Via The Cradle

Representatives of Hamas and the Palestinian Authority’s (PA) Fatah party met recently in Beijing and held talks on reconciliation, the Chinese Foreign Ministry announced Tuesday. “Representatives of the Palestine National Liberation Movement and the Islamic Resistance Movement [Hamas] recently came to Beijing,” China’s Foreign Ministry spokesman Lin Jian said. 

“The two sides fully expressed their political will to achieve reconciliation through dialogue and consultation, discussed many specific issues, and made positive progress,” he added. The spokesman did not clarify exactly what day the meeting took place. 

China, Hamas, and Fatah confirmed beginning last Friday that intra-Palestinian talks would be held in the Chinese capital. 

“They agreed to continue the course of talks to achieve the realization of Palestinian solidarity and unity at an early date,” Jian went on to say, adding that the two sides thanked China for efforts to “promote Palestinian internal unity and reached an agreement on further dialogue.”

China has continued to call for a ceasefire and an end to the war in the Gaza Strip and has long been an advocate of Palestinian unity and a two-state solution between the Palestinians and Israelis. 

Chinese diplomat Wang Kejian met with Hamas leader Ismail Haniyeh in Qatar last month, where they both called for an end to the war in Gaza and the achievement of “political goals and aspirations of establishing an independent Palestinian state.”

Hamas assumed leadership of Gaza in 2006 after a political victory against Fatah in local elections. The Beijing talks come as Hamas has yet to deliver an official response to a new Israeli–Egyptian initiative for a ceasefire and prisoner release deal. 

While the initiative reportedly reflects an Israeli openness for the return of the displaced to northern Gaza and the establishment of a sustainable ceasefire, a Hamas official told Al-Mayadeen on Sunday that the proposal “does not reflect a fundamental shift” in Tel Aviv’s position. 

Washington has been promoting the idea of a reformed PA assuming control over post-war Gaza, something Hamas has rejected.

US–Israeli efforts to “create bodies to manage Gaza is a failed conspiracy that will not come to fruition,” a Hamas official said last month. 

Dozens of Columbia University students broke into Hamilton Hall on the New York campus early Tuesday and barricaded themselves inside, hours after the school began suspending students who violated a deadline to disperse from a pro-Palestinian encampment.

“The safety of every single member of this community is paramount,” said Ben Chang, vice president for communications at Columbia University, in an emailed statement to The Epoch Times, adding “In light of the protest activity, we have asked members of the University community who can avoid coming to the Morningside campus to do so; essential personnel should report to work according to university policy.”

Holy…. pic.twitter.com/42Lw4kaRHY

— Jessica Schwalb (@jessicaschwalb7) April 30, 2024

Taking over Hamilton Hall as done in 1968, Columbia students unfurl a banner that reads “Hind’s Hall,” in reference to Hind Rajab, a six-year-old girl killed by Israeli forces.
Hundreds of students cheer as the banner is revealed, erupting into chants to “Free Palestine.” pic.twitter.com/Oi8WgdZmqf

— Prem Thakker (@prem_thakker) April 30, 2024

As the Epoch Times‘ Katabella Roberts notes further;  According to The New York Times, the students began occupying the hall at around 12:35 a.m.

The protesters linked arms and blocked off the main entrance to the building at the Ivy League institution after previously marching around campus to chants of “free Palestine,” according to the publication.

A statement shared on the social media platform Instagram by student groups said the protesters had “taken matters into their own hands,” and would remain in the building until the university “divests from death.” Protesters have been urging the university to pause its investments in companies that, they claim, are profiting from Israel’s war against Hamas in Gaza.

The statement included video footage that appeared to show the students carrying metal barricades into Hamilton Hall as other students cheered them on.

“This escalation is in line with the historical student movements of 1968, 1985, and 1996 which Columbia repressed then and celebrates now,” the statement read. “This action will force the university to confront the blood on its hands.”

In the statement, the student group further accused the university of having been “complicit” in “Israel’s ongoing genocidal assault on the Gaza strip” for the past seven months.
“The students are on the right side of history,” the statement continued. “We know that the university will remember them as anti-apartheid, anti-genocide activists with moral clarity.”

Protesters Make Demands

According to Politico, protesters hung a sign reading “intifada,” which is Arabic for uprising, from the front of the building.

A spokesperson for the New York Police Department told Politico that law enforcement officers were outside the university campus as of Tuesday; however, they declined to elaborate further on exactly how many officers were on site or whether they had authorization to enter the school grounds.

The Epoch Times has contacted a spokesperson at Columbia University and the New York Police Department for further comment.

The takeover of Hamilton Hall occurred just hours after the university confirmed that it had begun suspending some students. The pro-Palestinian students failed to disband before Monday’s 2 p.m. deadline.

Students have occupied the lawn in the middle of campus—in which graduation ceremonies are scheduled to take place for roughly 15,000 students on May 15—for nearly two weeks while calling on the university to disclose and divest from any of its financial ties to Israel.

They are also calling for an end to alleged “land grabs” in the Harlem neighborhood of New York City and Palestine, no more policing on the university campus, and no academic ties with Israeli universities.

However, negotiations between university officials and student protest leaders broke down earlier in the day when the university rejected their demands, prompting officials to issue the 2 p.m. deadline.
In a statement, Minouche Shafik, Columbia’s president, said that ultimately, the university will not divest from Israel, adding that the school is committed to maintaining its core principles and shared values, which include ensuring no students suffer from harassment and discrimination and no anti-Semitic language is used.

School, Students Fail to Reach Agreement

“Both sides in these discussions put forward robust and thoughtful offers and worked in good faith to reach common ground,” Ms. Shafik said. “We thank them all for their diligent work, long hours, and careful effort and wish they had reached a different outcome.”

While the University will not divest from Israel, it has offered to “develop an expedited timeline for review of new proposals from the students by the Advisory Committee for Socially Responsible Investing, the body that considers divestment matters,” Ms. Shafik noted.

“The University also offered to publish a process for students to access a list of Columbia’s direct investment holdings, and to increase the frequency of updates to that list of holdings,” she added.

Ben Chang, vice president for communications at Columbia University, confirmed the suspensions had begun in a press conference late Monday, USA Today reports.

He added that students had been notified in advance that they would face disciplinary action, including suspension if they did not vacate the encampment by 2 p.m. ET and sign a form committing to abide by student politics until either June 30, 2025, or until their graduation, whichever came first.

