74.1 F
Chicago
Friday, September 11, 2026
type here...
Home Blog Page 1100

Corporate Earnings Slowdown Signaled By Employment Data

survivalnomics
-
0
Corporate Earnings Slowdown Signaled By Employment Data

Authored by Lance Roberts via RealInvestmentAdvice.com,

The latest employment data strongly warned of a potential corporate earnings slowdown ahead. This is the first time we have warned about the employment data and its impact on corporate earnings. In May, we penned “Employment Data Confirms Economy Is Slowing.” wherein we stated:

“Given the importance of consumption in the economy and that employment (production) must come first in the cycle, attention to employment data, particularly full-time employment, is crucial to determining economic risk. The risk of a recession remains very low; however, that can change if something causes consumption to contract quickly. Aside from an unexpected, exogenous impact, investors should expect economic growth to continue to slowly weaken to a longer-term trend slightly less than 2% annually. Unfortunately, while not recessionary, that growth rate will make it hard for corporate profitability to remain at record levels.”

The August 2025 employment report further confirmed the deceleration in job growth. Nonfarm payrolls added just 22,000 positions. Economists had expected over 75,000. June’s numbers were revised downward to a net loss of 13,000 jobs, the first monthly decline since 2020. July gained only a minor upward revision. However, what is most important is the “trend” of the data rather than just a one-month data point. As shown, the 3-month average of employment is deteriorating sharply, which has only occurred previously just before the onset of a recession.

While the labor force participation rate was 62.3 percent, still well below pre-COVID levels, the percentage of total full-time employees continues to drop sharply. That data point is essential because full-time employment is required to sustain economic growth. With that level well below pre-COVID levels, it is unsurprising that economic growth rates are slowing.

It isn’t just slower economic growth that the latest employment report suggests. Yes, growth is slowing because jobs are shrinking, and as a consequence, households are spending less. As we showed in a recent #BullBearReport, economic growth, inflation, and personal consumption are trending lower, given that employment, particularly full-time employment, supports economic supply and demand.

This data also confirms why the Fed is already behind the curve in cutting interest rates.

Why the Fed Is Likely Behind the Curve

Despite the slowdown, the Federal Reserve remains hesitant. Chair Powell noted softening labor conditions at Jackson Hole and suggested the door is open to rate cuts. But no concrete shift in policy has occurred. The Fed insists on being data-dependent while ignoring the most immediate data: labor markets are deteriorating. Inflation is not, and has not been a threat, and the two-year Treasury yield, a close approximation of what the Fed funds rate should be, is already more than 80-bps lower than the Fed’s current policy rate.

The latest Beige Book also revealed soft hiring trends and growing caution among employers, with businesses pulling job postings and limiting expansion. That’s not a labor supply issue; it’s a demand issue. The Fed’s ongoing focus on lagging inflation data means that policies remain too tight and are now well “behind the curve.”

Markets aren’t waiting. Fed futures now imply near certainty of a September rate cut, with some traders pricing in 50 basis points. While many remain concerned about the risk of inflation, bond yields are already warning that the economic data is more disinflationary than not. As we have discussed before, despite all the “fear mongers” warning of surging interest rates, the reality is that interest rates on the long-end will track the economy. As we discussed in Grant: Rates Are Going Much Higher?”

“…let’s create a composite index of wages (which provides consumer purchasing power, aka demand), economic growth (the result of production and consumption), and inflation (the byproduct of increased demand from rising economic activity). We then compare that composite index to interest rates. Unsurprisingly, there is a high correlation between economic activity, inflation, and interest rates as rates respond to the drivers of inflation.”

We further discussed that relationship in “Tudor Jones: I Won’t Own Bonds.”

“The previous surge in inflation, and ultimately interest rates, was not a function of organic economic growth. It was a stimulus-driven surge in the supply/demand equation following the pandemic-driven shutdown. As those monetary and fiscal inflows reverse, that support will fade. In the future, we must understand the factors that drive rates over time: economic growth, wages, and inflation.”

With the economy and its primary driver, employment, slowing, the Fed’s delay in cutting rates increases the risk of a more substantial economic downturn. By maintaining rates at an elevated level, the negative impact on consumption (demand) is increasing. The Fed’s tightening has already filtered into credit, housing, and business spending. The labor market is reacting, and further policy lags will likely make the next easing cycle less effective.

The risk is that the central bank may be easing into a downturn it failed to prevent.

Implications for Corporate Earnings and Profit Margins

For investors, the most significant consequence is a slowdown in corporate earnings. A corporate earnings slowdown is already underway. Revenue growth is faltering, and companies, particularly in the retail and fast dining sectors, are seeing less pricing power as consumer demand slips. Eventually, those forces will compress profit margins. As we noted with respect to Q2 earnings:

“While technology and AI-driven firms have recently become bright spots, their strength cannot offset broader corporate margin pressures. In Q2, S&P 500 earnings grew 6.4%, with 80 percent of companies beating estimates. But this masks a weakening breadth of growth, where earnings beats are concentrated in essentially just two sectors. There would have been no earnings growth without Megacap Technology and major Wall Street banks.”

While many firms relied on price hikes, labor efficiency, and cost-cutting to drive earnings growth this year, that playbook is limited in scope and becoming less effective. While Tech and AI-linked companies like Broadcom have offered bright spots, the rest of the market is under pressure. Discretionary sectors, cyclical industrials, and small-cap firms are more exposed to demand shocks and slowing economic growth. While investors are currently ignoring the linkages between economic demand and corporate earnings, as margins erode, the impact on earnings will become more significant.

Currently, analyst estimates still assume robust earnings growth into 2026. However, that will change in the months ahead. As those earnings estimates are revised lower, the risk to the market, and currently very optimistic investors, is the question of valuations. As the corporate earnings slowdown accelerates, forward guidance will get cut, and paying significantly high multiples for earnings will be questioned. If companies revise down expectations, delay investments, and increase layoffs to protect bottom lines, the risk to markets will increase significantly.

Navigating The Risks

The evidence points to a slowing US economy. Growth is weakening, inflation remains elevated, corporate margins face pressure, and interest rate cuts are likely. These conditions require a shift in investment strategy. Investors must adapt to preserve capital, generate income, and manage risk. Positioning should emphasize resilience, quality, and income stability. The goal is to reduce exposure to volatile sectors and concentrate on assets that perform well during economic slowdowns.

Here are key actions investors should consider:

  • Reduce exposure to cyclical stocks: Cut back on discretionary sectors like retail, travel, and consumer electronics that rely heavily on strong economic growth.

  • Increase allocation to defensive sectors: Focus on consumer staples, healthcare, and utilities. These sectors provide stable earnings even in weak environments.

  • Favor companies with strong pricing power: These firms can better maintain margins despite rising input costs.

  • Prioritize strong balance sheets: Low debt and high cash reserves reduce financial stress and support consistent returns.

  • Add high-quality dividend payers: Look for companies with a track record of stable or growing dividends. These provide income support as capital gains slow.

  • Increase fixed income exposure: Short-duration bonds and high-grade corporates may benefit from falling interest rates.

  • Consider yield curve positioning: A steeper yield curve from rate cuts may create an opportunity in intermediate bonds.

  • Avoid speculative growth stocks. These firms rely on future earnings and cheap financing, both of which will be under pressure in a slowing economy.

A decelerating US economy changes the return profile across asset classes. Adjusting now to focus on quality, cash flow, and defensive positioning can improve downside protection and set the stage for more stable portfolio returns.

While there are no guarantees, the current gap between what Wall Street expects and what the economy can deliver is very different. Could the economy catch up to meet Wall Street’s expectations? Sure. It just usually doesn’t happen that way.

Most importantly, the Fed is late once again, and history suggests the impact on stocks will be negative.

Tyler Durden
Fri, 09/12/2025 – 12:20

Alleged Kirk Assassin A “Radical Left ANTIFA-Adjacent Creep” Wrote “Hey Fascist” On Bullet Casing

survivalnomics
-
0
Alleged Kirk Assassin A “Radical Left ANTIFA-Adjacent Creep” Wrote “Hey Fascist” On Bullet Casing

Update (1207ET):

The political messaging on the bullet casings underscores a deeply troubling reality: words actually matter.

