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This may end up being the final straw for what's left of the global economy. With more highly negative signals from copper, gold, oil and swaps, even bond spreads here, we're getting more impressions that the part rolling recession is now rolling right on into the full thing. If this one goes, that's usually it. Eurodollar University's Money & Macro AnalysisBloomberg Carmaker Misery Is Dragging Down Global Credit Market Returnshttps://www.bloomberg.com/news/articles/2024-10-16/carmaker-misery-is-dragging-down-global-credit-market-returnsBloomberg Rolling Manufacturing Recession Collides With US Election Angsthttps://www.bloomberg.com/news/newsletters/2024-10-18/us-manufacturers-face-layoffs-weak-results-ahead-of-trump-harris-electionhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

A whopping 98% of American voters in one mainstream poll say the economy is a major concern, including 79% who rate it their top worry. Economists, the media, politicians, policymakers are at a loss to explain this. The latest data from the US government shows why that is, both the confusion and the underlying trouble. A vast majority of the evidence continues to consistently agree with what Americans are saying.Eurodollar University's Money & Macro AnalysisNRF Census Retail Sales Data Shows Retail Sales Grew in Septemberhttps://nrf.com/media-center/press-releases/census-retail-sales-data-shows-retail-sales-grew-septemberNRF CNBC/NRF Retail Monitor Shows Retail Sales Declined Monthly in September But Still Grew Year Over Yearhttps://nrf.com/media-center/press-releases/cnbc/nrf-retail-monitor-shows-retail-sales-declined-monthly-septemberAP NORChttps://apnorc.org/projects/the-economy-tops-voters-minds-as-they-consider-their-vote-in-the-upcoming-election/https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Wall Street was rocked by a huge plunge in orders for ASML, a company which produces machines that touch practically every part of the global economy. That was followed by another four-letter firm, LVMH, which reported a shock decline in revenue. Both showing the same thing from very different angles, further confirming - along with swap markets - why there will be another leg down in interest rates.Eurodollar University's Money & Macro AnalysisASML Homehttps://www.asml.com/enASML Q4 2023 Resultshttps://www.asml.com/en/news/press-releases/2024/q4-2023-financial-resultsASML Q3 2024 Resultshttps://www.asml.com/en/news/press-releases/2024/q3-2024-financial-results-dd3ac76a9d4d0f8cIntel Q2 2024 Financial Resultshttps://www.intc.com/news-events/press-releases/detail/1704/intel-reports-second-quarter-2024-financial-resultsLVMH Q3 2024 Resultshttps://www.lvmh.com/en/publications/lvmh-shows-good-resilience-in-the-current-contextNYT Shares of Louis Vuitton Owner Drop on Anxiety About Chinese Shoppershttps://www.nytimes.com/2024/10/16/business/dealbook/lvmh-dior-louis-vuitton-china.htmlhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

We are in the thick of bank earnings and quarterly reports. The one theme they keep coming back to is...losses. It's become such a problem even JPM CEO Jamie Dimon snapped during his last earnings call. The thing is, in spouting off he told the truth about all of it. Eurodollar University's Money & Macro AnalysisBloomberg Jamie Dimon Is Right. Forget the ‘Damn Number.’https://www.bloomberg.com/opinion/articles/2024-10-14/jamie-dimon-is-right-analysts-need-to-look-beyond-their-modelsBank of America Quarterly Earningshttps://investor.bankofamerica.com/quarterly-earningsJPM Third Quarter 2024 Resultshttps://www.jpmorganchase.com/content/dam/jpmc/jpmorgan-chase-and-co/investor-relations/documents/quarterly-earnings/2024/3rd-quarter/66269bb6-ecc5-4172-b461-6b7e7cd47aab.pdfCitigroup Third Quarter 2024 Resultshttps://www.citigroup.com/rcs/citigpa/storage/public/Earnings/Q32024/2024pr-qtr3rslt.pdfBloomberg Consumers Shift Spending to Pay for Basic Staples, Citi CFO Sayshttps://www.bloomberg.com/news/articles/2024-09-09/consumers-shift-spending-to-pay-for-basic-staples-citi-cfo-sayshttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Another update from top Chinese officials on the status of "stimulus" comes amidst a flurry of macro and banking data from the country. While many will claim the former cancels out the increasingly grim nature of the latter, the previous data still matters at the very least to describe the size of the hole China will have to climb out of. Assuming it is even making a reasonable attempt to. That last press gathering provided few assurances. Eurodollar University's Money & Macro AnalysisChina NBS Consumer Prices September 2024https://www.stats.gov.cn/sj/zxfb/202410/t20241013_1956899.htmlCNBC China’s Ministry of Finance is taking aim at local debt problems before tackling broader economic challengeshttps://www.cnbc.com/2024/10/14/chinas-ministry-of-finance-tackles-debt-problems-before-economic-challenges.htmlCaixin Exclusive: China May Add 6 Trillion Yuan in Treasury Bonds to Buttress Economyhttps://www.caixinglobal.com/2024-10-14/exclusive-china-may-issue-6-trillion-yuan-in-treasury-bonds-to-buttress-economy-102245341.htmlReuters China's exports miss forecasts as lone bright spot fadeshttps://www.reuters.com/markets/asia/china-sept-export-growth-hits-5-month-low-global-demand-cools-2024-10-14/https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

A big jump in jobless claims actually muddies the picture for the labor market. Meanwhile, consumer prices that many in the mainstream are claiming as sticky...are. But not for the reasons stated. We're seeing "sticky" prices in the technical sense, and that's not good. Eurodollar University's conversation w/Steve Van Metre Bloomberg Odd Lots Austan Goolsbee Explains the Fed’s Big Rate Cuthttps://www.bloomberg.com/news/articles/2024-10-11/austan-goolsbee-explains-the-fed-s-big-rate-cutAtlanta Fed Sticky Price CPIhttps://www.atlantafed.org/research/inflationproject/stickyprice/https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

