Will a recession follow?
It’s been a slow start to the month in financial markets but the ECB rate decision on Thursday finally got things moving and the US inflation data on Friday kept it going into the weekend. With so much to look forward to next week, it’s going to get really interesting.
The Fed rate decision on Wednesday is naturally the highlight, as traders look for further indications of the level of tightening that’s going to be required and whether it will ultimately tip the economy into recession. The inflation data did not make for good reading for policymakers.
The BoE is expected to raise rates on Thursday but could it be tempted to go super-sized like many of its peers? Markets suggest there’s an outside chance. Then there’s the BoJ on Friday which has a very different problem to many of its peers.
The main event of the week will be the FOMC decision on Wednesday. The Fed is widely expected to deliver a half-point rate increase and to signal more are coming as inflation remains scorching hot. The Fed will need to signal more aggressive hikes are warranted and that they will do what is needed to get inflation under control.
It is a busy week for economic data and it will start on Tuesday with PPI likely to tell a similar story as Friday’s hot inflation report. In addition to the Fed decision, Wednesday has two big reports: The Empire manufacturing survey should show a modest rebound. Most traders will fixate over retail sales for May, which could show consumer spending is weakening. Thursday will see the release of housing starts, jobless claims, and the Philly Fed business outlook.
The 2022 midterms are not that far away and many traders will pay close attention to see if Republicans have a clean sweep. Tuesday has primaries in Maine, Nevada, North Dakota, and South Carolina.
A quiet week for the euro area with final inflation data among the highlights. Big revisions to the upside would pile further misery on households and businesses, not to mention the ECB which has finally come around to the idea that something needs to be done. And it absolutely will, a little bit next month and maybe more so again next quarter. The ECB really knows how to address urgent problems. Central bank speak including Christine Lagarde later in the week will be of interest although markets have already gone ahead and priced in 1.5% of hikes this year. Why bother waiting for the ECB to inevitably catch up?
The highlight next week is obviously the Bank of England meeting, with the central bank expected to hike by another 25 basis points to 1.25%. Given the shift of gear from numerous other central banks recently, could the MPC be persuaded to join the 50 basis point club? Markets view a one in three chance of it happening. It arguably should be higher given the same central bank is expecting double-digit inflation later in the year.
Next week also offers the usual data dump that comes around the third week of the month, with jobs, retail sales, GDP and industrial production figures all due. Needless to say, it’s going to be eventful for the pound.
Next week is relatively quiet for Russia, with revised GDP for Q1 the only notable release. The CBR cut rates to pre-war levels on Friday at 9.5% but the currency remains near its recent highs thanks to a ballooning current account as imports have collapsed in the aftermath of the invasion.
The central bank has been patient in cutting rates again in the hope of lowering inflation which fell to 17.1% in May, down from 17.8% in April, giving the impression it may have peaked. With the economy performing better than feared and inflation heading in the right direction, further rate cuts could follow in an attempt to revive consumer demand and support the economy.
A quiet week with retail sales on Wednesday the only notable release.
Nothing much on offer next week from Turkey, with the focus still being on the collapse of the lira as the most vulnerable EM currencies are punished in the global tightening environment. While the Turkish government and central bank repeatedly try to deflect blame for the currency woes and surging inflation, the blame lies much closer to home as the monetary experiment continues to go from bad to worse.
China releases industrial output, retail sales and fixed asset investment on Wednesday and the 1-year MLF rate in the second half of the week. Chinese data should improve on the appalling April numbers in May as Shanghai and Beijing reopen, but will still be weak to negative. The 1-year MLF rate should stay unchanged at 2.85% as China persists with targetted stimulus aimed at MSME’s.
The main driver of volatility will be the Covid-zero policy with China announcing that 7 of Shanghai’s 16 districts will be tested over the weekend. Markets have been complacent around Covid-zero believing China was one and done. Unfortunately, omicron doesn’t work that way and if strict lockdowns spread once again, Chinese equities will be pummelled. Watch for developments on this front over the weekend and during the week.