Earlier, 22-year-old Tyler Robinson turned himself in and named the shooting suspect in Kirk’s political assassination. 

Utah Governor Spencer Cox confirmed that casings recovered from the shooting scene had political messages etched into the metal, including: 

  • FIRED CASING: “Notices Bulges OWO What is this?” –

  • UNFIRED CASING 1: “Hey fascist, catch! [3 down arrow symbols]” 

  • UNFIRED CASING 2: “O Bella Ciao, Bella Ciao, Bella Ciao Ciao Ciao” (a reference to an Italian anti-fascist song)

  • UNFIRED CASING 3: “If you read this, you are gay lmao”

Making sense of the radical left political messaging left behind on casings is Seamus Bruner, the Director of Research at the Government Accountability Institute (GAI), where he works closely with investigative author Peter Schweizer. 

“Translating the shooter’s bullet casings. This was a radical left ANTIFA-adjacent creep who, like the Minnesota shooter, wrote political messages on his weapons. Lingo is that of an extremely online leftwing gamer,” Bruner wrote on X. 

Here’s what Bruner found:

Hmm. 

Steve Bannon chimed in:

“You clearly have a progressive, young, left-wing hater who assassinated Charlie Kirk,” Bannon stated.

*   *   *

Update (0951ET):

AP News and the New York Post both report that the suspect in the Charlie Kirk assassination is 22-year-old Tyler Robinson of Utah. Robinson’s father apparently turned him in to the authorities – that is the official narrative so far.

Federal investigators are scheduled to hold a press conference later this morning about the new developments.

“The suspect in the murder of Charlie Kirk confessed to his father that he was the shooter. His father told authorities and secured his son until they could arrive to pick him up,” CNN’s Kristen Holmes reported earlier.

Earlier, President Donald Trump revealed that Robinson had been arrested – without naming him directly – saying, “With a high degree of certainty, we have him.” He credited both law enforcement and a minister who helped turn the suspect in after someone close to Robinson identified him.

Federal investigators have yet to release a motive. 

*   *   *

 

Update (0816ET):

President Trump joined Fox & Friends on Friday morning, telling hosts that Charlie Kirk’s assassin is “in custody” and that “with a high degree of certainty, we have the suspect.”

Watch here:

Conversation with the president continues. 

*   *   * 

 

Federal investigators at the FBI’s Salt Lake City field office released new surveillance footage on X late Thursday showing the suspect in the political assassination of Turning Point USA founder Charlie Kirk fleeing the scene by leaping off a rooftop at Utah Valley University. 

The FBI wrote in a note accompanying the video: 

The FBI is releasing a video of the shooter in the Utah Valley shooting. The subject is seen jumping from the rooftop of a building after the shooting. Around 12 p.m. Mountain Time on September 10, 2025, the subject climbed up to a rooftop; after he shot and killed Charlie Kirk, he jumped off and ran away. He left a gun and ammunition in a wooded area near the university. Trace evidence collected from the rooftop scene included shoe impressions, a forearm imprint, and a palm print. Anyone with information in this case should call the FBI at 1-800-CALL-FBI or visit fbi.gov/utahvalleyshooting.

Video

Here are the latest developments over the last three days: 

  • Suspect Description: College-age male, wearing a T-shirt with an American flag, black Converse shoes, and a baseball cap with a triangle.

  • Weapon Recovered: An imported Mauser bolt-action rifle with one spent cartridge and three live rounds, found wrapped in a towel near Utah Valley University.

  • Ammunition Recovered: All cartridges have engraved wording on them, expressing transgender and anti-fascist ideology (as per Steven Crowder, WSJ). 

  • Forensic Evidence: Palm impressions, footwear prints, and the rifle are being analyzed.

  • FBI Reward: Public asked to help identify the suspect; $100,000 reward offered. Over 7,000 tips received.

MSM failed to acknowledge Steven Crowder was the first to report the ‘transtifa’-style ammo …  

The 200-yard shot. 

On Wednesday night, President Trump addressed the nation from the Oval Office on the senseless political assassination of Kirk, calling it a “dark moment for America.” He vowed to crack down on radical left movements across the country that have sparked death and destruction so far this year. 

In fact, the Texan News reporter Cameron Abrams wrote on X that Rep. Chip Roy, R-Texas, and two dozen others in Congress are calling for a select committee on “the money, influence, and power behind the radical left’s assault on America and the rule of law.”

“Enough is enough. We must follow the money to identify the perpetrators of the coordinated anti-American assaults being carried out against us and take all steps under the law necessary to stop them,” the lawmakers stated. 

Sean Hannity and John Solomon reported last night that there could be a foreign component to the assassination of Kirk. 

Hmm. 

Tony Seruga wrote on X, “I will say this is looking more and more like an orchestrated professional hit. Despite what news will eventually break regarding the shooter, understand foreign isn’t really foreign when it comes assassins. It’s called plausible deniability. The leviathan/matrix/deep state likely has already crafted and perfected their narrative.” 

. . . 

Ty
Fri, 09/12/2025 – 12:07

Oil Prices Surge On Ukrainian Drone Threat, Expanded Russian Sanctions Fears

survivalnomics
-
0
Oil Prices Surge On Ukrainian Drone Threat, Expanded Russian Sanctions Fears

Oil prices are surging this morning as the market is caught in a “tug-of-war” between bearish fundamentals and heightened geopolitical risks (as Citigroup put it).

“The volatility reflects the market’s ongoing struggle to balance growing surplus risks against persistent geopolitical uncertainty and resilient refined product margins,” said Ole Hvalbye, a commodities analyst at SEB AB.

“Sentiment remains broadly cautious.”

Crude rallied initially on mounting fears that Ukrainian drone attacks may disrupt flows through Russia’s two most important crude-exporting hubs on the Baltic coast.

The strikes have suspended operations at Primorsk, the main oil-loading port in the region, as well as three pumping stations pushing crude to the Ust-Luga hub, a person familiar with the situation said.

The gains extended further on reports that the Trump administration will urge its allies in the Group of Seven to imposes tariffs as high as 100% on China and India for their purchases of Russian oil in an effort to convince President Vladimir Putin to end his war in Ukraine.

The US proposal calls for 50% to 100% secondary tariffs on China and India as well as restrictive trade measures on both imports and exports to curb the flow of Russian energy and to prevent the transfer of dual-use technologies into Russia, according to the proposal.

President Trump has told European officials he’s willing to impose sweeping new tariffs on India and China to push Putin to the negotiating table with Ukraine – but only if nations in Europe do so as well.

Trump’s suggestion comes after his deadline for Putin to hold a bilateral meeting with Ukraine’s Volodymyr Zelenskiy passed without indication that the Russian leader was genuinely interested in engaging in face-to-face peace talks.

Instead, Moscow has stepped up its Ukraine bombing campaign.

As Bloomberg reports, the heightened risk premium offset an International Energy Agency projection for a record oil supply surplus next year.

A more pessimistic report from the agency on Thursday followed a decision by OPEC+ to keep returning idled barrels to the market in October, albeit at a lower rate than previous hikes.

Tyler Durden
Fri, 09/12/2025 – 08:44

Futures Dip As Record-Breaking Rally Runs Out Of Steam

survivalnomics
-
0
Futures Dip As Record-Breaking Rally Runs Out Of Steam

US equity futures are fractionally lower with small caps lagging as the record-breaking rally in stocks appeared to be running out of steam. At 8:15am ET, S&P 500 futures slid 0.1% after all major US indexes hit all-time highs on Thursday, however Nasdaq 100 futures are still in the green amid an relentless tech bid: Microsoft rose in premarket trading, leading the Mag 7 after it avoided a hefty antitrust penalty from the European Union. Europe’s Stoxx 600 eased as well. Incremental headlines after yesterday’s close were limited as Fed policy and AI development continue to support bulls over job market concerns or geopolitics. On trade, Bessent and Chinese VP will meet in Madrid next week. Yields are 1-2bp higher and USD is higher. Commodities are mixed, with oil and base metals higher, while precious metals are lower. Today’s econ data slate is just the September prelim University of Michigan sentiment at 10am New York time.