The site of the protests has created an unwelcoming environment for many Jewish students and faculty members, he said. It has also been a source of loud noise.

“We’ve been suspending students as part of this next phase of our efforts to ensure safety on campus,” Mr. Chang said.

Mr. Chang did not provide further details regarding how many students from Columbia and its affiliate Barnard College have been disciplined. However, he confirmed that those suspended would not be able to finish the semester or graduate, Axios reports.

They will also be banned from entering any campus housing or academic buildings, he added.

Juliette Fairley contributed to this report.

It has been a terrible day for ‘soft’ survey data…

Source: Bloomberg

And it was just capped off by a big drop in Dallas Fed’s Services survey (which compliments yesterday’s Dallas Fed Manufacturing meltdown). The headline print dropped from -5.5 to -10.6. That is the 23rd straight month of contraction in the survey (one more month equals the span of contraction around Lehman’s collapse)…

Looking ahead, the picture was an ugly stagflationary one with revenue expected to grow slower and prices expected to rise faster…

With General Business Activity expected to decline (the first time since Nov 2023)…

But, just like the Manufacturing survey, it is the respondents answers that tell us the most about what is really occurring in America…

Inflationary pain…

• We repair long-haul trucks. The volume just keeps going down, which means everyone is holding back on repairs, so we have no work. Inflation keeps driving our costs up. It’s not looking pretty for trucking.

• Persistent inflation and the Fed potentially delaying rate cuts are causing uncertainty for the second half of 2024.

• Continued high interest rates, inflation and general economic malaise has caused employers to be very reluctant to hire professional level talent. They may replace talent if they have attrition, but in general, they are very slow to make any new hire decisions.

Political and geopolitical Uncertainty is weighing on many firms:

• The impact of the higher rate environment seems to be catching up, with general purchase intent among customers flattening out. At the same time, budget cuts and political uncertainty have impacted our public sector business as well, creating additional uncertainty across our business.

• The stress of an election year adds to the concern citizens have about the direction of our economy.

• We are still worried about the election causing uncertainty in our clients and prompting a slowdown later this year. Some clients are still worried about inflation and are stalling projects because of the volatility in the supply market. Overall, it is tough to make any forecast right now. Our backlog is strong for the next couple of months, but not as far in the future as we would like.

• The intensity of international conflict and increasing long-term rates certainly raise concerns.

• Geopolitical tensions are creating an uncertain environment. Also, upcoming elections and how this may affect the Fed’s monetary policy is a concern.

Too much regulation…

• Burdensome federal regulations are increasing the cost to do business, such as the so-called “Corporate Transparency Act” and minimum wage increases that just continue to drive inflation.

• Overregulation takes away a lot of time and money.

Rates are too damn high…

• We recently renegotiated our $600 million debt facility. Our cost of funds went from 9 percent to 14 percent—that’s a pretty big hit to our bottom line and resulted in us increasing prices to our customers.  Our business focus has been on forecasted easing; however, the reality of rates staying higher longer is creating uncertainty.

• The Federal Reserve signaling it will hold the rate at the current level for longer has affected our outlook negatively.

• Recent movement in long-term rates, combined with the Fed holding rates longer, have delayed the expected value of investment recovery until 2025 or later.

• The increase in treasury yields since last fall has negatively impacted deal-making activity in the income property industry

• Cost of capital is weighing on our customers and decreasing volume.

• High interest rates have drastically hindered our ability to grow our business, and it looks like a rate cut is not likely happening in 2024.

And finally, there’s panic in the air…

• We are a construction machinery and material handling dealership. Our business in the first quarter of 2024 was down 2 percent, and the industry was down 12.3 percent. Our manufacturing clients seem almost on the verge of panic, and there is stuff in inventory. We need a guest-worker program to meet our skilled-labor needs long term.

• We have not been this slow since the Great Recession. This includes Covid. We cannot understate how terrible the prospective real estate market is. People are not filing zoning cases, meaning in two years there will not be construction. Volumes have gone down in the automotive industry. It seems they are beginning to turn around, so we’re hoping.

But, but, but… “Bidenomics!”

Rep. Elise Stefanik (R-NY) filed an ethics complaint against special counsel Jack Smith on Tuesday, in which she accuses the prosecutor overseeing federal investigations into Donald Trump of trying to “interfere with the 2024 election and stop the American people from electing” the former president.

“At every turn, he has sought to accelerate his illegal prosecution of President Trump for the clear (if unstated) purpose of trying him before the November election,” Stefanik wrote in a Tuesday morning tweet. “Smith’s conduct has brought disrepute to the Department of Justice and the entire federal government, and the DOJ’s Office of Professional Responsibility should impose the discipline that such conduct warrants.”

🚨🚨🚨 I just filed an official ethics complaint against Jack Smith with the Department of Justice’s Office of Professional Responsibility for his illegal election interference.

It’s obvious to any reasonable observer that Jack Smith is trying to interfere with the 2024 election… pic.twitter.com/lNW4MUz5Oi

— Elise Stefanik (@EliseStefanik) April 30, 2024

Of course, if Elise wanted to do more than audition for Trump’s VP, she’d “start investigating the underlying organizers of all this,” writes journalist Jeff Carlson on X. “People like Norman Eisen, Ben Wittes & Mary McCord.”

If you really want to make a difference, start investigating the underlying organizers of all this. People like Norman Eisen, Ben Wittes & Mary McCord.

And their financial backers: Brookings, CREW, Open Society.

Jack Smith is just a useful tool. https://t.co/nQqyGEpcnb

— Jeff Carlson (@themarketswork) April 30, 2024

Read the complaint below:

Home prices in America’s 20 largest cities rose for the 13th straight month in February (the latest data released by S&P Global Case-Shiller today), up a massive 0.61% MoM (massively more than the 0.1% exp).

Source: Bloomberg

That pushed the YoY price up a stunning 7.29% (far otter than the 6.70% exp). That is the fastest price rise since Oct 2022.

“Since the previous peak in prices in 2022, this marks the second time home prices have pushed higher in the face of economic uncertainty,” according to Brian D. Luke, Head of Commodities, Real & Digital Assets at S&P Dow Jones Indices.

“Our National Composite rose by 6.4% in February, the fastest annual rate since November 2022.”