The world’s major growth engine the past few years is showing more and worsening signs of finally cracking, including its currency hitting a record low just today. I’m not talking about the US, obviously, nor is it sickly China. India. If India has stumbled, too, as the rupee suggests, then there might be no escaping globally synchronized. Eurodollar University's Money & Macro AnalysisBloomberg India’s Industrial Output Declines For First Time in Two Yearshttps://www.bloomberg.com/news/articles/2024-10-11/india-s-industrial-output-declines-for-first-time-in-two-years?srnd=phx-economics-v2S&P Globalhttps://www.spglobal.com/en/research-insights/special-reports/india-forward/indias-growing-role-in-the-global-economyHSBC India Total sales growth softens as export gains diminishhttps://www.pmi.spglobal.com/Public/Home/PressRelease/8b2aeb7799e44b899c2651b5732e0878https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

There is a story brewing in repo. Fails have broken a long run trend and they did it in early August. Latest data from FRBNY says that's still the case. It fits with a bunch of other data as well as brings up the ongoing unwind in the real yen carry trade. Finally, behind all of it is US recession fears driving fails, collateral, Japan's withdrawal, and more. And you don't have to take my word for it; hear it (or read it) straight from a carry trader himself. Eurodollar University's Money & Macro AnalysisBloomberg Mizuho Buys ‘Safe’ Assets on Risk That US Soft Landing Failshttps://www.bloomberg.com/news/articles/2024-10-08/mizuho-buys-safe-assets-to-cut-damage-if-us-soft-landing-fails?srnd=phx-economics-v2https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

While everyone - especially in Chinese and China-related stocks - get caught up in last month's "stimulus" frenzy, the overlooked the only real news that came out of it. Very quietly, the country's top bank regulator just casually mentioned the government was gathering a trillion yuan to "recapitalize" China's biggest six banks. Yeah. Meanwhile, volatility has hit the previously insane equity surge. Eurodollar University's Money & Macro Analysis***Eurodollar University's Fall Sale***Discounts on all our subscriptions and memberships. If you want to know how all this stuff works, EDU has got you covered.https://www.eurodollar.universityBloomberg China to Add Capital at Big Banks for First Time in a Decadehttps://www.bloomberg.com/news/articles/2024-09-24/china-to-boost-capital-at-mega-banks-for-first-time-in-a-decadeSCMP China weighs injecting US$142 billion of capital into top bankshttps://www.scmp.com/business/china-business/article/3280008/china-weighs-injecting-us142-billion-capital-top-banksNikkei Asia China's state banks report more bad loans to hotels, restaurants and storeshttps://asia.nikkei.com/Business/Finance/China-s-state-banks-report-more-bad-loans-to-hotels-restaurants-and-storesBloomberg China Markets Warn Xi That More Stimulus Is Needed to Fuel Rallyhttps://www.bloomberg.com/news/articles/2024-10-08/china-markets-warn-xi-that-more-stimulus-is-needed-to-fuel-rallyTwitter: https://twitter.com/JeffSnider_EDU

Another recession warning and this one is related to brewing problems with unemployment. The September payroll report has put mainstream focus back on a soft- or no-landing scenario, but we've been there before not long ago. Meanwhile, apart from the unreliable payroll figure everything else continues to point to bigger trouble, including Americans who have stopped using their credit cards. Eurodollar University's Money & Macro Analysis***EURODOLLAR UNIVERSITY FALL SALE***Subscriptions and price information:https://www.eurodollar.universityABC News Blockbuster jobs report flexes economic strength, defying Americans' lukewarm attitudeshttps://abcnews.go.com/Business/blockbuster-jobs-report-flexes-economic-strength-defying-americans/story?id=108887637Challenger, Gray & Christmas Job Cuts Flat in September 2024 from August; YTD Surpasses 2023https://www.challengergray.com/blog/job-cuts-flat-in-september-2024-from-august-ytd-surpasses-2023/Robert Shimer Reassessing the Ins and Outs of Unemploymenthttps://home.uchicago.edu/~shimer/wp/reassess.pdfTwitter: https://twitter.com/JeffSnider_EDU

US economic weakness continues to show up outside the country as much as inside (last payroll estimate notwithstanding). Japan's government leading indicator just tanked, lowest value since 2020 and pointing to growing trouble in Japan. Same from Mexico and even according to one by JP Morgan. Eurodollar University's Money & Macro AnalysisBloomberg Ueda Hints at Dovishness After New Prime Minister Urges Cautionhttps://www.bloomberg.com/news/articles/2024-10-02/ueda-hints-at-dovishness-after-new-prime-minister-urges-cautionS&P Global Mexico Manufacturing PMIhttps://www.pmi.spglobal.com/Public/Home/PressRelease/5cbff538ec56483b8e9a77ce7c1c252eJP Morgan Global Compositehttps://www.pmi.spglobal.com/Public/Home/PressRelease/80a2d5d7d8554f7f909ba9ae30fd4016***EDU FALL SALE***Subscriptions and memberships:https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

September's payroll estimate soared WAY above expectations. Is it a Fed miracle? This isn't the first time this has happened; in fact, each of the last two times the FOMC began cutting rates met eerily similar results. Steve and I talk about what those were and why, also why that means everything right now. Eurodollar University's conversation w/Steve Van Metre***EURODOLLAR UNIVERSITY FALL SALE***Best subscription prices on the Deep Dive Analysis, Daily Briefing, and EDU membership. https://www.eurodollar.universitySeptember 2024 Payroll Reporthttps://www.bls.gov/news.release/empsit.nr0.htmTwitter: https://twitter.com/JeffSnider_EDU

The bond rally is now one year old and it finally got to the point where central banks - including the Fed - are getting out of the way. Now that the market got what it "wants", there's no stopping it, right? Not quite. Nothing ever goes in a straight line, starting with policy pivots. The market will always surprise you. ***EURODOLLAR UNIVERSITY FALL SALE***https://www.eurodollar.universityEurodollar University's Money & Macro AnalysisTwitter: https://twitter.com/JeffSnider_EDU

