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☆ Bank of England drags Bagehot into the shadows
▼ + stars: | 2023-12-01 | by ( Liam Proud | ) www.reuters.com time to read: +8 min

That is no longer tenable, in part because of reforms to bank regulation that shifted activity from traditional lenders to financial market players. These days, the institutions in need of urgent liquidity are just as likely to be pension funds, insurers or hedge funds. The British central bank’s initial ideas make sense, but only solve part of the problem. The central bank can short-circuit the panic by opening the credit taps. Central banks are only just starting to grapple with what it means to be a lender of last resort in that context.

Persons: Walter Bagehot’s, Andrew Hauser, BoE, WALTER, Gurney, Peter Thal Larsen, Streisand Neto, Thomas Shum Organizations: Reuters, Bank of England, Reuters Graphics Reuters, U.S, Treasury, Federal Reserve, Pensions, . Treasury, Citadel, Millennium Management, City of, U.S . Federal, Gurney & Company, Victorian, Thomson Locations: British, City, City of London, Basel, Overend, Lombard

☆ Cash versus bonds? Pros weigh what to buy for the next 2 years and beyond
▼ + stars: | 2023-11-30 | by ( Weizhen Tan | ) www.cnbc.com time to read: +4 min

That's quite similar to what investors can get on government bonds, while high-quality corporate bonds yield more nearly 6.5% in the U.S. and U.K., and 4.6% in Europe. Here's what the pros say on how to invest within the fixed income space — cash or bonds — in the next two years and beyond. Schroders' Head of Strategic Research Duncan Lamont also stated his preference for bonds, saying that putting your money in cash means being exposed to interest rate fluctuations. And those rates are higher than cash — at 6.2% for corporate bonds with an average maturity of three years, and 6.5% on high-quality U.S. corporate bonds with an average tenure of 10 years, noted Lamont. "Fixed income is experiencing greater inflows than equities in the US and the same trend relative to cash in Europe.

Persons: Schroders, Luis D, Alvarado, Duncan Lamont, Lamont, Ashish Shah Organizations: Wells, Wells Fargo Investment Institute, Fed, CNBC Pro, Strategic, U.S . Federal, Goldman, Management, Goldman Sachs Asset Management Locations: U.S, Europe, Wells Fargo

☆ Goldilocks meets Santa as global stocks power to best month in three years
▼ + stars: | 2023-11-30 | by ( Naomi Rovnick | ) www.reuters.com time to read: +5 min

MSCI's world stock index (.MIWO00000PUS) is set to close the month up around 9%, its best performance since November 2020, when markets cheered the arrival of COVID-19 vaccines. Global bond prices have soared, with an ICE BofA index of global investment-grade bonds in major markets set to return 3.4% in November, the best month on record going back to 1997. Global growth stocks in high-tech sectors are up 11% (.dMIWO0000GNUS) while value stocks, which are mainly in cyclical industries and offer high dividends, have gained 6.5% (.dMIWO0000VNUS). And a cloudier outlook for stocks suggests a divergence could open up between again between stocks and bonds. The broader global index is set to return 1.6% for the year.

Persons: Joshua Roberts, That's, bode, Altaf Kassam, Wall, We've, Guy Miller, Joost Van Leenders, Van Lanschot Kempen, Van Leenders, Kassam, Naomi Rovnick, Yoruk Bahceli, Dhara Ranasinghe, Christina Fincher Organizations: Federal Reserve, REUTERS, U.S . Federal Reserve, European Central Bank, State Street Global Advisors, Traders, Fed, Insurance Group, Equity, Reuters Graphics Reuters, Treasury, Thomson Locations: Washington , U.S, COVID, U.S

☆ Exclusive: European fund giant Amundi dips toe back into Turkey's lira
▼ + stars: | 2023-11-28 | by ( Marc Jones | ) www.reuters.com time to read: +4 min

A logo of Amundi is seen outside the company headquarters in Paris, France, February 3, 2023. "We have started to cover our underweight in Turkish lira a few weeks ago," Strigo told Reuters, referring to the process of taking a more positive view on the currency. Amundi, while the first major fund to formally declare its shift, is not alone in testing the waters, according to other foreign investors and bankers. "It is probably the easiest way for now," Strigo said about the use of FX forwards to express that balance. With the bank having lifted rates to 40% from 8.5% since June, Amundi thinks another hike next month could finish the job.

