Polish Prime Minister Mateusz Morawiecki on Monday confirmed that his country is about to seek formal permission from the German government to send Leopard main battle tanks to Ukraine. Berlin requires formal permission for any of its German-manufactured military items to be sent to third party countries, especially in active war zones.

Germany has continued to refrain from giving its permission, citing fears of uncontrollable escalation between Russia and NATO countries, while further stressing Germany is not a party to the conflict. This as some Polish officials have stressed Germany faces possible “international isolation” if it doesn’t agree to send tanks. “Germany will be completely isolated if it does not give in and hand over the tanks,” Poland’s deputy foreign minister Arkadiusz Mularczyk told a Polish radio broadcaster.

On the same day Poland said it will seek Berlin’s approval, German Foreign Minister Annalena Baerbock was grilled by reporters at a European Union meeting on the issue.

She didn’t give a definitive answer, appearing to dodge the questions, but instead explained: “The whole country [Ukraine] is under attack from the Russian regime, and it’s clear that even 11 months after the start of the brutal Russian war of aggression, Putin has not deviated from his murderous plan to destroy Ukraine.”

“That’s why it’s so important that we as an international community do everything we can to defend Ukraine, so that Ukraine wins — wins to live in peace and freedom again,” she added. “Because if it loses this war, there will be no more Ukraine.”

But as CBS reports at a moment of apparent widening division among the Western allies on the tank issue: 

A day earlier, Baerbock said on French television that Germany would not block the export of Leopard tanks to Ukraine from third countries.

“At the moment, the question has not been asked, but if we were asked, we would not stand in the way,” she said after being asked what would happen, in theory, if Poland decided to supply Leopard tanks to Ukraine.

The division is on full display in Prime Minister Mateusz Morawiecki’s latest comments:

When things seem to be going in a slightly better direction on the subject of heavy weapons for Ukraine, Germany steps in and raises doubts. The enemy is in the east, and we are wasting time on discussions that do not lead to anything good,” Prime Minister Mateusz Morawiecki told the PAP Polish Press news agency.

Ukrainian diplomats and officials are also stepping up the pressure campaign: 

Just a kind reminder: Ukraine officially asked Germany to supply Leopard tanks on 3 March 2022, on the 7th day after russia started a war of annihilation against the Ukrainian statehood &🇺🇦nation. Today is the 334th day of barbarian🇷🇺war. Maybe it’s time to speed up this process? pic.twitter.com/C3N2C6pelT

— Andrij Melnyk (@MelnykAndrij) January 23, 2023

Meanwhile Kremlin spokesman Dmitry Peskov on Monday mocked the clear “anxiety” and “legal balancing act” on display by NATO countries regarding the German tanks issue.

“This whole legal balancing act that we see now, and the exchange of statements between European capital cities… European capitals, including Warsaw, are now threatening Berlin with international exclusion and much more,” he said. “All this suggests that anxiety among the members of the alliance is increasing all the time, keeps growing. But here, of course, all the countries that are directly or indirectly involved in pumping weapons and in raising the technological sophistication of Ukraine, they are all responsible for this in one way or another,” the Kremlin spokesman added, according to TASS.

The Kremlin later in the day added…

POLAND MUST ENSURE CHANCELLOR BACKS GERMAN FOREIGN MINISTRY BEFORE EXPORTING LEOPARD TANKS TO UKRAINE -TASS QUOTES PUTIN SPOKESMAN

Authored by Katabella Roberts via The Epoch Times,

The L.A. county sheriff praised two brave members of the local community on Sunday who he said helped prevent further loss of life after the gunman who had already murdered 10 people at a Los Angeles-area ballroom dancing studio attempted an attack on a second location.

In a press conference, Los Angeles County Sheriff Robert Luna explained how around 20 to 30 minutes after the suspected gunman, 72-year-old Huu Can Tran, opened fire at Star Ballroom Dance Studio in Monterey Park, California, he then entered another dance studio, Lai Lai Ballroom & Dance Studio in the nearby town of Alhambra.

ALHAMBRA, CA – JANUARY 22: The Lai Lai Ballroom and Studio near the site of a deadly shooting on January 22, 2023 in Alhambra, California. 10 people were killed and 10 more were injured at a dance studio in Monterey Park near a Lunar New Year celebration on Saturday night. (Photo by Eric Thayer/Getty Images)

Sheriff Luna said that the suspect was armed with a gun, specifically a “magazine-fed semiautomatic assault pistol” with a large-capacity magazine attached to it when he arrived at the Alhambra studio where he probably intended to kill more people.

However, upon arriving at the second dance studio, the suspect was swiftly disarmed by two brave individuals who jumped on him and disarmed him before he fled in a white van.