There are several ways to know that the second phase for the global recession has started. While there is never a clear demarcation between any stages or just recession, for that matter, there are telltale signs and we are getting them bigtime. Summer keeps showing up as full of warnings, including one that explains everything from the economy to central bankers' increasingly panicking reaction to it. Eurodollar University's Money & Macro AnalysisBloomberg ECB Can’t Ignore Headwinds to Economic Growth, Schnabel Sayshttps://www.bloomberg.com/news/articles/2024-10-02/ecb-can-t-ignore-headwinds-to-economic-growth-schnabel-saysBloomberg ECB Momentum for an October Rate Cut Is Looking Unstoppablehttps://www.bloomberg.com/news/articles/2024-10-02/ecb-momentum-for-an-october-rate-cut-is-looking-unstoppableBloomberg ECB Should Proceed Cautiously With Rate Cuts, Schnabel Warnshttps://www.bloomberg.com/news/articles/2024-08-30/ecb-should-proceed-cautiously-with-rate-cuts-schnabel-warnsNikkei Transcript: ECB board member Isabel Schnabel speaks with Nikkeihttps://asia.nikkei.com/Editor-s-Picks/Interview/Transcript-ECB-board-member-Isabel-Schnabel-speaks-with-NikkeiFT Lower borrowing costs risk ‘flare-up’ of inflation, warns ECB policymakerhttps://www.ft.com/content/bdf3bb86-8a80-4bd5-b562-0c3c47f85f50https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

The Bank of Japan's very recent change of heart has apparently been strong enough to do the same for incoming Prime Minister Shigeru Ishiba. Sounding aggressively hawkish where it came to interest rates just last week after his surprise ascent, suddenly he's completely changed his tune. Why? The answer can be found in another record low for a highly critical US$ market. Eurodollar University's Money & Macro AnalysisBloomberg Ueda Keeps Rate Hikes in Play, Talks Down BOJ’s Part in Meltdownhttps://www.bloomberg.com/news/articles/2024-08-23/boj-s-ueda-still-plans-to-hike-rates-if-economy-meets-outlookBloomberg Ueda Reiterates That BOJ Will Lift Rates If Outlook Realizedhttps://www.bloomberg.com/news/articles/2024-09-03/boj-ueda-reiterates-stance-of-lifting-rates-if-outlook-realizedThe New York Times Stocks in Japan Tumble After Party’s Election of New Prime Ministerhttps://www.nytimes.com/2024/09/29/business/japan-stocks-nikkei-shigeru-ishiba.htmlCNBC Here’s why Japan’s stocks are plunging after Shigeru Ishiba’s winhttps://www.cnbc.com/2024/09/30/heres-why-japans-stocks-are-plunging-after-shigeru-ishibas-win.htmlBNN Bloomberg Ishiba Ally Sends Signal to Warn BOJ Against Rate Hike Too Soonhttps://www.bnnbloomberg.ca/business/international/2024/10/02/japans-ishiba-isnt-necessarily-pro-boj-hike-new-minister-says/Bloomberg Japan’s Ishiba Rules Out BOJ Interest Rate Hikes For Nowhttps://www.bloomberg.com/news/articles/2024-10-02/boj-s-ueda-briefs-new-pm-ishiba-on-market-developmentsBloomberg Ueda Hints at Dovishness After New Prime Minister Urges Cautionhttps://www.bloomberg.com/news/articles/2024-10-02/ueda-hints-at-dovishness-after-new-prime-minister-urges-cautionhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Jay Powell again reiterated that he believes the economy is "on solid footing." The most recent data on the labor market shows he's either wrong or lying. There is no equivocating these latest estimates in which hiring has collapsed. As if that wasn't enough, it was backed up by other sources. All of it pointing to summertime being the time for recession. It's all about hiring, and that has all but disappeared. Eurodollar University's Money & Macro AnalysisBloomberg Powell Says Fed Not in a Hurry, Will Lower Rates ‘Over Time’https://www.bloomberg.com/news/articles/2024-09-30/powell-says-fed-will-move-over-time-to-more-neutral-stanceBloomberg Fed’s Goolsbee Sees ‘Many More’ Rate Cuts Over the Next Yearhttps://www.bloomberg.com/news/articles/2024-09-23/fed-s-goolsbee-sees-many-more-rate-cuts-over-the-next-yearCNN A sign of strength in the labor market: Job openings increased in Augusthttps://www.cnn.com/2024/10/01/economy/us-jolts-job-openings-layoffs-august/index.htmlISM September 2024 Manufacturing ISM Report On Businesshttps://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/september/https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Car stocks got clobbered as the global auto industry is heading for a major fall. There was a flood of announcements from carmakers all over the world this weekend as carmakers are facing very difficult choices. The fallout from the growing reverse will be profound given how important a rising auto market had been up to now. Eurodollar University's Money & Macro AnalysisStellantis Updates 2024 Financial Guidancehttps://www.globenewswire.com/news-release/2024/09/30/2954870/0/en/Stellantis-Updates-2024-Financial-Guidance.htmlBloomberg Stellantis Cuts Forecasts in Further Blow to Besieged Carmakershttps://www.bloomberg.com/news/articles/2024-09-30/stellantis-cuts-2024-forecast-on-costs-for-us-global-slowdownDow Jones Aston Martin shares fall 25% after warning blamed on supply disruptions, Chinahttps://www.morningstar.com/news/marketwatch/2024093033/aston-martin-shares-fall-25-after-warning-blamed-on-supply-disruptions-chinaVolkswagen AG updates its forecast for the 2024 financial yearhttps://www.volkswagen-group.com/en/ad-hoc/volkswagen-ag-updates-its-forecast-for-the-2024-financial-year-18698The Guardian Volkswagen has ‘a year, maybe two to turn around’, financial chief warnshttps://www.theguardian.com/business/article/2024/sep/04/volkswagen-has-a-year-maybe-two-to-turn-around-financial-chief-warnsBloomberg VW’s Second Profit Warning Exposes a Carmaker in Declinehttps://www.bloomberg.com/news/articles/2024-09-30/volkswagen-s-second-profit-warning-exposes-a-carmaker-in-declinehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Now that everyone is coming to grips with economic weakness, particularly where it comes to employment conditions, understanding the high potential for a lot more or worse, people are trying to figure out where it is coming from therefore what might be done to turn it all around. Did the Fed break the economy? Are employers worried about the next President? Eurodollar University's conversation w/Steve Van Metrehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Americans continue to say they're alarmed about job prospects. That's what consumer confidence is truly about, not consumer spending. Workers see and understand labor market shifts before they show up in the major data sources. The latest income data show there is every reason to believe what consumers are seeing. Eurodollar University's Money & Macro AnalysisConference Board September 2024https://www.conference-board.org/topics/consumer-confidence/press/CCI-Sep-2024FRBNY Consumer Confidence: A Useful Indicator of . . . the Labor Market?https://libertystreeteconomics.newyorkfed.org/2013/09/consumer-confidence-a-useful-indicator-of-the-labor-market/FRBNY Survey of Consumer Expectationshttps://www.newyorkfed.org/microeconomics/sce#/earnuncert-1https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Not content to leave it with the PBOC's Oprah-fest of rate cutting, China's central authorities announced what's being called a massive stimulus push. The response has been near-euphoria in Chinese and other stocks, but the opposite in more crucial markets and places. All the more curious given how much other "stimulus" is being offered around the world, central bank rate cuts that are accelerating. Eurodollar University's Money & Macro AnalysisThe Political Bureau of the CPC Central Committee held a meeting to analyze and study the current economic situation and economic work.https://www.gov.cn/yaowen/liebiao/202409/content_6976686.htmReuters Exclusive: China to issue $284 billion of sovereign debt this year to help revive economyhttps://www.reuters.com/markets/asia/china-issue-284-bln-sovereign-debt-this-year-help-revive-economy-sources-say-2024-09-26/https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