In premarket trading, Mag 7 stocks are mostly higher with AMZN and AAPL lagging (Microsoft +1%, Nvidia +0.1%, Amazon -0.07%, Meta +0.01%, Tesla +0.1%, Apple -0.3%, Alphabet +0.2%)

  • Adobe (ADBE) rises about 3% after giving a strong quarterly revenue outlook, suggesting that the software maker is seeing a payoff from its investment in AI features.
  • Alaska Air (ALK) gains 2% as an upgrade from UBS gives the stock a clean sweep of buy ratings among analysts.
  • Array Technologies (ARRY) declines 5% as BofA assigns the solar tracking technology firm its only negative analyst rating, downgrading to underperform based on tariff drag.
  • RH (RH) falls 8% after the luxury furniture company cut its sales outlook for the full year, citing mounting impacts from new US tariffs that resulted in delays to a seasonal catalog.
  • Stellantis’ US shares (STLA) fall 3%, giving back some of the gains booked on Thursday following comments from CEO Antonio Filosa on dealer inventory levels and the company’s tariff talks with Washington. UBS tempered the optimism this morning, claiming the risk-reward profile looks “unattractive” in the near-term.
  • Super Micro Computer (SMCI) gains 5% after the server company announced the availability of its Nvidia Blackwell Ultra solutions
  • Warner Bros. Discovery (WBD) is up 6%, set to extend Thursday’s 29% rally as Paramount Skydance, the Hollywood studio taken over by independent filmmaker David Ellison, is said to be preparing a bid for the company.

Stocks repeatedly scaled all-time highs after a raft of data this week pointed to a strained labor market and relatively contained inflation, sealing a Fed cut when policymakers meet next week. Some now question whether the rally has further room to run as seasonal weakness and geopolitical uncertainty linger. Meanwhile swaps pricing indicates traders anticipate the equivalent of between two or three quarter point cuts through year-end, with some wagering on a jumbo half-point cut next week (odds about 10%).

Claudia Panseri, chief investment officer for France at UBS Wealth Management, cautioned that markets were reaching the limit of pricing in Fed support: “I would say that the market is overestimating the scale of rate cuts across the 12 coming months,” she said. “As for next week, some investors will be disappointed if there’s not a 50 basis-point cut, and I don’t think there will be.”

While the slowdown in the labor market has raised concerns that the Federal Reserve may have stayed on pause for too long, Bank BofA strategist Michael Hartnett said markets are betting that policymakers would still be ahead of the curve once they begin cutting rates. A rally in banks and other rate-sensitive stocks, along with a decline in investment-grade credit spreads, signal that investors are “saying the Fed can cut with credibility and is cutting into US growth re-acceleration,” he said.

Analysts expect small caps to outperform over the next twelve months, with the potential for a 20% advance in the Russell 2000, compared with calls for an 11% jump in the S&P 500, as highlighted in today’s Taking Stock column. BI strategist Gillian Wolff notes the Russell 2000 broke above the key psychological level of 2,400 this week and at 68, the 14-day RSI remains far from overbought levels — prior highs were marked by RSI above a 73-handle.

In European markets, European stocks are subdued on Friday as investors await the Federal Reserve meeting next week. Automobile and retail shares are biggest laggards, while mining and utilities equities are the best-performers.
The Stoxx Europe 600 Index was little changed at 554.86. Here are the biggest movers Friday:

  • European miners are outperforming on Friday thanks to a broad rise in metal prices, with gold, copper, aluminum and nickel all gaining ground
  • Hannover Rueck SE shares rise as much as 3.4%, the most since April, after UBS raised the recommendation on the German reinsurance company to buy from neutral on earnings resilience
  • Inwido rises as much as 6%, reaching the highest in two months, as Berenberg initiates on the Swedish windows and door manufacturer with a buy rating
  • Vallourec shares rise as much as 6.3%, the most in over two months, after the tubular product maker said it has won a major contract from Petrobras that could generate up to $1 billion in revenue
  • European energy firms are lagging the wider market on Friday as oil extends a decline after the International Energy Agency projected an even bigger surplus next year
  • Novartis drops as much as 2.9% after the stock was downgraded to sell from neutral at Goldman Sachs. The analysts say the Swiss drugmaker’s valuation looks “stretched” given the increasing impact of generic competition following drug patent expiries in the coming years
  • Ocado shares plunge as much as 12% extending losses booked in late trading on Thursday. Morgan Stanley analysts noted “negative readacross” from comments made on US grocer Kroger’s conference call yesterday

French bonds lagged most regional peers ahead of a Fitch Ratings update on the country, due after the close. French assets have been unsettled after former Prime Minister Francois Bayrou lost a confidence vote, failing to muster enough support to rein in the budget deficit.  “The market is already incorporating at least one or two or even three downgrades,” Vincent Mortier, chief investment officer at Amundi SA, told Bloomberg TV. “We’re still far away from a sub-investment-grade rating. The market has been quicker than the rating agencies to adjust the levels.”

Earlier in the session, Asian equities advanced, as technology shares extended their rally on rising expectations that the Federal Reserve will cut interest rates next week.  The MSCI Asia Pacific Index rose as much as 1.1%, poised for a seventh day of rise in its longest winning streak since May 2024. South Korea’s Kospi notched another all-time high, after SK Hynix announced it had completed development of its next-generation AI memory chip. Shares in Hong Kong also rose, with Alibaba surging amid optimism over its AI infrastructure plans. Risk appetite has been improving in Asia as tariff worries ease on progress in US trade talks. The return of optimism on the AI trade, a liquidity-driven rally in Chinese stocks and expectations that Fed cuts will allow Asian central banks room to ease further have helped power the advance. Tech got a boost this week from Oracle Corp.’s upbeat cloud-business outlook. Stocks also climbed Friday in Taiwan, Japan and Australia. Indonesia’s key equity gauge jumped more than 1% on optimism over plans from the nation’s new finance minister. Here Are the Most Notable Movers

  • Ain Holdings Inc. shares jumped after the Japanese pharmacy operator raised its full-year operating profit guidance. Meanwhile, Fuji Oil Co. shares surged following a takeover offer from Idemitsu Kosan Co.
  • Infosys shares rise as much as 2.3% to their highest in seven weeks after the software firm said it will buy back shares worth 180 billion rupees ($2 billion).
  • Aristocrat Leisure shares fall as much as 4.5%, the most since May 14, after the Australian game machine operator said Dylan Slaney will replace Moti Malul as CEO of the interactive division.
  • Star Plus Legend shares rise as much as 22% in Hong Kong, the most since July 30, after a media report saying that a robot dog created by the company and Hangzhou Unitree Technology will make its first appearance soon.
  • Malaysian car distributor Bermaz Auto Bhd. fell to a record low after its first-quarter net income slumped 88%, weighed by strong competition from Chinese automakers.
  • Ascletis Pharma shares rise as much as 6.6% in Hong Kong after the company said Chairman Jason Wu and Executive Director Judy Wu are demonstrating “strong faith” in its long-term value and future prospects.
  • Verisilicon Microelectronics shares surge as much as 20% to a record high, resuming trading following a halt, after the company announced plans to buy a Shanghai chip tech firm.
  • Alibaba Group Holding Ltd.’s stock gained the most in about two weeks after the company initiated a series of moves intended to shore up its place in China’s AI development boom.
  • Anritsu shares jump as much as 13% to the highest intraday level since Nov 2021 after Goldman Sachs initiates a buy rating on the Japanese measurement instruments company on expectations of profit growth driven by AI and data center businesses.
  • Timee shares plunged as much as 18%, the most in a year, after the part-time job app developer’s quarterly sales missed estimates, spurring concern about weakness in its food industry operations.

