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Writer's pictureStéphan

IMF warned US on fiscal deficit-infl / EU sanctions on Iran, Biden tariffs on China, Venezuela sanctions, risk infl⬆️/ Eq risk premium 22year lows / ASIAN FX / SOMA dets out



  • The IMF has warned the US that its massive fiscal deficits have stoked inflation and pose "significant risks" for the global economy.'

  • Christine Lagarde says US plan to raise debt against Russian assets carries legal risk, from European Central Bank chief who points to transatlantic rift over use of seized funds

  • EU to tighten Iran sanctions after Israel attack & Biden calls for tripling tariffs on Chinese metals, US reimposes Venezuela oil sanctions >>> inflation!

  • U.S., Japan, South Korea finance chiefs share concern for weak yen, won First trilateral meeting also addresses Pyongyang missile sales and supply chains >>> Asian FX battle may well soon heat up

  • Equity Risk Premium (the benefit of owning stocks over treasuries) has fallen to its lowest level in 22 years

  • MORGAN STANLEY: “.. We do not believe #TSLA will get credit as an AI company as long as core auto earnings are being revised down. .. This process may take a few more quarters to see through, over which time our $100 bear case may be ‘in play.’”

  • NY Fed's SOMA projections are out, they see the balance-sheet bottoming around $6trn

  • Markets risk : going in full correction mode >> recall CTA were full/über long risk up to 1week ago, now price action different, selling into weakness (short gamma), a decent correction may well be what bonds need - eventually (2y area IS value at 5%), USDollar stays firm(er), but do watch out if ASIAN CB's wake up on interventions facts, rather than noise

 



NY Fed's SOMA projections are out, they see the balance-sheet bottoming around $6trn












NASDAQ - a decent correction could easily takes us another 10% down towards 16K - beware earnings season, with less of a BTD mentality, earnings miss will be brutal


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