Government
Week Ahead – Markets hate uncertainty
Week Ahead – Markets hate uncertainty
Share this:
Or so the old saying goes
You’re going to be hearing the word uncertainty a lot over the next month. We have political uncertainty ahead of what is going to be a highly unusual election, economic uncertainty as Congress fails to pass another relief package, uncertainty around Covid should the dreaded winter spike occur. Now we have Presidential uncertainty after Donald Trump became the latest world leader to test positive for Covid-19. “Markets hate uncertainty” is both a cliche and a fact. And we may see it a lot more over the next month, in particular.
Trump positive Covid test fuels further uncertainty
Brexit heading for eleventh hour deal
Will OPEC+ be forced into further cuts?
US
Uncertainty reigns supreme after President Donald Trump and first lady Melania Trump tested positive for coronavirus. Wall Street will closely watch to see how bad the virus spreads across Washington DC and if President Trump will have a mild or severe battle with the virus.
Following a disappointing nonfarm payroll report, the last one before the election, the focus shifts to release of the Fed policy minutes for the September 16th policy decision. The Fed has clearly signaled rates will be near zero well into 2023, the minutes could show what they might need to see before they could raise rates. With many signs that the economic recovery is losing steam, the Fed may have discussed increasing asset purchases.
US Politics
The vice presidential debate between California Senator Kamala Harris and Vice President Mike Pence will not be anything like the President Trump’s no-holds barred debate with former-VP Biden. The democrats are growing confident they will take back the White House and given Biden’s age, he may only serve one term. For many Americans, this will be their first look at Kamala Harris and this could be critical to see if she is the favorite to lead the party after Biden.
Biden is enjoying a comfortable lead in the national polls, but the lead is not as strong in the battleground states. The chances are dwindling that Trump could steal the election but they still exist.
EU
ECB minutes next week will be of interest, although with the central bank not showing any inclination to ease again this year, despite the rising Covid numbers and economic slowdown, I don’t expect the minutes will offer much in terms of new information. The comments on the exchange rate were the most interesting take away from the meeting itself but policymakers were quick to clarify.
Brexit
Hopes earlier this week that common ground had been found on level playing field were short-lived and we now enter the final weeks of the negotiations with the major issues unresolved. High level talks between Boris Johnson and Ursula Von Der Leyen will commence on Saturday ahead of more meetings next week. It’s looking less likely that a deal will be agreed by mid-October, meaning these talks may well run into November, to the surprise of no one.
UK
Winter has come early for the UK. The weather has turned, nights are drawing in sooner and Covid is on the rise meaning more restrictions and another hit to economic activity just as things were starting to move again. It’s another week of low-tier data, with an appearance from BoE Governor Andrew Bailey to add some interest. I’m not sure we’ll learn anything new though, with the central bank still considering negative rates but seemingly no closer to actually implementing them.
China
China on holiday until Friday.
Friday services and composite PMI released, expected to confirm China recovery remains on track. Sentiment dominated by the Trump Covid-19 situation and its evolution.
Hong Kong
Arrests continue under new security law. Ant Financial IPO announcement date likely to dominate headlines.
India
Covid-19 continues to wreak havoc on the domestic economy, heightening fears about growth as the stability of the banking system. India has become the no 2 infected country and over 5 million cases this week with no end in sight.
RBI rate decision postponed due a lack of members to make a quorum! This will further undermine confidence in India. Demonstrations continue over the agriculture reform bill.
Services PMI on tuesday expected to show India still marooned in contractionary territory.
New Zealand
Pre-voting starts for New Zealand’s October 17th election. Market has priced in Labour clean sweep with movement in the polls that threatens unstable coalitions weighing on the NZ Dollar. A deterioration in the risk environment due to Trump’s Covid-19 illness will also weigh on NZD.
Australia
Busy data week with PMI’s Monday, RBA rate decision and trade balance on Tuesday, home loans on Friday. RBA will remain unchanged but the possibility exists of another rate cut to 10 basis points. A rate cut and talk of negative rates from RBA will see AUD move lower.