Persons: Sarah Meyssonnier, Sergei Strigo, Amundi's, Strigo, Tayyip Erdogan, Amundi, Goldman Sachs, Erdogan, sceptics, Central Bank Governor Hafize Gaye Erkan, Marc Jones, Karin Strohecker, Jonathan Spicer, Susan Fenton Organizations: REUTERS, Reuters, Investment, JPMorgan, FX, Graphics, Central Bank Governor, Reuters Graphics Reuters, Thomson Locations: Paris, France, Turkey, Turkish, New York, London, Istanbul

☆ JPMorgan boss Jamie Dimon says the US is addicted to debt, and it's created a dangerous sugar high in the economy
▼ + stars: | 2023-11-28 | by ( Jennifer Sor | ) www.businessinsider.com time to read: +3 min

America's debt problem has caused a dangerous sugar high for the economy, Jamie Dimon said. The JPMorgan chief pointed to the enormous surge of new debt taken on during the pandemic. NEW LOOK Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. AdvertisementThe US is practically addicted to debt – and that's put the economy in a dangerous position, according to JPMorgan CEO Jamie Dimon. The rest of the global economy is also staring at a "cocktail" of risks, Dimon added.

Persons: Jamie Dimon, —, that's, Dimon Organizations: JPMorgan, Service, Wall Street, Federal Reserve, Global Investment Summit, Penn Wharton Budget Locations: London

☆ Dollar slips on bets US rates have peaked
▼ + stars: | 2023-11-24 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +4 min

A woman counts U.S. dollar bills at her home in Buenos Aires, Argentina August 28, 2018. Currencies traded in a relatively narrow range with U.S. markets closing early the day after the U.S. Thanksgiving holiday. "I think what we're seeing is a classic case of the market taking the 'path of least resistance.'" The dollar index , which measures the U.S. currency with six peers, eased 0.4 % to 103.35 , staying close to the 2-1/2 month low of 103.17 touched earlier this week. German business morale improved for a third straight month in November, data showed.

Persons: Marcos Brindicci, Michael Brown, Jane Foley, Sterling, Saqib Iqbal Ahmed, Ankur Banerjee, Joice Alves, David Evans, Jason Neely, Richard Chang Organizations: REUTERS, U.S, Trader, P Global, Rabobank, Federal, ING, Thomson Locations: Buenos Aires, Argentina, London, Germany, Singapore

☆ Dollar eases on bets US rates have peaked
▼ + stars: | 2023-11-24 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +4 min

A woman counts U.S. dollar bills at her home in Buenos Aires, Argentina August 28, 2018. "I think what we're seeing is a classic case of the market taking the 'path of least resistance'," Brown said. The dollar index , which measures the U.S. currency with six peers, eased 0.3% to 103.43, staying close to the two-and-a-half month low of 103.17 it touched earlier this week. Elsewhere, the Japanese yen was about flat against the dollar at 149.53, after strengthening following data that showed Japan's core consumer price growth picked up slightly in October. Separate data showed German business morale improved for a third straight month in November.

Persons: Marcos Brindicci, Michael Brown, Brown, X's Brown, Sterling, Saqib Iqbal Ahmed, Ankur Banerjee, Joice Alves, David Evans, Jason Neely Organizations: REUTERS, U.S, Trader, P Global, Federal, ING, Thomson Locations: Buenos Aires, Argentina, London, U.S, Germany, Singapore

With U.S. markets closed on Thursday for the Thanksgiving holiday and due for a shorter Black Friday trading session, currencies are trading narrowly as liquidity is expected to remain thin. The bank will "then begin its first rate hike in Q2 2024 if wage growth continues to accelerate next year". The nationwide core consumer price index (CPI), which excludes volatile fresh food costs, rose 2.9% year-on-year in October, government data showed on Friday, against 3.0% expected by economists in a Reuters poll. Separate data showed German business morale improved for a third straight month in November. Sterling rose for a second consecutive day, up 0.2% to $1.2559, after data showed on Thursday that British companies returned to growth in November, fuelling hopes Britain will avoid a recession.

