President Trump spoke about his relationship with Xi and the possibility of trade deals with China during his meeting with Australian Prime Minister Anthony Albanese this morning.

“I expect we’ll probably work out a very fair deal with President Xi of China,” Trump said Monday, as he repeatedly returned to his dynamics with China.

“They will threaten us with rare earths. I don’t think they’re threatening us too much right now, but they could do that,” Trump said.

“But I threaten them with something I think is much more powerful, and it’s tariffs.”

Trump’s words moved markets up and down (but not significantly)…

• 1145ET *TRUMP: CHINA MAY PAY 155% TARIFF IF NO DEAL BY NOV 1 – Stocks down

• 1155ET *TRUMP: WE’LL END UP WITH STRONG TRADE DEAL WITH CHINA – Stocks up

• 1215ET *TRUMP: COULD THREATEN CHINA WITH AIRPLANE EXPORT CONTROLS – Stocks down

• 1220ET *TRUMP: I WANT CHINA TO THRIVE – Stocks up

This follows comments late Sunday by President Trump, speaking aboard Air Force One while en route from Florida to Washington, telling reporters that rare earths, fentanyl, and soybeans would be key topics in his upcoming meeting with Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation (APEC) summit later this month.

The goal of the meeting is to defuse the latest round of trade war tensions between the world’s two largest economies, which have sent financial markets on a rollercoaster ride in recent weeks. 

“I don’t want them playing the rare earth game with us,” Trump told reporters. Just days earlier, he warned that he would impose a 100% tariff on Chinese imports starting November 1 unless Beijing reverses its newly expanded export restrictions on rare-earth minerals and magnets. Goldman briefed clients on rare-earths and tariff threats on Sunday (read here). 

The president noted that he wants Beijing “to stop with the fentanyl,” referring to his calls for the world’s second-largest economy to halt the export of fentanyl precursor chemicals fueling America’s drug crisis, which has led to 100,000 U.S. overdose deaths each year (read this). Some view the fentanyl trade as a form of “reverse opium war,” or, as we detailed in a recent note, part of a multifaceted “total war” against the U.S. that leverages next-generation weapons, including synthetic narcotics (e.g., fentanyl and cannabinoids), bioweapons (e.g., Covid-19), psychological manipulation and influence (e.g., TikTok), and a broad arsenal of irregular warfare tools. 

Trump on what he wants from China:
–for them to restart buying soybeans “at least in the amount that they were buying before.”
— “to stop with the fentanyl.”
–“I don’t want them to play the rare earth game with us.”
It’s “very, you know, normal things,” he said on AF1. pic.twitter.com/wxGZFbuEkg

— Jennifer Jacobs (@JenniferJJacobs) October 20, 2025

Another key demand Trump laid out on Air Force One ahead of his meeting with Xi is that Beijing resume soybean purchases. He said these three topics were all “very, you know, normal things.” 

Soybeans have been a big issue in recent weeks:

• China’s Soybean Boycott – Key Questions Before Trump-Xi Meeting

• Stocks Dump As Trump Says China Committing “Economically Hostile Act”

• U.S. Soybean Exports Show Signs Of Recovery – Even As China Pivots Elsewhere

• U.S. Farmers Are Facing The Worst Economic Downturn In At Least 50 Years

This week, Treasury Secretary Scott Bessent is set to meet with China’s top trade negotiators in Malaysia, following a virtual meeting last Friday with Vice Premier He Lifeng that Chinese state media characterized as a “constructive exchange of views.” The talks are seen as a key pathway to de-escalating tensions ahead of the Trump–Xi meeting.

Bloomberg noted a regular press briefing in Beijing earlier today, where Chinese Foreign Ministry spokesman Guo Jiakun was asked about Trump’s three issues.

 Jiakun responded by saying that a “trade war does not serve the interests of either party, and both sides should negotiate and resolve relevant issues on the basis of equality, respect and mutual benefit.”

President Zelensky got rejected on Tomahawks, but is now seeking to finalizing a deal to purchase 25 Patriot air defense systems, which the Ukrainian leader has described as a major step forward in strengthening the country’s defenses against Russia’s ongoing aerial assaults.

Zelensky has told reporters in fresh remarks that the agreement envisions the delivery of multiple systems each year over a period of several years. Additionally, key European partners are expected to grant Ukraine priority access to Patriot systems when they come off the production line.

What’s more is that Zelensky wants to use Russian funds to buy the air defense missiles. “Speaking in Kyiv after talks with Trump and American weapons-makers, Zelenskyy said Ukraine needed 25 US Patriot anti-missile batteries and that Russia’s frozen assets in the west should be used to buy them,” The Guardian reports.

Ukraine’s energy sites and electrical grid are getting pummeled by nightly Russian missile and drone assaults, which have resulted in forced rolling blackouts to keep the lights on as much as possible across the country, and all ahead of winter when resources tend to be at their most strained.

At the moment, President Trump is being widely accused in mainstream media of essentially selling out the Ukrainians and siding with Putin related to potential future terms of a peace settlement:

Behind the scenes, Trump had pushed Zelenskyy to give up swaths of territory to Russia, two people briefed on the discussion told Reuters. “Let it be cut the way it is,” Trump told reporters on Air Force One on Sunday. “It’s cut up right now,” he said, adding that you can “leave it the way it is right now”.