AUD and Australian equities as a pro-cyclical play, are acutely vulnerable to increased risk-off sentiment next week if the Trump/Covid situation deteriorates.
Japan
Heavy data week with services PMI’s, bank lending, household spending and machinery orders all expected to show Japan’s recovery is slow and uneven. BOJ Governor Kuroda makes speeches on Monday and Wednesday. Will be closely watched for signs of more easing to combat slowdown. Negative Yen, bullish Japan stocks.
Japan stocks are vulnerable to a deteriorating risk environment next week. Japan fund managers bought Yen heavily versus the US Dollar today after the Trump announcement. A deterioration in that situation will see the repatriation flows increasing pushing USD/JPY lower.
Oil
Oil prices are slipping again today, in line with the broader risk off move. While some will want to link this to the election, or the prospect of a Biden victory, I’m not really buying it. This is something that’s been building recently and the only reason it hasn’t materialised earlier is due to the warnings from the Saudi Energy Minister.
The simple fact remains that we’re heading into a worrying period for Covid and the impact on the global economy and oil demand will be significant. OPEC+ will likely be forced to hold a special meeting prior to December if they want prices to hold around $40.
Gold
Gold is continuing to push hard against $1,900 and is having a little success but it’s struggling to gather any significant momentum above these levels, which could be a sign of weakness. The jobs report didn’t cause too much of a stir for the dollar and so the impact on gold has been minimal.
If the yellow metal fails to secure a weekly close above $1,900, it may start next week on the back foot. The momentum indicators are favourable for the yellow metal and the jobs report hasn’t changed that. This will be a very interesting test and more downside may follow.
Economic Calendar
Saturday, October 3rd
-The ruling U.K. Conservative Party 4-day conference begins
Sunday, October 4th
-Czech regional elections expected
Monday, October 5th
-Nobel prizes for 2020 are announced in medicine, physics, chemistry, literature, economics and peace.
-Brexit in focus. The final formal round of talks is over, the British government expects trade negotiations to continue up to the EU summit in mid-October.
-Turkey and Greece may resume exploratory talks over maritime disputes this week.
-National Association for Business Economics (NABE) holds its 62nd annual meeting, virtually. The three-day event will focus on “Global Reset? Economics, Business and Policy in the Pandemic.” Chicago Fed Chair Charles Evans will speak.
-Atlanta Fed President Raphael Bostic speaks at the Fintech South event on regulating financial technology.
-South Africa’s ruling party continues meeting to discuss a proposed economic recovery plan.
Economic Data
U.S. ISM services, Markit services/composite PMIs
South Africa PMI
Thailand CPI
Services PMI: Euro-area, U.K.
Singapore retail sales
Turkey CPI
Tuesday, October 6th
– Top diplomats from ‘Quad’ countries meet in Tokyo, seen as a democratic counter to China’s influence in the Indo-Pacific region. U.S. Secretary of State Michael Pompeo, Japanese Foreign Minister Toshimitsu Motegi, Australian Foreign Minister Marise Payne and India’s Subrahmanyam Jaishankar will attend.
– The RBA Interest Rate Decision: No changes expected with its main policy programs and cash rate.
-IMF Managing Director Kristalina Georgieva delivers IMF’s annual curtain raiser speech, previewing key issues for the IMF/World Bank meetings next week.
-Fed Chair Jerome Powell and ECB Chief Economist Philip Lane deliver keynote addresses at the NABE conference.
-Philadelphia Fed President Patrick Harker discusses machine learning via a webinar hosted by the Global Interdependence Center. Atlanta Fed President Raphael Bostic will speak to Leadership Florida about “An Inclusive Recovery.”
-Bank of Mexico Governor Alejandro Diaz de Leon discusses the global economy with Dallas Fed President Robert Kaplan, via webcast.
-ECB President Christine Lagarde participates in a panel discussion organized by the Bridge Forum Dialogue.
-German Chancellor Angela Merkel speaks at a German industry event in Berlin.