Persons: Marcos Brindicci, Jefferies, Mohit Kumar, Sterling, Ankur Banerjee, Joice Alves, Jan Harvey, David Evans Organizations: REUTERS, Bank of Japan, U.S, Federal, Fed, European Central Bank, Bank of England, ING, Thomson Locations: Buenos Aires, Argentina, SINGAPORE, Germany, Singapore, London

☆ Dollar defensive as markets weigh US rates outlook
▼ + stars: | 2023-11-24 | by ( Ankur Banerjee | ) www.reuters.com time to read: +3 min

A woman counts U.S. dollar bills at her home in Buenos Aires, Argentina August 28, 2018. The dollar index , which measures the U.S. currency with six peers, eased 0.029% to 103.73, staying close to the two-and-a-half month low of 103.17 it touched earlier this week. The Australian dollar rose 0.14% to $0.657, while the kiwi rose 0.07% to $0.605. The yield on the 30-year Treasury bond rose 2.8 basis points to 4.576%. Reporting by Ankur Banerjee in Singapore; Editing by Jacqueline WongOur Standards: The Thomson Reuters Trust Principles.

Persons: Marcos Brindicci, Sterling, Cash Treasuries, Ankur Banerjee, Jacqueline Wong Organizations: REUTERS, Rights, U.S, Federal, Fed, Bank of Japan, ING, Treasury, Thomson Locations: Buenos Aires, Argentina, Rights SINGAPORE, Germany, Asia, Singapore

☆ The future of interest rates is more surprises
▼ + stars: | 2023-11-24 | by ( Edward Chancellor | ) www.reuters.com time to read: +7 min

Observing these oscillating forecasts, a bystander might conclude that nobody knows anything about the future direction of interest rates. The study examined data from 19 countries back to 1870 and found only a tenuous link between the determinants of savings and investment and real interest rates. “No single factor or combination of such factors”, the authors concluded, “can consistently explain the long-term evolution of real interest rates. Indeed, if the trend persisted Schmelzing forecast that “within a generation historically implied real interest rates will have reached negative territory”. Homer and Sylla wryly observe that people assume that the interest rates they encounter are normal and are surprised by what comes next.

Persons: Claudio Borio, “, ”, Paul Schmelzing, Sidney Homer, Richard Sylla, Sylla, Peter Thal Larsen, Streisand Neto, Thomas Shum Organizations: Reuters, U.S, Capital Economics, Bank for International, Austrian, Reuters Graphics Reuters Graphics, Financial, Boston College, Treasury, Thomson Locations: Central, U.S . Federal, London, Japan

☆ Dollar defensive as markets weigh U.S. rates outlook
▼ + stars: | 2023-11-24 | by ( ) www.cnbc.com time to read: +2 min

The dollar was restrained on Friday by uncertainty over the path of U.S. interest rates, while the euro held overnight gains as data hinted that the downturn in the euro zone may be easing. The dollar index , which measures the U.S. currency with six peers, eased 0.029% to 103.73, staying close to the two-and-a-half month low of 103.17 it touched earlier this week. The Australian dollar rose 0.14% to $0.657, while the kiwi rose 0.07% to $0.605. Cash Treasuries resumed trading in Asia after Japan's holiday on Thursday, with the yield on 10-year Treasury notes up 2.9 basis points at 4.445%. The yield on the 30-year Treasury bond rose 2.8 basis points to 4.576%.