“Remember, the suspect went to the Alhambra location after he conducted the shooting (in Monterey Park), and he was disarmed by two community members who I consider to be heroes,” Luna said.

“They saved lives. This could’ve been much worse.”

No further details regarding the two brave community members were revealed.

No Motive for Attack

The Sheriff added that he believes the weapon taken from the suspect at the Alhambra location is not legal under Californian law.

Luna said that law enforcement still have no clear motive for the attack but believe the gunman acted alone.

“We want to know how something this awful can happen,” Luna said.

According to police, the suspect opened fire at Star Ballroom Dance Studio in Monterey Park—a city of about 60,000 people which is known for its large Asian population—on Saturday at around 10:22 p.m. local time as a day of celebrating the Chinese Lunar New Year drew to a close.

A total of 10 people were killed, with police stating that the majority of the victims appear to be in their 50s, 60s, or older. Another 10 more people were injured, seven of whom were still in hospital as of Sunday evening—some in critical condition.

The shooting sparked a huge manhunt for the suspect who was later found dead in Torrance on Sunday morning, at around 1 p.m. local time in a white van, about 30 miles from the Monterey Park shooting scene.

The vehicle, which was stationed in a parking lot, was isolated by a SWAT team. Police said that earlier, they had heard what appeared to be a single shot from inside the van, triggering officers to call for reinforcements.

Authorities said that upon further inspection, it appeared as though Huu Can Tran died from a self-inflicted gunshot wound. He was declared dead at the scene.

Sheriff Luna told the press conference that the number plates on the van had been changed and were likely stolen. A handgun was found in the van where Tran died.

Law enforcement personnel open the door of a van outside the site in Torrance, California, where the alleged suspect in the mass shooting in which 10 people were killed in Monterey Park, Calif., is believed to be holed up on Jan. 22, 2023. (Robyn Beck/AFP via Getty Images)

Biden Orders Flags Flown at Half-Staff

Elsewhere during Sunday’s press conference, Monterey Park representative Judy Chu, who chairs the Congressional Asian Pacific American Caucus (CAPAC) and is a former mayor of the city, said that community members are “no longer in danger” but that there were questions surrounding why the two dance community studios were targeted.

“What was the motive for this shooting? Was he a domestic violence abuser? How did he get these guns? Was it through legal means or not? These questions will have to be answered in the future,” Chu said.

In a Facebook post on Sunday, the Alhambra ballroom said it was closed following the devastating shooting in Monterey Park and would implement visitor searches when it reopened on Monday.

The Lai Lai Ballroom and Studio near the site of a deadly shooting in Alhambra, Calif., on Jan. 22, 2023. (Eric Thayer/Getty Images)

“In observance of the tragedy at Star Dance last night, Lai Lai Ballroom will be closed today,” the post read.

“Lai Lai will reopen Monday for lessons only. As an extra precaution, all students and teachers are subject to search prior to entering the studio. Our prayers go out to all the victims families.”

President Joe Biden on Sunday evening ordered the U.S. flag to be flown at half-staff at the White House and all other federal posts until Jan. 26 as “a mark of respect for the victims of the senseless acts of violence,” according to a White House statement.

A former top FBI counterintelligence official – in fact, the guy who received the tip that supposedly kicked off the Trump-Russia investigation – has been arrested and charged with violating US sanctions on Russia by taking secret payments from a Russian oligarch in order to investigate another oligarch.

Federal prosecutors in Manhattan charged Charles McGonigal, former special agent in charge of the FBI’s New York counterintelligence desk, with taking secret payments from Oleg V. Deripaska – which violated US sanctions by agreeing to help the Russian billionaire, who himself was indicted last year on sanctions charges. McGonical notably retired in 2018.

During his days in counterintelligence, McGonical was responsible for supervising and participating in investigations of Russian oligarchs, including Deripaska.

The indictment unsealed in Federal District Court in Manhattan on Monday charges the former F.B.I. official, Mr. McGonigal, with one count of violating U.S. sanctions, one count of money laundering and two conspiracy counts. –NY Times

According to his lawyer, “Charlie served the United States capably, effectively, for decades,” adding “We have closely reviewed the accusations made by the government and we look forward to receiving discovery so we can get a view on what the evidence is upon which the government intends to rely.”

McGonigal was the FBI’s recipient of the fake tip from Alexander Downer that supposedly started the Trump/Russia investigation.

He was also involved in the fake Carter Page (“Crossfire Dragon”) investigation. https://t.co/MDwosXQaqP pic.twitter.com/tGjDL5zFq6

— Hans Mahncke (@HansMahncke) January 23, 2023

Former colleagues who worked closely with McGonigal were reportedly ‘shocked’ at his arrest.

