Posts Tagged ‘EU’

Notes From Underground:

February 11, 2020

In the 1960 classic film The Time Machine a traveler visits a future civilization in which a group of people is enslaved as a source of food. The food source are zombie-like and kept in comfortable captivity in an effort to control their protein source. After violence is done a siren sounds. When the time traveler questions the meaning of the siren the answer is it is ALL CLEAR but we never know what is all clear. Well, it seems the Coronavirus has been given the all clear signal based on the value of equity markets.

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Notes From Underground: The Market Has Much to Consider

December 16, 2019

Last week was filled with the culmination of many issues as we had the FEDECB, trade agreement, UK election, impeachment hearings, and even an attempt at resolving the USMCA trade deal with Mexico and Canada.

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Notes From Underground: The Hills Are Alive With … Sounds?

October 20, 2019

There are so many sounds resonating in the global financial world it has been difficult to discern the impact of any particular tweet or headline. NOTES FROM UNDERGROUND hopes to cut through the babel to provide perspective, context and NUANCE. If we at NOTES cannot accomplish this then we’re just screaming into the chasm that is global macro finance. The impact of Chinese tariffs, Middle East maneuverings, QE programs — from the BOJ to the FEDERAL RESERVE (yes I know what the policy makers are saying — it’s not QE) to the ECB — need to be understood as they drive short-term moves but also have much longer consequences.

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Notes From Underground: ECB, Political Pawn?

July 4, 2019

Warning: There’s a great deal of colorful language in this very important discussion regarding the nomination of Christine Lagarde to the post of European Central Bank president. This is another political move by the EU elite to avoid placing a German at the helm of the ECB. Jens Weidmann may be a tough choice but Lagarde is preposterous, as Jean Claude Trichet might say. If you thought Mario Draghi was a politician and a dove by design, Lagarde will make Draghi look like a HAWK. In my opinion, IMF Director Lagarde has been and remains the ultimate politician. The role she played in the Greek bailout was pure politics and the price paid by the Greek citizenry has been steep. All in an effort to bailout many European financial institutions. Ask Yanis Varafoukis what he thinks of the Lagarde nomination.

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Notes From Underground: Just When It Couldn’t Get More Volatile

June 5, 2019

The above reference is from the wonderful cult movie, Putney’s Swope. The CEO of a major advertising firm has a heart attack during a board meeting and the sycophants don’t realize it as they continue peppering him with questions. When he’s unable to respond they ask, “How Many Syllables, Mario?”

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Notes From Underground: Welcome Back, Rick

May 28, 2019

On Tuesday, Rick Santelli and I dissected the European Parliamentary elections. The results weren’t far off the projections as the GREEN PARTY was able to siphon off voters from the established left-leaning parties as they attracted more young voters than in previous EU-wide elections. There will be much to discuss as we head into the “horse trading” of Brussels politics but I stick to my insistence that the ECB needs the leadership of Jens Weidmann.

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Notes From Underground: Mario Draghi’s Circus

January 24, 2019

The ECB did exactly as expected, which was less than its deposit rate (if that’s even possible). President Draghi answered questions for an hour and said absolutely nothing except that risks were now weighted to the downside. The structural theme of his composed narrative was the concept of persistence and assessment. Draghi laid the need for continued ECB monetary ease on many factors inhibiting growth:

  1. German auto production slowing;
  2. U.S.trade actions are creating greater uncertainty due to tariff threats;
  3. China slowdown; and
  4. Brexit

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Notes From Underground: Angie, Where Will It Lead Us From Here?

December 9, 2018

Germany chose a new CDU party leader to replace Angela Merkel. Membership chose Merkel’s hand-picked choice Annegret Kramp-Karrenbauer, also known as AKK. This is a very poor choice as it reflects a continuation of the status quo at a time that the traditional German ruling parties are struggling to maintain voter support. These are turbulent times for Germany, Europe and the world and Chancellor Merkel has proven to be too staid to deal with a world threatened by a populist upheaval.

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Notes From Underground: Rome Is Alive With the Sound of Music

October 31, 2018

There was singing in Rome when Angela Merkel announced that she is stepping down as the leader of the Christian Democratic Union. The two most recent German regional elections has solidified the unmitigated truth about the weakened condition of the German chancellor. For the last six years, I have been highly critical about Merkel’s policies. The bumbling French President Nicholas Sarkozy out-maneuvered Merkel in 2011 as he prevented then-Bundesbank President Axel Weber from leading the ECB.

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Notes From Underground: A Fresh Glance at Markets

October 21, 2018

Exactly two weeks ago we at Notes From Underground published, “Powell Seeks To Reestablish The Authority of Markets…Maybe?” While I was off enjoying my daughter’s wedding, the December S&P futures had closed at 2895 on Oct. 5 (unemployment Friday). I warned that the market was misjudging Chairman Jerome Powell as he seemed impervious to equity and bond market corrections. The algos are built on the FOMC being quick to defend the elevated levels of the bond and equity markets.

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