“They can negotiate something later on down the line,” he said. But for now, both sides of the conflict should “stop at the battle line – go home, stop fighting, stop killing people”.

This would indeed give Russia effective control of some 20% of Ukraine, and the idea is that the battlelines would be ‘frozen’ as a more comprehensive deal is hammered out.

It could be that Trump is finally getting realistic about the conflict – the Russians are not going to pack up and leave the battle lines, and territorial concessions are what will end the war, whether Kiev likes it or not.

Q: Did you tell Zelenskyy he needed to cede all of the Donbas region to Russia?

TRUMP: No, we never discussed it. We think that what they should do is just stop at the lines where they are.

Q: What do you think should happen with the Donbas region?

TRUMP: I think 78% of the… pic.twitter.com/y6y8wMz6LR

— Aaron Rupar (@atrupar) October 20, 2025

Interestingly, Zelensky has also newly indicated he would be open to traveling to Budapest, where Presidents Vladimir Putin and Donald Trump are expected to meet, in the scenario of trilateral or “shuttle diplomacy”; however, neither side has offered this to him.

He and the Europeans fear getting ‘cut out’ or sidelined from Moscow-Washington agreements. So far, the biggest hawks who seek to prevent Zelensky from striking real compromise are in the European capitals.

Authored by Lance Roberts via RealInvestmentAdvice.com,

The recent market crack certainly woke up the more complacent bullish investors. Of course, the complacency was warranted, given the recent market surge, conversations about “TINA” (There Is No Alternative), and how “this time is different.” But that is what a speculative bull run looks and feels like. However, deep inside, you know there are risks. Valuations seem insane, credit spreads are historically tight, and sentiment and trading activity push more speculative extremes. Such is why, while considered “bearish,” we discuss risk management protocols. Why? Because such actions can protect you when it matters most. This is why I want to discuss a different approach to portfolio management with you today. Rather, how to think like a “bear,” so you see the risks of the speculative bull run. However, to act like a “bull” to capture the gains while available.

But that is a difficult skill to master.

Yes, thinking like a bear means you are aware of the exceedingly high levels of investor complacency, that valuations are stretched, and credit spreads have been crushed. Furthermore, margin debt is at very high levels, which provides the fuel for the eventual downturn.

The problem with speculative bull runs is that they always end, and most of the time that ending is destructive. It is inherently logical that, as an investor, you want to move to protect your capital. The problem is that a bearish posture can lead to more severe underperformance because the market is in full speculative mode. Such is why, as an investor, it is logical to engage in bearish thinking, but must maintain a bullish bias amid a bull run. That means you must engage selectively, ride momentum where it leads, and keep disciplined exits.

As noted, that is a difficult skill to master, but that is your edge: you see the warning signs, yet you don’t surrender to them too early.

Howard Marks once argued that psychology overwhelmingly defines speculative bull runs. Price divorces value as crowds chase narratives. While the optimists win short-term, and the pessimists are mocked, Marks warns that during these periods, “value” takes a back seat and momentum becomes the dominant force. Marks underscored that manias shift the center of gravity from intrinsic worth to consensus euphoria. So when you think like a bear, your job is not to dogmatically short every overvalued name, but to structure your exposure to survive the mania’s reversal.

However, marrying the two mindsets is challenging. While valuation models can anchor your long‑term expectations, near-term indicators like relative strength and momentum overlays can help navigate potentially dangerous waters. Like any good captain in uncharted waters, they follow the navigation but pay attention to their instincts.

Why Fundamental Analysis Alone Fails in Mania Mode

Under normal conditions, valuation metrics drive returns. You buy cheap (low P/S, high free cash flow yield, strong ROE) and wait for mean reversion. But in a speculative bull run, those rules often fail. As discussed recently, high volatility and “bad balance sheet” (poor fundamentals) are what investors are chasing. That is because the perceived risk of loss is extremely low, even though it is not.

But that is what happens during market manias. As the crowd chases momentum and dismisses warnings, it pushes prices beyond what the underlying assets justify. This is what is called “valuation expansion.” As shown below, valuations, in the short term, reflect consumer (investor) sentiment. The chart shows the correlation between consumers’ expectations of higher prices in 12 months versus trailing 12-month valuations.

Warren Buffett emphasized this point, stating that in speculative manias, the market becomes a voting machine first (popularity), then later a weighing machine (intrinsic value). In mania phases, price can outrun value over long periods before eventually reverting. Betting on the value convergence too early is dangerous. The reason, as John Maynard Keynes noted, is that.“The market can remain irrational longer than you can remain solvent.”

As we discussed in a recent #BullBearReport on the AI Bubble:

“The critical issue for investors, both then and now, was that many were “right” about the Dot.com bubble. However, they were so early in their warnings that they were wrong in their portfolios. The same warning applies currently. Is there a bubble in AI? Maybe. But, I would even suggest that it is pretty likely. As investors, we must realize that during the “inflation” phase of the bubble, there is a lot of money to be made, but the cycle will eventually end.”

That’s why fighting parabolic moves can be so problematic. As Peter Lynch once stated:

“Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in the corrections themselves.”

