All traders will be on deck for Friday, July 6th when we not only get June payrolls, but growing trade wars culminate as the US is set to launch 25% tariffs on $34 billion of Chinese imports, provoking instant retaliation.
"It’s not a happy start to the second half. Trade war concerns, U.S. sanctions, Trump’s rants and political problems in Europe, as well as worries about slowing emerging-market growth are all playing their part." - Saxo's Ole Hansen.
Major states buying oil from Iran are unlikely to heed the US call to drop imports; key allies want a waiver to avoid sanctions; OPEC, meanwhile, will have trouble boosting output in the short-term; the puzzle is not solved, but there are dark clouds...
"The peripheral crisis will keep moving towards the core unless stopped by massive central bank ease. But - given the rising inflation now being reported - central banks won’t switch back to massive ease unless the peripheral crisis moves much closer to the core (or something else equally terrifying happens first)."
Last Thursday, three sources told Reuters that Elon Musk's self-imposed deadline of midnight Saturday to reach the milestone 5000th Model 3 produced in a week, would fail. Reuters now cites two sources today that while they reached the 5000 milestone - it was 5 hours late...
"Uncle Sam has made too many promises to too many people, with little regard for its future ability to fulfill them. These are debt. Worse, some of them are additional debt on top of the obligations we already see on the national balance sheet...Even worse, entire generations have planned their retirement lives around the government fulfilling those promises."
"If a hawkish Fed or an escalation of trade tensions put further upward pressure on the dollar, market risks emanating from China make 2018 look even more like 2015"
With the "smart" money exiting the stock market in droves, yield curves collapsing, and continued extreme speculative positioning, the possibility of a crash is rising. Here are the cheapest way to hedge against a market shock.
On Sunday, Mexico will be the latest domino to fall to the global anti-establishment wave, and will elect its first "leftist populist" president in a generation with potentially far-reaching consequences for the country’s economy, trade, crime fighting and US relations.