San Diego is back at the top, with home prices rising double-digits…

Source: Bloomberg

Given the smoothing and heavy lag in the Case-Shiller data, it’s hard to find a causal relationship between prices and mortgage rates, but with rates remaining above 7%, it seems hard to believe prices can continue their advance…

Source: Bloomberg

…and median new home prices remain notably decoupled, with Case-Shiller’s data back near record highs…

How is Powell going to cut rates when home prices are rising at over y% per year?

Highlighting just how sensitive the market is to any ‘inflation/deflation’ narrative questions, the Q1 Employment Cost Index (ECI) – a data point that is typically of secondary import – printed hotter than expected this morning and sent markets reeling.

The ECI rose from +0.9% QoQ in Q4 to +1.2% QoQ in Q1 (well above the +1.0% QoQ expected). That is the biggest QoQ jump in a year…

That was higher than the highest forecast…

Which leaves the civilian worker ECI up 4.2% YoY, stalling the disinflationary path it had been on…

And guess who is to blame for the rise in employment costs! The Government, where compensation is up 4.8% YoY (re-accelerating back near its fastest in history)…

And unionized service workers are seeing their wages soar at a record pace while non-unionized manufacturing workers are seeing wage growth slowing…

In other words, persistent wage pressures are keeping inflation elevated.

This sent stocks tumbling lower…

…and Treasury yields higher…

Just add this data point to the ‘the disinflation narrative is dead’ side of the ledger.

The recently approved Hong Kong Bitcoin spot ETFs began trading today, but saw relatively low volume on their first day. The Hong Kong Securities and Futures Commission (SFC) approved 6 total spot Bitcoin and Ethereum ETFs last week.

Bitcoin Magazine’s Vivek Sun reports that the three Bitcoin ETFs that went live overnight include the ChinaAMC Bitcoin ETF, Harvest Bitcoin ETF, and Bosera HashKey Bitcoin ETF. 

NEW: 🇭🇰 Opening ceremony of Hong Kong spot #Bitcoin ETFs 👏 pic.twitter.com/ux1eb5PqRn

— Bitcoin Magazine (@BitcoinMagazine) April 30, 2024

Despite the excitement surrounding the launch, the total trading volume for all Hong Kong Bitcoin ETFs stood at a modest $8.5 million (HK$67 million) for the first trading day.

Breaking down the individual Bitcoin ETF trading volumes, the ChinaAMC Bitcoin ETF recorded highest volume of HK$37.16 million, the Harvest Bitcoin ETF saw $17.89 million, and the Bosera HashKey Bitcoin ETF witnessed HK$12.44 million in trading. 

The combined Bitcoin and Ethereum ETF trading volume for the day amounted to HK$87.58 million dollars ($12 million), as per data on Hong Kong Stock Exchange.

While the trading volumes may seem low compared to the U.S. spot Bitcoin ETFs, which saw a staggering $4.6 billion in trading volumes on their first day, industry experts remain optimistic about the prospects of these products in Hong Kong. 

Samson Mow, founder of JAN3 expressed his belief that these ETFs will bear fruit in the long run, despite the initial low volume trading day: 

“Bitcoin ETFs in HK are going to be big. Maybe not on day 1 or 2, but the long term implications are massive. There is really nothing else for Chinese investors to put their money into at this time.”

That said, on a relative context the data is hardly disappointing, and as Bloomberg’s ETF guru Eric Balchunas notes, the $12.4 million “a LOT for that market- equiv of $1.6b in US. Assets much stronger tho: China AMC reporting $141m in assets (equiv to $22b in US) with $121m of it in btc and $20m of it eth, so eth grabbed 14%.”

Here’s Hong Kong crypto ETFs volume breakdown, all told traded $12.4m, a LOT for that market- equiv of $1.6b in US. Assets much stronger tho: China AMC reporting $141m in assets (equiv to $22b in US) with $121m of it in btc and $20m of it eth, so eth grabbed 14%. All early data,… pic.twitter.com/scEeBYxOsD

— Eric Balchunas (@EricBalchunas) April 30, 2024

In other words, on an “East vs West” comparison, “the US did $740m in assets and $4.6b in trading. These are far below that but if you adjust for the size of their mkt it is dif story: equiv of $25b+ and $1.6b, respectively. For context, China AMC’s bitcoin ETF is already among Top 20% biggest in that mkt after one day”

East vs West: The US did $740m in assets and $4.6b in trading. These are far below that but if you adjust for the size of their mkt it is dif story: equiv of $25b+ and $1.6b, respectively. For context, China AMC’s bitcoin ETF is already among Top 20% biggest in that mkt after one…

— Eric Balchunas (@EricBalchunas) April 30, 2024

In any case, the launch of Bitcoin ETFs in Hong Kong is expected to attract more institutional investors and mainstream adoption of Bitcoin in the region over time.And as the global Bitcoin landscape continues to evolve, Hong Kong’s move to embrace spot Bitcoin ETFs could position the city as a key player in the future of Bitcoin in Asia.

But, perhaps more notably in the big picture for crypto, CoinTelegraph’s Martin Young reports that the ETF issuers in Hong Kong are not concerned about the crypto crackdown in the United States, which could result in regulators classifying Ether as a security. 

Speaking at a press conference on April 29 on the eve of the launch of spot crypto ETFs in Hong Kong, the head of digital asset management firm China Asset Management, Zhu Haokang, and the head of custody firm OSL Digital Securities, Wayne Huang, answered questions on the new institutional investment products.

One of the more notable responses was to a question regarding the world’s first spot Ether ETF and whether the United States declaring it a security will have any impact in Hong Kong. Huang responded:

“Probably not, because whether the United States defines Ethereum as a security does not affect the independent decision-making of the Hong Kong Securities Regulatory Commission.” [translation]

He added that the Hong Kong Securities and Futures Commission has its own set of procedures for determining whether particular crypto assets are securities and whether retail investors can trade them.

“It will not be affected by different opinions between various departments in the United States, or ultimately their own unilateral definition,” he continued.

He also emphasized why Hong Kong will be the first in the world to launch a spot Ethereum ETF, rather than the United States.

“The regulation of cryptocurrency in the United States has multiple departments speaking out at the same time, or trying to regulate it.”

“Hong Kong has already had a clear definition of Ethereum,” he said before stating, “Ethereum is not a security.”

He said it is one of the two assets, including Bitcoin, that can be provided to retail investors.

The U.S. Securities and Exchange Commission is currently investigating the Ethereum Foundation in a probe to determine whether it believes the asset is a security.