Persons: Sterling, Cash Treasuries Organizations: U.S, Federal, Fed, Bank of Japan, ING, Treasury Locations: Germany, Asia

☆ Dutch election: what's at stake for markets after far-right Wilders' victory
▼ + stars: | 2023-11-23 | by ( Yoruk Bahceli | ) www.reuters.com time to read: +5 min

Dutch politician Geert Wilders, the leader of the PVV party, speaks during the final debate between the lead candidates in the Dutch election before polls open on Wednesday, in The Hague, Netherlands, November 21, 2023. REUTERS/Piroschka van de Wouw/File Photo Acquire Licensing RightsAMSTERDAM, Nov 23 (Reuters) - A shock win for Geert Wilders's far-right, anti-EU Freedom Party in Dutch elections has set the stage for months of uncertainty. However, Wilders took a more pragmatic approach during the campaign and he will need to collaborate with pro-EU parties if he wants to govern. Opponents of a critical pension fund reform, which went into effect in July, now have a majority in parliament. There is broad support for raising taxation on banks, including from Wilders' party, which also backs taxing lenders' windfall profits from higher interest rates.

Persons: Geert Wilders, de, Geert Wilders's, Mark Rutte, Wilders, Marcel Klok, Klok, WILDERS, Rutte, van Zanden, Rabobank's van Zanden, Banks, ING's Klok, Joost Beaumont, Yoruk, Amanda Cooper, Toby Chopra Organizations: REUTERS, Rights, EU, Party, ING, European Union, Rabobank, ABN AMRO, Thomson Locations: The Hague, Netherlands, Dutch, Europe

☆ Britain's Hunt broadens push to unlock pension pots for growth
▼ + stars: | 2023-11-22 | by ( Huw Jones | ) www.reuters.com time to read: +3 min

By 2030, the majority of workplace DC savers will have their pension pots managed in schemes of over 30 billion pounds, and by 2040, all local government pension funds will be invested in pools of 200 billion pounds or more," Hunt told parliament. Hunt said such changes could help unlock an extra 75 billion pounds ($93.46 billion) of financing for high growth companies by 2030, and improve returns for pensioners. The British Business Bank will set up a new growth fund for schemes to invest in growth companies, and there will be a consultation on giving the Pension Protection Fund a new role to help consolidate direct benefit schemes, he said. The government also wants to allow certain portions of shares - fractional shares - within ISAs. ($1 = 0.8025 pounds)Reporting by Huw Jones Editing by Frances Kerry and Bernadette BaumOur Standards: The Thomson Reuters Trust Principles.

Persons: Jeremy Hunt, Hannah McKay, Hunt, PIMFA, William Wright, Huw Jones, Frances Kerry, Bernadette Baum Organizations: REUTERS, British, London Stock Exchange's, Aquis Exchange, DC, British Business Bank, Local, ISA, Labour Party, Labour, New, Thomson Locations: London, Britain, New York, ISAs

☆ Investors can get a 5.6% yield with this 'first-rate' ultrashort bond ETF
▼ + stars: | 2023-11-22 | by ( Michelle Fox | ) www.cnbc.com time to read: +6 min

As investors hunt for yield, many are turning to actively managed exchange-traded funds focused on bonds, like Pimco's Enhanced Short Maturity Active ETF . The fund, which has a 5.6% 30-day SEC yield, is a "a first-rate ultrashort ETF," Morningstar senior analyst Paul Olmsted wrote in August. Trading under the ticker symbol MINT, the ETF holds fixed income securities with durations of no more than one year. In fact, investors flooded into the fund in October, making it the actively managed bond ETF with the highest inflows last month, according to FactSet. Investors can capture that higher yield on the short end of the yield curve, Schneider said.

Persons: Paul Olmsted, Morningstar, Jerome Schneider, Pimco's, Schneider, FactSet, Matthew Bartolini, It's, Treasurys —, who's Organizations: SEC, Morningstar, MINT, Street Global Advisors, Research, Federal Reserve, Treasury, Federal, Bear Stearns Locations: Pimco

☆ UK borrowing figures give Hunt some room for tax cuts
▼ + stars: | 2023-11-21 | by ( William Schomberg | ) www.reuters.com time to read: +4 min

Government borrowing between April and October totalled 98.3 billion pounds ($122.49 billion), the Office for National Statistics (ONS) said on Tuesday. The data meant borrowing was running about 22 billion pounds higher than in the same period last year but almost 17 billion pounds less than the Office for Budget Responsibility (OBR) forecast in March, giving Hunt some fiscal room for manoeuvre. The ONS said that in October alone, public sector net borrowing, excluding state-owned banks, was 14.9 billion pounds last month. A Reuters poll of economists had pointed to public sector net borrowing, excluding state-owned banks, of 12 billion pounds in the month. The figure was also higher than the OBR's forecast for borrowing of 13.7 billion pounds in the month.