They said he primarily investigated Russian counterintelligence and espionage during his lengthy career with the F.B.I. Mr. McGonigal also took on extremely sensitive assignments in the intelligence community, leading an F.B.I. team that investigated why C.I.A. informants in China were being arrested and killed. -NYT

A second man, Sergey Shestakov, was also indicted in the case. He’s a former Soviet and Russian diplomat who later obtained US citizenship and worked as a Russian interpreter for courts and government offices.

Days after he warned NATO of the likelihood of nuclear war if Russia is defeated in Ukraine, former Russian president and current deputy chairman of the security council Dmitry Medvedev on Monday said the world stands on the brink of World War III due to US and Western aggression against Russia.

“The world has come close to the threat of World War III due to impending US aggression against the Russian Federation,” Medvedev said in comments first reported by Sky News Arabia. He also emphasized he sees the conflict at a point of no return. “There are no conditions for negotiations between Russia and Ukraine now, either de facto or de jure,” Medvedev said.

On the same day, Russian Foreign Minister Sergey Lavrov voiced something similar, saying the confrontation with NATO can no longer be seen as merely a “hybrid war” or proxy war, but is instead fast approaching a real one. He said this in a joint press conference with his South African counterpart, Naledi Pandor

Lavrov explained that this “almost real” – as he put it according to state media, was something the West “has been preparing for a long time against Russia.”

He further charged that Ukraine’s leadership has created “presidents of war” and “Russophobic leaders” – particularly in reference to Present Zelensky and before him Petro Poroshenko.

Russian presidential spokesman Dmitry Peskov additionally sounded the alarm in separate Monday remarks, saying that the current rush to supply Western-made tanks to the battlefield will severely escalate the conflict. “The Ukrainian people will pay the burden of this so-called support,” he said.

Former Russian Pres. Dmitri Medvedev said the defeat of Russia in Ukraine may trigger a nuclear war. The head of the Russian Orthodox Church, Patriarch Kirill, backed up Medvedev’s warning that “Russian defeat would mark the world’s end.” Need I say more? https://t.co/1bh2P1Lga1

— Steve Hanke (@steve_hanke) January 22, 2023

Peskov also highlighted that it’s clearly creating tensions and division among allies, noting that if the tank plan proceeds, “All countries that directly or indirectly ship weapons to Ukraine are responsible for this.”

Currently, Poland is leading the way on pressuring Germany to authorize sending advanced Leopard tanks to Ukrainian forces. Berlin has so far expressed reluctance, fearing uncontrollable isolation, while seeking to stress Germany doesn’t wish to be a party to the conflict.

Meanwhile, heavier weapons continue to pour into the conflict unabated…

⚡️American M2A2 Bradley infantry fighting vehicles somewhere in Poland.

Most probably headed to Ukraine. pic.twitter.com/RZNrQpyhe0

— War Monitor (@WarMonitors) January 22, 2023

Update (1105ET):

Activist investors are swarming Salesforce. 

CNBC’s David Faber reports that Jeff Ubben’s hedge fund Inclusive Capital Partners LP has taken a stake in the cloud-based software firm. There was no mention of the position size. 

The news follows Elliott Management’s multi-billion dollar investment in Salesforce earlier this morning. 

Also to note, Starboard Value LP bought a stake in October.

What’s next? Potential moves to cut more jobs.

 *   *   * 

Salesforce Inc shares are up 5% in premarket trading after WSJ reported activist investor Elliott Management had made a multi-billion dollar investment in the cloud-based software firm. 

The activist investor has taken a stake as the business software giant slashed about 10% of its headcount, or about 8,000 employees, and reduced back office space over mounting macroeconomic headwinds. 

“Salesforce is one of the pre-eminent software companies in the world, and having followed the company for nearly two decades, we have developed a deep respect for [Co-Chief Executive] Marc Benioff and what he has built,” Jesse Cohn, managing partner at Elliott, said.

“We look forward to working constructively with Salesforce to realize the value befitting a company of its stature,” Cohn continued. He has previously served on the boards of Twitter, eBay, and Citrix. 

As of Friday’s close, the San Francisco company had a market capitalization of $151 billion, down from $303 billion in November of 2021. 

The activist stake will pressure Salesforce and Marc Benioff, the company’s co-chief executive, to achieve greater profitability. In October, Starboard Value LP bought a stake in Salesforce. The activist investor is very successful at helping companies achieve operational efficiency and margin improvement.

Perhaps one of Salesforce’s overhangs is the massive influx of hiring it has done over the last several years. The latest filings show the company had about 80,000 employees globally, up from 49,000 as of Jan. 31, 2020. 

When Benioff laid off employees earlier this month, he told them in a letter, “… hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that.”