And just to close out this farce, BitDegree reports that court documents filed by Consensys against the US Securities and Exchange Commission (SEC) have revealed that the agency, under Chair Gary Gensler, may have considered Ether (ETH) an “unregistered security” since last year.

I said this on a recent town hall Spaces (as one of the main reasons eth etf ain’t happening) and some guy sharply refuted it. Forget who. I think he was a lawyer. Anyway this is for you Holmes: https://t.co/vtxRCbytpq

— Eric Balchunas (@EricBalchunas) April 29, 2024

Interestingly, the current stance of the Chair of the SEC contradicts his previous beliefs; in 2018, Gensler claimed that over 70% of the crypto market, including Bitcoin, Ether, Litecoin, and Bitcoin Cash, were not securities.

We assume his beliefs will be driven by whatever Liz Warren thinks from now on…

US equity futures dropped, and European markets were mixed on the last day of the month amid concerns the Fed may stick to its hawkish messaging at its meeting on Wednesday. As of 7:40am, S&P 500 and Nasdaq futures were down 0.1% while Europe’s Stoxx 600 index retreated 0.4%, while Asian stocks gained on Japan’s return from holiday. The Bloomberg Dollar Spot Index climbed and 10-year Treasury yields were steady at 4.62%. The yen resumed its decline even as a Bloomberg analysis found that Japan almost certainly conducted its first currency intervention since 2022 to prop up the yen on Monday. Commodities were mixed with metals down and oil rebounding from its biggest drop in almost two weeks amid discussions on a possible cease-fire in the Middle East. Macro data today includes Q1 employment cost index, Case Shiller home prices, April MNI Chicago PMI, consumer confidence and Dallas Fed services activity. Bitcoin tumbled after activity on Hong Kong’s new crypto ETFs came in far below expectations.

In premarket trading, HSBC Holdings climbed more than 3% after solid earnings and the surprise departure of CEO Noel Quinn, which some analysts said could pave the way for the next stage in the bank’s growth plans. Chegg shares fell 13% after the online educational platform company forecast total net revenue for the second quarter that missed the average estimate. Here are some other notable premarket movers:

• Blend Labs shares jump 20% after it reported a $150 million investment by Haveli Investments in the form of convertible preferred stock with a zero percent coupon.
• Coursera’s shares drop 14%, putting them on track for a one-year low, after the online educational firm cut full-year revenue and adjusted-Ebitda forecasts, prompting analysts to lower their price targets on the stock.
• NXP Semiconductors shares rose 3.6% after the chipmaker reported better-than-expected 1Q adjusted earnings per share and forecast 2Q adjusted EPS and revenue largely above average analyst expectations.
• Paramount Global analysts note that investors are more focused on the Skydance deal rather than results this quarter. The media company replaced CEO Bob Bakish as the board negotiates a possible change in control of the company. Shares in the company fell about 0.4% in premarket trading.

US stocks are on the edge of closing out the first monthly retreat of 2024, with the S&P 500 down 2.6% in April. Amazon.com, McDonald’s and Coca-Cola are due to report later today, but all eyes are on Fed Chair Powell who will likely bolster expectations interest rates will stay higher for longer after Wednesday’s rates announcement.

“Sentiment is positive but reserved,” said Peter Rosenstreich, head of investment products at Swissquote. “There has been plenty of hype around rates, earnings and the macro environment — now markets want to see the results.”

Meanwhile, as we reported first last night, Goldman’s desk calculated that momentum traders are modeled to buy equities over the next week, regardless of market direction. Commodity trading advisers — funds that use systematic strategies to trade futures contracts — are exposed to about $106 billion in long positions after the drawdown in April, Cullen Morgan, an equity derivatives and flows specialist at the bank, wrote in a note. That’s set to support a bounce in global equities after a rough month.

European stocks also fall, led by declines in autos as Volkswagen and Mercedes Benz shares fall post-earnings which offset better-than-expected European economic data. Here are the biggest movers Tuesday:

• Logitech shares soar as much as 10%, the most in six months, after the Swiss maker of computer accessories reported better-than-expected FY25 sales guidance
• Cargotec jumps as much as 17% to a fresh high after the Finnish crane and cargo-handling equipment firm reports “record” first-quarter earnings boosted by its Marine division
• HSBC shares advanced as much as 3.6% after the lender announced a larger buyback than expected and reported earnings that analysts saw as solid
• OMV shares jump as much as 5.3%, largest intraday rise since November, after Austrian refiner reported 1Q clean CCS operating profit beat
• Clariant shares gain as much as 4.8%, to the highest level in more than six months after the Swiss specialty chemicals firm’s margins beat consensus despite some challenges
• Rotork shares rise 3.9% after the valve manufacturer reported a solid start to the year. Sales and orders both grew, while its book-to-bill ratio also improved
• European automakers shares fall as 1Q numbers from Stellantis, Volkswagen and Mercedes disappointed the market, making the SXAP auto index the worst performing subsector
• Straumann shares drop as much as 10%, the most since Oct. 26, after a soft performance in North America overshadowed the Swiss dental equipment company’s 1Q revenue beat
• SES depositary receipts drop as much as 12% after the satellite firm agreed to buy Intelsat for $3.1 billion, in a deal to be funded by cash on hand and new debt
• Air France-KLM falls as much as 4.7% after carrier reports a wider operating loss than expected in the first quarter. Bernstein says one-off costs weighed on profitability
• Santander shares drop as much as 2.9% after forecast-beating net interest income and fees in the first quarter were offset by a cost surge at the Spanish lender
• Adidas shares fell as much as 1.6% as 1Q results broadly confirmed a recent pre-release, and the sportswear maker’s guidance was seen by some as conservative

Earlier in the session, Asian stocks advanced for a third day, led by a rally in Japanese shares as the yen stabilized following wild swings in the previous session. The MSCI Asia Pacific Index rose as much as 1.1%, led by industrial shares such as Hitachi and Toyota Motor. Japan’s Topix Index jumped more than 2% as the market reopened from a holiday. Traders remain on alert for sharp yen moves after the currency’s rebound from a 34-year low sparked speculation of intervention.

“While we remain constructive on the Japan equity market over the medium term, we also believe that near-term FX movement is likely to see some profit taking from investors in the broad Japanese equity market,” said Ricky Tang, head of client portfolio management at Value Partners Group.