Thus, if you followed pure valuation discipline, you would often be sidelined during the high-return leg. Worse, you might have to “catch the knife” when the reversal begins. So you need to adapt your thinking to allow “bearishness” to control risk, but remain “bullish” to allow for the fact that momentum may temporarily drive prices higher..

One pitfall, however, is correlation. Historically non-correlated assets in speculative environments will move in tandem as investors look for the next speculative opportunity. Large-cap, high volatility, emerging market, international, gold, and bitcoin are all being chased higher in the current market. Each has its own narrative to justify its move higher, but buyers’ speculative fervor outstripping supply pushes prices further. In this environment, traditional diversification will likely fail to protect you in a downturn. Your differentiation comes from picking “which” levered momentum plays to hold and having triggers to exit them before they become toxic.

The good news is that markets do not collapse at once, and you will not wake up one morning with stocks down 50%. Instead, the initial sharp move lower will signal that some market “dynamic” has shifted. No one will ever know what that will be in advance. However, it will be an event that causes investors to “revalue” their forward earnings estimates. If those estimates decline, the current market will be repriced for lower future earnings. As shown, there is a high correlation between the market and the 12-month rate of change in forward earnings estimates.

The lesson is that valuation signals are essential but insufficient. You need momentum lenses, risk thresholds, and rules for scaling exposure and exiting when conditions shift. These give you a fighting chance in a speculative bull run.

How to Manage Risk & Exposure During the Mania

You have a framework now: think like a bear, engage like a bull, and overlay defenses. But how do you operationalize that in real portfolios? Below are the steps and principles from our approach and Mark’s wisdom.

• Establish trend break rules and define when the trend is broken. Use moving averages, momentum divergences, or multi‑timeframe trend signals. When a trend breaks, reduce exposure.

• Scale into exposure. Don’t go all in at once. Add when strength confirms. If the market corrects, your position is still manageable.

• Use stop zones and dynamic trailing thresholds. Set stop levels or trailing stops that adapt. Cut losers early. Lock in profits on winners when they begin to stall.

• Tier exposure by risk class. Have distinct layers: value core, momentum growth sleeve, and optional speculative layer. The speculative layer should be small, optional, and easy to cut.

• Monitor outside‑equity signals. Watch credit spreads, yield curves, bond markets, and sentiment extremes. Those often show cracks before equities do.

• Transition to a defensive posture incrementally. Move from “stop buying” to “reduce aggressive holdings” rather than all at once. You don’t have to hit complete defense unless the trends demand.

• Always maintain optionality. Hold dry powder. Leave capacity to enter new momentum trends or reallocate when the old ones shed. You want to be able to pivot.

• Accept uncertainty and probabilistic thinking. Risk and probability matter more than certainty. You can’t know exactly when the shift happens, but you can manage positioning around probabilities.

• Be unemotional and contrarian at extremes. Great investors are unemotional. In extremes, follow contrarian logic: reduce exposure when others lean heavily in. Resist being swept by sentiment. At mania highs, the crowd is usually at its most overextended.

• Review and adapt constantly. Conditions change. What looks good today may become a trap tomorrow. Stay vigilant. Reassess allocations regularly.

By applying these rules, you can capture much of the upside of a speculative market while protecting against the inevitable reversion.

A Roadmap: Where This Strategy Wins and When It Loses

This hybrid approach is not perfect. There are strengths, and there are risks. But it’s more durable than rigid value or blind momentum.

When it wins:

• During strong speculative rallies, where momentum dominates, investors can participate in the gains and avoid collapsing names.

• Technical signals can keep investors aligned with the market in environments where fundamentals are weak but liquidity and psychology are strong.

• When the trend eventually breaks, stop rules trigger exits, preserving investor capital.

When it struggles:

• Momentum-based strategies will fail if the trend reverses abruptly and violently without warning.

• During choppy market phases, investors will likely suffer underperformance when the trend direction is unclear, as trend signals whipsaw.

• A pure value strategy will outperform in sustained value-driven rebounds (after deep crashes), where fundamentals again dominate.

You mitigate those risks by:

• Staying light in speculative exposures

• Keeping a strong value core

• Loosening stop logic in volatile whipsaw phases

• Being ready to switch investment strategies when the cycle changes

The path isn’t perfect, but it gives you flexibility.

Think Like a Bear, Invest Like A Bull

In today’s market environment, where risk is elevated, it can pay to “think like a bear, but invest like a bull.” As Howard Marks previously wrote about navigating speculative manias:

“In hot times, the few who do remember the past are dismissed as relics of the old, lacking the ability to imagine the new. But it invariably turns out that there’s nothing new in terms of investor behavior. Mark Twain said that “history does not repeat itself, but it does rhyme,” and what rhymes are the important themes.

The bottom line is that even though knowing financial history is important, requiring people to study it won’t make a big difference, because they’ll ignore its lessons. There’s a very strong tendency for people to believe in things which, if true, would make them rich. As Demosthenes said, “For that a man wishes, he generally believes to be true”

Just like in the movies, where they show a person in a dilemma to have an angel on one side and a devil on the other, in the case of investing, investors have prudence and memory on one shoulder and greed on the other. Most of the time greed wins. As long as human nature is part of the investment environment, which it always will be, we’ll experience bubbles and crashes.“

There have only been a few points in history where the market is as overbought and extended, technically, as it is currently.