WSJ noted, “Elliott is known for taking on tech companies and others and forcing changes that also include sales and executive shake-ups.”

With two major activists in Salesforce, it wouldn’t shock us if more layoffs were ahead — and it has been the season of tech layoffs as a slowdown in the industry has led tech giants like Amazon and Google to reduce headcount. 

By Michael Msika, Bloomberg Markets Live reporter and commentator

After nearly four months of brisk gains, the European equity rally is starting to look stretched. Investors should watch out for some overheating in the short term.

The Stoxx 600 hit overbought levels last week for the first time in more than a month, while the breadth of its index members trading at such levels reached the highest since November. The last such occurrence was followed by the European benchmark dropping about 4.5% on a closing basis, before resuming gains.

China’s accelerated reopening, receding bond yields and a weaker dollar have all helped the rally, while Europe has also seen better-than-expected macro data, in contrast with the US. Preliminary reports on European PMIs due Tuesday may offer clues on whether the region’s resilience can be sustained amid rising rates.

“We expect a sharp loss of growth momentum in response to aggressive monetary tightening, but markets are not priced for this,” says Bank of America strategist Sebastian Raedler. “European equities look particularly vulnerable, as a pro-cyclical, pro-value market that has already strongly outperformed.”

Barclays strategist Emmanuel Cau points out that disinflation bets have dragged bond yields lower in Europe despite a hawkish ECB, while improving economic sentiment has pushed up equities. “Europe appears to be in the sweet spot right now,” he says, but adds that “if the macro situation in the US were to deteriorate more, history suggests the decoupling between the two markets may not last long.”

If US data continue to weaken, worries of a hard recession are likely to hit European stocks too. “US economic data downside surprises are occurring against a labor market which continues refusing to roll over and placate the FOMC into thinking that their work is done – hence, the ultra-rare sighting of a ‘bad news is bad news’ market regime,” says Nomura cross-asset strategist Charlie McElligott.

Volatility measures also indicate it may be a good time for investors to secure some of the year-to-date gains. Both the VVIX and SKEW gauges are on the rise, while the VIX itself bounced above 20 last week, a key level that was followed by higher volatility last year. That offers a relatively cheap hedging opportunity.

Equity strategists on average predict the Stoxx 600 will end the year near current levels, but it may take a bumpy path to get there. While the consensus at the end of last year was that the first half of 2023 will be rougher than the second half, that’s being challenged by the favorable conditions that have led to European stocks’ best-ever start to a year.

“We could almost have some kind of Goldilocks scenario in the first half,” says Argonaut fund manager Barry Norris, expecting a tougher second half. Norris says Europe got lucky with a mild winter that eased energy woes and helped the region avoid recession, but warns that things will be different in three to six months, when investors will think the bull market is back and inflation re-accelerates.

Just as we warned last week, the short squeeze is back again, perhaps as traders relished the start of the Fed blackout period (ahead of the Feb 1 FOMC) and the coming start of buybacks, with buyback blackout ending next weekend.

And the squeeze. Rinse. Repeat https://t.co/1yBrWiXPOC

— zerohedge (@zerohedge) January 23, 2023

…and adding to this re-reversal in sentiment, is the latest note from Goldman prime (also available to pro subs), according to which there has been a notable shift in market sentiment as “hedge funds net bought US Info Tech stocks for a second straight week led by Semis & Semi Equip names (after being sold in 10 of the 11 prior weeks).”

Evident in the dramatic outperformance grab in Nasdaq today…

The S&P has extended its gains above the 200-day moving-average…

And is now set to test its longer-term downtrend line…

As SpotGamma notes, this week starts the Fed blackout period into 2/1 which may help reduce “tape bombs”.

Key earnings kick off this week which may shift traders focus to single stock stories.

Much of short term market movement may now key off of “recessionary” earnings narratives.

Overall, while levels look fairly similar to last week, OPEX served to weaken them.

The fairly large Jan OPEX also reduces some of the upside bias (calls) in single stocks.

We do not anticipate a high volatility session today, within 3900 holding as support, and 4000 resistance. There doesn’t appear to be any skew to favor a break of one side or the other.

SpotGamma’s models turn bullish on a close over 4000, with room to move up to 4050.

A break of 3900 flips positioning much more put-heavy, which suggests that markets lose their ability to bounce.

Finally, we note that implied volatility remains near the low end of its “fair value” and this may reduce vanna as a key driver of upside movement – particularly over 4000.

This does not mean that IV has to suddenly spike, and is unlikely to do so while the SPX is >3900. Arguably traders have some incentive to sell pre-FOMC IV, which should support markets as a test of 3900 (as traders sell relative spikes in puts/IV).

By Michael Every of Rabobank

Happy Chinese New Year! Kung Hei Fat Choi/Gong Xi Fa Cai/Sing Zia Ju-i!