In FX, the dollar rebounded from back-to-back losses. The yen lags G-10 currency peers, down by 0.5%, and set for a third consecutive weekly decline. The pound trimmed a weekly gain after the economy showed a sluggish start to the third quarter, with gross domestic product flat and slowing from the previous month.

In rates, treasuries pulled back from Thursday’s advance alongside weakness in Europe, with the US 10-year yield rising two basis points to 4.05%. Yields are biased slightly higher amid bigger losses for bunds during European morning following German and French CPI data. US front-end to 10-year yields are cheaper by as much as 1.5bp with 2s10s curve barely 1bp steeper on the day. Long-end yields are little changed, flattening 5s30s by about 1bp. German and UK counterparts lag US 10-year by 2bp and 1bp. Gilt yields are higher and the pound is weaker after UK economy flat-lined in July.

In commodities, gold pares gains after testing another record, but is still up by $6 to $3,639/oz as money pours into bullion-backed ETFs. Copper and nickel also rise to buoy miners in Europe. Oil prices reverse an earlier decline, with Brent trading up 1% and shy of $67/barrel.

Looking ahead, today’s calendar includes the US September University of Michigan Survey, UK July monthly GDP, Italy’s Q2 unemployment rate, and Canada’s July building permits. Central bank speakers include the ECB’s Rehn, Kocher, and Nagel, as well as the BoE’s inflation attitudes survey.

Market Snapshot

  • S&P 500 mini -0.1%
  • Nasdaq 100 mini little changed
  • Russell 2000 mini -0.5%
  • Stoxx Europe 600 -0.1%
  • DAX -0.3%
  • CAC 40 -0.4%
  • 10-year Treasury yield +2 basis points at 4.04%
  • VIX little changed at 14.68
  • Bloomberg Dollar Index +0.2% at 1199.62
  • euro -0.1% at $1.172
  • WTI crude +0.6% at $62.74/barrel

Top Overnight News

  • Trump says Charlie Kirk’s murder suspect has been captured and is in police custody
  • The US will pressure G7 countries to hit India and China with sharply higher tariffs for buying Russian oil in an attempt to force Moscow into peace talks with Ukraine, according to four people briefed on the plans. FT  
  • China on Thursday warned Mexico that raising tariffs on Chinese goods will be considered “appeasement” to US “bullying,” after Mexico mulled plans to impose import duties of up to 50%. Nikkei
  • Allianz and AllianceBernstein are among global firms boosting holdings of Chinese government bonds after a selloff driven by a rotation into stocks sent yields to multi-month highs. Analysts also expect the PBOC to resume purchases. BBG
  • US Treasury Secretary Scott Bessent plans to meet with Chinese Vice Premier He Lifeng and other senior officials next week in Madrid to continue their discussions on trade, economic and national security issues, the Treasury said on Thursday. RTRS
  • Brazil’s Supreme Court sentenced former president Jair Bolsonaro to 27 years in prison for plotting a coup after his 2022 election defeat. Marco Rubio said the US will respond “accordingly.” BBG
  • OpenAI is moving closer to a for-profit structure under a new deal with Microsoft, giving its nonprofit parent an equity stake of more than $100 billion. The plan faces resistance from Elon Musk and regulatory scrutiny. BBG
  • Sam Altman and Nvidia’s Jensen Huang will announce investments worth billions of dollars in UK data centers next week, people familiar said. BBG
  • Adobe (+3.8% premkt) shares rose on a strong revenue forecast, suggesting investments in AI features are paying off.  Reported solid quarterly results, and upped its Revenue, net new ARR, and EPS guidance which should help push back on bear thesis. 
  • Gold ETF holdings jumped about 25 tons this week — the sixth-highest weekly gain this year — on the back of Fed rate-cut bets, weaker yields and central-bank demand. Still, Phillip Nova warned long-term holding is riskier amid volatile momentum-driven trading. BBG

Trade/Tariffs

  • US Treasury Secretary Bessent will travel to Spain and the UK on September 12th-18th on a trip that includes government and private sector meetings in London. Bessent will meet with Chinese Vice Premier He and other senior Chinese officials next week in Madrid, while Bessent and He are to discuss key US-China national security, economic and trade issues, including TikTok and anti-money-laundering cooperation. Furthermore, Bessent will also meet with Spanish government counterparts to discuss the US-Spain relationship and is to join US President Trump in the UK for an official state visit with King Charles.
  • China’s Commerce Ministry said planned Mexican tariffs on China are too seriously affect Mexico’s business environment and confidence of enterprises in investing in Mexico, while it added that China will take necessary measures to safeguard legitimate rights and interests.
  • Taiwan said it will continue advanced talks with the US and seeks more equitable reciprocal trade terms with the US, while Taiwan and the US affirmed that some progress was made in trade talks

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were mostly higher following the gains on Wall St, where the major indices climbed to record highs after a jump in Initial Jobless claims further boosted Fed rate cut pricing. ASX 200 edged higher with outperformance in Real Estate, Miners, Materials & Financials spearheading the advances as Fed rate hike expectations boost global risk sentiment. Nikkei 225 extended on record highs and approached closer towards the 45,000 level despite little fresh pertinent drivers. Hang Seng and Shanghai Comp traded mixed with tech leading the gains in Hong Kong after it was reported that Alibaba (9988 HK) and Baidu (9888 HK) are using internally designed chips for training AI models are to adopt their own AI chips in a major shift for Chinese tech, while the mainland lagged amid frictions, with the US reportedly to urge G7 to impose high tariffs on China and India over Russian oil purchases.

Top Asian News

  • Japanese and US finance ministers’ joint statement noted as trusted partners, the United States Department of the Treasury and the Japanese Ministry of Finance agreed to continue their close consultations on macroeconomic and foreign exchange matters, while they reaffirmed that exchange rates should be market-determined and that excess volatility can have adverse implications for economic and financial stability.
  • Japanese Member of the House of Representatives Takaichi leads in a Kyodo poll to be next head of Japan ruling party.
  • Chinese finance minister says local debt swap programme is achieving results. China’s finance minister vows to resolutely curb new local hidden debt.
  • Japan’s former Top Currency Diplomat Gyoten says BoJ must take into consideration concerns that weak JPY could accelerate inflation; Japan’s interest rates are too low and are contributing to the JPY weakness.

European bourses (STOXX 600 -0.3%) opened modestly firmer across the board, but sentiment slipped as the morning progressed to display a negative picture – nothing really behind the turn. European sectors are split down the middle, and with little overall newsflow driving this at the moment. Basic Resources takes the top spot, buoyed by strength in underlying metals prices. Insurance and Utilities follow closely behind. Autos is found at the foot of the pile, and then joined by Retail and Energy

Top European News

  • UBS Global Wealth Management expects ECB to remain on hold in 2025 (prev. 25bps cut in Dec); Now expect ECB to remain on hold for a prolonged period
  • ECB’s Simkus says inflation has stabilised at the target and labour market is in a good situation, adds economic activity is quicker than previously observed. Inflation risks are significantly high.
  • ECB’s Villeroy says another rate cut is possible in coming meetings; upward risks to inflation are lower than downward, via Bloomberg.
  • ECB’s Kazaks says risks remain elevated; a meeting-by-meeting approach is still appropriate, via CNBC; December meeting is ‘rich’.
  • ECB’s Muller says rates in the right place at the moment.
  • ECB’s Rehn says the risk that inflation remains slower than the target level should not be underestimated. Must be mindful of downside risks to inflation stemming from cheaper energy and a stronger EUR.
  • ECB’s Kocher says the gap between Austrian inflation and EZ average is far too high; growth and inflation outlook presented at the meeting was little changed; will decide meeting-by-meeting and changes to risk landscape.
  • Ipsos data: UK public inflation expectations at 3.6% (prev. 3.2%) for the coming year and 3.4% (prev. 3.2%) for the following 12-month period, 5-year 3.8% (prev. 3.6%)