-Norwegian Central Bank Governor Oystein Olsen speaks in Oslo.
–South African Reserve Bank will publish its six-month Monetary Policy Review.
Economic Data
U.S. trade balance
Australia trade
Germany factory orders
India services PMI
Wednesday, Oct. 7
-Pompeo visits South Korea. Seoul is pushing for a resumption of stalled nuclear negotiations between President Donald Trump and North Korean leader Kim Jong Un.
-U.S. Vice Presidential debate takes place in Salt Lake City. Vice President Mike Pence will square off with Joe Biden’s running mate, California Senator Kamala Harris.
– EIA crude oil inventory report
-Fed Presidents Raphael Bostic (Atlanta), Neel Kashkari (Minneapolis) and Eric Rosengren (Boston) speak at a virtual event on “Racism and the Economy.”
-New York Fed President John Williams moderates a discussion with Henry Kissinger, hosted by the Economic Club of New York. Williams will also discuss “Flexible Average Inflation Targeting” at an event hosted by Hoover Economic Policy Working Group.
-Chicago Fed President Charles Evans discusses the outlook for the U.S. economy.
-ECB’s Lagarde and Governing Council Member Francois Villeroy de Galhauspeak at the Paris Europlace conference.
-IMF releases the analytical chapters of its World Economic Outlook: one on mitigating climate change and one on the economic impact of the great lockdown.
–The minutes of the Sept. 15-16 meeting of the FOMC will closely be watched for hints on what conditions are necessary to trigger a rate increase. The minutes may also reveal whether policy makers discussed increasing asset purchases, continuing to restrict bank dividends, and allowing higher inflation and lower unemployment than officials previously had tolerated.
Economic Data
US FOMC meeting minutes
South Africa gross/net reserves, business confidence
Poland rate decision: Base rate to remain unchanged at 0.10%
Germany industrial production
Spain industrial output
U.K. house prices
Switzerland foreign currency reserves
Thursday, Oct. 8
-BOE Governor Andrew Bailey, ECB Executive Board member Isabel Schnabeland Governing Council member Pablo Hernandez de Cos speak at the Single Resolution Board conference.
-The ECB publishes the account of the monetary policy meeting of the Governing Council, held on Sept. 9-10.
-Bank of Canada Governor Tiff Macklem gives a speech via videoconference.
-Nigerian President Muhammadu Buhari may present his 2021 budget.
-OPEC publishes the World Oil Outlook.
Economic Data
US initial jobless claims
Mexico CPI, central bank policy minutes
Bank of France industrial sentiment
UK RICS house prices
Hungary CPI
Canada housing starts
Japan current account balance
Norway GDP
New Zealand business confidence
Friday, October 9th
Economic Data
Industrial production: France, Italy, U.K.
Romania GDP
US Baker Hughes rig count, wholesale inventories
Canada unemployment rate
Japan household spending
Sovereign Rating Updates
– Poland (S&P)
International
Beloved mall retailer files Chapter 7 bankruptcy, will liquidate
The struggling chain has given up the fight and will close hundreds of stores around the world.
Share this:
It has been a brutal period for several popular retailers. The fallout from the covid pandemic and a challenging economic environment have pushed numerous chains into bankruptcy with Tuesday Morning, Christmas Tree Shops, and Bed Bath & Beyond all moving from Chapter 11 to Chapter 7 bankruptcy liquidation.
In all three of those cases, the companies faced clear financial pressures that led to inventory problems and vendors demanding faster, or even upfront payment. That creates a sort of inevitability.
Related: Beloved retailer finds life after bankruptcy, new famous owner
When a retailer faces financial pressure it sets off a cycle where vendors become wary of selling them items. That leads to barren shelves and no ability for the chain to sell its way out of its financial problems.
Once that happens bankruptcy generally becomes the only option. Sometimes that means a Chapter 11 filing which gives the company a chance to negotiate with its creditors. In some cases, deals can be worked out where vendors extend longer terms or even forgive some debts, and banks offer an extension of loan terms.
