Chancellor Rachel Reeves should be angry, not tearful. The multiple crises facing the UK’s funding have been long-term in creation. Reeves has the opportunity to fix them. The recipe is simple; common sense, political discipline, a dash for growth and a spicing of Gilts Liability Management. C’mon Rachel… you can do it.
Trump has been sending “for your immediate attention”, letters to former friends and allies hiking tariffs and threatening retribution if they retaliate. Yawn. Who cares? The Global economy gets it. America is no longer America. Global trade is shifting. Excellent – that spells opportunity!
A heatwave in London is unbearable – and we’re about to experience the third of this long, hot, summer. Elsewhere, increasingly chaotic climate events are triggering unpredictable weather disasters – including the tragic floods that hit Texas. We can’t deny the threat – but we can mitigate the effects if we acknowledge the threat is real, and invest accordingly.
Never has the contrast in economic outlook and market expectations been so divided on either side of the pond. In Washington, joy as Trump’s tax cuts are enacted. In London, unremitting gloom and despair. But, hey-ho, Labour is going to fix the NHS! Give me strength….
Yesterday the Gilts market suffered a judder moment – but it was political theatre. The gilts market is fundamentally in good shape, well run, and a 3.5 times oversubscribed Gilts auction highlights it’s not under Bond Vigilante pressure. The UK is not about to default, beg an IMF bailout – no matter what Liz Truss apologists would like to believe.
When markets are hitting record highs is the time to be cautious, and ask why? US Stocks and Bonds are at record levels, despite the current uncertainties and policy instability. What’s driving it is a mix of themes, including market evolution. But also a market potentially complacent about approaching threats.
What an interesting time we live in. Uncertainty, instability, markets hitting new highs as fears plumb new depths. Nothing to worry about. The global economy and markers are changing. Just how we won’t know till we can see it in the rear-view mirror.
The last 6 months has been….. interesting. The world has been shaken, stirred, and left confused, uncertain and destablised. Fantastic. Big shocks create massive opportunities. The issue for markets is understanding why, where and what they are!
Trump described Fed Head Jay Powell as "stupid" for not easing rates – Powell is playing safe, waiting for the Trump impulse to play through the economy. The standoff in Iran looks likely to prove Trump’s pivotal moment: is he a risk taker, or just noise? The stakes are massive - the upside is consolidation of US power, the downside includes acute embarrassment and MAGA disillusionment in the Presidency.
Global Oil Markets have shrugged off the supply threats. Markets seen unfazed by the economic consequences of trade ructions and tariffs. Rising instability elicits little more than yawns. Are we walking into a crisis?
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