It's not just USTs. Rates are falling all over the world faster in shorter maturities than long. That means a global wave of un-inversions and bull steepening right as more and more central banks plan to accelerate their own rate cutting. All of it for the same reason. Globally synchronized.***CHECK OUT EURODOLLAR UNIVERSITY's FALL SALE***https://www.eurodollar.universityEurodollar University's Money & Macro AnalysisNBB Is a recession imminent? The signal of the yield curvehttps://www.nbb.be/doc/ts/publications/economicreview/2019/ecorevi2019_h4.pdfBloomberg Riksbank Cuts Rate Again and Opens Door to Half-Point Movehttps://www.bloomberg.com/news/articles/2024-09-25/riksbank-cuts-rate-a-quarter-point-and-opens-door-to-bigger-move

Chinese authorities held a surprise press conference early this morning where PBOC Governor Pan Gongsheng did his best Oprah Winfrey impression handing out rate cuts to practically everyone. All that does is further expose the gravity of the situation: the more the central bank or any authority does, the worse you know it is since rate cuts never work. China just announced a lot of them. Eurodollar University's Money & Macro AnalysisBloomberg China Unleashes Stimulus Package to Revive Economy, Marketshttps://www.bloomberg.com/news/articles/2024-09-24/china-frees-banks-to-lend-more-cuts-key-interest-ratehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

More confirmation that recession is coming back with a vengeance in Europe. The latest data indicates the dangers this time around including jobs and layoffs. This situation in Europe is hardly unique. This is why central bankers are out in force downplaying their own rate cuts; to the point a few policymakers are outright lying why they voted for them. Eurodollar University's Money & Macro AnalysisBloomberg Fed’s Waller Says Slowing Inflation Led Him to Support Large Rate Cuthttps://www.bloomberg.com/news/articles/2024-09-20/waller-says-slowing-inflation-led-him-to-support-large-rate-cutBloomberg Fed’s Kashkari Says Interest-Rate Hikes Not Entirely Ruled Outhttps://www.bloomberg.com/news/articles/2024-05-28/fed-s-kashkari-says-rate-hike-not-entirely-ruled-outBloomberg Fed’s Neel Kashkari Expects Two Quarter-Point Cuts Before Year’s Endhttps://www.bloomberg.com/news/articles/2024-09-23/neel-kashkari-backed-fed-s-large-cut-and-another-half-point-this-yearBloomberg Fed’s Bostic Says He Now Might Favor More Than One 2024 Cuthttps://www.bloomberg.com/news/articles/2024-08-23/fed-s-bostic-says-he-now-might-favor-more-than-one-cut-this-yearAtlanta Fed On the State of the US Economy and Monetary Policyhttps://www.atlantafed.org/news/speeches/2024/09/23/bostic--on-the-state-of-the-us-economy-and-monetary-policyS&P Global S&P Global Flash US Composite PMI September 2024https://www.pmi.spglobal.com/Public/Home/PressRelease/35c60149cdbe461fb6bc3c959a58a551S&P Global/Hamburg Commercial Bank HCOB Flash Eurozone PMI September 2024https://www.pmi.spglobal.com/Public/Home/PressRelease/cf25d7bb494046ae9256a00ca028f09ahttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

The Fed just cut its benchmark rate by 50-bps even though jobless claims are among the lowest in their history. At the same time, CPI shelter prices have accelerated. Neither seems like it would warrant the Fed action yet there are good reasons to believe true unemployment is very different from claims and current market rents are plunging. Eurodollar University's conversation w/Steve Van Metrehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

FedEx's CEO admitted some truth about the Fed's rate cut this week, and the stock was immediately punished for it, dropping 15% on Friday. This raises a bunch of questions, starting with: what happens to stocks in general when the Fed cuts rates? The answer is not what you think.Eurodollar University's Money & Macro AnalysisCNBC FedEx quarterly profit disappoints as demand for speedy delivery waneshttps://www.cnbc.com/2024/09/19/fedex-reports-drop-in-quarterly-earnings-on-lower-demand-for-priority-services.htmlRobert Shiller 2013 Nobel Speculative Asset Priceshttps://www.nobelprize.org/uploads/2018/06/shiller-lecture.pdfhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Now that the Fed has done it, everyone wants to get in on the act. They call it "undershooting" which is just a fancy word for "bonds were right." Switzerland, Canada, even the Europeans all thinking hefty and accelerated schedules. Leave it to the Brits to be the lone exception. Eurodollar University's Money & Macro AnalysisBloomberg Bank of Canada Officials Split on Balance of Inflation Riskshttps://www.bloomberg.com/news/articles/2024-09-18/bank-of-canada-officials-are-split-on-balance-of-inflation-risksBloomberg Swiss Government Sees Sharp Drop in Inflation Rate Next Yearhttps://www.bloomberg.com/news/articles/2024-09-19/swiss-government-sees-sharp-drop-in-inflation-rate-next-yearBloomberg Swiss Economists See ‘Substantial’ Chance of SNB Half-Point Cuthttps://www.bloomberg.com/news/articles/2024-09-19/swiss-economists-see-sustantial-chance-of-snb-half-point-cutPolitico EU Portuguese bank chief: ECB may need to accelerate interest rate cutshttps://www.politico.eu/article/mario-centeno-ecb-may-need-accelerate-easing-interest-rate-date-bank-portugal/ZEW Hopes of a Recovery Are Fadinghttps://www.zew.de/en/press/latest-press-releases/hopes-of-a-recovery-are-fadingBloomberg Germany May Already Be in Mild Recession, Bundesbank Sayshttps://www.bloomberg.com/news/articles/2024-09-19/germany-may-already-be-in-mild-recession-bundesbank-saysEuronews US chip-maker Intel has announced plans to postpone the construction of a factory in Germany for at least two years.https://www.euronews.com/business/2024/09/17/intel-postpones-construction-of-german-chip-factory-for-two-yearshttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