In other cases, new funding can be secured which assuages vendor concerns or the company might be taken over by its vendors. Sometimes, as was the case with David's Bridal, a new owner steps in, adds new money, and makes deals with creditors in order to give the company a new lease on life.
It's rare that a retailer moves directly into Chapter 7 bankruptcy and decides to liquidate without trying to find a new source of funding.
Image source: Getty Images
The Body Shop has bad news for customers
The Body Shop has been in a very public fight for survival. Fears began when the company closed half of its locations in the United Kingdom. That was followed by a bankruptcy-style filing in Canada and an abrupt closure of its U.S. stores on March 4.
"The Canadian subsidiary of the global beauty and cosmetics brand announced it has started restructuring proceedings by filing a Notice of Intention (NOI) to Make a Proposal pursuant to the Bankruptcy and Insolvency Act (Canada). In the same release, the company said that, as of March 1, 2024, The Body Shop US Limited has ceased operations," Chain Store Age reported.
A message on the company's U.S. website shared a simple message that does not appear to be the entire story.
"We're currently undergoing planned maintenance, but don't worry we're due to be back online soon."
That same message is still on the company's website, but a new filing makes it clear that the site is not down for maintenance, it's down for good.
The Body Shop files for Chapter 7 bankruptcy
While the future appeared bleak for The Body Shop, fans of the brand held out hope that a savior would step in. That's not going to be the case.
The Body Shop filed for Chapter 7 bankruptcy in the United States.
"The US arm of the ethical cosmetics group has ceased trading at its 50 outlets. On Saturday (March 9), it filed for Chapter 7 insolvency, under which assets are sold off to clear debts, putting about 400 jobs at risk including those in a distribution center that still holds millions of dollars worth of stock," The Guardian reported.
After its closure in the United States, the survival of the brand remains very much in doubt. About half of the chain's stores in the United Kingdom remain open along with its Australian stores.
The future of those stores remains very much in doubt and the chain has shared that it needs new funding in order for them to continue operating.
The Body Shop did not respond to a request for comment from TheStreet.
bankruptcy pandemic canadaGovernment
Are Voters Recoiling Against Disorder?
Are Voters Recoiling Against Disorder?
Authored by Michael Barone via The Epoch Times (emphasis ours),
The headlines coming out of the Super…
Share this:
Authored by Michael Barone via The Epoch Times (emphasis ours),
The headlines coming out of the Super Tuesday primaries have got it right. Barring cataclysmic changes, Donald Trump and Joe Biden will be the Republican and Democratic nominees for president in 2024.
With Nikki Haley’s withdrawal, there will be no more significantly contested primaries or caucuses—the earliest both parties’ races have been over since something like the current primary-dominated system was put in place in 1972.
The primary results have spotlighted some of both nominees’ weaknesses.
Donald Trump lost high-income, high-educated constituencies, including the entire metro area—aka the Swamp. Many but by no means all Haley votes there were cast by Biden Democrats. Mr. Trump can’t afford to lose too many of the others in target states like Pennsylvania and Michigan.
Majorities and large minorities of voters in overwhelmingly Latino counties in Texas’s Rio Grande Valley and some in Houston voted against Joe Biden, and even more against Senate nominee Rep. Colin Allred (D-Texas).
Returns from Hispanic precincts in New Hampshire and Massachusetts show the same thing. Mr. Biden can’t afford to lose too many Latino votes in target states like Arizona and Georgia.
When Mr. Trump rode down that escalator in 2015, commentators assumed he’d repel Latinos. Instead, Latino voters nationally, and especially the closest eyewitnesses of Biden’s open-border policy, have been trending heavily Republican.
High-income liberal Democrats may sport lawn signs proclaiming, “In this house, we believe ... no human is illegal.” The logical consequence of that belief is an open border. But modest-income folks in border counties know that flows of illegal immigrants result in disorder, disease, and crime.
There is plenty of impatience with increased disorder in election returns below the presidential level. Consider Los Angeles County, America’s largest county, with nearly 10 million people, more people than 40 of the 50 states. It voted 71 percent for Mr. Biden in 2020.