India hiked rates again this past week and the RBI will be closely watching Wednesday’s inflation release for May. Inflation is expected to fall to around 7.0% from 7.80%, but a higher print will see RBI tightening expectations ratcheted up, which could weigh heavily on local equities.
Notably, the RBI rate hike and hawkish outlook did not benefit the Indian rupee this week and it remains near record lows at 77.800 to the US Dollar. A hawkish FOMC next week and softer inflation data could spur another bout of weakness in the currency. High oil prices are also another serious headwind.
Australian unemployment on Thursday is the only material data point this week and is usually only good for intraday volatility.
Both Australian equities and the AUD remain under pressure with the price action particularly negative on AUD/USD. Wobbly risk sentiment globally has pushed the currency lower, and fears over renewed Chinese lockdowns are also weighing heavily as a proxy for China. Readers should watch virus developments in China for directional inputs on AUD.
NZ GDP on Thursday and Business PMI on Friday are both expected to retreat sharply. Nerves continue rising around the NZ economy as it slows while the RBNZ tightens policy. Poor data this week could weigh heavily on the NZD/USD, which, like AUD/USD, is also extremely vulnerable to negative virus developments/slowdown risk from China this week.
The Bank of Japan announces its monetary policy decision on Friday, a day after the FOMC announcement (Asian time). Despite the huge fall in the Japanese yen in the past week, it would be an enormous surprise if Japan tinkered with monetary policy. Given the weight of long USD/JPY positioning out there, a tightening move by the BOJ, no matter how tenuous, could see USD/JPY correct strongly.
Otherwise, the yen continues to be pummeled as US yields rise back above 3.0%, widening the US/Japan rate differential.
Japan releases industrial production on Monday, and the Tankan Survey and Machinery Orders on Tuesday. Both should show a slight improvement on the economic reopening and a weaker yen, but will only drive short-term intraday liquidity.
Singapore releases non-oil exports on Friday. A volatile series and poor data could be a short-term negative factor for local stocks. The SGD has been heavy this week and negative virus developments from China in the week ahead could accelerate USD/SGD strength.
Sunday, June 12
France holds the first round of parliamentary elections
The World Trade Organization begins its ministerial meeting
Monday, June 13
China medium-term lending
Japan business conditions index
New Zealand net migration
Turkey current account, industrial production
UK industrial production, trade data
Norway monthly GDP
ECB’s Luis De Guindos participates in a meeting on “The challenges of enhancing financial stability in the recovery phase from the Corona pandemic” organized by the Arab Monetary Fund.
Italian Prime Minister Mario Draghi travels to Israel
Tuesday, June 14
Australia household spending, business confidence
Germany CPI, ZEW survey expectations
India trade, wholesale prices
Japan industrial production, capacity utilization
Mexico international reserves
New Zealand food prices
UK jobless claims, unemployment
ECB’s Schnabel speaks at Universite Paris 1 Pantheon-Sorbonne
Wednesday, June 15
FOMC Decision: To raise rates by a half-point and update economic projections
US cross-border investment, business inventories, empire manufacturing, retail sales
Australia consumer confidence
Canada housing starts, existing home sales
China retail sales, industrial production, surveyed jobless rate, fixed assets, residential property sales
Eurozone industrial production, trade balance
Japan machinery orders, tertiary index
New Zealand BoP, current account GDP ratio
South Africa retail sales
ECB President Christine Lagarde participates in a discussion hosted by the London School of Economics
ECB’s Mario Centeno, Pablo Hernandez de Cos, Klaas Knot and Joachim Nagel speak at Young Factor web event
ECB’s Panetta gives an introductory statement at a hearing on the digital euro before the Committee on Economic and Monetary Affairs in the European Parliament
UK Prime Minister Boris Johnson due to take questions in Parliament
Thursday, June 16
US housing starts, initial jobless claims
Australia unemployment, consumer inflation expectations
China property prices
Eurozone new car registrations
Hungary one-week deposit rate
Japan trade, department store sales
New Zealand GDP
Switzerland rate decision: No change expected with Policy Rate
UK BOE rate decision: Expected to raise Bank Rate by 25bps to 1.25%
ECB’s Centeno, de Cos, de Guindos, Knot, Vasle, Visco and Villeroy speak at Young Factor web event.