Persons: Jeremy Hunt, Laura Kuenssberg, Isabel Infantes, Hunt, Rishi Sunak, Sunak, Liz, Michal Stelmach, Stelmach, William Schomberg, Kate Holton, Jason Neely Organizations: BBC Broadcasting House, REUTERS, National Statistics, KPMG, Labour Party, ONS, Thomson Locations: London, Britain

☆ Zambia's troubled debt restructuring efforts
▼ + stars: | 2023-11-21 | by ( ) www.reuters.com time to read: +3 min

REUTERS/Yuri Gripas/File Photo Acquire Licensing RightsLONDON, Nov 21 (Reuters) - Zambia's debt restructuring has been a complex, three-year process, which suffered a serious setback on Monday when bilateral creditors, including China, effectively ordered it secure more debt relief from international funds that hold its sovereign bonds. 2020: The country requests to have its debt payments frozen under the G20-led Debt Service Suspension Initiative (DSSI) due to COVID-19. In May, Zambian President Edgar Lungu’s government hires French firm Lazard to advise on restructuring the cash-strapped southern African nation’s $11 billion worth of foreign debts. 2022: Negotiations continue with bondholders for debt relief and restructuring deals. Angry bondholders say the OCC is demanding debt relief from them that is materially higher than either Zambia's government or the International Monetary Fund deem necessary.

Persons: Yuri Gripas, Edgar Lungu’s, Lazard, Lungu’s, Hakainde Hichilema, Marc Jones, Sharon Singleton Organizations: Monetary Fund, REUTERS, Zambian, China, Export, Import Bank of China, OCC, International, Fund, Thomson Locations: Washington , U.S, China, Zambia

Japanese national flag is hoisted atop the headquarters of Bank of Japan in Tokyo, Japan September 20, 2023. If the BOJ pulls interest rates above zero for the first time in years, banks' lending margins could rise. Steve Donzé, deputy head of investment at Pictet Asset Management in Tokyo, said he had also been buying Japanese bank stocks. BOND PAINJapanese inflation means bond investors could suffer. But investors are cautious about this so-called yield curve control policy ending as the BOJ is forced to tighten monetary policy.

Persons: Issei Kato, Shigeka Koda, Koda, Steve Donzé, Junichi Inoue, Janus Henderson, James Halse, Warren Buffett, David Hogarty, Jon Day, Grégoire Pesques, Amundi, Pictet's Donzé, Naomi Rovnick, Kevin Buckland, Dhara Ranasinghe, Jane Merriman Organizations: Bank of Japan, REUTERS, LONDON, Asia Investment, Kosaido Holdings, Kyushu Financial, Pictet, Management, Platinum Asset Management, Global, Bank of America, Tokyo Stock Exchange, Dublin, Newton Investment Management, Thomson Locations: Tokyo, Japan, TOKYO, Singapore, Sydney, United States, Europe, London

☆ Bank of Japan needs to walk away from ultra-loose monetary policy to support yen, Deutsche Bank says
▼ + stars: | 2023-11-20 | by ( Shreyashi Sanyal | ) www.cnbc.com time to read: +1 min

SeongJoon Cho | Bloomberg | Getty ImagesAmong major central banks, the Bank of Japan has been most notorious for its ultra-loose monetary policy, but that must come to an end soon to support the country's currency, according to Deutsche Bank. "For the yen to do something meaningfully better you really need more of a dovish pivot in every other central bank, or the Bank of Japan really has to start walking away from quantitative easing and negative rates," Tim Baker G10 FX strategist at Deutsche Bank told CNBC's Street Signs Asia. watch nowQuantitative easing is when a central bank tries to increase the liquidity in its financial system by buying long-term government bonds from the country's largest banks. The BOJ has used various quantitative easing tools to reflate the economy in the last three decades. The central bank has been cautious in unwinding its long-held ultra-easy monetary policy, wary of any premature moves that could potentially derail recent nascent improvements in the economy.