The Fed cut its benchmark rates by 50 bps in a panicky move to catch up to both the economy and the marketplace. Reaction in the latter was muted because this wasn't unexpected. All the FOMC did was confirm everything - and then deny that it did. Eurodollar University's Money & Macro AnalysisBloomberg Fed Minutes Show Officials Rally Around Higher-for-Longer Rateshttps://www.bloomberg.com/news/articles/2024-05-22/minutes-show-officials-rallying-around-higher-for-longer-ratesFOMC September statementhttps://www.federalreserve.gov/monetarypolicy/files/monetary20240918a1.pdfFOMC September projectionshttps://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20240918.pdfFOMC June projectionshttps://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20240612.pdfhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

People imagine a recession is when masses of people are being laid off and so consumer spending isn't just negative, it must be crashing. While those can happen in a downturn, they tend to show up at the end. So, if you're waiting for those to make a determination you'll be way too late. Evidence consistently and conclusively shows hiring not firing creates the recession environment that is marked by a drop in real spending. We have both.Eurodollar University's Money & Macro AnalysisRobert Shimer Reassessing the Ins and Outs of Unemployment∗https://home.uchicago.edu/~shimer/wp/reassess.pdfChallenger, Gray & Christmas Job Cuts Announced by US-Based Companies Surge in August 2024; Hiring Falls to Lowest YTD Since Challenger Began Tracking in 2005https://www.challengergray.com/blog/job-cuts-announced-by-us-based-companies-surge-in-august-2024-hiring-falls-to-lowest-ytd-since-challenger-began-tracking-in-2005/NYT Layoffs Are Few. So Why Are Jobs Harder to Find?https://www.nytimes.com/2024/09/12/business/economy/layoffs-jobs-economy.htmlhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Americans' hopes and dreams of better opportunities have utterly crashed and burned over the past five months. This isn't about more price increases, rather how those in the past have combined with recession prospects to rob the future. The 2020s have taken the worst aspect of the 2010s and added more trouble on top. Eurodollar University's Money & Macro AnalysisLarry Summers The Age of Secular Stagnationhttps://larrysummers.com/2016/02/17/the-age-of-secular-stagnation/Larry Summers IMF Accepting Secular Stagnationhttps://www.imf.org/en/Publications/fandd/issues/2020/03/larry-summers-on-secular-stagnationhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Consumers can't afford groceries, so how is a lower reverse repo rate going to help them? Now that it is settled the Fed will cut rates next week, everyone wants to know by how much. The real story is what's behind the cuts in the first place and what that means for financial markets as well as the economy. It isn't the murder hornet rate. Eurodollar University's conversation w/Steve Van Metrehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Authorities in China continue to do everything they can to derail the country's globally synchronized bond rally. It continues to hit record low yields anyway in spite of increasingly desperate government efforts. But why? More ugly data on banks, incomes, and Chinese jobs shows bonds are right, and not just about what's already happened to this point. Eurodollar University's Money & Macro AnalysisChina Xinhua Xi Jinping presided over a symposium on comprehensively promoting ecological protection...https://www.gov.cn/yaowen/liebiao/202409/content_6974190.htmBloomberg Xi Urges Efforts to Hit 5% Growth Target Amid Rising Doubtshttps://www.bloomberg.com/news/articles/2024-09-12/xi-urges-efforts-to-hit-annual-growth-target-amid-rising-doubtBloomberg PBOC’s China Bonds See Trading Surge in Sign of Interventionhttps://www.bloomberg.com/news/articles/2024-09-10/pboc-owned-china-bonds-see-trading-surge-in-sign-of-interventionBloomberg China’s Deflationary Spiral Is Now Entering Dangerous New Stagehttps://www.bloomberg.com/news/articles/2024-09-09/china-s-deflationary-spiral-is-now-entering-dangerous-new-stagehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

The ECB cut rates for the second time, as expected, though amidst a strong bond/bund market rally that has now completely un-inverted that yield curve. This comes at a time when major businesses like Volkswagen are thinking about closing down factories due to how much idle capacity they have. What links all of these together, what explains all the facts, is that there was never a global recovery, only a transitory price illusion. Eurodollar University's Money & Macro AnalysisBloomberg Half-Empty Car Plants in Europe Spell Trouble for Workershttps://www.bloomberg.com/news/articles/2024-09-11/vw-s-german-factory-closures-highlight-wider-problems-for-europe-s-carmakers?srnd=phx-economics-v2Volkswagen 2023 Annual Report Income Statementhttps://annualreport2023.volkswagen-group.com/consolidated-financial-statements/income-statement.htmlVolkswagen 2019 Annual Reporthttps://annualreport2019.volkswagenag.com/ECB Press Conference Statementhttps://www.ecb.europa.eu/press/press_conference/monetary-policy-statement/2024/html/ecb.is240912~4f7b17040c.en.htmlBloomberg ECB’s Economic Hopes at Risk as Consumers Put Spending on Icehttps://www.bloomberg.com/news/articles/2024-09-09/ecb-s-economic-hopes-at-risk-as-consumers-put-spending-on-iceStatista Half of OECD Countries Earn Less Now Than Pre-Pandemichttps://www.statista.com/chart/32831/real-wage-growth-in-the-oecd/OECD Employment Outlook 2024https://www.oecd.org/en/publications/oecd-employment-outlook-2024_ac8b3538-en.htmlhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