ECB’s Panetta speaks at European Payments Council’s 20th-anniversary event in Brussels.
ECB’s Vasle speaks at a Slovenian banking conference.
Friday, June 17
US Conference Board leading index, industrial production
BOJ Rate Decision: To stand pat on rates
Hong Kong jobless rate
UK retail sales
New Zealand PMI
Singapore non-oil domestic exports, electronic exports
Thailand foreign reserves, forward contracts, car salesrecession unemployment pandemic stimulus reopening equities stocks monetary policy fomc fed home sales currencies pound us dollar euro spread recession gdp recovery consumer spending unemployment stimulus oil singapore africa india mexico japan hong kong canada european uk france spain italy germany sweden poland hungary russia eu china
NIH Doctor Flagged Wuhan Virus Lab Safety Problems As Early As 2017
NIH Doctor Flagged Wuhan Virus Lab Safety Problems As Early As 2017
Authored by Tom Ozimek via The Epoch Times,
A doctor working for the…
A doctor working for the U.S. government in 2017 visited the China-based virus research facility that may have leaked the pathogen that causes COVID-19, and sounded the alarm on safety issues at the lab earlier than previously reported, according to documents obtained by The Epoch Times.
Dr. Ping Chen, who worked for the National Institute of Allergy and Infectious Diseases (NIAID), visited the Wuhan Institute of Virology (WIV) in October 2017 and prepared a report for her superiors after her visit.
While a version of her report obtained by a Freedom of Information Act (FOIA) request was fully redacted, Sen. Ron Johnson (R-Wis.) and his team were granted an opportunity to carry out an in-camera review of the report that had some of the redactions removed.
“It is clear to me by talking to the technician that certainly there is a need for training support” at the Wuhan lab, Dr. Chen wrote in the report, parts of which were attached to a letter sent by Mr. Johnson to Department of Health and Human Services (HHS) Secretary Xavier Becerra on Sept. 21.
The letter, which was obtained by The Epoch Times, includes fragments of Dr. Chen's report and suggests that HHS and the U.S. National Institutes of Health (NIH) were aware of safety issues at the Wuhan facility as early as October 2017.
The P4 laboratory on the campus of the Wuhan Institute of Virology in Wuhan, Hubei Province, China, on May 13, 2020. (Hector Retamal/AFP via Getty Images)
Earlier reporting based on two State Department cables and correspondence records obtained by Judicial Watch indicate that NIH was made aware of safety problems at the Wuhan lab in 2018, the year after Dr. Chen's report.
“I think the institute would welcome any help and technical support by NIAID,” Dr. Chen wrote in her 2017 report.
Mr. Johnson wrote in his letter to Mr. Becerra that Dr. Chen's 2017 report partially served as the basis for a Jan. 19, 2018, State Department cable that raised safety concerns about the Wuhan virus lab.
Evidence suggests that SARS-CoV-2, the virus that causes COVID-19, leaked from the Wuhan facility before spreading across the world. According to the so-called lab leak theory, the deadly pathogen that caused the pandemic escaped the Chinese facility, which was conducting risky gain-of-function research on bat coronaviruses that was partially funded by U.S. taxpayer dollars.
Mr. Johnson demanded that HHS provide a version of Dr. Chen's 2017 report that contains fewer redactions in order to scrutinize its contents more closely and determine how closely it aligned with the cable.
“In the public FOIA document, HHS redacted Dr. Chen’s entire report claiming that it contains privacy and deliberative information,” Mr. Johnson wrote.