In FX, the dollar gained against all its major peers on expectation of a hawkish message from the Federal Reserve on Wednesday. The euro outperformed and the region’s government bonds fell after data showed the largest economies of the bloc were stronger than expected in the first quarter. The yen weakens towards 157 against the dollar. The Aussie underperforms, falling 0.5% after retail sales missed estimates.

In rates, treasuries are slightly cheaper across the curve, paring a portion of Monday’s gains, amid steeper declines for bunds after first estimate of 1Q euro-zone growth rate topped estimates. US yields cheaper by 0.5bp to 1.5bp across the curve with losses led by intermediates, steepening 2s10s spread by 1bp on the day; 10-year yields around 4.63% with bunds underperforming by 1.5bp in the sector.  Also during London morning, an array of regional inflation readings lifted intermediate German yields by ~3bp. Bunds are in the red, with German 10-year yields rising 2bps to 2.55%. S&P 500 futures are down 0.1%.

In commodities, oil prices advanced, with WTI rising 0.2% to trade near $82.80. Spot gold falls 0.8%.

Looking at today’s calendar, we have the 1Q employment cost index (8:30am), February FHFA house price index, S&P CoreLogic home prices (9am), April MNI Chicago PMI (9:45am, 3 minutes earlier for subscribers), consumer confidence (10am) and Dallas Fed services activity (10:30am). Fed members are in self-imposed quiet period ahead of May 1 policy announcement.

Market Snapshot

• S&P 500 futures down 0.1% to 5,139.50
• STOXX Europe 600 down 0.2% to 507.25
• MXAP up 0.7% to 174.73
• MXAPJ little changed at 540.41
• Nikkei up 1.2% to 38,405.66
• Topix up 2.1% to 2,743.17
• Hang Seng Index little changed at 17,763.03
• Shanghai Composite down 0.3% to 3,104.82
• Sensex up 0.5% to 75,063.11
• Australia S&P/ASX 200 up 0.3% to 7,664.08
• Kospi up 0.2% to 2,692.06
• German 10Y yield little changed at 2.54%
• Euro down 0.2% to $1.0700
• Brent Futures little changed at $88.47/bbl
• Gold spot down 0.9% to $2,314.21
• US Dollar Index up 0.31% to 105.90

Top Overnight News

• China’s NBS PMIs for April are mixed, with manufacturing about inline at 50.4 (vs. the Street 50.3 and down from 50.8 in Mar) while non-manufacturing fell short at 51.2 (vs. the Street 52.3 and down from 53 in Mar). China’s Caixin manufacturing PMI came in at 51.4, slightly ahead of the Street’s 51 forecast. WSJ
• China’s ruling Communist Party vowed to explore new measures to tackle a protracted housing crisis, which remains the biggest drag on the nation’s economy, and hinted at possible rate cuts ahead. BBG
• HSBC’s chief executive Noel Quinn is to retire unexpectedly after five years, setting off a hunt for a successor at the UK-based bank. Quinn, 62, has overhauled the lender since taking charge in 2019, selling off parts of its global operations to increase its focus on Asia, where it makes the lion’s share of its profits. FT
• BOJ accounts suggest Japan probably intervened in the FX market yesterday, buying around 5.5 trillion yen. Officials have declined to say whether they stepped in. BBG
• The chief executive of Ericsson said a focus on regulation was “driving Europe to irrelevance” as he warned that the region’s competitiveness was being undermined and called for changes to antitrust policy. FT
• EU’s Apr CPI was inline with the Street on a headline basis at +2.4% (unchanged vs. Mar) and a bit firmer on core (+2.7% vs. the Street +2.6% and vs. +2.9% in Mar). BBG
• ECB’s Knot says it is “realistic” to anticipate a cut in June and expresses confidence in inflation coming back to 2%, although he doesn’t envision rates returning to their pandemic/pre-pandemic lows. Nikkei
• Tensions grow between Trump and Lake in Arizona race for Senate. The former president fears that GOP candidate Kari Lake might not win and will drag down his own prospects in the battleground state. WaPo
• Apple has poached dozens of artificial intelligence experts from Google and has created a secretive European laboratory in Zurich, as the tech giant builds a team to battle rivals in developing new AI models and products. FT
• Caterpillar Caterpillar announced a voluntary delisting from Euronext Paris and the Six Swiss Exchange; cites low trading volumes and high administrative costs. CAT will solely trade on NYSE thereafter. (Newswires)
• Tesla (TSLA) CEO Musk is reportedly planning more layoffs as two senior executives depart, while roughly 500 people will be laid off in supercharger group, according to The Information. (The Information)
• WSJ’s Timiraos article “Fed to Signal It Has Stomach to Keep Rates High for Longer” & “Firmer price pressures could lead longer-term rates to rise as investors continue paring back expectations of cuts”

Earnings

• NXP Semiconductors NV (NXPI) Shares climb 3.4% pre-market on top- and bottom-line beats, and guidance. Q1 adj. EPS 3.24 (exp. 3.16), Q1 revenue USD 3.13bln (exp. 3.13bln). Q1 gross margin 58.2% (exp. 58%), Q1 operating margin 34.5% (exp. 34%). Auto revenue -1% Y/Y, Industrial/IoT +14%, Mobile +34%, Communications Infrastructure -25% Y/Y. Exec said early views into H2 underpin a cautious optimism. Sees Q2 revenue of 3.125bln (exp. 3.11bln), Q2 EPS of 3.20 (exp. 3.12).
• Paramount Global (PARA) Q1 Adj. EPS 0.62 (exp. 0.36), Q1 revenue USD 7.69bln (exp. 7.73bln); Q1 Paramount+ net additions +3.7mln (exp. +2.2mln); Q1 EBITDA USD 0.987bln (exp. 0.756bln), Q1 FCF USD 209mln (exp. -62mln). President and CEO Bob Bakish stepped down, as many press reports suggested he would do over the weekend. Establishes a management committee; George Cheeks, Chris McCarthy, and Brian Robbins will work with CFO Naveen Chopra to accelerate growth, streamline operations, and optimise streaming strategy; Chair Shari Redstone (of National Amusements) has expressed confidence in their leadership.
• Adidas (ADS GY) Q1 (EUR): Revenue 5.45bln (exp. 5.46bln, prev. 5.27bln Y/Y). Currency-neutral sales +8% driven by growth in all regions except in North America, where revenue fell by 4% to 1.12bln. Europe: +14%.
• Stellantis (STLAM IM/STLAP FP) Q1 (EUR): Revenue 41.7bln (exp. 43.92bln), -12% Y/Y due to “volume, mix and foreign exchange headwinds, partly offset by firm net pricing”.
• Volkswagen (VOW3 GY) Q1 (EUR): Operating Profit 4.59bln (exp. 4.51bln). Revenue 75.5bln (exp. 74.193bln). Operating Margin 6.1% (prev. 7.5% Y/Y); outlook confirmed.
• Mercedes-Benz Group (MBG GY) Q1 (EUR): Adj. EBIT 3.60bln (exp. 3.71bln). Sales 35.87bln (exp. 35.58bln). Cars Adj. EBIT 2.32bln (2.57bln); Outlook maintained.
• HSBC (5 HK/ HSBA LN) Q1 (USD): Revenue 20.75bln (exp. 21.03bln). Pretax profit 12.65bln (exp. 12.61bln). CET1 ratio 15.2% (exp. 15.4%). CEO Quinn is unexpectedly retiring.

