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Margin Call - Does Margin Debt Really Predict Market Crashes?
July 27, 2026 11:31 AM UTC
· US margin debt has reached USD1.5tn, the kind of huge round figure milestone that is always going to get a fair amount of attention, especially with the market focused on risk and valuations. Should this number be sounding the alarm? The balanced answer is probably partially, though i
The Fed's Balance Sheet: Revolution or Recalibration
August 3, 2026 9:18 AM UTC
· Fed chair Warsh has reopened the question of how the Federal Reserve implements monetary policy, not just the size of the balance sheet. The two go hand in hand.
· The realistic choice is not between today's balance sheet and a return to 2006, but among several ways of o
AI Equities: Correction/Consolidation?
August 5, 2026 7:40 AM UTC
• Overall, we feel that recent movements have been a correction/consolidation in the AI equity story. AI specific revenue growth still remains healthy and will support multi-year plans over cloud computing growth and in turn semiconductor demand. Even so, slowing free cash flows and ove
UK Fiscal Policy and the New Chancellor
July 21, 2026 6:18 AM UTC
· Apprehension will exist until the Autumn budget, despite a repeated commitment by PM Burnham to stick to the fiscal rules. Spending commitments are clearer than tax raises measures, while new Chancellor Healey may not be strong enough to curtail spending pressures. This could mean
The Endpoint Problem: US Asset Prices, Investment and the Current Cycle
July 20, 2026 8:00 AM UTC
· Asset Price Index (API) framework suggests the US gap is elevated and, on some constructs, has moved into top-decile territory.
· The question is whether prices, capex and financing conditions are beginning to reinforce the same cyclical risk-accumulation dynamics.
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Preview: Due August 7 - U.S. July Employment (Non-Farm Payrolls) - Stronger than June, but with a rise in unemployment
July 28, 2026 3:49 PM UTC
We expect July’s non-farm payroll to rise by 120k overall and by 110k in the private sector, a significant improvement from June’s respective gains of 57k and 49k but largely explained by a recovery in leisure and hospitality. We expect unemployment to rise to 4.3% from 4.2%, reversing a June de
FOMC - Warsh leaves markets confused
July 29, 2026 7:30 PM UTC
That this FOMC meeting showed a 9-3 vote for unchanged policy, with the dissents being for tightening, shows there was a case for tightening and a case for steady policy. However, the press conference from Chairman Warsh gave little insight on the nature of the debate, talking a lot about how the Fe
Preview: Due August 7 - U.S. July Employment (Non-Farm Payrolls) - Stronger than June, but with a rise in unemployment
August 6, 2026 1:27 PM UTC
We expect July’s non-farm payroll to rise by 120k overall and by 110k in the private sector, a significant improvement from June’s respective gains of 57k and 49k but largely explained by a recovery in leisure and hospitality. We expect unemployment to rise to 4.3% from 4.2%, reversing a June de
Trump: Tariffs 2.0
July 24, 2026 7:16 AM UTC
• Replacing section 122 at 10% with section 301 at 10-12.5% is unlikely to have much lasting economic impact in itself. However, the Trump administration are also undertaking section 301 investigation against 16 countries on excess production, with the report and new tariffs expected in A
Slicing and dicing US inflation – why different measures are at the centre of Fed debate
August 10, 2026 1:01 PM UTC
* Wide divergence of US inflation measures becoming increasingly material to policy debate and sets the unusual statistical backdrop to the next CPI release
* Reflects many of the divergent opinions over AI, ‘relative price adjustment’ vs generalised inflation, temporary vs persistent overshoot.
China: Debt Surge Problems
July 28, 2026 10:55 AM UTC
· China general government debt/GDP is on an unstable upward trend. China authorities are reluctant to ease underlying fiscal policy more than the already large primary budget deficit, but are also reluctant to consider broadening of income tax or property taxes that would help fiscal
U.S. June Durable Goods Orders - Restrained by seasonal adjustments and possibly prices
July 27, 2026 12:49 PM UTC
June durable goods orders with a 0.3% rise were well below expectations with a bounce in aircraft orders implied by Boeing data failing to show up in seasonally adjusted data while the ex transport gain of 0.6% was the slowest since January, though this may in part reflect easing price pressures.
Fresh U.S. Tariff Risks to Canada's Economy are Moderate
August 17, 2026 6:54 PM UTC
The US and Canada are approaching an August 19 deadline for the US to impose 50% tariffs on some Canadian exports. Tense negotiations are to be expected as the deadline approaches but a deal is far from certain. Many in the market may be expecting Trump to back down a few days after announcing the t
From Hanging Chads to Hanging By a Thread – ‘Alternative’ US Election Risk Scenarios
August 17, 2026 9:22 AM UTC
* Without being alarmist, the market arguably needs to factor in the risk that the elections do not proceed smoothly to a clean conclusion. At the moment, there is no risk premia
* The markets hope that the destination is some degree of gridlock and thus reduction in extreme policy (albeit with mixed
BOE: Split Does Not Mean September Hike
July 30, 2026 12:45 PM UTC
. · Overall, the July MPC minutes and monetary policy report/press conference suggest that the MPC is not convinced of a September hike and a worsening of energy price rises and/or 2nd round effects would be required to shift the voting to a 25bps hike. While the MPC has a hawkish
Is CAD poised for a short-squeeze?
August 10, 2026 5:03 PM UTC
There's a decent argument that, event-risk given, CAD may be poised for a short-squeeze
Positioning is extreme and against the grain of recent $ moves
Data has been surprising to the upside supporting a shift in momentum
Lead indicator trends support a recent move back toward recovery and outperforma
Taiwan: China Coastguard Quarantine Risks Grow
August 10, 2026 7:55 AM UTC
· Given China’s coastguard recent actions, we now raise the probability of a full quarantine of Taiwan shipping to 20% versus 10-15% in 2027/28 (Figure 2), with the probability of some further measures beyond radio requests now above 50% in 2027/28 and in our baseline. Quarantine meas
CHF/JPY and the carry question
July 30, 2026 1:39 PM UTC
· CHF/JPY has become interesting from several directions: extreme relative valuation, changing carry rankings, opposing official preferences over currency direction, and the beginnings of a possible technical rollover. When things align, they can encourage some migration in positioning
Taylor Rules for Uncertain Times
August 11, 2026 2:44 PM UTC
* The Fed’s rate puzzle has three awkward-shaped pieces: which inflation measure to trust, how much slack remains, and where r* now sits.
* Taylor rules may be deeply unfashionable, but they force those hidden assumptions into the open.
* Change only the inflation measure and the same rule can make
ECB: September Hike 50% Probability?
July 23, 2026 1:41 PM UTC
· Lagarde disclosed that some ECB board members considered a hike at today’s meeting and she noted that the consensus was to wait for incoming data before the September 10 meeting and then reassess. This clearly signals that the September meeting will seriously consider a 25bps hike,
BOE Preview After CPI: Hawkish Noises
July 22, 2026 6:11 AM UTC
• The BOE will likely maintain a hawkish bias on July 30, but are unlikely to signal a September hike. The June CPI did not really change this picture, with the core unchanged at 2.6%. Though BOE Bailey recently noted the unstable process (in the Straits of Hormuz and for energy prices), he