“It seems apparent that the only reason that HHS redacted this information was to hide the report’s contents from the American people. Perhaps HHS did not want the public to fully understand the fact that NIH and NIAID officials were aware of safety concerns at the WIV dating as far back as 2017,” he added.
Mr. Johnson also accused NIH and HHS of obstructing his probe.
"HHS and NIH continue to obstruct my oversight efforts," he wrote. "It is unacceptable that HHS and NIH had Dr. Chen's report in its possession and only provided a slightly less redacted version for my staff to review in camera."
He demanded that HHS provide unredacted copies of Dr. Chen's report and all documents and communications relating to the report and to the Wuhan lab.
Mr. Johnson also asked for Dr. Chen to sit before a congressional panel and testify.
He set an Oct. 5 deadline for HHS to comply with his request.
HHS officials didn't immediately respond to a request by The Epoch Times for comment.
Chinese virologist Shi Zhengli is seen inside the P4 laboratory in Wuhan, China, on Feb. 23, 2017. (Johannes Eisele/AFP via Getty Images)
'Preponderance of Evidence' for Lab Leak
In August 2021, a report by Republican lawmakers noted a "preponderance of evidence" that the virus that caused the COVID-19 pandemic leaked from the Wuhan lab.
Chinese officials have denied the lab leak claim, insisting that the virus made a natural jump from animals to humans.
Rep. Michael McCaul (R-Texas) said in testimony before the Coronavirus Select Subcommittee Republicans that evidence points to a lab leak as the likely origin of the virus, saying that "it's time to completely dismiss the wet market as the source of the outbreak" and "the preponderance of the evidence that it came from the lab is very convincing."
U.S. intelligence agencies later said in a report that a natural origin and a lab leak are both plausible hypotheses but that a lack of evidence makes a definitive conclusion either way impossible.
It's a sentiment echoed by Mr. McCaul in his testimony.
"Unfortunately, we may never know for certain because the Chinese Communist Party went to great lengths to cover up this outbreak," he said. "They detained the doctors in order to silence them. They disappeared journalists. They destroyed lab samples. They hid the fact there was clear evidence of human-to-human transmission. And they have refused to allow a real investigation into the origins."
Wuhan Lab Funding Controversy
The U.S. Agency for International Development awarded a total of $1.1 million to the WIV between October 2009 and May 2019, the agency wrote in a May 2021 letter (pdf) to Rep. Guy Reschenthaler (R-Pa.).
Mr. Reschenthaler alleged that the funding was used for a study that used gain-of-function research to create "a hybrid, man-made virus by inserting a spiked protein from a wild coronavirus into a mouse-adapted SARS-CoV backbone, which could infect human airways."
The agency said the funds were channeled through EcoHealth Alliance and were meant for the purpose of advancing research on critical viruses that could pose a threat to humans. It also denied claims that the money was used for gain-of-function research, which seeks to boost viral lethality for the purpose of studying it.
In June 2022, the House Appropriations Committee approved a ban on sending any further funding to the Wuhan Institute of Virology.
More recently, the NIH quietly removed the WIV from a list of foreign facilities that are eligible to receive U.S. taxpayer funds to conduct animal experiments.
Fauci And The CIA: A New Explanation Emerges
Fauci And The CIA: A New Explanation Emerges
Authored by Jeffrey A. Tucker via Brownstone Institute,
Jeremy Farrar’s book from August 2021…
Jeremy Farrar’s book from August 2021 is relatively more candid than most accounts of the initial decision to lock down in the US and UK. “It’s hard to come off nocturnal calls about the possibility of a lab leak and go back to bed,” he wrote of the clandestine phone calls he was getting from January 27-31, 2020. They had already alerted the FBI and MI5.