FX

  • DXY is attempting to claw back some lost ground after declining on Thursday in the wake of the jump in US weekly claims data, which overshadowed the mostly in-line/slightly firmer (on an underlying basis) CPI report. Pricing for next week’s FOMC rate decision was largely unchanged with markets reluctant to price a 50bps reduction. With regards to personnel at the Fed, the latest reporting suggests US Treasury Secretary Bessent met this week with Warsh, Lindsey, and Bullard as the search for the next Fed chair continues. Ahead, focus is on UoM data for September. DXY sits towards the bottom end of Thursday’s 97.47-98.08 range.
  • EUR is steady vs. the USD after gaining yesterday in the wake of a broadly softer dollar and what turned out to be a hawkish ECB policy announcement. Source reporting has suggested that an October cut is very unlikely. However, the matter could be revisited in December alongside the latest economic projections. We have heard from a slew of ECB speakers this morning, who have largely echoed Lagarde’s remarks that policy is in the right place. Afterhours, focus will be on Fitch’s review of France. EUR/USD ventured as high as 1.1747 before pulling back. If upside resumes, the WTD peak sits at 1.1780.
  • JPY is softer vs. the USD and at the bottom of the G10 leaderboard. Focus this week for Japan has primarily been on the fallout from political uncertainty after PM Ishiba announced his resignation, with pressure this morning potentially exacerbated by the Kyodo poll. The inference for markets has been that the upheaval in Japan could derail BoJ tightening expectations. Elsewhere, a joint statement between the US and Japan has reaffirmed their commitment to close consultations on foreign exchange matters and reaffirmed that exchange rates should be market-determined. USD/JPY is currently contained within Thursday’s 146.98-148.19 range.
  • GBP is on the backfoot vs. the USD following an in-line M/M outturn for UK GDP at 0%, leaving the 3M/3M rate at 0.2%, as expected. Looking ahead, Pantheon expects “GDP growth will probably undershoot the MPC’s forecast for Q3 slightly after today’s release, but that should have little effect on interest rates”. Cable sits towards the middle of Thursday’s 1.3490-1.3583 range.
  • Antipodeans are both softer vs. the USD after faltering alongside the pullback in risk sentiment in early European trade. Macro drivers for both remain on the light side and as such, the risk environment and broader moves in the USD are likely to provide the greatest source of traction for AUD/USD and NZD/USD.
  • PBoC set USD/CNY mid-point at 7.1019 vs exp. 7.1081 (Prev. 7.1034).

Fixed Income

  • A softer start to the final session of a packed week. Today’s docket is a little lighter stateside, University of Michigan is the main data event while scheduled speakers are light aside from POTUS on Fox at 13:00BST, an interview likely to focus on Charlie Kirk. Currently, USTs are lower by a handful of ticks in a thin c. five tick range which is comfortably within Thursday’s 113-09 to 113-29 band. September aside, Treasury Secretary Bessent met this week with Warsh, Lindsey, and Bullard regarding the Chair position. Will be speaking with sitting officials’ post-blackout. His goal is to add one or two names to the list of candidates.
  • Bunds are softer, continuing to pullback from the 129.38 peak that printed yesterday in reaction to US weekly claims. Entered today’s session just above the 129.00 mark but has since slipped below the figure and is at a 128.84 trough. Very much focussed on the post-ECB sources. In short, a move in October is off the cards (-1.3bps implied) with policymakers generally of the view that further easing is not required to get inflation to the 2.0% target; however, the December meeting (-3.8bps implied) is the point to review this when new forecasts will be available including the first look at 2028. ECB speak today has been mixed but has largely echoed commentary from Lagarde on Thursday.
  • Gilts are just in the red, but outperforming peers. Outperformance that is a function of the morning’s growth data. Where the headline metrics were as expected for the M/M and 3M/3M, the Y/Y missed consensus and the manufacturing/production breakdown was very weak, printing beneath the forecast range. Notably, the M/M only just avoided being a negative print, helped out by some favourable 1dp rounding. A series that was sufficient to lift Gilts to a 91.75 peak, posting gains of 11 ticks at best. However, as the morning progressed this strength has waned and the benchmark is well off best, but still outperforming peers. The data has had no impact on BoE pricing, with markets not looking for a move until around March 2026.
  • OATs are lower, in-fitting with peers. Awaiting the sovereign review from Fitch, due after the US close. Into this, OATs trade in-line with Bunds and the OAT-Bund 10yr yield spread holds just below the 80bps mark. Fitch has France at AA-, negative. Fitch last updated on March 14th, highlighting high levels of debt and a poor record of fiscal consolidation as points of weakness, adding the negative outlook is reflective of significant fiscal risks.

Commodities

  • Crude opened lower, but traded with an upward bias since the European cash open, taking the complex into the green; currently resides at session highs. Some of the downbeat sentiment may be on EU officials suggesting it is unlikely the G7 will impose 100% tariffs on China and India, as India is a vital partner in trade and security matters, according to FT. WTI currently resides in a 61.69-62.83/bbl range while Brent sits in a USD 65.71-66.91/bbl range.
  • Precious metals are steadily gaining despite this morning’s dollar strength and in tandem with a rally in silver, which climbed above the USD 42/oz level. Spot gold currently resides in a USD 3,622.75-3,649.35/oz range. All-time high still sits at USD 3,674.69/oz printed on 9th September.
  • Base metals trades firmly despite the weaker sentiment and stronger dollar, and with little in terms of newsflow to explain price action, although supply-side headlines yesterday suggested Peruvian copper output fell 2% in July. 3M LME copper resides in a USD 10,054.35-10,127.20/t range at the time of writing.
  • US Energy Secretary Wright says the faster EU phase out of Russian energy would be helpful in ending the Ukraine war; thinks EU could phase out Russian oil and gas faster.
  • Commerzbank raised gold price forecast to USD 3,800/oz by end-2026 (prev. USD 3,600/oz); raises silver end-2025 forecast to USD 41/oz to USD 43/oz; raises platinum forecast for 2025-end to USD 1,400/oz (prev. USD 1,350/oz).

Geopolitics: Middle East

  • Israel’s UN envoy to the Security Council said Israel will act against the leaders of terror wherever they are hiding.
  • Qatar’s PM said to the UN Security Council that the Israeli attack on Hamas leaders in Doha is a violation of Qatar’s sovereignty, and the attack, which was carried out while we are engaged in mediation, exposes Israel’s intentions to derail peace efforts. Furthermore, Qatar’s PM said Israeli leaders show no regard for hostages’ lives and Qatar will continue its humanitarian and diplomatic role to spare bloodshed, but will not tolerate any infringement on sovereignty and security.

Geopolitics: Ukraine

  • The US is to urge G7 to impose high tariffs on China and India over Russian oil purchases, while finance ministers from G7 leading economies will discuss a US proposal for a round of new measures on Friday, according to FT.
  • EU officials say it is unlikely G7 will impose 100% tariffs on China and India as India is a vital partner in trade and security matters, according to FT.
  • Japan’s Chief Cabinet Secretary Hayashi said Japan is to impose additional asset freeze, export controls, and sanctions on Russia over Moscow’s invasion of Ukraine, while he added they are to lower the price cap on Russian crude oil from today.
  • Japan’s Trade Ministry said they are to restrict exports to additional entities, including six in China, two in Turkey, and one in the UAE, as part of sanctions against Russia’s invasion of Ukraine.
  • NATO Secretary General Rutte and Supreme Allied Commander to hold joint press conference at NATO headquarters today at 16:00 BST.

US Event Calendar

  • 10:00 am: Sep P U. of Mich. Sentiment, est. 58, prior 58.2

DB’s Jim Reid concludes the overnight wrap

As we approach the end of the week, markets have been in a buoyant mood over the last 24 hours, continuing into this morning’s Asian session, with investor attention squarely focused on the slightly higher than expected US August CPI release, and the notably higher than expected jobless claims data. The influence of the latter won out with December fed futures spiking to price in 76bps of cuts immediately after the numbers, having been at 68bps before the release. We ended up pricing in 72bps at the close. This overshadowed a slightly hawkish ECB meeting where sources later suggested that the ECB are inclined to keep rates on hold in this cycle unless there is an economic shock. Equities extended their recent rally, with the S&P 500 (+0.85%), Nasdaq (+0.72%), and the Mag-7 (+1.13%) all notching fresh record highs.

