Englund

If the Jewish state can be bullied into letting Hamas survive, how can any free nation defend itself? Every Islamist terrorist Israel kills is one fewer threat to the rest of us. Every setback Israel can deal to the Iranian puppet masters of Hamas, Hezbollah and others inflicts a loss on the regime that is sworn to eliminate us, the “Great Satan,” and our allies.  There is no historical evidence that appeasing enemies committed to our extinction ever keeps us safe. If Israel can somehow be bullied into forgoing victory over this enemy, our own capacity to wage wars inflicted on us will be dramatically diminished.  We will have allowed a coalition of armchair media critics, far-left agitators and Islamist-sympathizing activists and governments to hold Israel to a standard no nation taking necessary measures to protect itself would ever be able to meet, a standard to which our enemies will certainly never hold themselves. Gerard Baker Wall Street Journal  8 April 2024 ...

Taleb defined the ballooning debt load as a “white swan,”  He did say white swans include both the US deficit and an economy that’s far more vulnerable to shocks than in prior years. The reason for that, he said, is that the world is far more interconnected due to globalization, with issues in one region able to ricochet around the world. When asked how the US “spiral” could ultimately play out, Taleb said “we need something to come in from the outside, or maybe some kind of miracle.” “This makes me kind of gloomy about the entire political system in the Western world,” he said. Bloomberg 30 januari 2024 https://www.bloomberg.com/news/articles/2024-01-30/nassim-taleb-says-us-faces-a-death-spiral-of-swelling-debt Robert Rubin Sees 'Enormous Risks' to US Federal Deficits https://englundmacro.blogspot.com/2024/01/robert-rubin-sees-enormous-risks-to-us.html Världsordningen går mot en kollaps Rolf Gustavsson  SvD 28 januari 2024 https://englundmacro.blogspot.com/2024/01/varldsordni...

At least five times, a biological catastrophe has engulfed the planet, killing off the vast majority of species from water and land over a relatively short geological interval. The most famous of these mass extinction events — when an asteroid slammed into Earth 66 million years ago, dooming the dinosaurs and many other species — is also the most recent. But scientists say it won’t be the last. Many researchers argue we’re in the middle of a sixth mass extinction, caused not by a city-size space rock but by the overgrowth and transformative behavior of a single species — Homo sapiens. Humans have destroyed habitats and unleashed a climate crisis. Calculations in a September study published in the journal PNAS have suggested that groups of related animal species are disappearing at a rate 35% times higher than the normally expected rate. And while every mass extinction has winners and losers, there is no reason to assume that human beings in this case would be among the survivors. Micha...

https://www.worldatlas.com/articles/the-timeline-of-the-mass-extinction-events-on-earth.html Extinction risk from climate change https://en.wikipedia.org/wiki/Extinction_risk_from_climate_change Mass Extinctions and CO2 levels https://johnenglander.net/mass-extinctions-and-co2-levels/ Another link between CO2 and mass extinctions of species Another link between CO2 and mass extinctions of species (theconversation.com)

Three recent books suggest that the Fed has the capacity to function as a device of indicative planning, coordinating economic activities to fulfill democratically determined social purposes. By now you’ve probably heard of collateralized debt obligations, quantitative easing, helicopter drops, shadow banking, hedge funds, private equity, leveraged buyouts, asset pricing, cryptocurrencies, and so on.  Why are the arcane terms of finance – the “secrets of the temple,” as William Greider famously called them – so familiar, and how have its gray protagonists become household names? The short answer is easy: where bankers go, it seems, shit inevitably meets fan. These firms – “shadow banks” unbound by any statutory or customary constraints the Fed can impose on “member banks” – have presided over crisis after crisis since October 1987, when a stock market awash in idle money generated by Ronald Reagan’s tax cuts crashed and burned.  Or, rather, with the Fed backstopping them as th...

The Persian empire is now the Islamic Republic of Iran; one might say the Holy Roman Empire has been reincarnated in the form of the European Union, at once extensive, German-centered and weak. It is not civilizations that clash, but empires.   Biden’s plan for Russia might be described cynically as fighting to the last Ukrainian, but to what end? Ostensibly the US is determined to “support Ukraine in its fight for its freedom,” but the real goal is “to degrade Russia’s ability to wage future wars of aggression.” That is why the administration has made almost no effort to broker a cease-fire, much less peace. The White House seems to want this war to keep going, though I suspect that will change after the mid-term elections. Yet there is a much worse scenario, in which we get something closer to the 1940s, with regional conflicts coalescing into something like World War III — albeit with smaller armies, many unmanned weapons systems, and far more powerful and accurate bombs. What m...