“I’d never had trouble sleeping before, something that comes from spending a career working as a doctor in critical care and medicine. But the situation with this new virus and the dark question marks over its origins felt emotionally overwhelming. None of us knew what was going to happen but things had already escalated into an international emergency. On top of that, just a few of us – Eddie [Holmes], Kristian [Anderson], Tony [Fauci] and I – were now privy to sensitive information that, if proved to be true, might set off a whole series of events that would be far bigger than any of us. It felt as if a storm was gathering, of forces beyond anything I had experienced and over which none of us had any control.”
At that point in the trajectory of events, intelligence services on both sides of the Atlantic had been put on notice. Anthony Fauci also received confirmation that money from the National Institutes of Health had been channeled to the offending lab in Wuhan, which meant that his career was on the line. Working at a furious pace, the famed “Proximal Origin” paper was produced in record time. It concluded that there was no lab leak.
In a remarkable series of revelations this week, we’ve learned that the CIA was involved in trying to make payments to those authors (thank you whistleblower), plus it appears that Fauci made visits to the CIA’s headquarters, most likely around the same time.
Suddenly we get some possible clarity in what has otherwise been a very blurry picture. The anomaly that has heretofore cried out for explanation is how it is that Fauci changed his mind so dramatically and precisely on the merit of lockdowns for the virus. One day he was counseling calm because this was flu-like, and the next day he was drumming up awareness of the coming lockdown. That day was February 27, 2020, the same day that the New York Times joined with alarmist propaganda from its lead virus reporter Donald G. McNeil.
On February 26, Fauci was writing: “Do not let the fear of the unknown… distort your evaluation of the risk of the pandemic to you relative to the risks that you face every day… do not yield to unreasonable fear.”
The next day, February 27, Fauci wrote actress Morgan Fairchild – likely the most high-profile influencer he knew from the firmament – that “be prepared to mitigate an outbreak in this country by measures that include social distancing, teleworking, temporary closure of schools, etc.”
To be sure, twenty-plus days had passed between the time Fauci alerted intelligence and when he decided to become the voice for lockdowns. We don’t know the exact date of the meetings with the CIA. But generally until now, most of February 2020 has been a blur in terms of the timeline. Something was going on but we hadn’t known just what.
Let’s distinguish between a proximate and distal cause of the lockdowns.
The proximate cause is the fear of a lab leak and an aping of the Wuhan strategy of keeping everyone in their homes to stop the spread. They might have believed this would work, based on the legend of how SARS-1 was controlled. The CIA had dealings with Wuhan and so did Fauci. They both had an interest in denying the lab leak and stopping the spread. The WHO gave them cover.
The distal reasons are more complicated. What stands out here is the possibility of a quid pro quo. The CIA pays scientists to say there was no lab leak and otherwise instructs its kept media sources (New York Times) to call the lab leak a conspiracy theory of the far right. Every measure would be deployed to keep Fauci off the hot seat for his funding of the Wuhan lab. But this cooperation would need to come at a price. Fauci would need to participate in a real-life version of the germ games (Event 201 and Crimson Contagion).
It would be the biggest role of Fauci’s long career. He would need to throw out his principles and medical knowledge of, for example, natural immunity and standard epidemiology concerning the spread of viruses and mitigation strategies. The old pandemic playbook would need to be shredded in favor of lockdown theory as invented in 2005 and then tried in Wuhan. The WHO could be relied upon to say that this strategy worked.
Fauci would need to be on TV daily to somehow persuade Americans to give up their precious rights and liberties. This would need to go on for a long time, maybe all the way to the election, however implausible this sounds. He would need to push the vaccine for which he had already made a deal with Moderna in late January.
Above all else, he would need to convince Trump to go along. That was the hardest part. They considered Trump’s weaknesses. He was a germaphobe so that’s good. He hated Chinese imports so it was merely a matter of describing the virus this way. But he also has a well-known weakness for deferring to highly competent and articulate professional women. That’s where the highly reliable Deborah Birx comes in: Fauci would be her wingman to convince Trump to green-light the lockdowns.
