Business

Authored by Jake Van Der Kamp via The South China Morning Post,

So much production in industries like steel is based on demand for more production, but should that demand falter, the whole system could come crashing down

Friends who have a greater interest than I do in reading the tea leaves in Beijing tell me that the emphasis in relations with Hong Kong from now on will be on one country rather than two systems.

I think this phrases things the wrong way. The one country bit was never in issue.

The entire energy futures complex is notably higher at the open with RBOB Gasoline spiking over 4% to its highest since January amid the carnage of Hurricane Harvey.

After President Trump declared "economic war" with China, seemingly following Bannon's strategy to maintain hegemony...

“We’re at economic war with China,” he added. “It’s in all their literature. They’re not shy about saying what they’re doing. One of us is going to be a hegemon in 25 or 30 years and it’s gonna be them if we go down this path.”

 

Back in April, we showed that according to a Goldman Sachs report, the current run of chronic active manager underperformance began shortly after the launch of QE in 2009.

As discussed earlier today by Matt King in his report on "one-way" markets resulting from QE and ETFs, this period has been marked by "stubbornly low volatility and dispersion", something Goldman first observed four months ago:

Which brings us to what we concluded back in April in "Dear Hedge Funds: This Is Who Is Responsible For Your Deplorable Returns", namely that:

Authored by Lakshman Achuthan and Anirvan Banerj via Bloomberg.com,

Two things bear most of the blame: external shocks and economic volatility.

The U.S. managed to avoid recession after the financial crisis, but Japan has succumbed to three contractions since 2009. Economic volatility is a key reason for this divergence, and that tells us a great deal about the risk of future U.S. recessions.