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Monday, November 11, 2024

Latest Morning Briefing

The Fed: Neutral Or Bust?

Something’s amiss with Fed Chair Powell’s explanation for lowering the federal fund rate a second time in two months despite an economy he admits is performing remarkably well. He tied the rationale for the move to the theoretical “neutral FFR,” implying that monetary policy needs to be less restrictive to reach that point, even though that point is intrinsically unknowable. Also implied was that the related risks are worth taking—including potentially overheating a strong economy, untethering inflation, and inciting a stock market meltup. Eric and Ed disagree that risking all that for an elusive goal makes sense. … Also: A few more questions they would have liked to put to Powell at his Thursday presser. ... Also: Ed reviews “Disclaimer” (+ +).

Markets

Stocks Fall on China OutlookBloomberg
For What Comes Next in Markets, Look Back to 2016Wall Street Journal
Bond Market on Risky Path as Traders Regroup From Turbulent WeekBloomberg
Going Into New Trump Era, Risky Emerging Market Bonds Keep Luring TradersBloomberg

Commodities

Central banks

US

US Inflation Progress Gets Harder Entering the Final MileBloomberg
What Trump Can—and Can’t—Do on Day OneWall Street Journal
What Trump mass deportation plan would mean for immigrants and economyCNBC

China

China Struggles to Shake Off Deflationary Pressures as Consumer Prices Edge HigherWall Street Journal
Lululemon cracks $1 billion in sales in China by catering to local tastesBloomberg

Europe

Europe needs to wake up and look after itselfEconomist
Germany’s fractious coalition falls apart—and how!Economist

Mexico

Mexico is edging closer and closer to one-party ruleEconomist

Geopolitics & trade I

Donald Trump is poised to smash Mexico with tariffsEconomist
How Donald Trump Will Reshape Foreign Policy in His Second TermBloomberg
Deals and Deterrence: Trump’s Foreign Policy in a Dangerous WorldWall Street Journal
Trump Advised Putin Against Ukraine Upturn, Washington Post SaysBloomberg
Elon Musk Joined Trump’s Call With Ukraine’s ZelenskyWall Street Journal
Why North Korean Soldiers Are Prepared to Die in RussiaWall Street Journal

Geopolitics & trade II

BRICS isn’t exactly picky, but has just rejected VenezuelaEconomist
US ordered TSMC to halt shipments to China of chips used in AI: SourceCNBC
China Courts U.S. Allies as Defense Against Trump’s ProtectionismWall Street Journal
A Xi Enforcer Is Revving Up China’s Spy Machine—and Alarming the WestWall Street Journal

Industries & companies

Autos:European Auto Stocks Are Bargains. 2 Big Things That Could Change That.Barron's

AI

How ChatGPT Brought Down an Online Education GiantWall Street Journal

Beyond markets

Taylor Swift’s ‘Eras Tour,’ Fandom Offer Business Lessons for Us AllBloomberg
Families Battle Tech Giants as Australia Pushes for an Under-16 Social-Media BanWall Street Journal