Stuff I'm Watching

UK Politics. Mirror mirror on the wall, who is the least unpopular... ?

  

 

Story of the Week - BREXIT - WHAT HAVE WE AGREED?

  

Brexit Treaty: What the EU and UK have agreed

FT https://www.ft.com/content/693b88b0-e804-11e8-8a85-04b8afea6ea3

FT Sums up what the agreement says – and doesn’t.

Key Points: 

Approval Process – EU Summit 25th Nov, House of Commons December, European Parliament. Still risks cabinet ministers may resign.

UK will get bill for European financial commitments – at least Euro 45 bln. Additional payments to cover EU Staff pensions till 2064!

UK to pay “due regard” to European Court rulings.

Northern Ireland – messy. Binds Northern Ireland to single market.

UK customs code is equivalent to customs union lite. 

EU rules on competition, labour, environment and taxation to be maintained by UK – makes sense from European perspective.

Fish war still possible – until reciprocal rights established.  



Bond Vigilante Poll  (353 votes)

Let's say the new Brexit deal is approved by Cabinet, but rejected by Parliament.  What is most likely to happen next?

30% No Deal

38% General Election

32% New Referendum


Thought for the Week - GE In the Spotlight!

  

The Collapse has Begun – GE is Now Trading Like Junk

https://www.zerohedge.com/news/2018-11-13/collapse-has-begun-ge-now-trading-junk

GE – is its tumble towards Fallen Angel the sign of worse to come to US corporate sector as rates rise? 


  

GE Selling Spreads to Bond Markets

https://www.wsj.com/articles/ge-selling-spreads-to-bond-markets-1542131394

GE beginning to look like a firesale… Should we be reassured by statement: “GE does not plan to raise new debt until 2020 so the recent increase in its bond yields will not increase current interest expenses…The company plans to pay down debt through asset sales before returning to bond markets

Blain Speaks....

17/10/18 

The effect of geopolitics on uncertain markets - likely to keep markets turbulent.

Bill on Core TV -6/11/18 

US Midterm elections - potential gridlock, but getting rid of the uncertainty. 

Maybe time to expect better conditions into year end? 

Stuff I'm Reading

What's in the News:

  

  

Bank of Japan’s Bond and Stock Holdings Top 100% of GDP

https://www.wsj.com/articles/bank-of-japans-bond-and-stock-holdings-top-100-of-gdp-1542086889

The BoJ has dropped the quantitative H-Bomb on the Japanese economy. It controls many companies and bond market liquidity. But to what effect? Japan is still an unconvincing game unless you play follow the BoJ. 


Theresa May accused of betrayal as she unveils Brexit deal

The Thunderer: https://www.thetimes.co.uk/edition/news/may-accused-of-betrayal-as-she-unveils-brexit-deal-ks9frvbwz

Usual stuff…


French would be speaking German with US, Trump tells Macron.

The Thunderer: https://www.thetimes.co.uk/edition/news/french-would-be-speaking-german-without-us-trump-tells-macron-cw668ssdw

Ouch. Nothing like a lesson from Trump to focus the mind…. 


Germany’s Economy, Europe’s Powerhouse, Contracts for First Time in Years

WSJ _ https://www.wsj.com/articles/germanys-economy-europes-powerhouse-contracts-for-first-time-in-years-1542186094

Should not be a crisis – especially if there is limited Brexit hiccup. 


WeWork raised $3bln from Softbank as losses balloon. 

https://www.ft.com/content/52298614-e74f-11e8-8a85-04b8afea6ea3

Apparently it would be unwise to stem losses and make a small profit. Much more sensible to make larger losses and keep expanding the company.. I suppose that makes sense??


Five US Tech Giants spend combined $115 bln on buying back stock

https://www.ft.com/content/2017ec30-e711-11e8-8a85-04b8afea6ea3

Buybacks are great for stock holders right up to the moment when they aren’t – which is probably when the only thing sustaining the “magic” is the illusion the company is worth more because its stock price is kept high by low interest rates, tax bribes and buy-backs. What’s the underlying reality?