Given that knowledge, investors must learn to live in tension. Think like a bear, so you’re ready for danger. Invest like a bull to participate in the current wealth-building opportunity. No rule says you can ONLY be a bull or a bear. It is okay, and logical, to be a bit of both.

Critically, you must adopt probabilistic thinking and reject certainty.

This combined approach gives you a fighting chance in environments where liquidity and psychology override fundamentals. It also preserves your survival when sentiment eventually reverses.

OpenAI’s aggressive expansion of datacenters and infrastructure investments – along with its massive pipeline of future projects, fueled by what we call a “circle jerk” in AI vendor financing – has prompted warnings from Microsoft executives that meeting all of Sam Altman’s infrastructure demands could generate overcapacity risks over data centers, according to The Information. Meanwhile, a separate TechCrunch report indicates that ChatGPT’s mobile app growth may have already peaked.

An OpenAI employee told The Information that the chatbot startup ($500 billion valuation) has budgeted approximately $450 billion in server expenses through 2030, with additional plans to rent servers from Microsoft and Oracle. 

OpenAI has made requests for increased computing capacity with Microsoft, which has sparked internal friction between both companies. Microsoft retains “first dibs” on supplying OpenAI data center capacity due to its $13 billion investment; however, practical constraints such as construction limits and power market woes have slowed its ability to scale. 

Microsoft executives, including CFO Amy Hood, cautioned against overbuilding servers that might not yield returns, while OpenAI CEO Altman pushed for faster expansion. 

The Information continued:

There are usually two sides to most stories of marital friction. For OpenAI, its frustrations speak to the startup’s seemingly bottomless computing needs, which have multiplied by the month. Over the past year, OpenAI CEO Sam Altman frequently pressed Microsoft to move more quickly in adding capacity to meet those needs.

And for their part, Microsoft leaders told Altman the company simply couldn’t supply that capacity as fast as he wanted due to fundamental constraints in the construction process, such as connecting new data centers to power. Chief Financial Officer Amy Hood and her staff told colleagues that catering to OpenAI’s demands could put Microsoft at risk of overbuilding servers that might not produce a financial return, according to people involved in the discussions.

Eventually, the two companies came to a resolution. In the summer of 2024, Altman and Microsoft CEO Satya Nadella agreed it would be impossible for Microsoft to be the startup’s sole cloud provider given OpenAI’s recent growth, according to people who spoke to them. As a result, Microsoft began granting OpenAI waivers to strike deals with other cloud providers.

Hood’s overbuilding server risk comes around the time that new global daily active user (DAUs) data from third-party app intelligence firm Apptopia shows “ChatGPT’s mobile app growth may have hit its peak,” according to TechCrunch. 

In the U.S…

And more evidence that ChatGPT’s hype is fading.

Fueling the data center bubble and breaking down how the giant “circle jerk” works, we exposed the infinite money glitch earlier this month.

More complex via Bloomberg.

Super impressive Capex by hyperscalers. 

And comes as:

• AI Is Now A Debt Bubble Too, Quietly Surpassing All Banks To Become The Largest Sector In The Market

While the Bank of England warned earlier this month that AI-related valuations are “stretched.” The irony of this warning is that central bankers very rarely make the right calls. 

This story builds on:

• Reddit Plunges On New Traffic Data Suggesting ChatGPT “Massively Reduced Citations”

• Did Goldman Just Spot ‘Peak Reddit’?

The bigger question is whether user fatigue with AI products is only now beginning to emerge. If that’s the case, Hood’s concerns about OpenAI’s aggressive expansion may be justified, as Goldman’s James Schneider told clients, “The net impact of our model updates extends the duration of peak datacenter occupancy well into 2026 (from the end of 2025 previously). After this point, we forecast a modest, but gradual loosening of supply/demand balance in 2027…”

Schneider added more color:

Reconciling our revised supply and demand updates, our baseline forecast for supply sufficiency stays largely unchanged in 2025 at 92% but increases by an average of 2% in 2026 to 92%, and 2% in 2027 to 92% – with a longer-term forecast supply sufficiency of 89% by 2030 – a 1% increase from our prior version of the supply/demand model. As a result, we now believe the peak of datacenter supply sufficiency is likely to be pushed out into 2026, from the end of 2025 as previously forecast. We believe the datacenter market’s current supply/demand tightness will extend for longer, and our model continues to suggest that market occupancy will stabilize around average levels seen over the past 18 months. In summary, we believe the outlook for datacenter supply, demand, and their implied supply sufficiency remains relatively healthy for now. We continue to watch for incremental datapoints that could cause a shift in expectations – and we are closely watching for any changes (GPU demand, AI model efficiencies, announced incremental supply additions such as Stargate) that could significantly impact medium-term supply/demand balance.

ZeroHedge Pro Subs can read the full global datacenter supply/demand report in the usual place.

Authored by ‘sundance’ via The Last Refuge,

A fascinating hour-long interview with Steve Witkoff and Jared Kushner as they outline the backstory to the Israel-Hamas peace agreement in Gaza.

During a segment (prompted below) Witkoff and Kushner are outlining the step-by-step process as they engaged the leaders of Qatar, Turkey and Egypt. 