The Year of the Rabbit 2023 is associated with longevity, peace, prosperity, and fecundity. All would be welcome after the Year of the Tiger, which was correctly associated with competition, challenges, rebellion, short-temperedness, unpredictability, and an official decline in the Chinese population. Markets started 2023 off rabbit-like, and while the ‘buy stocks’ trade may be fading, the ‘buy bonds’ trade is still going strong, as is ‘sell US, buy anything else’, assuming there are now no tigers to sink their teeth into defenceless, fluffy things like Europe.

If only we could rely on astrology and Wall Street projections!

“Tanks for nothing”; parallel unparalleleds

A new Russian offensive in Ukraine looms but Berlin won’t send German tanks. However, it might finally allow others with German-made tanks to send them. Yet geopolitics experts agree that while Germany doesn’t want Russia to win, it doesn’t really want Ukraine to win either, as that would decouple from Russia permanently, create a new Poland/Balts/Scandies/Central Europe/Ukraine bloc, and EU gas would flow from the south via Italy, not from the east via Germany, shifting intra-EU power dynamics. The German press says its defence industry fears every Deutsche tank will be replaced by an American, entrenching US market position. In short, the risks are still of an extended war, not rabbit-like peace, and the damage to peaceful Germany’s reputation within the EU and US, not just as an arms dealer, is not to be taken lightly.

Bloomberg also reports ‘Germany and France Push for Huge Spending to Compete With US’, meaning its Inflation Reduction Act (IRA). The Franco-German view is that “European businesses will need to unleash investments on a nearly unparalleled scale to keep from falling behind US and Chinese firms as countries revamp their economies to make them more climate friendly.” Except smaller EU member states are vexed again because, as with unparalleled EU energy subsidies, it is the Big Two who can most afford to prop up their industries. (Even as the unparalleled German defence spending promised to keep smaller EU members, and industry, safe is not happening.) 

France and Germany insist the whole EU must get the same US trade treatment as Canada and Mexico under the IRA. However, they aren’t likely to get it when German tanks are “out” yet Berlin and Paris stress China must be “in” any trade loop just as the US Congress looks to introduce legislation to create an ‘inverse CFIUS’ to limit US private capital flows to China.

Rabbit lovers should also note that the unparalleled increase in the EU fiscal deficit now being floated to subsidize French and German businesses, on top of unparalleled energy subsidies (and maybe unparalleled defence spending), will mean a larger Eurozone current-account deficit and higher inflation. Doesn’t that imply unparalleled higher ECB rates? Or perhaps there won’t be any investment, or defense spending, or energy subsidies – but then we get the unparalleled sucking sound of investment moving from Europe to the US and/or China. Doesn’t that also imply a long-run current-account deficit and higher interest rates?

Rabbits’ legs

China’s new year holiday will show if ‘the Chinese consumer’ narrative has the hind legs of a rabbit or not. Recall that historically it doesn’t, despite rabbiting from Beijing about this topic, and that there were no Covid payments to households in China, so only a few of them are as cashed up as the charts show. Moreover, Robin Brooks of the IIF points out China’s electricity consumption plummeted to 2020 Covid lows in December, out of line with the strong data that so enthused the market, and the China Beige Book say a contraction was actually seen. So, yes, look for carrots, but also watch out for the data schtick.

However, let’s presume China is back and the worst fears for global growth are fading: why are central banks going to cut rates in 2023 or 2024, as Mr. Rabbit likes to see ahead? As someone noted on Friday, from recent lows we already saw iron ore +48%; silver +38%; Copper +35%; Uranium +32%; Aluminium +25%; Corn +20%; Gold +19%; Sugar +14%; Oil +16%; Coal +8%; and Wheat +2%. Now cut rates and see what happens. Indeed, notice headlines like ‘Summers Warns of 1970s Crisis If Central Banks Relent on Rates’, and the Financial Times reporting from Davos last week that ‘4% is the new 2%’, with everyone expecting inflation to come down, but nobody much outside central banks — and the long end of the bond market — expecting 2% to be where it finally settles.

Back in the US, perhaps rates will fall because unemployment rises? Yet @SteveMiran tweets outside of firings in tech’s cloistered circles (captured by TikTok’s ‘Day in the life of a Meta product manager’), US construction firms are not firing despite the collapse in home sales and prices. Perhaps labour data lag, which is the bond market’s argument; or perhaps its labour hoarding, which the bond market refuses to accept as a possible post-Covid structural trend; or, as Steve posits, perhaps it’s the infrastructure spending in the US IRA – if so, once again fiscal policy mattering more than monetary-policy obsessed market analysts expect.