Persons: SeongJoon Cho, Tim Baker, CNBC's, Baker Organizations: Bloomberg, Getty, Bank of Japan, Deutsche Bank, Bank of, Fed, ECB Locations: Hakone, Japan, Bank of Japan

☆ Morning Bid: Japanese stocks party like it's 1990
▼ + stars: | 2023-11-20 | by ( ) www.reuters.com time to read: +4 min

A man walks past an electronic board displaying Japan's 10-year government bonds level, the current Japanese Yen exchange rate against the U.S. dollar and Nikkei share average, outside a brokerage in Tokyo, Japan, October 31, 2023. It's been a mixed start for most of Asia in this holiday-truncated week, though Japanese shares extended their bull streak to hit highs not seen since 1990. The Nikkei is up more than 8% so far this month, and almost 29% for the year so far. The entire market capitalisation of the Topix is 454 trillion yen ($3.03 trillion), yet Japanese companies held 555 trillion yen in internal reserves at the end of the financial year. Recent surveys show inflation expectations are finally picking up which may prompt households to invest some of the 1,000 trillion yen they currently keep in cash and deposits into equities and bonds.

Persons: Kim Kyung, It's, financials, de, de Cos, Bank of England Governor Bailey, Fed's Barkin, Wayne Cole, Christopher Cushing Organizations: U.S ., Nikkei, REUTERS, Nasdaq, Bank of Japan's, Hamas, Tech, Nvidia, Futures, PPI, Bank of France, Bank of Spain, Bank of England, Thomson Locations: Tokyo, Japan, Asia, Israel, United States, Gaza, de Galhau

☆ Treasuries see first weekly outflow since Feb as investors buy stocks
▼ + stars: | 2023-11-17 | by ( Lucy Raitano | ) www.reuters.com time to read: +2 min

A bronze seal for the Department of the Treasury is shown at the U.S. Treasury building in Washington, U.S., January 20, 2023. Investors snapped up $23.5 billion in stocks in the week to Nov. 15, marking the second largest weekly inflow into equities of 2023. Cash funds saw inflows of $20.5 billion, BofA said, and overall investors bought $2.6 billion in bonds, marking a sixth week of inflows. Outflows from emerging markets debt continued for the 16th week, with EM funds shedding $1.6 billion in the latest week. BofA's bull & bear indicator, a measure of market sentiment, rose marginally to 1.7 from 1.6, a contrarian "buy" signal, said BofA.

Persons: Kevin Lamarque, Cash, BofA, financials, Lucy Raitano, Amanda Cooper, Chizu Organizations: Department of, U.S . Treasury, REUTERS, Treasury, Bank of America, Investors, Federal Reserve, Thomson Locations: Washington , U.S, U.S, United States, Europe

☆ BoE's Ramsden: UK interest rates to stay high for extended time
▼ + stars: | 2023-11-16 | by ( ) www.reuters.com time to read: +2 min

LONDON, Nov 16 (Reuters) - The Bank of England is likely to need to keep interest rates high for an extended period, Deputy Governor Dave Ramsden said on Thursday, sticking close to the central bank's existing language on the topic. Ramsden voted with the majority on the Monetary Policy Committee (MPC) this month to keep interest rates on hold at a 15-year high of 5.25%. "Monetary policy is likely to need to be restrictive for an extended period of time," Ramsden said in prepared remarks for the European Systemic Risk Board's annual conference. "The MPC have communicated that monetary policy will need to be sufficiently restrictive for sufficiently long to return inflation to the 2% target sustainably in the medium term," he added. The BoE currently holds 748 billion pounds ($931 billion) of gilts, down from a peak of 875 billion pounds in December 2021, and committed to reduce its stockpile by 100 billion pounds between October 2023 and September 2024.