Witkoff reveals how the CIA was briefing them both, multiple times a day, and the briefing itself was exactly the opposite of what Emir of Qatar and Presidents of Turkey and Egypt were telling them. 

The CIA intelligence was the exact opposite of reality.  

WATCH:

What they are describing is EXACTLY why we outlined how ‘outside govt’ emissaries were/are vitally necessary to work around the control agenda of the U.S. Intelligence Community. 

This small example is stunning in magnitude when considered around the importance of the moment.

On a positive note, with Witkoff making this stunning public statement, we can now add a major datapoint to President Trump’s reference of NOT TRUSTING the CIA. 

Combined with the previous assertions of Marco Rubio and Tulsi Gabbard on essentially the same level of outlook, this example of the CIA getting it wrong (misleading the administration) has long-range ramifications beyond the Hamas example.

With this backdrop for reference, surely now we can have an optimistic sense that President Trump doesn’t trust the CIA intelligence on the Russia-Ukraine conflict.

As futures indicate this morning, and as DB’s Jim Reid writes overnight, the mood music on tariffs has sounded much more positive in recent days. As it stands, President Trump has threatened additional 100% tariffs on China from November 1, but Treasury Secretary Bessent said that he’d be meeting with China’s Vice Premier He Lifeng in person this week. And on Friday, President Trump said he thought that a meeting with Chinese President Xi in South Korea would still go ahead, and said “I think we’re getting along with China”. So that’s added to investor expectations that those 100% tariffs won’t come into force, and if we look at Polymarket, it’s currently pointing to just a 7% chance they come into effect by November 1.

As all that’s happening, we still have the ongoing government shutdown in the US, which is now on day 20. Bear in mind that only two shutdowns have been longer than this one, which were the 35-day shutdown in 2018-19, and the 21-day shutdown in 1995-96. And as it stands, there’s still no sign of a compromise between Republicans and Democrats that would see the government re-open. In terms of the market implications, this is still affecting the flow of economic data, so we’re not getting regular releases like the weekly initial jobless claims, and we don’t have the payrolls number for September either. However, this week we will get the postponed CPI release for September, which is coming out on Friday, just in time for the FOMC meeting the week after.

In terms of what to expect, DB’s economists are looking for headline CPI to come in at a monthly +0.42% pace, which would push up the year-on-year rate to +3.1%, and be the strongest monthly print since January. Meanwhile for core CPI, they expect that to come in at +0.32%, with the year-on-year print remaining at +3.1%. Within the data, they’re still looking for signs of tariff impacts in core goods, with a focus on categories like apparel and new vehicles that haven’t yet seen a meaningful tariff pass-through. 

Otherwise this week, another key data highlight will be the October flash PMIs on Friday, which will give us an initial indication as to how the global economy has fared at the start of Q4. We also have a few CPI prints elsewhere, including from Japan, the UK and Canada.

There are no speaking engagements by Fed officials this week, reflecting the FOMC’s blackout period.

On the earnings side, we’ve got more than 80 companies in the S&P 500 reporting this week – accounting for some 20% of S&P market cap – including Tesla and Netflix, along with more than 80 from the STOXX 600, including Barclays, NatWest and SAP.

Here is a day day-by-day calendar of events

Monday October 20

• Data: Germany September PPI, Italy August current account balance, Eurozone August construction output, Canada September industrial and raw materials price index
• Central banks: ECB’s Schnabel, Nagel and Vujcic speak, BoC Q3 business outlook survey
• Earnings: Zions Bancorp
• Other: China’s Fourth Plenum (through October 23rd)

Tuesday October 21

• Data: US October Philadelphia Fed non-manufacturing activity, UK September public finances, Canada September CPI
• Central banks: ECB’s Lagarde, Escriva, Nagel, Lane and Kocher speak
• Earnings: Western Alliance Bancorp, Netflix, General Electric, Coca-Cola, Philip Morris, RTX, Texas Instruments, Capital One Financial, Lockheed Martin, 3M, General Motors

Wednesday October 22

• Data: UK September CPI, RPI, PPI, August house price index, Japan September trade balance
• Central banks: ECB’s Lagarde and de Guindos speak
• Earnings: Tesla, SAP, IBM, Thermo Fisher Scientific, AT&T, UniCredit, Barclays, Hilton, Heineken, Southwest Airlines, Alcoa
• Auctions: US 20-yr Bond

Thursday October 23

• Data: US September existing home sales, October Kansas City Fed manufacturing activity, France October business confidence, Eurozone October consumer confidence, Canada August retail sales
• Central banks: ECB’s Lane speaks
• Earnings: T-Mobile US, Blackstone, Intel, Union Pacific, Honeywell, Newmont, Lloyds, Ford Motor
• Auctions: US 5-yr TIPS 
• Other: European Council summit of EU leaders in Brussels

Friday October 24

• Data: Global October flash PMIs, US September CPI, October Kansas City Fed services activity, UK October GfK consumer confidence, September retail sales, Japan September national CPI, France October consumer confidence, Sweden September PPI
• Central banks: ECB’s Nagel, Cipollone and Villeroy speak
• Earnings: Procter & Gamble, Sanofi, NatWest, Porsche
• Other: Moody’s review France’s credit rating, Ireland presidential election

Looking at just the US, Goldman writes that the September CPI report—originally scheduled for release last week—will be released on Friday. The new home sales report on Thursday will be postponed if the federal government shutdown continues until then. The Department of Labor will also postpone the official release of the jobless claims report if the government shutdown continues through Thursday, but preliminary state-level claims data will likely be available. There are no speaking engagements by Fed officials this week, reflecting the FOMC’s blackout period.

