2026 has been an interesting year thus far. A number of themes including AI, Geopolitics, Debt and Innovation have driven the flow of markets, which have very high upside expectations and few worries about downside risks. I would remind readers of Blain Mantra No 1: “The markets have but one objective: to inflict the maximum amount of pain on the maximum number of participants”. Hey-Ho, and on we go...

Andy Burnham promises the UK a national reboot. Critical to his success will be his choice of chancellor, and the relationship with the financial markets. Rachel Reeves is closely associated with the failed Starmer premiership – but she knows how to do the job and has credibility with the markets. With new leadership she could prove a much better choice than other contenders.

This is not an obituary – but a story about markets. Hans-Jeorg Rudloff, who passed away earlier this week, was the dominant figure of the Eurobond market. His insights and vision were extraordinary – understanding how markets worked, how to dominate them, and setting the foundations for today’s $120 trillion global market!

The AI Bubble floats on a wave of Confidence – confidence the global economy needs it, the USA will lead it, the hyperscalers and AI firms can afford it, energy is not an issues, and competition from China, tech evolution and quantum are not future problems. All the market sees is opportunity. We've been here before.

What’s not to like about markets which keep going up? Lots of participants are increasingly certain the current upside momentum is unstoppable. Some of us suffer from the problem of thinking too much and wondering if its sustainable. Being a bear can feel very lonely.

The bond bear market looks set to deepen as rising energy prices threaten to keep inflation sticky. The way bonds impact the economy is more complex than most understand – it’s not  just interest rates, but how inflation, and growth limit policy choices.

China issued $2bln of Bonds via Saudi Arabia last week. Some think it’s part of a malign plan for China to disrupt the global dollar bond markets. It may be the trigger for a dramatic rethink and recalibration of how global markets finance future credit. As geopolitical flux deepens, how might a new bond markets evolve?

Labour might have a massive majority, but they are being mugged in broad daylight by the rump Tories who have persuaded the electorate they’re as bad as they were. That’s not good in an economy requiring big decisions to be taken and delivered competently. Labour is in danger of losing “Grip”.

Blain’s Morning Porridge 16th October, 2024: Boeing, throwing the dice [...]

Politics and Corporate Greed are close bedfellows. This week’s market will be driven by the US inflation number and what it means for rate cut timing, but the costs of inflation fall hardest upon the poor. Political populism is driven by inequality and corporate greed, and underlies market instability.