- Fink š§
- Posts
- Secretly, these economies are getting crucified
Secretly, these economies are getting crucified
Rate hikes are REALLY biting now
Five days left for 20% off Fink Pro Premiumā¦
Hereās a message from one of our long term subscribers.
If itās helped this subscriber (and there are others too), do you think itāll help you, especially as we go into this danger period of the next 12 months (see TikTok at end of this note)?
If so, click below!
š§ The Big Brain
Rate Sensitive Economies Getting Crucified
The global economy is slowing. Some economies are slowing faster than others.
Yes that line sounds weird. How can something be slowing faster?
Itās also 100% true.
See, some economies are way more sensitive to rate hikes than others, and a couple that we track are giving off āweāre all about to die of poverty, this is gonna be worse than 2008ā kinda vibes.
OK. FINE. Not quite that bad, but still seriously concerning.
All in todayās Big Brain, along with that EURGBP trade idea promised on Friday.
Pro Premium Members: click here to read
Subscribe to Fink Pro to read the FULL Big Brain piece, every single day (currently 20% off annual subscriptions).
ā” The Spark
Dr Copper On The Cliff Of Deathā¢
Sometimes I have an irrational hatred of market clichƩs.
One of these is the idea that copper has mysterious powers to ādiagnose the healthā of the global economy.
See, itās just like a doctor. Diagnosing and sh*t.
Hence, the nickname, Dr Copper.
Conspiracy Theory: The nickname was invented by salespeople to pitch mining stocks to wealthy marks doctors & surgeons.
Weāre gonna dissect (geddit?) that little nugget in a sec.
First though, if copper is genuinely diagnosing anything, weāre about to be pretty sick:
Scaramouche scaramouche, will you do the... contango?
Honestly, canāt say contango without singing Bohemian Rhapsody.
Thunderbolts & lightning, very very frightening meā¦
On the one hand, that level of contango is a pretty bad sign in the near term.
On the other, is this a sign that sentiment is deeply bearish and thereās limited juice left to the downside?
WTFink is Contango anyway?
Contango is a situation where the futures price of a commodity is higher than the spot price. Contango usually occurs when an asset's price is expected to rise over time. That results in an upward-sloping forward curve.
Too much of a good thing?: Itās also what we see when the market is near-term over-supplied, but that situation is not expected to persist.
āWe are seeing invisible inventories being released onto the exchangeā
Not sure how heās seeing them if theyāre invisibleā¦
Anyway, that comment was from the end of September. Not the kind of thing youāll see in a healthy market.
Worth keeping a close eye on copper now if risk sentiment stabilises.
š” The Lightbulb
Cold War Cancelled
Whenever things change, thereās usually a rush to predict WHAT THIS MEANS for well, everything.
Especially in markets, where the prize is vast sums of money, or, in the case of those who shout loudest, analyst cloutā¦
And weāve been told countless times how thereās no way back for the US & China.
Relations getting worse and worseā¦.
Trade wars forever and so on.
What ifā¦ thatās wrong?
See, although thereās little doubt that some companies are trying to reshore, friendshore, nearshore or whatever type of shore means ābeing less reliant on China just in case SHTFā¦.ā, the rhetoric hasnāt really escalated for a while.
Sure, there are restrictions on certain types of chips being exported from the US to China, while Chinaās restricting exports of certain materials including graphite for batteries, but whatās REALLY new?
Everyone knows there are ways around most of these things, and weāve been wondering if that story is actually on the turnā¦
Adding to the evidence, a Wang Yi trip to Washington is on the cards this weekā¦
WSJ: China hasnāt said yet whether its leader, Xi Jinping, will accept President Bidenās invitation to visit the U.S. next month, but Beijing is gearing up an American charm offensive that appears designed to prepare the way for what would be Xiās first U.S. trip in six-and-a-half years.
Xi is expected to dispatch Chinese Foreign Minister Wang Yi this week to Washington for summit-preparation meetings with Secretary of State Antony Blinken, according to people briefed on the plans.
Maybe that Cold War can be postponed for a whileā¦
š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±š±
@fink.tok #bondyields drive the market, and rhe #yieldcurve is a VERY good predictor of the direction of the #useconomy. But itās an even better ind... See more
š§ 3 referrals gives you a monthās FREE access to Fink Pro!