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Ebola Bundibugyo  The Democratic Republic of the Congo is gearing up to roll out an Ebola vaccine with some doses being used as part of a trial to see if it is effective against the Bundibugyo species of the virus that is currently circulating in the country. The Ervebo vaccine does help protect against the Zaïre species of Ebola but currently there are no proven vaccines or treatments for Bundibugyo. The rollout comes as the World Health Organization (WHO) issued a new warning that Ebola was "growing exponentially" in the north and east of DR Congo and the spread of infections now covered an area bigger than France. BBC 21August 2026 https://www.bbc.com/news/articles/czxe9n0vxzdo Pragvåren slutade med att Warszawapaktens makter invaderade Prag den 21 augusti 1968 https://sv.wikipedia.org/wiki/Pragv%C3%A5ren Pragvåren och invasionen var det viktigaste och mest bestående av allt som brukar betecknas som "68". Det som då hände visade att kommunismen inte lät sig refor...

JPMorgan Chase Chief Executive Officer Jamie Dimon said in order to maintain its military and economic might, and detailed his bank’s plans to deploy more than $1 trillion to ensure that happens. Dimon’s latest remarks follow JPMorgan’s launch of the second of a pair of initiatives to tackle big-picture policy issues. The bank unveiled an “American Dream Initiative” last week, which is aimed at expanding economic opportunity in local communities in the US.  That followed a “Security and Resiliency Initiative” announced in October, through which JPMorgan vowed to plow $1.5 trillion into industries that bolster US economic security and resiliency over the next decade. Dimon, who turned 70 last month, has built JPMorgan into America’s biggest and most profitable US bank and has become the industry’s elder statesman along the way.  His closely-read annual letters have veered increasingly into policy matters beyond those directly impacting banking. In this year’s missive, which tot...

Banks’ soaring exposure to trading firms creating ‘inherent fragility’, warns S&P Large investment banks have become increasingly reliant on markets financing. Trading firms such as Citadel Securities have reshaped financial markets, with their growth fuelled by lending from traditional investment banks that have retreated from making proprietary bets. Banks’ gross exposure to hedge funds and trading firms was in the trillions,  meaning tail risks, which have a low likelihood of occurring but can have a significant impact if they do, were “high”. Financial Times 15 April 2026 https://www.ft.com/content/942b091b-add3-4ffd-911a-6a9d9738f2ea?syn-25a6b1a6=1 Ares limits withdrawals from $10.7bn private credit fund Redemption requests across industry surge as exodus of wealthy individuals accelerates The $623bn investment group said it had capped redemptions from the Ares Strategic Income Fund at 5 per cent — a threshold built into the fund that allows it to limit outflows in any one...

Back in December he wrote about “AI Bubble” fears.  Significant changes since then made him feel obligated to write a follow-up piece. (Which is one of the things I admire about Howard. He never stops learning.) Working with the latest versions is a bit like exchanging text messages with what may increasingly become a good friend. But this friend is a world-class expert on everything, with a remarkable ability to explain it in exactly the terms you need. Claude - here’s what it said: “Howard, everything you know about investing came from other people. Benjamin Graham taught you about margin of safety. Buffett taught you about quality. Charlie Munger taught you about mental models from multiple disciplines. John Kenneth Galbraith taught you about the psychology of financial manias. You read thousands of books, memos, case studies, and annual reports over fifty years.  Every input was someone else’s thinking… The raw material came from others. The synthesis was yours. “All very ...