Current returns show county District Attorney George Gascon winning only 21 percent of the vote in the nonpartisan primary. He’ll apparently face Republican Nathan Hochman, a critic of his liberal policies, in November.
Gascon, elected after the May 2020 death of counterfeit-passing suspect George Floyd in Minneapolis, is one of many county prosecutors supported by billionaire George Soros. His policies include not charging juveniles as adults, not seeking higher penalties for gang membership or use of firearms, and bringing fewer misdemeanor cases.
The predictable result has been increased car thefts, burglaries, and personal robberies. Some 120 assistant district attorneys have left the office, and there’s a backlog of 10,000 unprosecuted cases.
More than a dozen other Soros-backed and similarly liberal prosecutors have faced strong opposition or have left office.
St. Louis prosecutor Kim Gardner resigned last May amid lawsuits seeking her removal, Milwaukee’s John Chisholm retired in January, and Baltimore’s Marilyn Mosby was defeated in July 2022 and convicted of perjury in September 2023. Last November, Loudoun County, Virginia, voters (62 percent Biden) ousted liberal Buta Biberaj, who declined to prosecute a transgender student for assault, and in June 2022 voters in San Francisco (85 percent Biden) recalled famed radical Chesa Boudin.
Similarly, this Tuesday, voters in San Francisco passed ballot measures strengthening police powers and requiring treatment of drug-addicted welfare recipients.
In retrospect, it appears the Floyd video, appearing after three months of COVID-19 confinement, sparked a frenzied, even crazed reaction, especially among the highly educated and articulate. One fatal incident was seen as proof that America’s “systemic racism” was worse than ever and that police forces should be defunded and perhaps abolished.
2020 was “the year America went crazy,” I wrote in January 2021, a year in which police funding was actually cut by Democrats in New York, Los Angeles, San Francisco, Seattle, and Denver. A year in which young New York Times (NYT) staffers claimed they were endangered by the publication of Sen. Tom Cotton’s (R-Ark.) opinion article advocating calling in military forces if necessary to stop rioting, as had been done in Detroit in 1967 and Los Angeles in 1992. A craven NYT publisher even fired the editorial page editor for running the article.
Evidence of visible and tangible discontent with increasing violence and its consequences—barren and locked shelves in Manhattan chain drugstores, skyrocketing carjackings in Washington, D.C.—is as unmistakable in polls and election results as it is in daily life in large metropolitan areas. Maybe 2024 will turn out to be the year even liberal America stopped acting crazy.
Chaos and disorder work against incumbents, as they did in 1968 when Democrats saw their party’s popular vote fall from 61 percent to 43 percent.
Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times or ZeroHedge.
Government
Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence
Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence
Authored by Zachary Stieber via The Epoch Times (emphasis ours),
The…
Share this:
Authored by Zachary Stieber via The Epoch Times (emphasis ours),
The U.S. Department of Veterans Affairs (VA) reviewed no data when deciding in 2023 to keep its COVID-19 vaccine mandate in place.
VA Secretary Denis McDonough said on May 1, 2023, that the end of many other federal mandates “will not impact current policies at the Department of Veterans Affairs.”
He said the mandate was remaining for VA health care personnel “to ensure the safety of veterans and our colleagues.”
Mr. McDonough did not cite any studies or other data. A VA spokesperson declined to provide any data that was reviewed when deciding not to rescind the mandate. The Epoch Times submitted a Freedom of Information Act for “all documents outlining which data was relied upon when establishing the mandate when deciding to keep the mandate in place.”
The agency searched for such data and did not find any.
“The VA does not even attempt to justify its policies with science, because it can’t,” Leslie Manookian, president and founder of the Health Freedom Defense Fund, told The Epoch Times.
“The VA just trusts that the process and cost of challenging its unfounded policies is so onerous, most people are dissuaded from even trying,” she added.
The VA’s mandate remains in place to this day.