Sur-charge

Brazil and Argentina have announced plans to develop a common currency, the ‘Sur’, aimed at bringing the entire continent under one monetary umbrella. Yet those fist-pumping and shouting ‘Bretton Woods 3!’ should note it took closely-aligned, developed European economies 35 years to get the Euro up and running… and it still doesn’t work properly if you ask its critics. Let’s see how Latin America fares in trying to build a base on the foundations of Brazil and Argentina.

‘Sur’-e, this sits with the dedollarisation meme regular readers know is something I *do* see being attempted as the world ‘geopoliticizes’. Yet dedollarisation is still something I *don’t* see actually happening beyond more barter and countertrade for some, because a ‘geopoliticizing’ world suits the US better than most others.

The Financial Times last week asked, ‘The Era of Markets ended in 2019: What comes next?’ Our report ‘The Age of Rage’ from January 2019 said, ‘politicized central banks and a return to mercantilism’. I had long argued the US would get more mercantile – and look at the fears in Europe and China over what it means for them. More recently, I argued all the Fed needs to do is raise rates and keep them there, as under Volcker, after the initial policy flap in the 70’s after Bretton Woods collapsed. That and/or weaponize the financial system more. On which, a FinTwit rumour going round Sunday was that SWIFT had announced a new policy that it would not transfer funds into crypto exchanges for amounts below $100,000. It seems it was only Signature Bank dealing with Binance…. for now. But see how easily things are upended?

In short, you might think the year of the rabbit is the holy grail of lowflation, no recession, rates pivots, a lower dollar, asset booms, and that new baby smell. Yet the fluffy white rabbit you are looking at is far more likely to be the deadly decapitating one from that Monty Python movie.

Authored by Paul Joseph Watson via Summit News,

Elon Musk’s father says he is afraid “something might happen” to his son, asserting that the billionaire is “a bit naïve about the enemies he’s making” in relation to the release of the Twitter files.

Over the past several weeks, Musk has spearheaded the release of innumerable internal communications proving the White House, the federal government and giant pharmaceutical corporations worked directly with the old guard at Twitter to censor information and ban prominent users.

Although the legacy media has done its best to ignore the bombshell revelations, the Twitter files have nonetheless embarrassed many powerful individuals.

Retired engineer Errol Musk told the Sun newspaper that he thinks his son is being rather blasé about the potential backlash he may receive for exposing the establishment.

“I’m really afraid that something might happen to Elon, even though he has about 100 security guards around him,” Errol warned, noting that his son was being “a bit naïve about the enemies he’s making, especially with the Twitter Files.”

It appears that the feeling is very much mutual, with Elon Musk fearing that someone may try to harm or kidnap his father as revenge for his political stances.

The younger Musk “decided, after the recent threats against him, that I need protection as well,” Errol told the Sun, revealing that his home has undergone a “first class” security system upgrade.

Having had his home broken into four times in the last year alone, the property is now “completely secure,” with an electric fence, nine security cameras rolling 24/7 that Musk can access from his phone, as well as “around-the-clock monitoring by guards who are armed to the teeth.”

“If they kidnap one of us, it will be the quickest $20 million anybody’s ever made in their life,” said the 76-year-old, who previously shot three armed home invaders in 1998.

“The risk of something bad happening or literally even being shot is quite significant,” said Errol, adding, “It’s not that hard to kill me if somebody wanted to, so hopefully they don’t.”

As we previously highlighted, last month Musk revealed that he has increased his personal security in response to concerns over his safety following the release of the first dump of ‘Twitter files’.

“The risk of something happening to me is quite significant,” said the billionaire.

*  *  *

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As markets brace for next week’s FOMC meeting and the relative peace of the preceding Fed blackout, we’ll get the latest health check on global growth momentum this week amid releases of Q4 US GDP (Thursday) and global PMI numbers (tomorrow). US leading indicators today will also be of note as we are around levels only previously associated with recessions. In addition, PCE, personal spending (both Friday) and durable goods orders (Thursday) will also be released. Key central bank events will include the BoC decision, and Summary of Opinions and minutes from the BoJ’s shock December meeting (all Wednesday). In earnings, all eyes will be on Microsoft (tomorrow), Tesla and ASML (both Wednesday), among others.

As we noted earlier today, the Fed is now in the blackout period so the usual vol spikes around Fed speakers won’t be there this week. However, as DB’s Jim Reid notes in his Morning Reid note, there are quite a few growth signposts to engage markets. Let’s focus on some of the key upcoming events.