A more detailed look at markets courtesy of Newsquawk

APAC stocks were mostly higher but with gains capped heading into month-end amid a slew of data and earnings. ASX 200 was led by strength in the mining sector but with upside limited after a surprise contraction in Retail Sales. Nikkei 225 outperformed on return from the long weekend and as participants digested a slew of earnings releases. Hang Seng and Shanghai Comp. were varied in which the former made another brief foray into bull market territory, while the mainland lagged ahead of the Labour Day holidays and as participants reflected on mixed Chinese PMI data in which the official NBS Manufacturing and Caixin Manufacturing PMIs topped forecasts but Non-Manufacturing PMI disappointed despite remaining in expansion territory.

Top Asian News

• PBoC injected CNY 440bln via 7-day reverse repos with the rate at 1.80%.
• PBoC reportedly wants to halt the bond-buying spree and not join in on it, with the central bank concerned about bond market bubbles and economic gloom, according to Bloomberg.
• Japan’s top currency diplomat Kanda said no comment on FX intervention and noted that a weak yen has positive and negative impacts, while he added the currency has a bigger impact on import prices now and that excessive FX moves could impact daily lives. Kanda said they need to take appropriate actions on FX and reiterated they are ready to take action 24 hours a day and will continue taking appropriate actions when needed.
• BoJ keep monthly bond purchases plan for May unchanged from April
• China’s Communist Party Central Committee is to hold a 3rd plenum during July, via State Media; Politburo undertook a meeting on Tuesday.
• Former Japanese top FX diplomat Furusawa says it is highly likely the Japanese government intervened on Monday to prop up the JPY

European bourses, Stoxx600 (-0.3%) are mixed, with a slight negative bias. Indices initially opened around flat, though tilted lower as the morning progressed, with little driving the shift in sentiment. European sectors hold little bias, with the breadth of the market fairly narrow, with the exception of Autos, dragged down by poor results from Mercedes (-3.4%), Stellantis (-2.4%) and Volkswagen (-2.1%). Real Estate tops the pile, propped up by post-earning gains in Vonovia (+5.5%). US Equity Futures (ES -0.2%, NQ -0.2%, RTY -0.3%) are modestly softer, in fitting with the broader price action seen in European trade. Earnings include: McDonald’s, AMD, Amazon and Starbucks.

Top European News

• ECB’s Knot said he is increasingly confident inflation is falling towards the 2% target but the ECB must be cautious beyond a June rate cut.

FX

• USD is attempting to claw back some of yesterday’s JPY-induced losses which sent the index down to a low of 105.46. For now, the DXY has topped out at 105.96 and unable to reclaim 106 status, 106.18 was the high from yesterday. Recent EUR strength in the wake of the EZ data has led the index back down to the unchanged mark.
• EUR is slightly firmer vs. the broadly flat USD in the wake of a slew of EZ data with EUR being propped up by firmer than expected growth metrics. Inflation data was in-line on a headline basis and mixed from a core perspective.
• JPY is softer vs. the USD after yesterday’s wild (touted intervention led) session which saw USD/JPY swing from a 160.20 peak to a 154.51 low; currently trades towards the top end of a 156.08-99 range.
• Antipodeans are giving back yesterday’s gains and then some as the USD regains some poise. AUD/USD had advanced to a peak of 0.6586 yesterday (highest since April 12th) before pulling back as low as 0.6514 with soft retail sales also acting as a drag.

Fixed Income

• Bunds began on the backfoot after hotter than expected French inflation and a sticky Services metric, with additional pressure coming from better-than-forecast GDP prints by France & Germany ahead of the EZ figures. EZ HICP headline Y/Y was in-line with the core metrics mixed against expected, which led to a hawkish reaction; Bunds currently sit at session lows around 130.40 given the strong GDP numbers and potentially mixed core.
• USTs are moving in tandem with EGBs which leaves the benchmark a touch softer but some way from Monday’s 107-18+ base. Specifics light thus far into Wednesday’s FOMC and Quarterly Refunding.
• Gilts are once again following EGB/UST impetus. A narrative that is unlikely to change significantly in the near-term given a sparse UK docket before next week’s BoE; though, we are attentive to anything from the EZ/US, particularly around the Fed, which provides insight into the Central Bank divergence narrative.
• UK sells GBP 4bln 4.125% 2029 Gilt: b/c 3.21x, average yield 4.251%, tail 0.8bps.

Commodities

• Crude futures are choppy and now in modest positive territory after earlier subdued trade. Prices are on standby ahead of key macro risk events including the FOMC and US jobs data on Friday; Brent July similarly found an intraday base at USD 86.64/bbl.
• Softer trade across precious metals amid yesterday’s geopolitical unwind coupled with a rebound in the Dollar today. Spot silver sits as the laggard after yesterday’s outperformance; XAU fell under yesterday’s low (USD 2,319.84/oz) to a current base at USD 2,310.96/oz.
• Losses seen across base metals amid the aforementioned Dollar rebound coupled with a pullback in sentiment. 3M LME copper topped USD 10,200/t earlier to reach a USD 10,217.00/t intraday peak.

