jail.”

That was either deliberate fake news or extremely shoddy journalism, but since the New York Times article cited Huff Post, which in turn quoted an obscure travel blog, we’ll give the Grey Lady some benefit of the doubt and go with the latter possibility.

The fact is, what the Russian law explicitly forbids is the promotion of “non-traditional sexual relationships” to children. Full stop. Adults can behave any way they want in the privacy of their own homes or hotels, but please keep the underage children away from the spectacles. Sounds pretty logical, right? In fact, if the Western media had not become sold-out sycophants of the LGBTQ movement, together with the insidious induction of children into the act, they would probably find that the overwhelming majority of Westerners would gladly stand behind the Russian law as well.

“We have no problem with LGBT persons,” Putin said in an interview with the Financial Times.

“God forbid, let them live as they wish. But some things do appear excessive to us. They claim now that children can play five or six gender roles.”

He added:

“Let everyone be happy, we have no problem with that. But this must not be allowed to overshadow the culture, traditions and traditional family values of millions of people making up the core population.”

This is an issue that few Western leaders are willing or able to promote: the traditional family, which is increasingly portrayed as some sort of radical institution in Western eyes. At the same time, the average citizen has absolutely zero say in the LGBTQ indoctrination program that is happening practically everywhere in the West, including inside of the public school system.

As a consequence of the madness, the West is facing demons of its own making as hundreds of adolescents who underwent so-called ‘sexual reassignment surgery’ – the removal of the breasts in women, the penis in men, together with the ingestion of powerful and potentially deadly sex hormones – want to change back to their original selves. Unfortunately for them, that is nearly mission impossible.

Meanwhile, transgender females, that is, biological males at birth, are now triumphing on the field of dream against their female competition. Needless to say, this radical new development in the world of sports has set back feminism to the somewhere around the time of the Moon landing.

And here is where the next great East-West showdown will get ugly – at some future Olympic event when the West insists on fielding transgender females against the East’s more feminine counterparts. In fact, the debate on the transgender issue is already underway ahead of the Tokyo 2020 Games.

One thing is clear from all of this nonsense: Vladimir Putin and other like-minded leaders have their work cut out for them in a world gone absolutely mad.

Via Truthstream Media,

It’s that time again: the United Nations is officially releasing the all new Agenda 2030 sustainable development plan, or what some have hailed as “the new Agenda 21 on steroids,” at the United Nations Sustainable Development Summit kicking off today in New York City.

Since these supposedly non-binding international agreements can sometimes be a bit tricky to decode, what with all the weaponized buzz terms and semantics games, we’ve prepared a handy dandy translator on the 17 new Agenda 2030 goals below.

Goal 1: End poverty in all its forms everywhere

Translation: Centralized banks, IMF, World Bank, Fed to control all finances, digital one world currency in a cashless society

Goal 2: End hunger, achieve food security and improved nutrition and promote sustainable agriculture

Translation: GMO

Goal 3: Ensure healthy lives and promote well-being for all at all ages

Translation: Mass vaccination, Codex Alimentarius

Goal 4: Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all

Translation: UN propaganda, brainwashing through compulsory education from cradle to grave

Goal 5: Achieve gender equality and empower all women and girls

Translation: Population control through forced “Family Planning”

Goal 6: Ensure availability and sustainable management of water and sanitation for all

Translation: Privatize all water sources, don’t forget to add fluoride

Goal 7: Ensure access to affordable, reliable, sustainable and modern energy for all

Translation: Smart grid with smart meters on everything, peak pricing

Goal 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all

Translation: TPP, free trade zones that favor megacorporate interests

Goal 9: Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation

Translation: Toll roads, push public transit, remove free travel, environmental restrictions

Goal 10: Reduce inequality within and among countries

Translation: Even more regional government bureaucracy like a mutant octopus

Goal 11: Make cities and human settlements inclusive, safe, resilient and sustainable

Translation: Big brother big data surveillance state

Goal 12: Ensure sustainable consumption and production patterns

Translation: Forced austerity

Goal 13: Take urgent action to combat climate change and its impacts*

Translation: Cap and Trade, carbon taxes/credits, footprint taxes (aka Al Gore’s wet dream)

Goal 14: Conserve and sustainably use the oceans, seas and marine resources for sustainable development

Translation: Environmental restrictions, control all oceans including mineral rights from ocean floors

Goal 15: Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss

Translation: More environmental restrictions, more controlling resources and mineral rights

Goal 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels

Translation: UN “peacekeeping” missions (ex 1, ex 2), the International Court of (blind) Justice, force people together via fake refugee crises and then mediate with more “UN peacekeeping” when tension breaks out to gain more control over a region, remove 2nd Amendment in USA

Goal 17: Strengthen the means of implementation and revitalize the global partnership for sustainable development

Translation: Remove national sovereignty worldwide, promote globalism under the “authority” and bloated, Orwellian bureaucracy of the UN

But, don’t worry, it’s all for your own good!