投稿者: Gold Macro Page 11 of 18

It’s fair to say that last weekend’s POTUS Tweetfest was unhelpful to a rapidly deteriorating Global Economy.

For those who missed it, here’s a summary below, courtesy of Zerohedge:

“Jerome Powell’s Jackson Hole speech was supposed to be the most important event of an otherwise sleepy, August day, after which traders could quietly exit for the rest of the day and commence drinking. It did not quite work out that way.
Not only did Powell’s speech barely make the top 3 most important events, but Friday ended up being an exercise in surreal market news flow, and one of the biggest drops of 2019 to boot.
With a few hours left before Jackson Hole, as traders were getting ready to trade Powell’s Jackson Hole speech which was a big dud, and did not reveal anything new (as even Trump figured out when he blasted the Fed chief slamming “As usual, the Fed did NOTHING!” and asking “who is our bigger enemy, Jay Powell or Chairman Xi?”), China shocked the market by unveiling that it would retaliate by slapping 10% tariffs on another $75BN in US imports, which sent stocks sharply lower at first. Then, Powell’s remarks managed to somewhat stabilize sentiment, and the S&P almost regained all losses… before all hell broke loose and in a vicious tirade, Trump first slammed Powell, effectively calling him an enemy of the state”, and then warned he would retaliate to China soon, while ordering US companies (can a US president dictate to companies what they can and can not do?) to find an “alternative” to China.
The result was a violent slam lower in risk assets, with the S&P tumbling over 70 points, the Dow plunging over 500 point, its 3rd such drop in the month of August, which has emerged as the worst month for stocks since December 2018…”

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To some, the main event of the new Australian Financial Year was the RBA’s continued commitment to 0% interest rates for borrowers and -% for depositors.

We agree this is important. Before we get to commentary around Aussie rates we’d like to make sure you didn’t miss the move of the Systemically important Global behemoth, Deutsche Bank (DB) last weekend.

After 10 long years of can-kicking, they revealed their plans to “fix it”

The plan to fix their woes is to shed workforce, put bad “stuff” in bad bank and wind back global operations to focus on “strengths”, whatever they are.

To think this is just a “restructure” with job losses is a failure to connect the dots. It’s highly relative to unresolved systemic financial “issues” left over from the last crisis.

Below are some very simple numbers to help.

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Confirmation over the last six months of central bank commitment to solving a debt and credit crisis with more of the same is really starting to take effect.

It’s truly amazing, that with the prospect of slowing global economic growth and recession looming, Central bank buildings around the world, full of PhD’s, are nothing more than a collection of giant echo chambers!

All their modelling and prognosticating always produces the same fix. More money printing, lower rates, creating even more debt and bubbles, everywhere. Everywhere.

Negative Yielding Debt is now over 13 TRILLION dollar equivalent, and on the rise. Onwards and upwards!!!

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