It was all banks all day yesterday. Basel rules foul-up. Warren Buffett continuing to dump BofA. Citi dumping on credit. Deutsche unloading CRE, or trying to. JP Morgan downgrading...itself. Most of all Ally Financial admitting unemployment is fast becoming a big problem and right on its balance sheet. Eurodollar University's Money & Macro AnalysisBloomberg JPMorgan Leads Banks in Dimming Outlooks, Spoiling Win on Ruleshttps://www.bloomberg.com/news/articles/2024-09-10/jpmorgan-leads-banks-in-dimming-outlooks-spoiling-win-on-rulesBloomberg Ally Drops After CFO Flags Consumer Stress, Underperformancehttps://www.bloomberg.com/news/articles/2024-09-10/ally-drops-after-cfo-flags-consumer-stress-underperformanceBloomberg Consumers Shift Spending to Pay for Basic Staples, Citi CFO Sayshttps://www.bloomberg.com/news/articles/2024-09-09/consumers-shift-spending-to-pay-for-basic-staples-citi-cfo-saysFRBNY Household Debt and Credit Reporthttps://www.newyorkfed.org/microeconomics/hhdc.htmlCNBC Berkshire unloads another chunk of Bank of America as CEO Moynihan lauds Buffett as great shareholderhttps://www.cnbc.com/2024/09/11/berkshire-unloads-another-chunk-of-bank-of-america-as-ceo-moynihan-lauds-buffett-as-great-shareholder.htmlBloomberg Deutsche Bank Is Unloading $1 Billion in US Real Estate Loanshttps://www.bloomberg.com/news/articles/2024-08-01/deutsche-bank-is-unloading-1-billion-in-us-real-estate-loanshttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

There's no September here as interest rates continue to plunge. The two-year UST is at a record low relative to the Fed. In the past when the two-year has dropped like this it has meant nothing good. Combined with the still ongoing crash in energy prices, we have a solid sense of what's coming next. And it isn't just a lot of rate cuts. Eurodollar University's Money & Macro AnalysisCHECK OUT EURODOLLAR UNIVERSITY'S DDA SUBSCRIPTIONGO MUCH DEEPER AND STEP INTO THE BLACKHOLE OF MONEY AND MACRO.NOW MORE THAN EVER. Bloomberg S&P 500 Rally Hits a Wall as Big Banks Sound Alarm: Markets Wraphttps://www.bloomberg.com/news/articles/2024-09-09/stock-market-today-dow-s-p-live-updatesFOMC Transcript Conference Call January 3, 2001https://www.federalreserve.gov/monetarypolicy/files/FOMC20010103ConfCall.pdfhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Interest rates continue to collapse in China even outpacing US Treasuries. Commodities are being crushed as prospects for the world's two largest economies are getting worse by the week; by the day. Over the weekend, the Chinese reported negatives in consumer and more so producer prices, adding more evidence to what is shaping up in bond markets and beyond as a looming deflation shock. Eurodollar University's Money & Macro AnalysisBloomberg China’s Deflationary Spiral Is Now Entering Dangerous New Stagehttps://www.bloomberg.com/news/articles/2024-09-09/china-s-deflationary-spiral-is-now-entering-dangerous-new-stageWall Street Journal Australian Economy Posts Weakest Growth Since Early 1990shttps://www.wsj.com/economy/australian-economy-posts-weakest-growth-since-early-1990s-a7f5d6b0?tpl=cbChina's NBS Consumer Prices August 2024https://www.stats.gov.cn/sj/zxfb/202409/t20240909_1956311.htmlChina's NBS Producer/Factory Gate Prices August 2024https://www.stats.gov.cn/sj/zxfb/202409/t20240909_1956310.htmlhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

We know there are Fed rate cuts coming in September and that there is very good chance it will be 50 bps. Could policymakers also surprise by ending QT (not that it matters)? Might that be a first step toward the next QE? It's not as far-fetched as you may think; after all, some at the Fed were talking rate hikes just two months ago. Eurodollar University's conversation w/Steve Van MetreBloomberg Fed’s Waller Says Jobs Data ‘Requires Action,’ Open to Big Cuthttps://www.bloomberg.com/news/articles/2024-09-06/fed-s-waller-says-jobs-data-requires-action-open-to-big-cut?https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

More meltdowns across key markets, starting with the Treasury curve rapidly unwinding. Commodities are getting crushed, gasoline absolutely smoked. Swaps. Yen. The August payroll report only further confirmed the reasons why all this is happening. Eurodollar University's Money & Macro AnalysisBloomberg OPEC+ Pauses Oil Supply Hike in Effort to Reverse Price Slumphttps://www.bloomberg.com/news/articles/2024-09-05/opec-has-deal-to-pause-planned-oil-hike-for-2-months-delegatehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Politicians always feel the need to do something even if they don't know why or what's actually wrong. That's all "price controls" really are since they sure don't control anything like prices. Unknown to most people, the US has already experimented with them running price and wage restrictions for several years. The results are conclusive. Eurodollar University's Money & Macro AnalysisRobert Bleiberg Farewell to Wage and Price Controlshttps://imprimis.hillsdale.edu/farewell-to-wage-and-price-controls-july-1974/Richard Nixon August 15, 1971 TV addresshttps://www.youtube.com/watch?v=7_Xw5tWsOQohttps://www.cvce.eu/content/publication/1999/1/1/168eed17-f28b-487b-9cd2-6d668e42e63a/publishable_en.pdfArthur Burns Testimony before Congress Joint Economic Committee June 1971https://fraser.stlouisfed.org/files/docs/historical/burns/Burns_19710630.pdf?utm_source=direct_downloadArthur Burns Testimony before Congress Joint Economic Committee July 1971https://fraser.stlouisfed.org/files/docs/historical/burns/Burns_19710723.pdf?utm_source=direct_downloadNYT NIXON FREEZES PRICES FOR UP TO 60 DAYS, THEN WILL ESTABLISH PHASE 4 CONTROLS; FARM PRICES, WAGES, RENTS UNAFFECTEDhttps://www.nytimes.com/1973/06/14/archives/nixon-freezes-prices-for-up-to-60-da-ys-then-will-establish-phase-4.htmlhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Carry trade is back! In reality, it never left. Not because of BoJ rates hikes or threats, rather all the growing evidence the US isn't at risk of recession, so many indications showing it's here. Oil and gasoline are crashing. Curves unwinding. Forward rates project...a total mess. In time for all of the fun, JOLTS shows job openings plunge and layoffs jump.Eurodollar University's Money & Macro AnalysisCNBC Job openings fell more than expected in July in another sign of labor market softeninghttps://www.cnbc.com/2024/09/04/jolts-july-2024.htmlCNBC Nikkei sees worst day since early August sell-off; Taiex leads losses in Asia as tech stocks fallhttps://www.cnbc.com/2024/09/04/asia-pacific-markets-set-to-fall-after-recession-fears-heighten-nvidia-tumbles.htmlhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