Geopolitics

• “IDF finalizes Rafah plans, invasion possible if no deal in 72 hours”, according to Times of Israel.
• “Israeli delegation will not head to Cairo until Hamas gives its response, according to Israeli official”, according to Walla’s Elster.
• Hamas is expected to respond to the exchange deal proposal “tomorrow evening”, Al Arabiya reports
• Hamas delegation left Cairo and will return with a written response to the ceasefire proposal, according to Egypt’s Al Qahera News.
• An Israeli delegation plans to travel to Cairo to resume ceasefire talks if Hamas agrees to attend, according to NYT.
• Israeli PM Netanyahu asked US President Biden to help prevent the ICC from issuing arrest warrants against Israeli officials, according to Axios.
• Yemen’s Houthis said they targeted the ‘Cyclades’ vessel and two US destroyers in the Red Sea, while it also targeted ‘Israeli ship MSC Orion’ in the Indian Ocean, according to Reuters. US CENTCOM later confirmed that Iranian-backed Houthis fired three anti-ship ballistic missiles and three UAVs from Yemen into the Red Sea towards MV Cyclades but added there were no injuries or damages reported by US, coalition or merchant vessels.
• Chinese Coast Guard expelled a Philippines Coast Guard ship and vessels from waters adjacent to the Scarborough Shoal.
• Shanghai Maritime Safety Administration said military activities will be carried out in a part of the East China Sea from 07:00 AM on May 1st to 09:00 AM on May 9th local time and vessels unrelated to the activity are prohibited from entering the area.

US Event Calendar

• 08:30: 1Q Employment Cost Index, est. 1.0%, prior 0.9%
• 09:00: Feb. FHFA House Price Index MoM, est. 0.2%, prior -0.1%
• 09:00: Feb. S&P CS Composite-20 YoY, est. 6.70%, prior 6.59%
  • Feb. S&P/CS 20 City MoM SA, est. 0.10%, prior 0.14%
  • Feb. S&P/Case-Shiller US HPI YoY, est. 6.38%, prior 6.03%
• 09:45: April MNI Chicago PMI, est. 45.0, prior 41.4
• 10:00: April Conf. Board Consumer Confidenc, est. 104.0, prior 104.7
  • April Conf. Board Present Situation, prior 151.0
  • April Conf. Board Expectations, prior 73.8
• 10:30: April Dallas Fed Services Activity, prior -5.5

DB’s Jim Reid concludes the overnight wrap

Markets got the week off to a decent start yesterday, with the S&P 500 (+0.32%) building on last week’s advance as we await the Fed’s decision tomorrow and an array of earnings releases. Several factors helped to boost sentiment, including a remarkable advance for Tesla (+15.31%) as outlets including Bloomberg and the Wall Street Journal reported that Chinese government officials had given the firm in-principle approval for its driver-assistance system. In addition, investors were reassured after there was nothing alarming in the flash CPI releases from several European countries, which cemented expectations that the ECB would deliver a rate cut in June. And alongside that, concern about a geopolitical escalation continued to ebb, with Brent crude oil prices down -1.23% to $88.40/bbl. So there were several positive catalysts helping to boost sentiment. The Yen’s range of around 160.25 – 154.5 was a constant side show all day, with heavy speculation that the government had intervened in very thin holiday trading. As we type this morning the Yen is trading down slightly at 156.75 from 156.35 as the US closed last night, which continues to leave it as the worst performing G10 currency year-to-date, down -10% against the US dollar. The intervention hasn’t been officially confirmed but top currency official Kanda has commented that the authorities are watching the Yen 24 hours a day and suggested they were looking more for the size of moves rather than specific levels.

Staying in Asia, China’s factory activity remained in expansion territory for the second consecutive month in April but the pace of expansion slowed slightly as the official manufacturing PMI came in at 50.4 (v/s 50.3 expected) as against a reading of 50.8 in March. Meanwhile, the decline in non-manufacturing activity was more pronounced as the official PMI moderated to 51.2 (v/s 52.3 expected) down from a reading of 53.0. At the same time, the Caixin manufacturing PMI advanced to 51.4 in April (v/s 51.0 expected), marking the fastest pace since February 2023 and compared to an expansion of 51.1 seen in March. Our Chinese economist reviews the details within today’s PMIs in a note just out here.

Going into more detail now on the main events of the last 24 hours. Those European inflation numbers were important from the market open, as they helped to allay fears about a European inflation rebound of the sort happening in the US. We’ll have to wait for the Euro Area-wide number today, but ahead of that, Spanish inflation came in at +3.4% on the EU-harmonised measure, in line with expectations. Then in Germany, harmonised inflation ticked up to +2.4% in April (vs. +2.3% expected), whilst in Ireland it fell a tenth to +1.6%, the lowest since June 2021. So given recent ECB commentary about a potential June cut, those numbers keep that on track, and market pricing raised the chance to a 91% probability by the close, up from 88% on Friday. Estonia’s Muller also backed up that sentiment, as he said that in June “we’ll probably have reached the point where it’s already possible to start lowering central-bank interest rates”.

The lack of any bad news on inflation supported government bonds on both sides of the Atlantic, with some added support from the fall in energy prices. For instance in Europe, yields on 10yr bunds (-4.3bps), OATs (-6.2bps) and BTPs (-6.6bps) all saw decent declines. And over in the US, yields on 10yr Treasuries were also down -5.0bps to 4.61% and are a further -1bps lower overnight at 4.60% as we go to print.

US Treasuries had sold off by a couple of basis points later in the US session following the latest borrowing estimates from the US Treasury. These saw the expected Q2 issuance rise from $202bn to $243bn, “largely due to lower cash receipts”. This was slightly puzzling given what have been fairly strong tax receipts in the recent April tax period. Still, while the Q2 estimate was revised slightly higher, the Q3 number (excluding TGA movement) was in line with expectations, so our rates strategists don’t see meaningful alteration to the fiscal outlook. Indeed, the negative reaction in Treasuries did not persist with yields closing not far above their intra-day lows.

For equities, it was also a solid day, with the S&P 500 (+0.32%) up to its highest level in a couple of weeks, and Europe’s STOXX 600 (+0.07%) inching up to a 3-week high. The advance was a broad-based one, with the small-cap Russell 2000 (+0.70%) and the equal-weighted S&P 500 (+0.70%) posting larger gains. But there was some weakness in continental Europe, where the CAC 40 (-0.29%), the DAX (-0.24%) and the IBEX 35 (-0.48%) all lost ground.

