Interesting FT article highlighting the improvement of global liquidity (contributor -> Cross Border Capital as contributor)
Flows of global liquidity accelerated higher into early 2024, expanding by 9 per cent at an annual rate from September, led by strong increases in Japan and China In 2024, we expect greater liquidity support from central banks as more policymakers turn towards monetary policy easing. Aside from the Fed, the People’s Bank of China is the obvious central bank to watch as it already contributed almost one-fifth of the total increase in global liquidity last year.
BREAKING: 14% of all commercial real estate (CRE) loans and 44% of office building loans are now in "negative equity."
In other words, the debt is now greater than the property value on all of these properties. Currently, US banks hold over $2.9 trillion of CRE debt, the majority of which is held by regional banks. Office building prices are down 40% from their highs and CRE as a whole is down over 20%. All as rates rise and many of these loans are due CRE is beyond bear market territory.
Gross domestic product data showed the U.S. economy grew at a rate of 3.3% in the fourth quarter
That’s much higher than the 2% expectation from economists polled by Dow Jones, underscoring continued economic resiliency despite interest rate hikes from the Federal Reserve. The result, for better or worse, speak for themselves: while Q4 GDP rose by $329 billion to $27.939 trillion, a respectable if made up number, what is much more disturbing is that over the same time period, the US budget deficit rose by more than 50%, or $510 billion. And the cherry on top: the increase in public US debt in the same three month period was a stunning $834 billion, or 154% more than the increase in GDP. In other words, it now takes $1.55 in budget deficit to generate $1 of growth... and it takes over $2.50 in new debt to generate $1 of GDP growth! Source; www.zerohedge.com
If we do not have a recession, stocks tend to rally after the Fed cuts
If we do, however, they tend to decline They say the economy isn't the market, but in this example it could have a measurable impact on the outcome Source: Markets & Mayhem
China's real GDP is now further below its pre-COVID trend than after the 2008 crisis
Will they be tempted to opt for more mercantilism (and expansionism)? Source chart: Robin Brooks
Japan is expected to be short 11 million workers by 2040
Source: Win Smart, FT
Corporate Borrowing Hits All-Time High 🚨:
Investment Grade Companies have issued more than $150 Billion worth of bonds through the first 18 days of the year, the highest amount in history at this point in the year. Source: Barchart, FT
Suez Canal Transit Volume continues to plunge (Chart via SRP)
Source: HolgerZ