What does the CIA get out of this? The vast intelligence community would have to be put in charge of the pandemic response as the rule maker, the lead agency. Its outposts such as CISA would handle labor-related issues and use its contacts in social media to curate the public mind. This would allow the intelligence community finally to crack down on information flows that had begun 20 years earlier that they had heretofore failed to manage.
The CIA would hobble and hamstring the US president, whom they hated. And importantly, there was his China problem. He had wrecked relations through his tariff wars. So far as they were concerned, this was treason because he did it all on his own. This man was completely out of control. He needed to be put in his place. To convince the president to destroy the US economy with his own hand would be the ultimate coup de grace for the CIA.
A lockdown would restart trade with China. It did in fact achieve that.
How would Fauci and the CIA convince Trump to lock down and restart trade with China? By exploiting these weaknesses and others too: his vulnerability to flattery, his desire for presidential aggrandizement, and his longing for Xi-like powers over all to turn off and then turn on a whole country. Then they would push Trump to buy the much-needed personal protective equipment from China.
They finally got their way: somewhere between March 10 or possibly as late as March 14, Trump gave the go ahead. The press conference of March 16, especially those magical 70 seconds in which Fauci read the words mandating lockdowns because Birx turned out to be too squeamish, was the great turning point. A few days later, Trump was on the phone with Xi asking for equipment.
In addition, such a lockdown would greatly please the digital tech industry, which would experience a huge boost in demand, plus large corporations like Amazon and WalMart, which would stay open as their competitors were closed. Finally, it would be a massive subsidy to pharma and especially the mRNA platform technology itself, which would enjoy the credit for ending the pandemic.
If this whole scenario is true, it means that all along Fauci was merely playing a role, a front man for much deeper interests and priorities in the CIA-led intelligence community. This broad outline makes sense of why Fauci changed his mind on lockdowns, including the timing of the change. There are still many more details to know, but these new fragments of new information take our understanding in a new and more coherent direction.
Jeffrey A. Tucker is Founder and President of the Brownstone Institute. He is also Senior Economics Columnist for Epoch Times, author of 10 books, including Liberty or Lockdown, and thousands of articles in the scholarly and popular press. He speaks widely on topics of economics, technology, social philosophy, and culture.
Watch: Biden Tells People To Stop Questioning COVID Shots
Watch: Biden Tells People To Stop Questioning COVID Shots
Authored by Steve Watson via Summit News,
In remarks made Wednesday, Joe Biden…
In remarks made Wednesday, Joe Biden argued that people, including potential “leaders” should stop saying “inflammatory things” about COVID vaccinations and fall into line with what his administration is telling them to do.
“What leaders say matter, in terms of people’s confidence in things they’re not sure about,” biden began.
He continued, “And one of those areas — you saw what happened with regard to the crisis — health crisis that we had that cost us — we lost well over a million people. And as time began to move on, you had more and more voices saying, “No, no, no. You don’t need to get that shot. You don’t need to be — get — you don’t need to.”
“We have a new strain of COVID now, and we have answers for it,” Biden contended, further stating “I just would urge those in public life and both political parties or no political party to be cautious about the ac- — the sometimes inflammatory things you say about this, because people’s lives are at stake.”
Biden: People must be "cautious" about giving divergent opinions on Covid pic.twitter.com/bDDqfTQHK8— Tom Elliott (@tomselliott) September 27, 2023
That will be the COVID shots that don’t prevent anyone from getting COVID or stop transmission of the virus then will it? The ones that cause more serious side effects in children than they do save lives?
The comments come in the wake of revelations that Anthony Fauci was secretly escorted into CIA and State Department meetings to steer the direction of the COVID origins investigation away from the lab leak evidence.
Fauci allegedly attacked lab leak theory at meetings at CIA, the State Department, and the White House, seeding disinformation that disclaimed his own culpability for the Covid outbreak https://t.co/rleES5v4dt— Tom Elliott (@tomselliott) September 27, 2023
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