Persons: Dave Ramsden, Ramsden, BoE, David Milliken, Sachin Ravikumar, Kylie MacLellan Organizations: Bank of England, Monetary, Financial, Thomson

☆ Hedge funds help fill bond-buying void left by central banks
▼ + stars: | 2023-11-15 | by ( ) www.reuters.com time to read: +2 min

Weinberg said hedge funds accounted for roughly 40% of turnover in German securities. Other debt agency officials said regulation following the global financial crisis had prompted banks to be more cautious about investing in bonds, which also left hedge funds with greater scope to buy into fixed income markets. UK debt management office head Robert Stheeman said hedge funds had moved into the space left by banks in ensuring liquidity - in other words, the ease of buying and selling an asset. Mercedes Abascal Rojo, head of funding and debt management at the Spanish Treasury, urged the need for caution, however. So far, market functioning has generally been smooth, the debt agency heads said.

Persons: Heiko Becker, Thomas Weinberg, Weinberg, Robert Stheeman, Mercedes Abascal Rojo, Spain's Abascal, Dhara, Barbara Lewis Organizations: European Central Bank, REUTERS, Bank of England, Association for Financial Markets, Spanish Treasury, Thomson Locations: Frankfurt, Germany, Ukraine, Europe's, Brussels, Central, Spain

A recently edgy bond market gobbled all that up. Funds' bonds allocation in November soared 18 points over the month to leave them net 19% overweight - almost 3 standard deviations above long-term averages. Asset managers' overweight bond positions - or at least those in government bonds and U.S. Treasuries - tends to be mirrored by big short positions in Treasury futures among speculative hedge funds. CFTC numbers show the scale of that speculative 'Big Short' on the flipside of the mounting 'Big Long' built by regular asset managers. Lamont points out that U.S. Treasury yields and investment grade corporate debt yields would have to rise about another 100bps for the capital losses to wipe out current yields.

Persons: Sarah Silbiger, Lazard, Ronald Temple, Lombard Odier's Florian Ielpo, Duncan Lamont, Lamont, Jason Pride, Mike Dolan, Susan Fenton Organizations: El Progreso Market, Washington , D.C, REUTERS, Bank of America's, Treasury, Reuters, Thomson Locations: Mount Pleasant, Washington ,, what's

☆ Stocks, Bonds Soar After Inflation Data
▼ + stars: | 2023-11-14 | by ( Gunjan Banerji | ) www.wsj.com time to read: 1 min

Stock-market gains were broad-based, lifting all 11 sectors within the S&P 500. Photo: Michael M. Santiago/Getty ImagesAn autumn stock-market rally accelerated Tuesday after fresh data showed that inflation cooled more than expected, powering big gains across stocks and government bonds. Consumer prices were unchanged in October from the previous month and up 3.2% from a year ago, less than what economists surveyed by The Wall Street Journal had forecast. The figures helped reassure investors that the Federal Reserve is likely done raising rates and put a soft landing for the U.S. economy in view.

Persons: Michael M Organizations: Wall Street, Federal Reserve Locations: U.S

☆ The Rise and Fall of the World’s Most Successful Joint Venture
▼ + stars: | 2023-11-14 | by ( Peter S. Goodman | More About Peter S. Goodman | ) www.nytimes.com time to read: +1 min

For more than a quarter century, the fortunes of the United States and China were fused in a uniquely monumental joint venture. Americans treated China like the mother of all outlet stores, purchasing staggering quantities of low-priced factory goods. Major brands exploited China as the ultimate means of cutting costs, manufacturing their products in a land where wages are low and unions are banned. As Chinese industry filled American homes with electronics and furniture, factory jobs lifted hundreds of millions of Chinese from poverty. China’s leaders used the proceeds of the export juggernaut to buy trillions of dollars of U.S. government bonds, keeping America’s borrowing costs low and allowing its spending bonanza to continue.

Persons: Niall Ferguson, ” Organizations: Communist Party Locations: United States, China

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