While the world was focused on financial volatility and liquidations at the start of August, something odd happened at the Federal Reserve's Discount Window (DW). Given everything else that has gone on since then, starting with the yield curve then considering now-cracking commodities, plus foreigners' dollar buffers and even US dealer banks' collateral holdings, there aren't that many ways to interpret what banks are doing - or not - at the DW.Eurodollar University's Money & Macro AnalysisFRB Michael Barr The Importance of Effective Liquidity Risk Managementhttps://www.federalreserve.gov/newsevents/speech/barr20231201a.htmReuters Discount window reform bill introduced as Fed works on its own overhaulhttps://www.reuters.com/markets/discount-window-reform-bill-introduced-fed-works-its-own-overhaul-2024-07-29/FRBNY Staff Report 1103 Can Discount Window Stigma Be Cured? An Experimental Investigationhttps://www.newyorkfed.org/medialibrary/media/research/staff_reports/sr1103.pdf?sc_lang=enhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Wholesale gasoline prices plunged in August to their lowest since the start of the year. This sounds like a positive, both for consumers as well as Fed policymakers and the disinflationary impact on consumer prices. But refinery margins have crashed to their lowest in three and a half years which instead points to more and bigger trouble. Eurodollar University's Money & Macro AnalysisCNBC Oil prices ease on US gasoline demand worries, economic datahttps://www.cnbc.com/2024/05/29/oil-rises-as-major-producers-expected-to-keep-output-cuts-in-place.htmlThe Globe & Mail Crude Prices Fall on Energy Demand Concerns and Increased Russian Crude Exportshttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

The most significant macro data from the past week certainly wasn't GDP (it wasn't even the most important datapoint within its own series), instead it was personal savings. It is yet another confirmation of what we've been hearing from across the economy and markets. Consumers are tapped out, and they're out of money because of jobs and incomes.Eurodollar University's conversation w/Steve Van MetreBLS Metropolitan Area Employment and Unemployment (Monthly)https://www.bls.gov/web/metro.supp.toc.htmBLS Over-the-year percent change in total private average weekly earnings for metropolitan areas, not seasonally adjustedhttps://www.bls.gov/charts/metro-area-employment-and-unemployment/metro-area-oty-percent-change-in-average-weekly-earnings.htmChallenger, Gray, & Christmas Challenger Report: Job Cuts Remain Low While Hiring Falls to Lowest YTD Since 2012https://www.challengergray.com/blog/challenger-report-job-cuts-remain-low-while-hiring-falls-to-lowest-ytd-since-2012/https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

People keep saying the economy is in the toilet and the US government keeps raising its estimate for GDP. The general public isn't wrong, GDP is. How do we know? Because that's what GDP says - its other side. Not as well known, it should be because this is the one which is far more accurate during cyclical downturns. History, academic studies, consistency with other signals, not to mention how much it backs up popular perception. Everything including the better side of GDP is lined up against GDP. Eurodollar University's Money & Macro AnalysisJeremy Nalewaik Board of Governors of the Federal Reserve SystemThe Income- and Expenditure-Side Estimates of U.S. Output Growth https://www.brookings.edu/wp-content/uploads/2010/03/2010a_bpea_nalewaik.pdfCNBC Dollar General shares crater 25% as retailer cuts outlook, blaming ‘financially constrained’ customershttps://www.cnbc.com/2024/08/29/dollar-general-shares-crater-20percent-as-retailer-cuts-outlook-blaming-financially-constrained-customers.htmlCNBC Lululemon cuts guidance, misses sales estimates after botched product launchhttps://www.cnbc.com/2024/08/29/lululemon-lulu-earnings-q2-2024.htmlMorningstar Lululemon Earnings: Near-Term Outlook Dims, but Profitability and Underlying Brand Strength Holdhttps://www.morningstar.com/stocks/lululemon-earnings-near-term-outlook-dims-profitability-underlying-brand-strength-holdUBS “Vibecession”? - The paradox between hard data and sentimenthttps://www.ubs.com/us/en/wealth-management/insights/market-news/article.1608955.htmlhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

New information from various sources all around the US service sector shows a downturn taking hold in that segment with employment signals turning more and more negative. It confirms the ongoing and more decisive bull steepening continuing to take shape in the Treasury market. Even mainstream sources are having to cover the fact there is something big happening when you can see it in services.Eurodollar University's Money & Macro AnalysisCNN A key part of America’s economy has shifted into reversehttps://www.cnn.com/2024/07/07/economy/stocks-week-ahead-services-sector-slow-restaurants-stores/index.htmlFRB Philadelphia August 2024 Nonmanufacturing Business Outlook Surveyhttps://www.philadelphiafed.org/surveys-and-data/regional-economic-analysis/nbos-2024-08Fifth District Survey of Service Sector Activityhttps://www.richmondfed.org/region_communities/regional_data_analysis/surveys/service_sectorTexas Service Sector Outlook Surveyhttps://www.dallasfed.org/research/surveys/tssos/2024/2408https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