Starting with the US CPI report, headline inflation rose by +0.4% month-on-month (m/m) in August, up from +0.2% in July and above the +0.3% consensus forecast. Core inflation matched expectations at +0.3% m/m, unchanged from July but it did come in at 0.345%, just shy of rounding up. However, it was outsized increases in volatile categories such as airfares (+5.8% m/m) and lodging (+2.3% m/m) that pushed the core reading higher, with the Cleveland Fed’s trimmed mean CPI measure rising by a more moderate +0.26% m/m. Indeed, with airfares CPI not entering into the Fed’s preferred core PCE inflation measure, our US economists’ projection for August core PCE has declined to +0.22% m/m after the CPI print. Overall, they see the CPI data pointing to continued strength in service prices, but to potentially more moderate tariff impacts than previously anticipated. See their full take here

Alongside CPI, initial jobless claims for the week ending 6 September rose to +263k, well above the +235k expected. The state of Texas accounted for most of this increase so some of this spike was likely due to temporary distortions. Still, it was yet another data point adding to a picture of a softening US labour market.

The combined data prompted a rally in US Treasuries, with 10yr yields falling -6bps lower after the print before closing -2.5bp on the day to 4.02%. 30yr yields saw a larger -4.2bps decline, even as they sold off a little after an average 30yr auction. However, the front-end rally ran out of steam as the day went on and 2yr yields closed a mere -0.1bps lower as markets remained hesitant to price in much risk of a 50bps cut, with September Fed pricing unchanged at 27bps. The dollar index weakened slightly, posting a -0.25% decline.

Equities responded positively to the lower rates outlook. The S&P 500 (+0.85%) and Nasdaq (+0.72%) both advanced to fresh records, supported by continued enthusiasm around AI. The Magnificent 7 gained +1.13%, although Oracle slipped -6.23% after three consecutive days of gains. But the equity gains were widespread with 436 advancers within the S&P 500 being the most we’ve seen since May 27, while the small cap Russell 2000 (+1.83%) surged to within 1% of its own record high reached back in November 2021.

Turning to Europe, the ECB held rates steady at 2%, as widely expected, but this was accompanied by some hawkish hints that led markets to price out prospects of another rate cut. The ECB saw the risks to growth as “more balanced” amid fading trade uncertainty and a resilient domestic economy. President Christine Lagarde stated that the “disinflationary process is over” and repeated that policy is “in a good place”. While there was a dovish tweak with the 2027 core CPI forecast being lowered from +1.9% to +1.8%, Lagarde did not focus on this, rather calling the downwardly revised +1.9% headline CPI projection for 2027 a “minimal deviation” from target. Overall, our European economists see the ECB as increasingly comfortable with 2% policy rates, and they continue to expect the next ECB move to be a hike in late 2026. See their full reaction here.

In response, markets effectively removed any pricing of an October rate cut and are now pricing only 10 bps of easing by next March (-3.1bps on the day), which marks the first time that another 25bp rate cut has been less than 50% priced. That sent 2yr bund yields +3.3bps higher, though the 10yr yield (+0.4bps to 2.65%) was little changed amid the US bond rally.

The euro gained +0.33% against the dollar on the day, and European equities rose as the STOXX 600 climbed +0.55%, with the CAC 40 up +0.78% and the DAX +0.30%.

Elsewhere, oil prices fell, with Brent crude down -1.66% to $66.37/bbl as the International Energy Agency projected a larger record oil market surplus for 2026. That outweighed ongoing geopolitical concerns after Russia’s drone incursions into Poland on Tuesday night. Warsaw’s allies including France and Germany pledged to expand their air policing over Poland, but we are yet to hear if Europe and the US will announce new sanctions in response.

In Asia, the Hang Seng tech index is leading the way with a rise of +2.18%, while the Hang Seng itself is +1.53%, bringing its five-day gain to over 4% and positioning it for its highest close since August 2021. Meanwhile, the KOSPI is up by +1.28%, supported by a notable surge of over 7% in one of its major heavyweights, SK Hynix, after the company announced the successful completion of its next-generation high bandwidth memory chip, HBM4, which is essential for AI applications. Elsewhere, the Nikkei (+1.08%) is rising for the third consecutive session, reaching new record highs despite the uncertainty following Prime Minister Ishiba’s resignation. The Shanghai Composite (+0.20%) is seeing more muted gains alongside US equity futures which are currently flat as I type. 

Looking ahead, today’s calendar includes the US September University of Michigan Survey, UK July monthly GDP, Italy’s Q2 unemployment rate, and Canada’s July building permits. Central bank speakers include the ECB’s Rehn, Kocher, and Nagel, as well as the BoE’s inflation attitudes survey.

Tyler Durden
Fri, 09/12/2025 – 08:37

1 In 9 Americans Still Believe Political Violence Is Sometimes Justified

survivalnomics
-
0
1 In 9 Americans Still Believe Political Violence Is Sometimes Justified
1 In 9 Americans Still Believe Political Violence Is Sometimes Justified

Unless you live under a rock, you will jnow by now that conservative activist Charlie Kirk (31) was shot dead while speaking at an event at Utah Valley University on Wednesday.

At the time of writing, the shooter is still at large and a manhunt is underway.

Kirk was an ally of U.S. President Donald Trump and the founder of Turning Point USA, a conservative student movement.

In a statement, Trump blamed the rhetoric of the “radical left” for Kirk’s death while politicians on both sides of the aisle shared their condolences.

The shooting adds to a growing list of incidents of politically-motivated violence in the United States, with echoes of an incident last year when Trump was also nearly shot at a rally in front of a crowd.

Despite the major rift that exists between left and right, data shows that such acts of political violence are not tolerated by the vast majority of U.S. adults.

As Statista’s Anna Fleck reports, following the shooting, YouGov asked 2,326 U.S. adults to share their opinions on whether they think it is ever justified for citizens to resort to violence in order to achieve political goals.

Infographic: Most Americans Think Political Violence Is Never Justified | Statista

You will find more infographics at Statista

Where 11 percent said that they thought violence can be justified in some cases, 72 percent said that it is never justified.

The remaining 16 percent were either unsure or preferred not to answer.

As the chart shows, both sides of the aisle are at least united in their stance that political violence in the U.S. today is a problem.

Where 87 percent of respondents said that it was at least somewhat of an issue, only one percent said it was not a problem at all and five percent said that it was not much of a problem.

Tyler Durden
Fri, 09/12/2025 – 08:25

Trump Says Charlie Kirk’s Assassin In Custody

survivalnomics
-
0
Trump Says Charlie Kirk’s Assassin In Custody

Update (0816ET):

President Trump joined Fox & Friends on Friday morning, telling hosts that Charlie Kirk’s assassin is “in custody” and that “with a high degree of certainty, we have the suspect.”

Watch here:

Conversation with the president continues. 

*   *   * 

 

Federal investigators at the FBI’s Salt Lake City field office released new surveillance footage on X late Thursday showing the suspect in the political assassination of Turning Point USA founder Charlie Kirk fleeing the scene by leaping off a rooftop at Utah Valley University. 

The FBI wrote in a note accompanying the video: 

The FBI is releasing a video of the shooter in the Utah Valley shooting. The subject is seen jumping from the rooftop of a building after the shooting. Around 12 p.m. Mountain Time on September 10, 2025, the subject climbed up to a rooftop; after he shot and killed Charlie Kirk, he jumped off and ran away. He left a gun and ammunition in a wooded area near the university. Trace evidence collected from the rooftop scene included shoe impressions, a forearm imprint, and a palm print. Anyone with information in this case should call the FBI at 1-800-CALL-FBI or visit fbi.gov/utahvalleyshooting.

Video

Here are the latest developments over the last three days: 

  • Suspect Description: College-age male, wearing a T-shirt with an American flag, black Converse shoes, and a baseball cap with a triangle.