The VA’s website claims that vaccines “help protect you from getting severe illness” and “offer good protection against most COVID-19 variants,” pointing in part to observational data from the U.S. Centers for Disease Control and Prevention (CDC) that estimate the vaccines provide poor protection against symptomatic infection and transient shielding against hospitalization.
There have also been increasing concerns among outside scientists about confirmed side effects like heart inflammation—the VA hid a safety signal it detected for the inflammation—and possible side effects such as tinnitus, which shift the benefit-risk calculus.
President Joe Biden imposed a slate of COVID-19 vaccine mandates in 2021. The VA was the first federal agency to implement a mandate.
President Biden rescinded the mandates in May 2023, citing a drop in COVID-19 cases and hospitalizations. His administration maintains the choice to require vaccines was the right one and saved lives.
“Our administration’s vaccination requirements helped ensure the safety of workers in critical workforces including those in the healthcare and education sectors, protecting themselves and the populations they serve, and strengthening their ability to provide services without disruptions to operations,” the White House said.
Some experts said requiring vaccination meant many younger people were forced to get a vaccine despite the risks potentially outweighing the benefits, leaving fewer doses for older adults.
“By mandating the vaccines to younger people and those with natural immunity from having had COVID, older people in the U.S. and other countries did not have access to them, and many people might have died because of that,” Martin Kulldorff, a professor of medicine on leave from Harvard Medical School, told The Epoch Times previously.
The VA was one of just a handful of agencies to keep its mandate in place following the removal of many federal mandates.
“At this time, the vaccine requirement will remain in effect for VA health care personnel, including VA psychologists, pharmacists, social workers, nursing assistants, physical therapists, respiratory therapists, peer specialists, medical support assistants, engineers, housekeepers, and other clinical, administrative, and infrastructure support employees,” Mr. McDonough wrote to VA employees at the time.
“This also includes VA volunteers and contractors. Effectively, this means that any Veterans Health Administration (VHA) employee, volunteer, or contractor who works in VHA facilities, visits VHA facilities, or provides direct care to those we serve will still be subject to the vaccine requirement at this time,” he said. “We continue to monitor and discuss this requirement, and we will provide more information about the vaccination requirements for VA health care employees soon. As always, we will process requests for vaccination exceptions in accordance with applicable laws, regulations, and policies.”
The version of the shots cleared in the fall of 2022, and available through the fall of 2023, did not have any clinical trial data supporting them.
A new version was approved in the fall of 2023 because there were indications that the shots not only offered temporary protection but also that the level of protection was lower than what was observed during earlier stages of the pandemic.
Ms. Manookian, whose group has challenged several of the federal mandates, said that the mandate “illustrates the dangers of the administrative state and how these federal agencies have become a law unto themselves.”
Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence
The Coming Of The Police State In America
When Military Rule Supplants Democracy
Low Iron Levels In Blood Could Trigger Long COVID: Study
Another beloved brewery files Chapter 11 bankruptcy
Walmart has really good news for shoppers (and Joe Biden)
Angry Shouting Aside, Here’s What Biden Is Running On
Jack Smith Says Trump Retention Of Documents “Starkly Different” From Biden
Walmart joins Costco in sharing key pricing news
Are Voters Recoiling Against Disorder?
-
Uncategorized2 weeks agoAll Of The Elements Are In Place For An Economic Crisis Of Staggering Proportions
-
Uncategorized1 month agoCathie Wood sells a major tech stock (again)
-
Uncategorized3 weeks agoCalifornia Counties Could Be Forced To Pay $300 Million To Cover COVID-Era Program
-
Uncategorized2 weeks agoApparel Retailer Express Moving Toward Bankruptcy
-
Uncategorized3 weeks agoIndustrial Production Decreased 0.1% in January
-
International2 days agoWalmart launches clever answer to Target’s new membership program
-
International2 days agoEyePoint poaches medical chief from Apellis; Sandoz CFO, longtime BioNTech exec to retire
-
Uncategorized3 weeks agoRFK Jr: The Wuhan Cover-Up & The Rise Of The Biowarfare-Industrial Complex