It’s not a top tier release but today’s US leading indicators (consensus -0.7% vs -1.0% last month and likely around -5.5% YoY) will likely remain at levels only previously associated with recessions. Last month the Conference Board, who publish this series, said the following: “Only stock prices contributed positively to the US LEI in November. Labor market, manufacturing, and housing indicators all weakened—reflecting serious headwinds to economic growth… The US LEI suggests the Federal Reserve’s monetary tightening cycle is curtailing aspects of economic activity, especially housing. As a result, we project a US recession is likely to start around the beginning of 2023 and last through mid-year.”

Reid says that this is interesting as he felt when he did his 2023 outlooks that he was the opposite way round to consensus. Reid expects a good start for risk assets this year but a very bad end to the year on his long-standing H2 23 recession call: “To be honest, the US data has generally been poorer than anticipated this year so far which is fascinating as markets are rallying hard”, he says.

Going down the list, we’ll also get a good read on global growth momentum with tomorrow’s global flash PMIs which will take into account China’s reopening and falling gas prices. Then we’ll see how growth was faring going into this year with Q4 US GDP on Thursday. Deutsche Bank economists expect +3.2% annualized (consensus +2.7%). They also expect +1.8% for Q1 with H2 being where the US recession hits. Consensus on Bloomberg is around 0% for Q1 so that’s a potential battle ground once actual hard data comes through.

Other notable data releases on Thursday include durable goods orders, new home sales, and the Chicago Fed national activity index. All will be closely watched for signs of weakness seen in the data so far this month.

Finally, Friday’s core PCE release will occupy the Fed’s minds on their blackout period ahead of next week’s FOMC. Most economists don’t expect the same declines as recently seen in CPI as some of the stronger components in PPI last week are better correlated to PCE components. Consensus expects a +0.3% monthly gain in the core PCE price index, up from 0.2% in November.

With that Fed blackout, ECB speakers will take center stage, especially today with Lagarde being the highlight. Dutch CB chief Knot continued his recent hawkish rhetoric over the weekend suggesting that “We made a step down in December from 75 to 50 basis points — that will be the pace for a multiple number of meetings… So that means at least the two in February and March.” So that will challenge the Euro rates bulls after the recent rally. We saw a big reversal from the yield lows (+20bps on 10yr Bunds) on Thursday (and into Friday) after Lagarde’s hawkish Davos commentary. Knot is also on the agenda again tomorrow. You’ll see the full list of speakers in the day-by-day week ahead at the end. Back across the pond, the BoC are expected to hike 25bps on Wednesday. A few weeks ago many were expecting a pause but a recent stretch of firm data has moved the consensus back in favour of a hike.

Over in Asia, key data releases for Japan will include the aforementioned PMIs and the Tokyo CPI (Thursday). Aside from the BoJ’s Summary of Opinions for the January meeting, the minutes of the December meeting will also be released and our economists highlight the importance of analysing how the decision to double the yield curve control range was reached. Elsewhere in the region, the Lunar holidays will curtail a lot of the week’s activity with many bourses shut until midweek with China shut all week.

In corporate earnings, Microsoft will kick off the reporting season for Big Tech tomorrow, with the rest of the group reporting next week. All eyes will be on Tesla post-market on Wednesday ahead of earnings from traditional automakers next week as investors try to grasp trends for EV demand. Other earnings highlights are in the calendar at the end.

Courtesy of DB, here is a day-by-day calendar of events

Monday January 23

• Data: US December leading index, Eurozone January consumer confidence
• Central banks: ECB’s Lagarde, Panetta, Visco and Holzmann speak
• Earnings: Baker Hughes

Tuesday January 24

• Data: US, UK, Japan, Germany, France and the Eurozone January PMIs, US January Richmond Fed manufacturing index, Philadelphia Fed activity, UK December public finances, Japan December Tokyo department store sales, nationwide department store sales, Germany February GfK consumer confidence, France January manufacturing and business confidence
• Central banks: ECB’s Knot speaks
• Earnings: Microsoft, Johnson & Johnson, Danaher, Verizon, Texas Instruments, Raytheon, Union Pacific, Lockheed Martin, General Electric, 3M, Halliburton

Wednesday January 25

• Data: UK November PPI, Japan December PPI services, Germany January ifo survey, France Q4 total jobseekers
• Central banks: BoC decision, BoJ Summary of Opinions (January meeting)
• Earnings: Tesla, ASML, Abbott, NextEra, AT&T, IBM, Boeing, CSX, Crown Castle, Lam Research, Freeport-McMoRan, Hess, Las Vegas Sands

Thursday January 26

• Data: US Q4 GDP, January Kansas City Fed manufacturing activity, December wholesale, retail inventories, new home sales, durable goods orders, Chicago Fed national activity index, advance goods trade balance, initial jobless claims, Japan January Tokyo CPI, Italy January manufacturing confidence, economic sentiment and consumer confidence index
• Earnings: Visa, LVMH, Mastercard, Comcast, SAP, Intel, Blackstone, Volvo, Northrop Grumman, Valero Energy, ADM, Dow Inc, Nucor, STMictoelectronics, Nokia