  • Weapon Recovered: An imported Mauser bolt-action rifle with one spent cartridge and three live rounds, found wrapped in a towel near Utah Valley University.

  • Ammunition Recovered: All cartridges have engraved wording on them, expressing transgender and anti-fascist ideology (as per Steven Crowder, WSJ). 

  • Forensic Evidence: Palm impressions, footwear prints, and the rifle are being analyzed.

  • FBI Reward: Public asked to help identify the suspect; $100,000 reward offered. Over 7,000 tips received.

MSM failed to acknowledge Steven Crowder was the first to report the ‘transtifa’-style ammo …  

The 200-yard shot. 

On Wednesday night, President Trump addressed the nation from the Oval Office on the senseless political assassination of Kirk, calling it a “dark moment for America.” He vowed to crack down on radical left movements across the country that have sparked death and destruction so far this year. 

In fact, the Texan News reporter Cameron Abrams wrote on X that Rep. Chip Roy, R-Texas, and two dozen others in Congress are calling for a select committee on “the money, influence, and power behind the radical left’s assault on America and the rule of law.”

“Enough is enough. We must follow the money to identify the perpetrators of the coordinated anti-American assaults being carried out against us and take all steps under the law necessary to stop them,” the lawmakers stated. 

Sean Hannity and John Solomon reported last night that there could be a foreign component to the assassination of Kirk. 

Hmm. 

Tony Seruga wrote on X, “I will say this is looking more and more like an orchestrated professional hit. Despite what news will eventually break regarding the shooter, understand foreign isn’t really foreign when it comes assassins. It’s called plausible deniability. The leviathan/matrix/deep state likely has already crafted and perfected their narrative.” 

. . . 

Tyler Durden
Fri, 09/12/2025 – 08:16

French Government Collapse Signals Rising Eurozone Debt Risk

survivalnomics
-
0
French Government Collapse Signals Rising Eurozone Debt Risk

Submitted By Thomas Kolbe

French Prime Minister François Bayrou failed a parliamentary confidence vote, bringing his government to an end. While markets largely remained calm, this does not mean France’s debt crisis has been postponed.

After only nine months in office, President Emmanuel Macron’s fourth government has collapsed. Prime Minister François Bayrou lost Monday evening’s confidence vote on his austerity budget by 364 to 194 votes. Bayrou announced his resignation for Tuesday. 

Bayrou Acknowledged the Severity of the Situation 

Bayrou took responsibility for the dire state of French public finances and attempted to impose a fiscal consolidation program. With public debt at 114% of GDP and a net borrowing forecast of 5.4% for this year, the plan included €44 billion in spending cuts, frozen pensions, and the reduction of two public holidays—measures intended as a lifeline for the struggling economy.

Both the parliamentary majority and broad segments of French society fundamentally opposed the reform program. Another general strike is already looming.

With Bayrou’s resignation, the wavering Emmanuel Macron faces the task of appointing a fifth prime minister in two years. Until the upcoming elections in April 2027, any government, regardless of composition, will confront the same problems. Any form of fiscal consolidation will be torpedoed by entrenched political factions. France is stuck in a political deadlock, making debt consolidation seem impossible.

The Road to Disaster 

This bizarre situation reveals that France’s political elite—and increasingly across all EU states under debt pressure—can no longer put economic necessity above ideological divides. The lost confidence vote is another nail in the EU’s coffin and will soon manifest in markets as a problem for the Eurozone, as investors realize France’s political impotence.

In recent days, Bayrou openly criticized the French lifestyle, identifying the welfare state as a core problem. He now experiences firsthand that anyone challenging the numerous privileges of the sprawling welfare system is politically ruthlessly punished. France defends its transfer society as a national sacred cow, even though this stance leads straight into fiscal catastrophe.

Europe’s Contagion Risk 

For financial markets, the events in Paris are not good news. France’s “OATs” — Treasury bonds — showed little immediate reaction to the government’s collapse. Yet they had been under increasing pressure in recent weeks amid the brewing sovereign crisis. Yields rose, and the spread to German Bunds—Europe’s benchmark—widened to as much as 90 basis points, signaling risk.

French government bonds are now trading with a significant risk premium, much like UK debt. Contagion risk looms for the Eurozone if markets turn to other high-debt nations such as Spain, Italy, or Greece, potentially triggering a chain reaction reminiscent of the prior sovereign debt crisis.

France remains in turmoil. On Friday, another crucial test awaits: Fitch will release its credit rating assessment.
Source

While an immediate downgrade is unlikely—France already sits at AA- with a negative outlook—a fall into the single-A category is now a real possibility. This would force institutional investors to sell French bonds, further raising refinancing costs and deepening France’s debt spiral. The country would gradually lose its “quasi risk-free” benchmark status in the Euro core.

Pricing in the Risks 

A similar pattern emerged in the currency markets, where the euro even gained slightly against the US dollar. Signals of the upcoming sovereign debt crisis may also come from precious metals: gold and silver temporarily hit all-time highs Monday evening, confirming a steady upward trend bolstered by central bank demand worldwide.

Private investors and institutional players should take note: awareness of impending sovereign crises has heightened since the severe market shocks eighteen months ago. Gold offers a safe haven without counterparty risk.

The ECB faces a difficult balancing act: in the event of renewed intervention, it must weigh inflation control against financial stability. Rising spreads can distort the transmission of monetary policy, forcing targeted liquidity measures without abandoning policy tightening entirely. Market commentators warn of a “jittery autumn” for Eurozone spreads.
Source

Showdown Inevitable 

The European Central Bank, the final Eurozone backstop in case of panicked bond sell-offs, remained invisible on Monday. Calm trading after the failed confidence vote and stable yields in French bonds and the euro suggest that the ECB may have quietly intervened with selective support purchases. Confirmation will come in weeks with the next TCI report, revealing central bank transactions.

Until then, speculation continues—unless leaks surface prematurely.

Cynics might argue markets have grown accustomed to the French drama and are merely awaiting the next chapter, possibly involving liquidity problems. Overall, the gradual sell-off of long-term government debt in global markets continues. France remains under close scrutiny due to ongoing political turbulence and unresolved fiscal challenges.

The major bond market showdown looms like a dark cloud, and the relentless accumulation of public debt will sooner or later unleash severe storms. The global financial architecture rests on a fragile foundation—a fiat currency system built on inflationarily circulating sovereign debt.

Tyler Durden
Fri, 09/12/2025 – 08:05

Mapping Global Trade With New High-Frequency Data

survivalnomics
-
0
Mapping Global Trade With New High-Frequency Data

The global economy is showing resilience despite a sharp rise in U.S. tariffs and growing uncertainty over the future of the international trading system. To provide the most up-to-date snapshot, a Goldman team led by Patrick Creuset introduced clients to a new high-frequency dataset on global trade on Thursday. The global dataset highlights continued economic momentum outside the U.S., even as U.S. trade barriers weigh on imports. 

Creuset explained that the new dataset is built on IMF Portwatch and UN Global Platform data, sourcing satellite data of 90,000 commercial vessels and generating more than 25,000 datapoints each week. With about a one-week lag, it provides a near-real-time view of global container flows. 

Global trade growth has slowed to 3% year-over-year in the third quarter, down from 4% year-to-date, but remains resilient outside the U.S., where volumes declined in August. Much of China’s strength is situated in its manufacturing industry, with exports up 5% compared to a 4% increase globally. Flows are increasingly directed toward emerging markets in Latin America and Africa, while Europe is importing more from China and exporting less back. A stronger euro against the yuan supports this. 

Charts 1 through 8 provide a near-real-time snapshot of the global economy. 

Global freight markets in the second half of 2025:

  • Ocean: We see Q3 growth tracking 3% so far, with a positive skew to Asia-Europe and North-South trades. U.S. exposures will likely underperform, and we would expect U.S. trade to continue to soften into year-end given frontloading/inventory trends. Planned USTR service fees targeting Chinese-built fleets (Oct) could add a further layer of import costs and complexity. Container rates are likely to keep sliding into year-end given slowing demand, rising supply plus adverse seasonal factors.