  In January, the Congressional Budget Office forecast that chronic federal deficits would add almost $22 trillion to America’s sovereign obligations over the next decade,  pushing net interest payments to 4.1% of gross domestic product in 2035, from 3.2% in 2025.  The obvious solution: Spend less, increase tax revenue or both Treasury Secretary Scott Bessent has advocated a different approach: shifting issuance of government debt toward short-term bills. If pursued aggressively, Bessent’s idea would signal a significant departure from the US practice of “regular and predictable” debt management.  The moment of truth might come on July 30, when the Treasury is set to announce its quarterly refunding plan. It's hard to see how doing so would be worth the risk. Bill Dudley Bloomberg 15 July 2025 https://www.bloomberg.com/opinion/articles/2025-07-15/bessent-s-interest-rate-bet-could-be-a-big-loser Bessent

  Treasury’s 2024 interest bill exceeded US spending on defense The climb reflects a historically big fiscal gap, higher rates The Treasury spent $882 billion on net interest payments  The cost was the equivalent of 3.06% as a share of gross domestic product, the highest ratio since 1996. The Fed’s short-term benchmark rate averaged less than 0.75% over the decade through 2019; policymakers in September projected the rate would settle around 2.9% in time. Bloomberg 19 October 2024  https://www.bloomberg.com/news/articles/2024-10-19/us-interest-burden-hits-28-year-high-escalating-political-risk IMF urges debt reduction as finance chiefs meet in Washington Even before global finance chiefs fly into Washington over the next few days, they’ve been urged in advance by the International Monetary Fund to tighten their belts. The fund, whose annual meetings  https://www.imfconnect.org/content/imf/en/meetings/AM24.html begin on Monday Managing Director Kristalina Georgieva, i...

10-year Treasury yields, a benchmark for mortgages, actually went up. The key question for the bond market is where rates will land once all is said and done.  The median respondent among Federal Reserve Board members and Federal Reserve Bank presidents now sees the “longer-run” federal funds rate landing at around 2.9%, up from about 2.8% in its previous quarterly update. For years, policymakers thought that “neutral” was around 2.5% (or 0.5% in “real” terms, adjusting for inflation at 2%). If you could raise rates from near zero to 5.25%-5.5% and still have gross domestic product expanding at around 2.5% and an unemployment rate below 4%, perhaps policy wasn’t as “restrictive” as people previously thought. Powell: Intuitively many, many people would say we’re probably not going back to that era where there were trillions of dollars of sovereign bonds trading at negative rates, long-term bonds trading at negative rates… and it looked like the neutral rate might even be negative… I...

But anticipating when investors enthusiasm for stocks will finally fade remains as difficult as ever, he said.  Of course, there have been plenty of fluctuations in the interim: the yield on the benchmark U.S. Treasury note has risen 300 basis points over the past two years. The fact that stocks have continued to march higher despite such a dramatic rise in borrowing costs is telling, according to Gross. “It tells me that fiscal deficit spending and AI enthusiasm have been overriding factors and momentum and ‘irrational’ exuberance have dominated markets since 2022,” he said. “Irrational exuberance” was famously used by former Federal Reserve Chairman Alan Greenspan in a December 1996 speech in reference to the then-fledging bubble in technology stocks.  Like Greenspan said back in 1996, it’s impossible to know ahead of time when the market’s “excessive” exuberance might finally start to flag.  Gross said that remains true today.  Best known for co-founding fixed-inc...

 There’s now an overwhelming consensus that the Federal Reserve and many other central banks are done hiking; and yet global government bond yields are suddenly surging to the highest levels in decades.  Predictions that the 10-year will have to advance further, from figures as well-known as Pimco founder Bill Gross, who thinks they should be 4.5%, and former Treasury Secretary Larry Summers, who estimates they should be 4.75%.  These are not outlandish, and merely imply a return to norms that held for many years before the 2008 crisis.  “The push to higher real yields looks in play globally. It’s likely that a structural shift away from the GFC-era levels is under way, and a spread of 2% or greater above inflation expectations makes sense for the 10-year Treasury yield,” If yields keep  A rise in real yields can portend a crisis, but it can also show a belief in a resilient economy in which minimal post-GFC interest rates will no longer be appropriate....

