MAP OF THE DAY: The number of ships that have diverted from the Red Sea and instead taken the 10/14-day longer route around Africa has risen to >100.
The map shows **container ships** declaring European ports as destination, with one only left in the Red Sea | Red Sea Source: Javier Blas
ALERT: Job openings are collapsing (but from a very high level)
Source: Game of Trades
Labor unions are pushing for big pay rise…
e.g Southwest Airlines pilot pay would increase 50pct under new labor contract. A wage-inflation spiral remains a threat (even if overall job creations are plunging) Source: CNBC
Longer-term US inflation expectations have fallen dramatically over the past two months, to close to the Fed's 2% target
Source: Bloomberg
BREAKING : Short Sellers
U.S. Stock Short Sellers have lost a reported $145 billion this year. Complete wipeout Source: Barchart
Compound interest as the 8th wonder of the world...
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The U.S. dollar remains king and is now used in 48% of international payment transactions, the highest level in more than a decade
Source: Barchart. Macrobond
Going All-In on US Long-Term Bonds for 2024? 📈
In a recent Bank of America survey, when asked which asset would likely excel if the Fed cuts rates in H1'24, an intriguing 26% (earning the top spot) pointed to the Long 30-Year US Treasury. This raises an important question: Is this a sound strategy given the current economic climate? Notably, the preference for long-term bonds comes amid a significant drop in the 30-year US Treasury yield (>100 bps). However, the landscape is complicated by the anticipated heavy Treasury supply in the first quarter, alongside other factors. These include the uncertain economic repercussions of potential fiscal policies from the 2024 US election results (if Trump or another candidate favoring fiscal stimulus were to win), a negative US term premium, and an unusually persistent inverted yield curve in what appears to be a late economic cycle. Moreover, there's a critical consideration often overlooked: in scenarios of Fed rate cuts, the front-end of the yield curve, when adjusted for duration risk, might actually offer a more favorable position. So, is pouring resources into long-term bonds for 2024 a judicious move right now? Are long-term US bonds really the safe haven they’re perceived to be, or should we approach this strategy with a more critical lens? 🤔📊 #InvestmentStrategy #FixedIncome #FinancialMarkets"