Friday January 27

• Data: US January Kansas City Fed services activity, December PCE, personal spending, income, pending home sales, Italy November industrial sales, France January consumer confidence, Eurozone December M3
• Earnings: Chevron, H&M, American Express, HCA Healthcare, Colgate-Palmolive, LyondellBasell

* * *

Finally, looking at just the US, Goldman writes that the key economic data releases this week are the S&P Global US manufacturing and services PMI reports on Tuesday, the durable goods and Q4 advance GDP reports on Thursday, and the core PCE inflation report on Friday. There are no major speaking engagements from Fed officials this week, reflecting the FOMC blackout period

Monday, January 23

• There are no major economic data releases scheduled.

Tuesday, January 24

• 09:45 AM S&P Global US manufacturing PMI, January preliminary (consensus 46.5, last 46.2): S&P Global US services PMI, January preliminary (consensus 45.0, last 44.7)
• 10:00 AM Richmond Fed manufacturing index, January (consensus -5, last +1)

Wednesday, January 25

• There are no major economic data releases scheduled.

Thursday, January 26

• 08:30 AM GDP, Q4 advance (GS +2.2%, consensus +2.7%, last +3.2%); Personal consumption, Q4 advance (GS +3.3%, consensus +2.8%, last +2.3%): We estimate that GDP rose +2.2% annualized in the advance reading for Q4, following +3.2% annualized in Q3. Our forecast reflects strength in consumption growth (+3.3%) despite a weak holiday season and another large decline in residential investment (-25%). We expect a positive contribution to GDP growth from inventories (+0.3pp) and net exports (+0.3pp). We estimate domestic final sales rose 1.8% annualized.
• 08:30 AM Advance goods trade balance, December (GS -$87.0bn, consensus -$88.5bn, last -$83.3bn): We estimate that the goods trade deficit widened by $3.7bn to $87.0bn in December compared to the final November report.
• 08:30 AM Wholesale inventories, December preliminary (consensus +0.5%, last +1.0%); 08:30 AM Initial jobless claims, week ended January 21 (GS 195k, consensus 205k, last 190k); Continuing jobless claims, week ended January 14 (consensus 1,658k, last 1,647k): We estimate initial jobless claims increased to 195k in the week ended January 21.
• 08:30 AM Durable goods orders, December preliminary (GS +3.5%, consensus +2.5%, last -2.1%): Durable goods orders ex-transportation, December preliminary (GS -0.75%, consensus -0.2%, last +0.1%); Core capital goods orders, December preliminary (GS -0.75%, consensus -0.2%, last +0.1%); Core capital goods shipments, December preliminary (GS -0.75%, consensus -0.4%, last -0.4%): We estimate that durable goods orders rebounded 3.5% in the preliminary December
• report, reflecting a surge in commercial aircraft orders. However, we forecast declines in core capital goods orders (-0.75%) and shipments (-0.75%), reflecting weak foreign demand and the softening in domestic industrial data.
• 10:00 AM New home sales, December (GS -4.0%, consensus -4.7%, last +5.8%) We estimate that new home sales declined 4.0% in December, following a 5.8% increase in November.
• 11:00 AM Kansas City Fed manufacturing index, January (consensus -6, last -9)

Friday, January 27

• 08:30 AM Personal income, December (GS +0.4%, consensus +0.2%, last +0.4%); Personal spending, December (GS -0.2%, consensus -0.1%, last +0.1%); PCE price index, December (GS +0.03%, consensus +0.0%, last +0.1%); Core PCE price index, December (GS +0.27%, consensus +0.3%, last +0.2%); Based on details in the PPI, CPI, and import price reports, we forecast that the core PCE price index edged up by 0.27% month-over-month in December, corresponding to a 4.40% increase from a year earlier. Additionally, we expect that the headline PCE price index increased by 0.03% in December, corresponding to a 5.01% increase from a year earlier. We expect that personal income increased by 0.4% and personal spending decreased by 0.2% in December.
• 10:00 AM Pending home sales, December (GS +3.0%, consensus -1.0%, last -4.0%) We estimate pending home sales increased 3.0% in December, following a 4.0% decline in November
• 10:00 AM University of Michigan consumer sentiment, January final (GS 64.0, consensus 64.6, last 64.6); University of Michigan 5–10-year inflation expectations, January final (GS 3.0%, consensus 3.0%, last 3.0%): We expect the University of Michigan consumer sentiment index to decline by 0.6pt to 64.0 in the final January reading. We expect that inflation expectations remained at 3.0% in the final January reading

Source: DB, Goldman,BofA