The fair value of the 10-year Treasury yield is about 4.5%, compared with the current level of around 4.16%. Gross, who retired from asset management in 2019, said inflation may prove sticky at around 3%.  He pointed out that 10-year yields historically traded about 135 basis points above the Federal Reserve’s policy rate. Bloomberg 11 August 2023 https://www.bloomberg.com/news/articles/2023-08-11/gross-says-10-year-treasuries-overvalued-yield-at-4-5-fair Bill Gross warns Fed rate rises will ‘crack the US economy’ https://englundmacro.blogspot.com/2022/07/bill-gross-buy-dips-in-bonds-stocks-and.html

 Recall that prior to the financial crisis, the neutral rate was widely assumed to be around 4% -- 2% real (as embodied in the Taylor Rule) and 2% inflation.   Fed officials need to drive wage inflation down to a range of 3% to 4%. This will require a rise in the unemployment rate to at least 4.5% to 5% from the current 3.7%. The budget deficit is likely to be around 5% of gross domestic product in 2023. That is an abject performance when the economy is operating beyond full employment.  The rise in short-term rates will cause the central bank’s income to fall from a profit of more than $100 billion in 2021 to a loss of more than $100 billion in 2023. While it is hard to know precisely when the persistent red ink will be viewed as big enough to matter, a fiscal crunch and bond market turbulence seem inevitable at some point. Bill Dudley Bloomberg 3 January 2023 https://www.bloomberg.com/opinion/articles/2023-01-03/what-could-go-wrong-for-the-federal-reserve-in-2023

Ultra cheap money created a bitter generational divide as soaring house prices made it impossible for younger people to get on the property ladder; it created legions of zombie companies that were kept barely alive on easy credit; it encouraged feckless spending by governments that thought the bills would never fall due; it created an explosion of debt and fuelled asset-price bubbles; and it destroyed the incentive to save. True, free money might have helped rescue the economy in the wake of the financial crisis of 2008 and 2009.  But one day interest rates will have to get back to normal – and now is the moment.    Matthew Lynn Telegraph 30 July 2022 https://www.telegraph.co.uk/business/2022/07/30/how-rock-bottom-interest-rates-harm-good/ Bill Gross 2021: “One of these days, one of these years, or one of these decades, the system will collapse, because capitalism depends on savers saving and investing.”  https://englundmacro.blogspot.com/2021/11/2005-alan-greenspan-...

 The former bond king said one-year Treasury bills are a better alternative to almost any other investments, as the Federal Reserve’s interest-rate hikes lead to a “strong” possibility of recession. Gross, whose net worth amounts to $1.2 billion according to Bloomberg’s Billionaires Index, retired from asset management in 2019, but still regularly updates his investment views on his website.  Bloomberg 11 July 2022 https://www.bloomberg.com/news/articles/2022-07-11/gross-sees-t-bills-trump-stocks-bonds-as-recession-looms-large Gross’s rates forecast (“to 3.5 and fast”) is exactly what the Fed says it is going to do  and exactly what the Fed funds futures market is pricing in — it has the Fed at 3.44 per cent by December.  So Gross’s point has to be that the Fed knows what it needs to do, and the futures market knows what that is, but the stock and bond markets don’t understand the severity of the implications of that. Robert Armstrong, US Financial Commentator FT 12 ...

För det är vi alltför skuldsatta. Vi har helt enkelt bakbundit centralbankscheferna.  Min gissning – och efter 25 år i prognosbranschen är man mer ödmjuk än 25-åringen – är att  de rörliga boräntorna toppar på 3-3,5 procent.  Det blir kännbart, men vi överlever. Räntechocken uteblir. Henrik Mitelman DI 11 april 2022 https://www.di.se/analys/darfor-slipper-vi-en-rantechock/ Bill Gross warns Fed rate rises will ‘crack the US economy’ Former Pimco ‘bond king’ predicts central bank will be unable to go above 2.5% to 3% “We’ve just gotten used to lower and lower rates and anything much higher will break the housing market.” https://englundmacro.blogspot.com/2022/03/bill-gross-warns-fed-rate-rises-will.html Can the Fed shrink its $9tn balance sheet without causing market mayhem? https://englundmacro.blogspot.com/2022/04/can-fed-shrink-its-9tn-balance-sheet.html