The Saturday Essay As markets plunged, Jerome Powell and his colleagues vastly expanded the reach of the central bank, with implications that will be felt for years to come  Over the week of March 16, markets experienced an enormous shock to what investors refer to as liquidity, a catchall term for the cost of quickly converting an asset into cash. Powell led his colleagues to slash interest rates to zero at a second emergency meeting in as many weeks. They were offering nearly unlimited cheap debt to keep the wheels of finance turning, and when that didn’t help, the Fed began purchasing massive quantities of government debt outright. But none of the Fed’s actions were having their intended effect. Investors dumped whatever they could, including ostensibly “risk-free” U.S. Treasury securities. The Dow tumbled as Mr. Ackman spoke, dropping as much as 2,000 points and triggering a marketwide 15-minute trading halt shortly before 1 p.m., one of several that month. By week’s end, the D...

A decade ago, China became the world’s largest importer of agricultural goods. Its arable land has been shrinking due to degradation and overuse.  Breakneck development has also made China the world’s largest energy importer: It buys three-quarters of its oil abroad at a time when America has become a net energy exporter. China’s water situation is particularly grim Much of China’s fresh water is concentrated in areas, such as Tibet A growing source of tension in the Himalayas is China’s plan to dam key waters before they reach India, leaving that country (and Bangladesh) the losers.  Hal Brands 29 december 2021 https://www.bloomberg.com/opinion/articles/2021-12-29/china-s-water-shortage-is-scary-for-india-thailand-vietnam Hal Brands is a Bloomberg Opinion columnist, the Henry Kissinger Distinguished Professor at Johns Hopkins University’s School of Advanced International Studies, and a scholar at the American Enterprise Institute

... the latest milestone in months-long financial drama that paves the way for a massive restructuring of the world’s most indebted developer. Fitch Ratings cut the developer to restricted default over its failure to meet two coupon payments after a grace period expired on Monday Beijing’s reluctance to bail out Evergrande sends a clear signal that the Communist Party won’t tolerate massive debt build-ups that threaten financial stability.  Bloomberg 9 december 2021 https://www.bloomberg.com/news/articles/2021-12-09/evergrande-defaults-for-first-time-as-china-debt-strains-spread ‘The risk caused by a few real-estate firms in the short run would not undermine the market for the medium and the long run,’ said Yi Gang, governor of the People’s Bank of China.  “Companies issuing bonds overseas and their shareholders will be urged to properly handle their debt issues and meet their debt obligation in accordance with law and market principles,” he said. “This is a market event. It s...

Fallet tilltog strax innan klockan 16 när Wall Street vände nedåt.  OMXSPI gick från att vara upp drygt 0,3 procent vid 15.30 till att nu handlas ned drygt 1 procent. Maria Van Kerkhove, teknisk chef på WHO, konstaterar samtidigt att det fortfarande är för tidigt att dra några slutsatser kring hur allvarlig sjukdom de som smittas drabbas av.  Tidiga rapporter har indikerat milda symptom, men de slutsatserna har enligt WHO-toppen baserats på klusterutbrott bland universitetsstudenter som tenderar att vara unga och friska. DI 3 december 2021 https://www.di.se/live/plotsligt-fall-pa-varldens-borser-stockholmsborsen-pa-minus/

MarketWatch Nov. 26, 2021  https://www.marketwatch.com/story/dow-futures-tumble-400-points-on-fears-over-new-covid-variant-detected-in-south-africa-11637908694 A heavily-mutated Covid variant emerges in southern Africa:  Here’s what we know so far https://www.cnbc.com/2021/11/26/covid-variant-emerges-in-south-africa-heres-what-we-know-so-far.html

Over the past four decades, total debt more than tripled to 350 per cent of global gross domestic product. No matter what happens to near-term inflation and growth, the world is too indebted for rates to rise much higher. Ruchir Sharma FT 22 November 2021 https://www.ft.com/content/c9e0c2c1-55af-4258-9c92-92faa111f41e The writer, Morgan Stanley Investment Management’s chief global strategist, is author of ‘The Ten Rules of Successful Nations’ Credit Markets Are Full of Alarms and No One Cares The Federal Reserve’s corporate-bond bailout in March 2020 has helped encourage a debt binge unlike any other. Investors see little choice but to whistle past the graveyard. Risks may be piling up, but haven’t you heard Junk-rated companies have the least debt relative to earnings since 2015. “Covenants do continue to get worse,” said Pisano. “Every day something comes up that makes them worse.” Brian Chappatta Bloomberg 22 november 2021  https://www.bloomberg.com/opinion/articles/2021-11-22/c...

