Eurodollar University

There are several ways to know that the second phase for the global recession has started. While there is never a clear demarcation between any stages or just recession, for that matter, there are telltale signs and we are getting them bigtime. Summer keeps showing up as full of warnings, including one that explains everything from the economy to central bankers' increasingly panicking reaction to it. Eurodollar University's Money & Macro AnalysisBloomberg ECB Can’t Ignore Headwinds to Economic Growth, Schnabel Sayshttps://www.bloomberg.com/news/articles/2024-10-02/ecb-can-t-ignore-headwinds-to-economic-growth-schnabel-saysBloomberg ECB Momentum for an October Rate Cut Is Looking Unstoppablehttps://www.bloomberg.com/news/articles/2024-10-02/ecb-momentum-for-an-october-rate-cut-is-looking-unstoppableBloomberg ECB Should Proceed Cautiously With Rate Cuts, Schnabel Warnshttps://www.bloomberg.com/news/articles/2024-08-30/ecb-should-proceed-cautiously-with-rate-cuts-schnabel-warnsNikkei Transcript: ECB board member Isabel Schnabel speaks with Nikkeihttps://asia.nikkei.com/Editor-s-Picks/Interview/Transcript-ECB-board-member-Isabel-Schnabel-speaks-with-NikkeiFT Lower borrowing costs risk ‘flare-up’ of inflation, warns ECB policymakerhttps://www.ft.com/content/bdf3bb86-8a80-4bd5-b562-0c3c47f85f50https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

The Bank of Japan's very recent change of heart has apparently been strong enough to do the same for incoming Prime Minister Shigeru Ishiba. Sounding aggressively hawkish where it came to interest rates just last week after his surprise ascent, suddenly he's completely changed his tune. Why? The answer can be found in another record low for a highly critical US$ market. Eurodollar University's Money & Macro AnalysisBloomberg Ueda Keeps Rate Hikes in Play, Talks Down BOJ’s Part in Meltdownhttps://www.bloomberg.com/news/articles/2024-08-23/boj-s-ueda-still-plans-to-hike-rates-if-economy-meets-outlookBloomberg Ueda Reiterates That BOJ Will Lift Rates If Outlook Realizedhttps://www.bloomberg.com/news/articles/2024-09-03/boj-ueda-reiterates-stance-of-lifting-rates-if-outlook-realizedThe New York Times Stocks in Japan Tumble After Party’s Election of New Prime Ministerhttps://www.nytimes.com/2024/09/29/business/japan-stocks-nikkei-shigeru-ishiba.htmlCNBC Here’s why Japan’s stocks are plunging after Shigeru Ishiba’s winhttps://www.cnbc.com/2024/09/30/heres-why-japans-stocks-are-plunging-after-shigeru-ishibas-win.htmlBNN Bloomberg Ishiba Ally Sends Signal to Warn BOJ Against Rate Hike Too Soonhttps://www.bnnbloomberg.ca/business/international/2024/10/02/japans-ishiba-isnt-necessarily-pro-boj-hike-new-minister-says/Bloomberg Japan’s Ishiba Rules Out BOJ Interest Rate Hikes For Nowhttps://www.bloomberg.com/news/articles/2024-10-02/boj-s-ueda-briefs-new-pm-ishiba-on-market-developmentsBloomberg Ueda Hints at Dovishness After New Prime Minister Urges Cautionhttps://www.bloomberg.com/news/articles/2024-10-02/ueda-hints-at-dovishness-after-new-prime-minister-urges-cautionhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Jay Powell again reiterated that he believes the economy is "on solid footing." The most recent data on the labor market shows he's either wrong or lying. There is no equivocating these latest estimates in which hiring has collapsed. As if that wasn't enough, it was backed up by other sources. All of it pointing to summertime being the time for recession. It's all about hiring, and that has all but disappeared. Eurodollar University's Money & Macro AnalysisBloomberg Powell Says Fed Not in a Hurry, Will Lower Rates ‘Over Time’https://www.bloomberg.com/news/articles/2024-09-30/powell-says-fed-will-move-over-time-to-more-neutral-stanceBloomberg Fed’s Goolsbee Sees ‘Many More’ Rate Cuts Over the Next Yearhttps://www.bloomberg.com/news/articles/2024-09-23/fed-s-goolsbee-sees-many-more-rate-cuts-over-the-next-yearCNN A sign of strength in the labor market: Job openings increased in Augusthttps://www.cnn.com/2024/10/01/economy/us-jolts-job-openings-layoffs-august/index.htmlISM September 2024 Manufacturing ISM Report On Businesshttps://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/september/https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Car stocks got clobbered as the global auto industry is heading for a major fall. There was a flood of announcements from carmakers all over the world this weekend as carmakers are facing very difficult choices. The fallout from the growing reverse will be profound given how important a rising auto market had been up to now. Eurodollar University's Money & Macro AnalysisStellantis Updates 2024 Financial Guidancehttps://www.globenewswire.com/news-release/2024/09/30/2954870/0/en/Stellantis-Updates-2024-Financial-Guidance.htmlBloomberg Stellantis Cuts Forecasts in Further Blow to Besieged Carmakershttps://www.bloomberg.com/news/articles/2024-09-30/stellantis-cuts-2024-forecast-on-costs-for-us-global-slowdownDow Jones Aston Martin shares fall 25% after warning blamed on supply disruptions, Chinahttps://www.morningstar.com/news/marketwatch/2024093033/aston-martin-shares-fall-25-after-warning-blamed-on-supply-disruptions-chinaVolkswagen AG updates its forecast for the 2024 financial yearhttps://www.volkswagen-group.com/en/ad-hoc/volkswagen-ag-updates-its-forecast-for-the-2024-financial-year-18698The Guardian Volkswagen has ‘a year, maybe two to turn around’, financial chief warnshttps://www.theguardian.com/business/article/2024/sep/04/volkswagen-has-a-year-maybe-two-to-turn-around-financial-chief-warnsBloomberg VW’s Second Profit Warning Exposes a Carmaker in Declinehttps://www.bloomberg.com/news/articles/2024-09-30/volkswagen-s-second-profit-warning-exposes-a-carmaker-in-declinehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Now that everyone is coming to grips with economic weakness, particularly where it comes to employment conditions, understanding the high potential for a lot more or worse, people are trying to figure out where it is coming from therefore what might be done to turn it all around. Did the Fed break the economy? Are employers worried about the next President? Eurodollar University's conversation w/Steve Van Metrehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Americans continue to say they're alarmed about job prospects. That's what consumer confidence is truly about, not consumer spending. Workers see and understand labor market shifts before they show up in the major data sources. The latest income data show there is every reason to believe what consumers are seeing. Eurodollar University's Money & Macro AnalysisConference Board September 2024https://www.conference-board.org/topics/consumer-confidence/press/CCI-Sep-2024FRBNY Consumer Confidence: A Useful Indicator of . . . the Labor Market?https://libertystreeteconomics.newyorkfed.org/2013/09/consumer-confidence-a-useful-indicator-of-the-labor-market/FRBNY Survey of Consumer Expectationshttps://www.newyorkfed.org/microeconomics/sce#/earnuncert-1https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Not content to leave it with the PBOC's Oprah-fest of rate cutting, China's central authorities announced what's being called a massive stimulus push. The response has been near-euphoria in Chinese and other stocks, but the opposite in more crucial markets and places. All the more curious given how much other "stimulus" is being offered around the world, central bank rate cuts that are accelerating. Eurodollar University's Money & Macro AnalysisThe Political Bureau of the CPC Central Committee held a meeting to analyze and study the current economic situation and economic work.https://www.gov.cn/yaowen/liebiao/202409/content_6976686.htmReuters Exclusive: China to issue $284 billion of sovereign debt this year to help revive economyhttps://www.reuters.com/markets/asia/china-issue-284-bln-sovereign-debt-this-year-help-revive-economy-sources-say-2024-09-26/https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