  • Air: Has been slightly more resilient than we had anticipated going into the quarter, +3%yoy QTD (Aug) with broadly stable rates (we took our DSV Air numbers up marginally last week), possibly reflecting greater capacity discipline vs. Ocean coupled with robust Tech shipment demand. We still expect the market to soften into Q4 given well-stocked inventories, ocean overcapacity, and the end of the U.S.’ global de minimis exemptions as of 29 Aug.

  • Road (Europe): Sequentially firmer, with German truck traffic +0.4%yoy QTD (Aug) after uninterrupted declines since early-22. As German infrastructure and defense-focused stimulus gets underway, Q3 25 could mark a positive cyclical inflection point.

This suggests that the popular Democratic narrative – repeated like a broken record on MSM such as CNN and MSNBC – that Trump’s tariffs would wreck the global economy has, so far, been proven wrong. The data show no signs of impending doom or collapse, marking yet another major setback for the left’s ability to hold a narrative for more than a day. 

The note, titled “Mapping Global Trade Close(r) to Real Time,” contains more than 80 charts. We’ve covered only about 10% of the charts in this note. The remaining ones can be viewed by ZeroHedge Pro subscribers here. 

Tyler Durden
Fri, 09/12/2025 – 06:55

The Four Horsemen Of The Western Apocalypse

survivalnomics
-
0
The Four Horsemen Of The Western Apocalypse

Authored by Victor Davis Hanson via American Greatness,

Europe is plagued by a number of existential crises. Yet they are all self-inflicted—and by a dominant, therapeutic culture that embraced utopian but lethal bromides.

These suicidal wounds are now nearing the end-stage.

Indeed, they are destroying the very civilization that was soon envisioned to be heaven on earth.

The global warming hysterics could not just entertain gradual transformations away from dependencies on traditional fuels and power generation.

Instead, elites have demanded catastrophic and near-instant “net zero” mandates. That radicalism entailed transitioning to unreliable and costly solar and wind energy. Fuel and electricity prices then soared.

The green socialist elite cared little that shutdowns of nuclear, coal, natural gas, and oil power generation would cripple industry, reduce living standards, and impoverish Europe.

Germany, the once economic powerhouse of Europe, became a shell of its former self. The same efforts accelerated under the Obama and Biden administrations in the U.S.

Both administrations sought to slash new fossil fuel production and use, without regard to the costs, dangers to the economy, or deleterious effects on the middle class and poor.

Second, for the last half-century, affluent Westerners embraced the idea that there were no normative lifestyles. Often, they claimed nuclear families with 2-3 children were parochial and passé.

Children supposedly inhibited the lifestyles and aspirations of women. Larger families, we were told, unfairly burdened upscale professionals with unneeded costs and offered biased and injurious models to gays, the transgendered, and single, childless men and women.

The result is that the fertility rate plummeted in the West, particularly in Europe (1.4) and the United States (1.6), to unsustainable levels.

Academia, the media, government, and foundations promoted these ideas of “empowerment”—despite the historical evidence that societies that cannot reproduce themselves age, ossify, and finally implode.

The third horseman of the Western apocalypse was unrestricted and illegal immigration.

Again, the elites discarded a century of research and common sense that immigration into modern Western societies is only beneficial if it is legal, measured, diverse, meritocratic, and met with robust efforts of the host to integrate, acculturate, and assimilate foreigners.

The arrogant West scoffed at all that.

Instead, it destroyed borders. It welcomed in millions of impoverished and unaudited illegal aliens, many of them with little desire or ability to adopt the values of their hosts.

What followed were unsustainable social welfare entitlements, rising crime, social chaos, and growing internal strife.

The last horseman was a new tribalism, euphemistically dubbed diversity/equity/inclusion.

An elite Western class envisioned an entire set of reparatory actions for growing nonwhite populations to atone for purported prior, and sometimes ancient, sins of slavery, racism, colonialism, sexism, homophobia, and transphobia.

No matter that all of these pathologies are commonplace worldwide, only in the self-critical West was slavery first outlawed, and tribalism curtailed.

Indeed, nonwhite immigrants knew precisely why fellow non-Westerners flocked to Western nations in the millions. Only there do meritocracy, consensual government, and self-criticism ensure more prosperity, freedom, and security than in their own tribal, often sexist, religiously and ethnically chauvinistic, and statist societies.

Human nature dictates that once racial fixations for any reason normalize exemptions and advantages, then tribalism and civil strife inevitably resurface.

Self-perpetuating myths of everlasting victimhood are necessary to ensure permanent special preferences. The Western idea of the Enlightenment, that we are individuals, not tribes and collectives, free to question the world about us, is shattered.

Instead, we descend into precivilizational tribalism, predicated on our superficial appearances.

There is some hope only because the four horsemen of our apocalypse were welcomed into the West by a minority of naïve, secular, and privileged Westerners. They believed as demigods that their wealth and freedom were irreversible birthrights, that utopia was near, and that they would be exempt from any consequences of their failure.

As a remedy, the West needs to stop apologizing for its 2,500-year history and take pride in its unique European and Judeo-Christian tradition that is innately inclusive.

It does not have to be perfect to be good—only far better than the alternatives, as mass illegal immigration attests.

The West needs to resist top-down radical green bromides and assess their cost-to-benefit damage to most citizens.

Larger, multi-generational, and two-parent families are not strange but the historical lifeblood of robust civilizations.

If foreigners wish to move legally to the West, they should be reminded why they do so and thus integrate and assimilate to the hosts’ values—or stay home.

Finally, Americans especially need to speak out against anyone of any race or tribe who stereotypes and spouts hatred of others outside their tribe.

And feigned victimhood will end only when the invented victimizers say, “Sorry, enough is enough.”

Tyler Durden
Fri, 09/12/2025 – 06:30

How Much Caffeine Is Hiding In Your Daily Drink?

survivalnomics
-
0
How Much Caffeine Is Hiding In Your Daily Drink?

From morning cups of tea to late-night energy drinks, caffeine has become part of daily life across the globe.

But how much is hidden in these drinks, and when does it become too much?

A Global Habit

Caffeine is the world’s most commonly consumed stimulant, present in coffee, tea, soft drinks, and energy beverages. Billions of people rely on it each day for focus or an energy boost.

Yet health authorities stress that safe limits are not universal.

Age, body size, and metabolism all affect how much caffeine the body can handle.

Children and teenagers are particularly sensitive, while most adults tolerate moderate amounts more easily.

How Popular Drinks Compare

As Visual Capitalist shows in the infographic below, the amount of caffeine in common drinks varies widely:

  • Cola (355ml): about 40mg

  • Black tea (250ml): around 50mg

  • Double espresso (60ml): 80mg

  • Instant coffee (250ml): 100mg

  • Red Bull (250ml): 80mg — about two colas or one espresso

  • Monster/Relentless (500ml): 160mg — equal to four colas or two espressos

  • Prime energy (330ml): 140mg — about three and a half colas or one and a half espressos

A single large energy drink can therefore contain as much caffeine as several cups of tea.

Children and Teenagers at Higher Risk

Health guidance around the world advises caution for younger people. Their smaller body size and developing nervous systems mean even one can of an energy drink may exceed recommended safe levels.

For teenagers, many health organisations suggest limiting caffeine to under 100mg a day — less than one can of Prime or Monster. For children, regular caffeine is often discouraged altogether.

Adults and Older People

For healthy adults, up to 400mg a day — the equivalent of four cups of coffee — is generally considered safe. But tolerance differs widely.

Older people may find that caffeine affects sleep, heart rate, or anxiety more strongly.

Why Awareness Matters

As high-caffeine energy drinks grow in popularity worldwide, experts say the public should be more aware of what is inside them. A product that looks like an ordinary soft drink can contain two or three times as much caffeine.

Knowing the numbers, health authorities suggest, is the first step to safer daily choices.

Tyler Durden
Fri, 09/12/2025 – 05:45

1...1,0991,1001,101...4,430Page 1,100 of 4,430

About Us

Popular Category

Editor Picks