German observers are saying the economy has reached crisis proportions and the reason is what the US economy's weakness is doing to the rest of the world. Rather than recover as many in Europe had hoped, the situation has turned grim due to America's growing negatives. As one result, bulls are firmly in charge of all the curves.Eurodollar University's Money & Macro AnalysisIFO Business Climate Index deteriorates (August 2024)https://www.ifo.de/en/facts/2024-08-26/ifo-business-climate-index-deteriorates-august-2024Dow Jones German business increasingly in trouble, Ifo survey findshttps://www.morningstar.com/news/marketwatch/2024082620/german-business-increasingly-in-trouble-ifo-survey-findsWSJ German Economic Expectations Nosedive as Global Slowdown Fears Bitehttps://www.wsj.com/economy/central-banking/german-economic-expectations-nosedive-as-global-slowdown-fears-bite-944996b5S&P Global/HCOB Germany PMIs August 2024https://www.pmi.spglobal.com/Public/Home/PressRelease/3c59ed1870c24259ac3e62cfb7792724deStatis Germany June Tradehttps://www.destatis.de/EN/Press/2024/08/PE24_300_51.htmlBundesbank Forecast for Germany: German economy slowly regaining its footinghttps://www.bundesbank.de/en/press/press-releases/bundesbank-forecast-for-germany-german-economy-slowly-regaining-its-footing-933658https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Chinese e-commerce retailer Temu becomes the latest global consumer business to warn about the economy - exactly what bonds have been doing all year much to the growing frustration of authorities. They'd rather derail lower market rates at the same time as cutting their own? It actually does make a lot of sense as all these things are related.Eurodollar University's Money & Macro AnalysisBloomberg PDD’s Warning Highlights Growing Strain on China Consumer Firmshttps://www.bloomberg.com/news/articles/2024-08-27/pdd-s-warning-highlights-growing-strain-on-china-consumer-firmsCNBC Shares of Temu parent company PDD plunge almost 29%https://www.cnbc.com/2024/08/27/shares-of-temu-parent-company-pdd-plunges-29percent-largest-one-day-loss.htmlBloomberg China Economists See Weak Demand Despite Expected Rate Cutshttps://www.bloomberg.com/news/articles/2024-08-26/china-seen-mired-in-weakening-demand-despite-expected-rate-cuts?srnd=phx-economics-v2Bloomberg PBOC Holds Policy Rate Steady After Warning on Bond Rallyhttps://www.bloomberg.com/news/articles/2024-08-26/pboc-holds-policy-loan-rate-steady-after-warning-on-bond-rally?srnd=phx-economics-v2Bloomberg China Won’t Ban Bond Trading But Sees Risk in Buying Frenzyhttps://www.bloomberg.com/news/articles/2024-08-24/china-won-t-ban-bond-trading-but-sees-risk-in-buying-frenzyhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Just as low interest rates are being validated in every way, some Economists like Nouriel Roubini are alleging that yields are instead being held down by noted monetary genius Janet Yellen who has the Treasury Department engaged in a form of stealth QE. The problem is actually Economists who think interest rates are nothing more than tools to be manipulated by all-powerful govts when in reality they are more accurate though not perfect reflections of how govts fail.Eurodollar University's Money & Macro AnalysisRoubini/Miran Hudson Bay Capital ATI: Activist Treasury Issuance and theTug-of-War Over Monetary Policyhttps://www.hudsonbaycapital.com/documents/FG/hudsonbay/research/635102_Activist_Treasury_Issuance_-_Hudson_Bay_Capital_Research.pdfFT People are flipping out about T-bill issuancehttps://www.ft.com/content/f0f62f0b-fee2-463a-a075-3b8dab333f40TBAC Fiscal Year 2023 Q3 Reporthttps://home.treasury.gov/system/files/221/TreasuryPresentationToTBACQ32023.pdfTBAC April 30, 2024https://home.treasury.gov/system/files/221/TBACCharge1Q22024.pdfCNN 'Dr. Doom' explains why the Fed will lose its inflation battlehttps://www.cnn.com/videos/business/2022/10/19/nouriel-roubini-markets-now.cnn-businessBloomberg Roubini Sees Significant Chance of ‘No Landing’ for US Economyhttps://www.bloomberg.com/news/articles/2024-03-04/roubini-sees-significant-chance-of-no-landing-for-us-economyhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Jay Powell's Jackson Hole appearance and speech wasn't really about rate cuts. It was a sales job trying to sell you and as much of the world as possible on the Fed itself. Just making the pitch, however, means implicitly admitting the US economy just leapt out of the frying pan and into the fire. Powell says it's OK because he knows how to turn the heat down when there is zero reason to believe anyone at the FOMC knows where it is us or what the temperature is going to be. Eurodollar University's conversation w/Steve Van MetreJay Powell Jackson Holehttps://www.federalreserve.gov/newsevents/speech/files/powell20240823a.pdfhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

It wasn't just a pivot, Powell admits the US economy is in trouble as unemployment has already started rising. While that's it's own can of worms, there are also more monetary and financial considerations related to what happened early in August. CLOs, collateral, stock market liquidations, all tied to what the Fed just agreed to. Eurodollar University's Money & Macro AnalysisEDU YT Japan is buying MASSIVE Amounts of Junk Credithttps://www.youtube.com/watch?v=_a_2J6mU48oCNBC Jay Powell Jackson Holehttps://www.youtube.com/watch?v=zpiMF6bZ0sgText of Powell Speechhttps://www.federalreserve.gov/newsevents/speech/powell20240823a.htmhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

The economy really has deteriorated quickly, enough that what seemed highly unlikely if not impossible early in July was very near to happened at the end of the month. I said a July Fed rate cut was in play on the 3rd and now according to the FOMC's minutes...it was. That, along with panicky central bankers seeking to quicken the pace of cutting, is definitely not a good sign. Eurodollar University's Money & Macro AnalysisEDU YT This Could Force the Fed to Cut Rates in Julyhttps://www.youtube.com/watch?v=B03jMrfetks Pascal Michaillat, Emmanuel Saez Has the Recession Started? August 2024https://pascalmichaillat.org/16.pdfFOMC July 2024 minuteshttps://www.federalreserve.gov/monetarypolicy/files/fomcminutes20240731.pdfPolitico Sharp slowdown in wage growth boosts ECB rate cut hopeshttps://www.politico.eu/article/big-slowdown-in-wages-boosts-ecb-rate-cut-hopes/Bloomberg ECB’s Rehn Says Growth Risks Bolster Case for September Cuthttps://www.bloomberg.com/news/articles/2024-08-19/ecb-s-rehn-says-growth-risks-bolster-case-for-september-cuthttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU