Faber News Flow

According to the UN, this week the world's (human) population hit 8 billion. As DB's Jim Reid notes, "it's incredible to think that several million people alive today were around when the world population first crossed 2 billion in around 1927"  Consider this: during the lifetime of the oldest people on earth today, the world's population has seen exponential growth in a way it has never seen before. In Reid's opinion, the impact of this is still being felt everywhere in financial markets and economies today: rapid population growth in the twentieth century onwards encouraged democracies, encouraged the welfare state  and forced governments to spend more than they took in taxes for the first time in peace time in order to be re-elected.  In the peak years of population growth of the second half of the twentieth century (1964 was the peak growth year), governments could use future strong population growth to pay for their real time promises to their citizen

The macro landscape is changing.  Inflation will remain in an elevated and unstable regime, but the first stage of the crisis is drawing to a close. That means the dollar in a downward trend, bonds in an upward trend, stocks underperforming bonds, and growth outperforming value. Regime shifts can be almost imperceptible in real time, but  in retrospect they mark fundamental turning points.  Inflation today is going through one of these shifts, analogous to the 1970s. In that decade, inflation could be understood as a play in three acts, a drama that is likely to be repeated in this cycle. In the first act,  inflation makes new highs and the  Fed tightens aggressively. The second is when  inflation begins to recede,  allowing the  central bank to pull back  from tightening. The final act is when we see  inflation return with a vengeance , eliciting a Volcker-esque monetary response and  a deep recession in order to fully snuff it out. So what's brought the curtain down on the first

If you said one week ago that the COP27 virtue signaling boondoggle in Egypt's Sharm el-Sheikh would be an epic failure, pat yourself on the back: it was. As  Argus media reports , a draft of the COP 27 UN climate summit cover decision released today reiterates many of the Glasgow Climate Pact goals agreed at Cop 26 last year,  and, as expected, does not mention a broader fossil fuel phase down. The document repeats a request made at COP26 for all countries to revisit and strengthen their 2030 nationally determined contributions (NDCs) — countries' climate pledges — to align with the UN's 2015 Paris Agreement, and to update their long term strategies. The Paris Agreement aims to limit global warming to well below 2°C above pre-industrial levels, and ideally to 1.5°C. Only problem: there is no mandate on how to do it, especially since even Europe is backsliding on its anti-fossil fuel promises and has restarted coal plants (not to mention record coal output in China). Only a

Markets have rallied since we got cooler-than-expected  CPI data for October . But in his podcast, Peter Schiff said we are in the eye of the inflation hurricane, and investors have been lulled into a false sense of security. On Tuesday (Nov. 15) producer price data came out, and like CPI, it was below expectations. PPI was up just 0.2% versus expectations of a 0.4% increase. Core PPI charted no monthly increase in October. Now, of course, all of these are still strong numbers, with the exception of the x-food and energy month-over-month, which was flat. But just looking at the increases,  we still have a big inflation problem even if these numbers seem to indicate that the inflation problem is going away. It's not. " Nevertheless, the markets are keying in on this data. The fact that PPI came in under projections  feeds into the perception  that inflation is cooling. That has led to a broad stock market rally due to the expectation that cooling inflation will give the Federal

A study on government electricity and gas price data reveals that Brits pay the world's highest energy bills. Norway is the country with by far the biggest increase in electricity prices worldwide The UK's energy price cap was recently raised from 28p to 34p per kWh. New research reveals that the UK has the highest electricity bills. Brits pay more for their power than anywhere else on the planet. A new study looked at Government data on electricity and gas prices from the past five years to analyse the impact of the worsening cost of living crisis and discover which countries have had the biggest year-on-year increase in energy prices. The data, compiled by BOXT, was shared with  City A.M.  today The UK's energy price cap was recently raised from 28p to 34p per kWh. Much like the rest of the world, prices have increased due to reduced supply from Russia due to the Ukraine conflict, as well as the after-effects of the coronavirus pandemic. The UK's neighbours in the Rep

The UK is  raising the windfall tax on the profits of oil and gas  operators in the North Sea while also  expanding the tax to include low-cost electricity generators  in the  Autumn Statement  of the UK's budget unveiled by the UK Chancellor of the Exchequer, Jeremy Hunt, on Thursday. The UK has had a windfall tax on oil and gas firms operating in the North Sea since May, when the current Prime Minister Rishi Sunak, then Boris Johnson's Chancellor of the Exchequer, announced a temporary  25% Energy Profits Levy  for oil and gas companies, reflecting their extraordinary profits as oil and gas prices surged. Commenting on the new budget measures, Sunak  said  today that  "Today's Autumn Statement delivers the long-term stability this country needs." "The Autumn Statement sets out reforms to ensure businesses in the energy sector who are making extraordinary profits contribute more," the UK government said. Thus, the  UK is raising the Energy Profits Levy

Last night, we laid out our view on today's $2.1 trillion opex, which following a record spike in the put-to-call ratio is just begging for another violent delta squeeze higher in risk.  In any case, for a more complete picture, here is the view of Goldman superstar trader  Brian Garrett  who shares several quick thoughts ahead of today's option expiration. 1. Today brings $2.1 trillion of option notional expiry:  $845bn of this is AM settled index options with the other $1.2 trillion expiring on the close… highlight that almost $200bn of SPX(pm) is in open interest, we will continue to watch this theme over time as investors potentially look to avoid SQ risk overall … Next month expiry is shaping up to be one of the largest spx expires in decades (currently 3.3tn) –  largely driven by put open interest which is at 2y highs! 2. The market is the longest of SPX gamma since the summer with 3950-4000 magnetized all week  … the desk believes a lot of this occurred following CPI pri

How much has the Fed's epic " inflationary is transitory"  policy error cost the world? Try $29 trillion and counting. According to calculations from Bloomberg's Robert Fullem,  the combined market value of the Bloomberg Global Aggregate bond index and the MSCI World index has dropped $29 trillion since its peak in November 2021.  The price gauge of the former has dropped to its lowest level since 2011.  That is more than twice the level of the world's international reserves assets, currently at about $12 trillion. As Fullem notes,  the drop in asset prices may not just be about inflation or rising rates but also about the prospect of a perpetual debt spiral to fuel a modicum of growth . Central-bank rate hikes and balance sheet trimming is making future debt more expensive. In some cases, debt costs rise further amid a dearth of foreign buyers as investors stick to local markets and official accounts see reserve balances shrink. In other cases, a high absolute le

VEN, 23 SETTEMBRE 2022 h.  6:31 EDT,  AGGIORNATO VENERDÌ 23 SETTEMBRE 2022  h.  16:18 EDT by  Jenni Reid (CNBC)   La sterlina è scesa a partire da $ 1,084, dopo che un programma di tagli alle tasse è stato presentato alla Camera dei Comuni. La sterlina ha registrato un precipitoso calo rispetto al biglietto verde quest'anno, raggiungendo livelli che questo mese non si vedevano dal 1985. Le misure di venerdì sono state annunciate dal governo come l'annuncio di una nuova era per il Regno Unito incentrata sulla crescita e includevano un mix di tagli fiscali e incentivi agli investimenti per le imprese. La sterlina ha toccato un minimo storico. La  sterlina britannica  è scesa del 3,5% rispetto al dollaro venerdì, dopo che il nuovo governo britannico ha annunciato un  piano economico radicale  nel tentativo di rilanciare la crescita. La sterlina è scesa a partire da $ 1,084, estendendo le perdite subite dopo che le misure sono state svelate in mattinata a Londra. La sterlina è sta