Monday, October 20 

• There are no major economic data releases scheduled.

Tuesday, October 21 

• 08:30 AM Philadelphia Fed non-manufacturing index, October (last -12.3)

Wednesday, October 22 

• There are no major economic data releases scheduled.

Thursday, October 23 

• 08:30 AM Initial jobless claims, week ended October 18 (GS 225k, consensus 226k, GS estimate of last 219k); Continuing jobless claims, week ended October 11 (GS estimate of last 1,912k): We forecast that initial jobless claims edged up to 225k in the week ended October 18th. Using state-level data from the Department of Labor (DOL), we now estimate that initial claims declined to 219k in the week ended October 11th (with a likely range between 216k and 222k; vs. our estimate of 217k on Thursday) reflecting new data uploaded by Massachusetts and Tennessee on Friday that were missing in DOL’s Thursday upload. We estimate that continuing claims declined to 1,912k in the week ended October 4th (with a likely range between 1,903k and 1,920k; vs. our previous estimate of 1,917k), also reflecting new data uploaded by Massachusetts and Tennessee.
• 10:00 AM Existing home sales, September (GS -1.5%, consensus +1.5%, last -0.2%)
• 11:00 AM Kansas City Fed manufacturing index, October (last +4)

Friday, October 24 

• 08:30 AM CPI (MoM), September (GS +0.33%, consensus +0.4%, last +0.4%); Core CPI (MoM), September (GS +0.25%, consensus +0.3%, last +0.3%); CPI (YoY), September (GS +3.02%, consensus +3.1%, last +2.92%); Core CPI (YoY), September (GS +3.05%, consensus +3.1%, last +3.11%): We estimate a 0.25% increase in September core CPI (month-over-month SA), which would leave the year-over-year rate unchanged at 3.1% on a rounded basis. Our forecast reflects unchanged used car prices reflecting the signal from auction prices, a slight increase in new car prices (+0.2%) reflecting an increase in dealer incentives, and an increase in car insurance prices (+0.3%) based on premiums in our online dataset. We forecast a decline in airfares in September (-1.5%), reflecting a fading boost from seasonal distortions and a decline in underlying airfares based on our equity analysts’ tracking of online price data. We have penciled in upward pressure from tariffs on categories that are particularly exposed (such as communication, household furnishings, and recreation) worth +0.07pp on core inflation. We expect moderation in the shelter components on net after a jump in the prior month (primary rent +0.25% in September vs. +0.30% in August; OER +0.26% vs. +0.38%). We estimate a 0.33% rise in headline CPI, reflecting higher food (+0.25%) and energy (+1.5%) prices. Our forecast is consistent with a 0.21% increase in core PCE in September. We will update our core PCE forecast after the CPI is released.
• 08:30 AM New home sales, September (GS -11.6%, consensus -11.6%, last +20.5%) 
• 09:45 AM S&P Global US manufacturing PMI, October final (consensus 51.8, last 52.0): S&P Global US services PMI, October final (consensus 53.5, last 54.2)
• 10:00 AM University of Michigan consumer sentiment, October final (GS 54.0, consensus 55.0, last 55.0): University of Michigan 5-10-year inflation expectations, October final (GS 3.8%, last 3.7%)

Source: DB, Goldman

With the government shutdown in its third week, White House’s top economic advisor Kevin Hassett said on Monday that the government shutdown is “likely to end sometime this week,” and that if it does not, the Trump administration may impose “stronger measures” to try and force Democrats to cooperate.

Hassett told CNBC that he’s heard from the Senate that Democrats thought it would be “bad optics” to vote to reopen the government before this weekend’s nationwide “No Kings” protest.

“Now there’s a shot that this week, things will come together, and very quickly,” he said. “The moderate Democrats will move forward and get us an open government, at which point we could negotiate whatever policies they want to negotiate with regular order.”

“I think the Schumer shutdown is likely to end sometime this week,” he said, referring to Senate Minority Leader Chuck Schumer (D-NY), who Republicans have blamed for letting the government shut down.

If it doesn’t reopen, “I think that the White House is going to have to look very closely, along with [White House budget chief Russell] Vought, at stronger measures that we could take to bring them to the table,” Hassett continued – suggesting that Democrats are simply looking for a politically opportune time to fold. 

Watch:

HASSETT: There’s cracks in the Schumer armor. I think the Schumer Shutdown is likely to end sometime this week. But I can tell you that if it doesn’t… the White House is gonna have to look very closely… at stronger measures that we can take to bring them to the table. pic.twitter.com/Z13tK3nyfd

— Rapid Response 47 (@RapidResponse47) October 20, 2025

Hassett’s comments added to the market’s Monday morning momentum, and sent Polymarket betters into a frenzy as to when the shutdown will end. 

Hassett’s comments aside, the shutdown is currently in day 20 – with no obvious end in sight. 

The top issue is Affordable Care Act subsidies – which Democrats are demanding an extension of a Biden-era pandemic ACA expansion set to expire at the end of the year – arguing that failing to do so would increase healthcare costs for families. 