The US government bond market used to be considered to be the world’s most liquid and deep asset class, in March 2020 that cosy assumption was smashed apart. Fed intervention prevented a complete crash. But it forced the Fed to step in with what John Williams, NY Fed president, has called “staggering” amounts of liquidity support, reaching almost $1tn each day. Gillian Tett FT 18 November 2021 https://www.ft.com/content/d2639eee-0b36-40b4-87c5-41087d8b7893 Bill Gross  says stimulus and low interest rates have created ‘dangerous’ situation https://englundmacro.blogspot.com/2021/11/2005-alan-greenspan-complained-of.html US government debt is a safe haven the way Pearl Harbor was a safe haven in 1941. Niall Ferguson FT February 10 2010 https://englundmacro.blogspot.com/2018/03/us-treasury-safe-haven.html

  Tthrough September, the total container volume coming into and leaving the nation has increased by nearly 22% from one year ago, and over 16% from 2019.  This amount of container traffic, as measured by twenty-foot equivalent units, or TEUs, is unprecedented. It is being propelled by the volume of imported containers coming into the United States, which have increased by 25% from 2020 and nearly 20% from two years ago.  Many of the containers are being sent back empty.   MarketWatch Nov. 18, 2021 https://www.marketwatch.com/story/this-is-how-americas-booming-demand-for-goods-shattered-the-supply-chain-11637242353 Empty shipping containers worsen stress on the US supply chain FT 18 November 2021 https://www.ft.com/content/40f667ce-b979-4171-9cd1-b935d06728c4                                                           ...

 “The firm has lost the capacity to sell new homes, which means its main business model is effectively defunct. This makes full repayment of its debts unlikely,” the analysts said. CNBC NOV 18 2021 https://www.cnbc.com/2021/11/18/china-evergrande-default-is-highly-likely-sp-says.html Evergrande shares slip ell 5.7% after deal to raise $273 million https://www.cnbc.com/2021/11/18/evergrande-shares-slip-after-striking-a-deal-to-raise-273-million.html

“Since the U.S. financial markets have achieved new levels of insanity, we want to make sure we document this moment in time for posterity’s sake. Apparently, we have not learned anything from the Equity, Housing and Credit bubbles that occurred between 1999 and 2008. “It can’t be any clearer than the fact that the S&P 500’s market capitalization is 177% of U.S. GDP,” adds O’Rourke MarketWatch 12 November 2021 https://www.marketwatch.com/story/doubting-that-we-could-be-in-a-stock-market-bubble-heres-the-chart-you-need-to-see-11636719571 A “fear of missing out” has gripped global markets, lifting everything from stocks to cryptocurrencies to record highs and forcing even staunch bears to throw in the towel. US equities are at the epicentre of the worldwide rush into stocks that has almost doubled the MSCI All-World share index since the coronavirus crisis nadir in March 2020  FT 13 November 2021 https://www.ft.com/content/637b2a59-f64d-46b6-a8a8-0072e3a936d2 ‘Bearmageddon’ for s...

  We are facing demand-driven inflation as a consequence of misguided monetary policy and misdirected fiscal stimulus.  But even if not calamitous, it will be bad... Today, I’ll describe what I think will happen over the next year or so. I rarely make short-term forecasts because I’m usually early. Reaching the major turning points takes longer than we think. The forthcoming changes will build on previous policy changes that were ineffective at best and probably outright harmful. The Federal Reserve is not the main cause of the inflation we see right now. Yes, they’ve pumped up the money supply, but most of the new money is trapped in the financial markets. It can’t escape unless banks lend it to someone. Their willingness to do so has been shrinking, not growing. Fed’s forthcoming policy change will have little or no effect on CPI inflation. They didn’t drive it up, nor will they make it go down. But that doesn’t mean it will have no effect. The taper may remove some of the f...

At some point this week, the world’s interest rate traders collectively woke up and decided to price in a massive tightening of monetary policy around the globe, leading to some very dramatic and at times strange moves in the bond market. Central banks now face a challenge as bond markets foreshadow one of the starkest hiking cycles in recent history, with everything from German bunds to Brazilian bonds, British gilts and U.S  Treasuries  pricing in more imminent increases to benchmark rates. Bloomberg 29 October 2021 https://www.bloomberg.com/news/articles/2021-10-29/here-are-the-most-unusual-moves-happening-in-bond-markets-right-now

 Why people stay in bubbles. They think they are going to be the ones to get out at the right time. Value managers who stuck to their guns in the late 1990s had often lost their jobs by the time the bubble burst. Even if you know you’re in a bubble, the conventional wisdom goes, it’s best to stay with the herd.  John Authers Bloomberg 27 October 2021 https://www.bloomberg.com/opinion/articles/2021-10-27/stock-bubble-timing-entices-again-with-tesla-topping-1-trillion

 Plunging consumer confidence in the future. It’s called the six last recessions, the Dartmouth professor and former Bank of England policy maker warns in a new paper. MarketWatch Oct. 23, 2021 https://www.marketwatch.com/story/the-u-s-may-be-falling-into-recession-heres-why-this-ex-central-banker-says-11634910899 in a new paper https://cpb-us-e1.wpmucdn.com/sites.dartmouth.edu/dist/5/2216/files/2021/10/us-fear-oct-8-final-nber.pdf