Asian equity markets are mostly higher again this morning with the Nikkei leading gains (+1.38%) after returning from a public holiday with the KOSPI (+0.70%) also notably higher after index heavyweight Samsung Electronics topped earnings estimates for the Jan-March quarter after its semiconductor division returned to profitability. Meanwhile, the Hang Seng (+0.25%) and the S&P/ASX 200 (+0.24%) are also moving higher. Elsewhere, mainland Chinese stocks are trading slightly lower with both the CSI (-0.18%) and the Shanghai Composite (-0.12%) seeing minor losses following the batch of mixed PMI readings for April. S&P 500 (-0.11%) and NASDAQ 100 (+0.0%) futures are quiet.

Retail sales in Australia unexpectedly slumped -0.4% m/m in March (v/s +0.2% expected) as against a revised +0.2% increase the previous month thus dampening expectations that the next move in interest rates might be up. This was a very low number relative to the last several decades of data so it does put into doubt the RBA’s view that the consumer is holding up.

In the political sphere, Spanish Prime Minister Sánchez confirmed that he would remain as PM, which follows his decision to cancel engagements last week following allegations against his wife. Separately in the UK though, the Scottish First Minister Humza Yousaf announced his resignation. That comes after last week’s collapse of an agreement between his Scottish National Party and the Greens, meaning that the SNP no longer had a majority in the Scottish Parliament. We’ve got lots more UK political events this week, as local elections are taking place on Thursday, which are the final electoral test for the political parties before the next general election, which has to be held by January at the latest.

To the day ahead now, and data releases include the Euro Area flash CPI release for April, along with Q1 GDP. In the US, we’ll also get the Employment Cost Index for Q1, the FHFA house price index for February, the Conference Board’s consumer confidence for April, and the MNI Chicago PMI for April. Meanwhile in the UK, there are mortgage approvals for March. Finally, today’s earnings releases include Amazon, Eli Lilly, Coca-Cola, McDonald’s and Starbucks.

HSBC Holdings Plc unexpectedly announced Tuesday that Chief Executive Noel Quinn is resigning after five years, citing the need for a ‘better work-life balance.’ 

The Asia-focused bank plans to complete the succession process in the second half of the year. Reuters said the top candidate for the position (at the moment) is Chief Financial Officer Georges Elhedery. 

Quinn, 62, has been at the helm for five years. Under his leadership, the bank’s profits soared, and its share price increased after the size of its underperforming units was slashed, especially in the United States and Europe. The bank has focused its efforts on Asia. 

Throughout his tenure, shares of HSBC have risen nearly 50% in Hong Kong.

Quinn told reporters on a call that his departure is entirely based on pursuing a better work-life balance, or at least that’s the public understanding.

“Doing this job, you have to give 100% — if not 120% — of your energy, your mindset, your time to the role,” he said, adding, “You can keep doing that, but that doesn’t necessarily achieve the balance in life that I wanted.”

“I’ve held intensive leadership roles since I took on a commercial bank role in October 2008 so I’m personally ready for a change,” he continued. 

And he concluded:  “It’s also a natural inflection point for the bank, as it comes to the end of the current transformation phase. It’s an ideal time to bring in leadership to move the bank forward over the next five years.”

Will Howlett, a financial analyst at Quilter Cheviot, who was quoted by Bloomberg, said the CEO’s exit is a major “surprise, especially given Quinn’s short tenure during which he has led the bank through significant changes.” 

Cheviot said, “The departure of Quinn introduces an element of uncertainty about the bank’s future leadership at a time when HSBC is navigating a complex global financial landscape.”

Matt Britzman, equity analyst at Hargreaves Lansdown, pointed out that Quinn has “navigated geopolitical tensions between the US and China” over the course of his tenure and also cites “uncertainty” on who will lead the bank from here. 

Other analysts hope the next CEO will introduce further plans to maintain the bank’s focus on its businesses in Asian countries.

Let’s not forget that HSBC has been involved in US money laundering probes. In 2012, the bank agreed to pay $1.92 billion to settle one of these investigations. 

“I strongly support free markets,” but this “corporate large-scale buying of residential homes seems to be distorting the market and making it harder for the average Texan to purchase a home,” Republican Texas Gov. Greg Abbott wrote on X in March. He added, “This must be added to the legislative agenda to protect Texas families.” 

I strongly support free markets.

But this corporate large-scale buying of residential homes seems to be distorting the market and making it harder for the average Texan to purchase a home.

This must be added to the legislative agenda to protect Texas families. https://t.co/VBs6Rluh3K

— Greg Abbott (@GregAbbott_TX) March 15, 2024

Institutional ownership of single-family homes has surged in recent years, with many firms turning the bulk of these homes into rentals. This has triggered a massive uproar with some lawmakers who want to end Wall Street’s home-buying mania. 

The Wall Street Journal reports that several lawmakers in Nebraska, California, New York, Minnesota, and North Carolina have sponsored bills requiring large single-family hedge fund owners to dispose of their portfolios or risk hefty fines. 

The bill mentioned the most in the corporate press, called the End Hedge Fund Control of American Homes Act, was introduced in the Senate by Oregon Sen. Jeff Merkley with companion legislation introduced in the House by Rep. Adam Smith. 

The Merkley/Smith bill could force hedge funds to divest their single-family home portfolios over the course of ten years. 

Lawmakers argue that “investors that have scooped up hundreds of thousands of houses to rent out are contributing to the dearth of homes for sale and driving up home prices,” according to WSJ, noting that limited housing supply has made housing unaffordable for the vast majority of Americans. 

Data from John Burns Research and Consulting shows that the share of institutional buying of single-family homes topped 25% in the first quarter—near a record high. The data goes back to 1Q16. 

Calls to block hedge funds from buying single-family homes predominantly come from Democrats, but some conservatives, such as Texas Gov. Abbott, also show support.  

In an election year, blocking hedge funds from buying single-family homes might be popular with middle-class and working-poor voters battered by the era of high inflation under failed Bidenomics. Many have been financially paralyzed in today’s economy, unable to afford a home, and stuck in a doom loop of renting and no savings with maxed-out credit cards. 

However, institutional investors have a different view of the bills being proposed by lawmakers. They’re overwhelmingly frustrated with signs that the government could step into a free market and break something. 

During a recent interview on Fox Business, Kevin O’Leary shared his stance on the proposed legislation.

“Very bad idea. Very bad policy when you try to manipulate markets or sources of capital,” O’Leary said, adding, “I don’t care if they’re Democrats or Republicans, whoever they are, stay out of the markets. Let the markets be the markets.”

The real problem isn’t the hedge funds but the Federal Reserve, which has distorted markets with record-low rates over the years. Great job, Yellen/Powell.