That said, maintaining the tax credit carries a big price tag – as permanently expanding the most generous benefits would increase the deficit by $350 billion from 2026 – 2035, according to the Congressional Budget Office. 

Lawmakers don’t have much time, however, as around a dozen states have published ACA heal insurance prices for 2026 which show many premiums skyrocketing unless Congress extends. By next week, dozens of other states will reveal pricing for next year.

Authored by Ken Silva via HeadlineUSA (emphasis ours),

U.S. Judge Bruce Reinhart, who issued the warrant for the FBI’s raid on President Donald Trump’s Mar-a-Lago home in 2022, once shared office space with deceased sex trafficker Jeffrey Epstein, according to newly revealed records.

Some of Judge Reinhart’s links to Epstein have long been known. Reinhart worked for the U.S. Attorney’s Office Southern District of Florida while that branch was prosecuting Epstein for sex crimes in the mid-2000s, and he left that office to work for Epstein in January 2008—more than six months before the Justice Department’s plea deal with Epstein was finalized.

But that’s not all. On Friday, the House Oversight Committee released a transcript of its interview with former U.S. Attorney for the Southern District of Florida Alex Acosta, who signed off on the Epstein plea deal. That transcript reveals that Judge Reinhart not only worked as an attorney for Epstein; he shared office with the deceased sex trafficker.

🚨NEW: It’s been known for years that U.S. Judge Bruce Reinhart, who issued the warrant for the FBI’s raid on President Donald Trump’s Mar-a-Lago home in 2022, once worked for Jeffrey Epstein — joining his legal team after serving at the U.S. Attorney’s Office that prosecuted… pic.twitter.com/67nQdIIRWv

— Headline USA (@HeadlineUSA) October 18, 2025

Indeed, Reinhart incorporated his private practice, Bruce E. Reinhart P.A., on Oct. 23, 2007, listing his address at 250 Australian Ave. South, Suite 1400, West Palm Beach, Florida. Exactly one week later, Epstein incorporated an organization called the Florida Science Foundation at the same address, which is also the office of his former lead attorney, Jack Goldberger.

Epstein would go on to work at the Florida Science Foundation on work-release while serving his 13-month sentence in 2008 and 2009—what’s widely been described as a “sweetheart” plea deal—for procuring a child for prostitution.

When House Oversight Committee investigators presented this evidence to Acosta last month, he expressed surprise.

“So you’ve just disclosed something that I did not know,” Acosta said. “I knew that he had left to work for Epstein while this case was pending. I did not know that he is the one that filed these articles of incorporation.”

Acosta also said it was unethical for Reinhart to have incorporated his private law practice while he was still working for the DOJ.

Most of the House Oversight Committee’s interview with Acosta focused on the plea deal his office granted Epstein. Acosta served as Trump’s Labor Secretary from 2017 to 2019, resigning after his role in the plea deal was thrust back into the public spotlight when Epstein was arrested again in July 2019.

Acosta has defended the plea deal on the grounds that it did result in Epstein’s incarceration and registration as a sex offender.

By far the biggest revelation from the new Acosta interview: The judge who approved the Mar-a-Lago raid once shared office space with Epstein.
The judge also worked for the DOJ in Southern Florida while that office was prosecuting Epstein, then he went on to work for Epstein!!! https://t.co/WRX1c1wss1 pic.twitter.com/6b6En5VlMo

— Ken Silva (@JD_Cashless) October 18, 2025

During his interview with the House Oversight Committee, he said taking Epstein to trial would’ve been a “crapshoot.”

He also blamed Epstein’s work-release on local authorities.

“He obtained work release from the Palm Beach sheriff under a factual situation that’s sketchy at best,” Acosta said. “I don’t remember all the details, but I think his work release was at an institution that had just been incorporated, or something along those lines. That was the Palm Beach sheriff’s decision.”

Ken Silva is the editor of Headline USA. Follow him at x.com/jd_cashless.

Authored by Luis Cornelio via HeadlineUSA,

Disgraced former CNN host Don Lemon urged “black” and “brown” Americans on Wednesday to take up arms, warning they could be swept up in President Donald Trump’s ICE operations. 

He made the incendiary claim during a podcast interview with Wajahat Ali, citing the small number of cases involving U.S. citizens being briefly detained by ICE in cities like Chicago. 

“I just want to be very clear here. I am not condoning or promoting violence,” Lemon began, before invoking the Second Amendment. “Here’s what I’m saying to black and brown people, to Mexican people, to people who are here legally and who can go and buy a gun legally and have a license to carry legally: Go do it! Why not? Go do it! It is your Second Amendment right.” 

Don Lemon instructs illegal aliens “to go out and get a gun because when you have people knocking on your door and taking you away, isn’t that what the second amendment was written for?”

The left is trying to get ICE agents killed.pic.twitter.com/B1lMqM2CqS

— CJ Pearson (@thecjpearson) October 16, 2025

Lemon then urged “black households,” “Indian Americans,” “Mexican Americans,” and, as he put it, “whatever you are,” to purchase firearms legally, claiming the show of force could discourage the Trump administration from conducting immigration raids. 

