Syz the moment

Consensus GDP forecasts for 2026 have been revised down from more than 1% to just 0.66%, while inflation forecasts have climbed above 2.7%. Against this backdrop, the ECB is now expected to raise interest rates twice – at least, that is what markets are pricing in. Source: HolgerZ, Bloomberg

Economy Minister called to end subsidies for excess renewable electricity after costs ran into the tens of millions last weekend alone. Source: Bloomberg, HolgerZ

The S&P 500 trades at a forward price-to-earnings (P/E) ratio of ~21 times, while the Stoxx Europe 600 trades at ~14 times. This brings the valuation gap up to ~7 points, the widest since at least the 2008 Financial Crisis. This comes as the Middle East war exposed Europe's structural vulnerability to energy shocks, turning what looked like attractive valuations into a value trap. At the same time, the US benefited from its relative energy independence and surging tech sector. Source: FT, Factset, Global Markets Investor

Ursula von der Leyen: "The cheapest energy is the one you don't use." Stay home, don't drive, don't use electricity. Source: Wall Street Mav

Italy's 10-yr yield hit 4.14% - highest since mid-2024. France's touched 3.9% - highest since 2009. Spain's at 3.7% - highest since 2023. The last time Eurozone borrowing costs moved this fast was in the 2022 energy crisis. The difference is that one cost €651 billion to contain. Source: FT, Nic @nicrypto

Governments will step in as energy prices surge. But here’s the uncomfortable truth: 👉 Many of these same governments helped create the crisis 👉 By weakening their own energy security 💸 Now comes the real problem: Most European countries are already running structural deficits. They don’t have the fiscal room to absorb another shock. So what happens next? ➡️ Subsidies go up ➡️ Deficits widen ➡️ Policymakers panic And then the “solution” kicks in: 👉 Higher taxes 🧠 Think about the loop: • Governments subsidise households • Then raise taxes to fund it ➡️ Households end up paying for their own “relief” (with a bit of redistribution in between) 🔁 And this doesn’t stop here. The same cycle is playing out across: • Healthcare costs • Welfare expansion • Defence spending ⏳ Until the next crisis hits. And when it does, you’ll hear the same line again: “We must stabilise the economy.” 💥 Which really means: • Deficits explode • Debt issuance surges • Central banks step in 👉 Printing money 👉 Buying bonds 👉 Repeating the cycle 📌 Once you see the system, you can’t unsee it: It’s a loop of: Crisis → Spending → Debt → Money printing → Repeat ⚠️ Now here’s the part most people ignore: If your wealth is tied to assets that: • Don’t generate real returns • Can’t be moved easily • Are fully exposed to domestic policy 👉 You are far more vulnerable than you think (Yes, that includes a lot of real estate) 🧠 The uncomfortable conclusion: This isn’t about one crisis. It’s about a system. And if your portfolio isn’t positioned for it… 👉 It’s probably mispriced for reality Source: Financial Times

We briefly bounced at the range lows, but the move has been weak and lacks follow-through. Now sitting well below the 200-day moving average, with the 21-day crossing lower, a bearish shift in trend dynamics. Last time this setup played out, the euro didn’t stabilize, it continued the move lower. Source: The Market Ear, LSEG

Take a look at what's going on in its key chemical sector: production is at levels seen during the GFC, and this during good times, even before the current energy crisis. Source: Bloomberg, Michel A.Arouet