Budget Deficit

Saudi Arabia Warns Trump Not To Block Oil Imports

Saudi Arabia's first attempt at engaging with Donald Trump amounts to what is effectively a thinly veiled threat wrapped as a warning. As the FT reports, "Saudi Arabia has warned Donald Trump that the incoming US president will risk the health of his country’s economy if he acts on his election promises to block oil imports."

Everything Is Soaring As Trump Makes Buying Stuff Great Again

The global repricing of inflation expectations continues at a feverish pace in the aftermath of the Trump victory, leading to another surge in US equity futures, up 15 points or 0.7% to 2175 at last check, with Asian and European stock market all surging after the initial shock of Trump’s election victory gave way to optimism for fiscal stimulus will provide a boost to the global economy.  Commodity metals soared with copper surging the most since May 2013.

Egypt Stocks Soar, Bonds Rally On Currency Devaluation: "Now The Hard Work Starts"

Given our warning last week (as the black market pound crashed), the devaluation of the Egyptian pound (to 14/$) was not entirely unexpected, but as ECStrat's Emad Mostaque notes, the market was probably in the 11/$ range and so they have surprised to the upside. This will put significant social pressure on society and we could potentially see unrest as Sisi’s support continues to diminish. For now, stocks and bonds are soaring on the currency's crash.

Crispin Odey Sees 80% Crash In UK Stocks With Recession, Inflation "Inevitable"

"The FTSE 100 share index is now up 30% over five years, whilst earnings have fallen by 80%. On an earnings yield of 1.6%, the stock market could fall by 80% and, provided profits did not fall, would be on a 13x P/E multiple. The Bank of England is proud that they have engineered such a pleasant result but there is now increasing evidence that this is unsustainable."

The Boredom Before The Storm

With all the surprising and/or disturbing things going on – Brexit, China’s soaring debt, US/Russia/China saber rattling, the, um, unique US presidential race, the cyber attack that shut down big parts of the US Internet – you’d think that an unsettled world would be reflected in skittish financial markets. Instead we’re getting the opposite...