“Get a license to carry legally,” he said. “Because when you have people knocking on your door and taking you away without due process as a citizen, isn’t that what the Second Amendment was written for?” 

He continued, “Go back and read what the Second Amendment says. And perhaps it will knock some sense … in the heads of these people who are saying: ‘Well, it’s all great. I don’t believe they’re doing it without due process. They’re asking people for papers. They’re not really beating people up. These people are doing things that are illegal.’”  

Lemon’s comments come amid the legacy media’s fixation on rare cases of American citizens briefly detained during ICE raids, most of which are quickly clarified or resolved. 

White House border czar Tom Homan has repeatedly clarified that ICE conducts only targeted operations focused on individuals with existing deportation orders. However, illegal aliens without such orders, as well as citizens lacking proper identification, may be temporarily detained if swept up during these raids. 

When reached by email, Lemon could not provide evidence of any widespread targeting of U.S. citizens by ICE by the time of publication. 

Watch Lemon’s full remarks below:

Submitted by Thomas Kolbe

In the German Bundestag, Friedrich Merz appealed to the EU to integrate the fragmented European capital market more deeply and reduce bureaucratic hurdles. His vision for the next step: a kind of Wall Street for Europe.

German Chancellor Friedrich Merz used his government statement on Thursday to take a strategic look at what he called the “fragmented and over-bureaucratized” European stock and capital market landscape. His stated goal: the completion of the Capital Markets Union.

“We need a kind of European Stock Exchange, so that successful companies like BionTech from Germany don’t have to go to the New York Stock Exchange,” Merz said. “Our companies need a sufficiently broad and deep capital market to fund themselves faster and more efficiently.”

Keeping Value Creation in Europe 

The Chancellor linked this call to a strong appeal to the European Commission for consistent de-bureaucratization of the fragmented European capital market. Only in this way, he stressed, will the value created from German and European research truly remain in Europe. Only then can societal wealth grow via the capital market, Merz argued.

The debate is fueled by the growing trend of European innovative companies raising capital on U.S. exchanges. Recent examples include Linde, Birkenstock Holding, and BioNTech – firms that chose Wall Street listings over domestic options.

This discussion fits into a broader financial context: the integration of European financial and capital markets. A far-reaching harmonization of financial hubs and access to capital would not be a mistake. Currently, there are around 15 securities exchanges in the Eurozone. The two largest operators – Euronext N.V. and Deutsche Börse AG – together handle about 80 percent of the annual €8 trillion equity trading volume.

Ending Capital Flight 

Merz’ initiative stands not only for institutional reform but also as an attempt to free Europe’s financial markets from self-imposed regulatory constraints.

The Chancellor emphasized the importance of better financing for innovative startups in high-tech future industries. Experience shows, however, that these companies tend to rely on venture capital – and they have no difficulty listing on international exchanges like Frankfurt or London.

The real question for Brussels and Berlin is whether focusing on a new financial hub alone is enough to prevent visible capital flows from Europe to the United States.

Germany alone lost around €64.5 billion last year due to capital flight – a symptom of deeper issues: an overbearing regulatory framework from Brussels and EU capitals, excessive fiscal burdens, and an escalating energy cost crisis.

The Real Target 

These are fundamental economic imbalances that cannot be resolved simply by creating a European mega-exchange. They are homegrown design flaws – at the heart of today’s economic crisis.

In reality, the debate over the Capital Markets Union is about something else entirely: the European Commission’s strategic goal to consolidate member state debt under its roof. This would give Brussels greater financial clout through regular EU bond issuances. More centralization in Brussels, less national oversight – the dream of the Brussels power center.

The EU is gradually moving toward a paradigm shift in debt financing. Originally, the Commission was strictly prohibited from financing itself via market issuances. That red line has long been crossed.

The COVID lockdowns provided a lever to launch NextGenerationEU, an unprecedented €800 billion debt program. This money largely financed national deficits, with the Commission acting as a market borrower, backed by the European Central Bank.

Brussels Is Already Active in the Market 

It is no secret that Brussels wants to expand this model. The Ukraine conflict serves as a convenient pretext to issue new joint debt under the media-amplified threat of Russian aggression. Chancellor Merz has already indicated this spring that EU-wide borrowing for defense purposes is not off the table – but only for “absolute exceptional cases.”

Merz deliberately avoided the term “Eurobonds,” just like Ursula von der Leyen, who in her State of the Union speech on September 10 circumnavigated the term, instead proposing a common European budget for “European goods.”

The signal is clear: we are in a transitional phase where old debt rules are being gradually loosened, and the centralization of debt issuance in Brussels is systematically advanced.

Euroclear as an Anchor 

This aligns seamlessly with thinking about a shared European exchange – potentially hosted by Euroclear in Brussels, the central player in the safekeeping and settlement of Eurozone securities. A serious move would also consider relocating the European Central Bank to Brussels for fast debt issuance.

The EU’s response to the looming debt crisis is obvious: a much higher degree of centralization. Activating capital that can be leveraged to expand debt becomes strategic; the exchange consolidation is just a secondary concern.

This also ties into the debate over using frozen Russian assets at Euroclear. The goal: collateralize a portfolio worth around €200 billion, largely expired European sovereign bonds, to finance reparations loans to Ukraine. Brussels is searching for credit collateral, regardless of origin.