For a long time, bond investing was considered a sleepy backwater. Then Pimco came along. Bill Gross discovered that bonds could be traded. He founded Pimco and proceeded to make a lot of money from bond investing, sometimes in controversial ways. Mary Childs just published a book on Gross called, “The Bond King: How One Man Made a Market, Built an Empire and Lost It All.”  Bloomberg podcast 4 April 2022 https://www.bloomberg.com/news/articles/2022-04-04/how-bill-gross-managed-to-build-a-bond-empire-then-lost-it-all-podcast Former Pimco ‘bond king’ predicts central bank will be unable to go above 2.5% to 3% “We’ve just gotten used to lower and lower rates and anything much higher will break the housing market.” https://englundmacro.blogspot.com/2022/03/bill-gross-warns-fed-rate-rises-will.html

Former Pimco ‘bond king’ predicts central bank will be unable to go above 2.5% to 3% “We’ve just gotten used to lower and lower rates and anything much higher will break the housing market.”  Dubbed “the bond king” for his decades of successful investing, Gross has been railing against low policy rates for years. “It destroys the savings function,” he said. “Meme stocks and NFTs [non fungible tokens], all of this nonsense in my mind has developed from the inability to earn a decent return in your 401k” retirement plan. Gross, 77, still wakes up early and spends five hours a day at his Bloomberg terminal. But he has given up all thought of another comeback after his acrimonious forced departure from Pimco in 2014, a nasty 2018 divorce and a disastrous attempt to run a new fund for Janus Henderson. FT 19 March 2022 https://www.ft.com/content/5ab01f85-bcc3-4dd7-b2ff-31195425be43 Bill Gross  says stimulus and low interest rates have created ‘dangerous’ situation    One o...

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

 He had hiked the Fed’s target rate six times, by a total of 150 basis points, and yet he had barely budged the 10-year Treasury yield.  It remained steady, and continued its gently declining trend.  A quiescent 10-year rate enabled the disastrously over-ambitious structured credit monstrosities that would bring down the economy.  Now we have a new version of the conundrum. Not even this inflation spike can dislodge the most reliable and most important trend in modern finance John Authers Bloomberg 16 november 2021 https://www.bloomberg.com/opinion/articles/2021-11-16/greenspan-s-bond-yield-conundrum-has-returned-to-haunt-markets Conundrum at IntCom - 2005 and all that https://www.internetional.se/conundrum.html Bill Gross  says stimulus and low interest rates have created ‘dangerous’ situation   ... financial euphoria in everything from stocks to digital assets like “non-fungible tokens” Gross sceptical inflation would stay this high or accelerate fur...

Have I got a deal for you. You can buy mortgage bonds priced to yield 17.85% over the next 10 years or 18.75% over the next 20 years. They’re investment grade, not junk bonds. The only catch? You have to buy them on Sept. 30, 1981. Even today, nobody has a clear explanation of why bonds suddenly seemed more attractive on Oct. 1, 1981, than they had the day before. Because we can see the past as clear as day, it’s all too easy to forget that the future is always enshrouded in fog. “Things can’t go on forever at these rates,” says Mr. Gross. “Interest rates can’t stay this low [net of inflation] because savers, whether it’s Mom and Pop in Des Moines or big pension funds, can’t earn anything on their investment.”  He adds, “For the economy to survive, at some point interest rates have to regain some semblance of an attraction to savers. Otherwise the savings function will be destroyed.” No one knows when that time will come—but come it will. Jason Zweig WSJ Oct. 1, 2021  https://...

 “Cash has been trash for a long time, but there are now new contenders,” said Gross, who co-founded Pacific Investment Management Co. in the 1970s and retired in 2019. “Intermediate to long-term bond funds are in that trash receptacle for sure, but will stocks follow? Earnings growth had better be double-digit-plus or else they could join the garbage truck.” Bloomberg 2 september 2021 https://www.bloomberg.com/news/articles/2021-09-01/bill-gross-says-bonds-are-investment-garbage-just-like-cash The FT examines whether inflation is back for good and Bill Gross https://englundmacro.blogspot.com/2021/06/the-ft-examines-whether-inflation-is.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://www.internetional.se/bondsnext.htm https://williamhgross.com/