It's not just USTs. Rates are falling all over the world faster in shorter maturities than long. That means a global wave of un-inversions and bull steepening right as more and more central banks plan to accelerate their own rate cutting. All of it for the same reason. Globally synchronized.***CHECK OUT EURODOLLAR UNIVERSITY's FALL SALE***https://www.eurodollar.universityEurodollar University's Money & Macro AnalysisNBB Is a recession imminent? The signal of the yield curvehttps://www.nbb.be/doc/ts/publications/economicreview/2019/ecorevi2019_h4.pdfBloomberg Riksbank Cuts Rate Again and Opens Door to Half-Point Movehttps://www.bloomberg.com/news/articles/2024-09-25/riksbank-cuts-rate-a-quarter-point-and-opens-door-to-bigger-move

Chinese authorities held a surprise press conference early this morning where PBOC Governor Pan Gongsheng did his best Oprah Winfrey impression handing out rate cuts to practically everyone. All that does is further expose the gravity of the situation: the more the central bank or any authority does, the worse you know it is since rate cuts never work. China just announced a lot of them. Eurodollar University's Money & Macro AnalysisBloomberg China Unleashes Stimulus Package to Revive Economy, Marketshttps://www.bloomberg.com/news/articles/2024-09-24/china-frees-banks-to-lend-more-cuts-key-interest-ratehttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

More confirmation that recession is coming back with a vengeance in Europe. The latest data indicates the dangers this time around including jobs and layoffs. This situation in Europe is hardly unique. This is why central bankers are out in force downplaying their own rate cuts; to the point a few policymakers are outright lying why they voted for them.  Eurodollar University's Money & Macro AnalysisBloomberg Fed’s Waller Says Slowing Inflation Led Him to Support Large Rate Cuthttps://www.bloomberg.com/news/articles/2024-09-20/waller-says-slowing-inflation-led-him-to-support-large-rate-cutBloomberg Fed’s Kashkari Says Interest-Rate Hikes Not Entirely Ruled Outhttps://www.bloomberg.com/news/articles/2024-05-28/fed-s-kashkari-says-rate-hike-not-entirely-ruled-outBloomberg Fed’s Neel Kashkari Expects Two Quarter-Point Cuts Before Year’s Endhttps://www.bloomberg.com/news/articles/2024-09-23/neel-kashkari-backed-fed-s-large-cut-and-another-half-point-this-yearBloomberg Fed’s Bostic Says He Now Might Favor More Than One 2024 Cuthttps://www.bloomberg.com/news/articles/2024-08-23/fed-s-bostic-says-he-now-might-favor-more-than-one-cut-this-yearAtlanta Fed On the State of the US Economy and Monetary Policyhttps://www.atlantafed.org/news/speeches/2024/09/23/bostic--on-the-state-of-the-us-economy-and-monetary-policyS&P Global  S&P Global Flash US Composite PMI September 2024https://www.pmi.spglobal.com/Public/Home/PressRelease/35c60149cdbe461fb6bc3c959a58a551S&P Global/Hamburg Commercial Bank HCOB Flash Eurozone PMI September 2024https://www.pmi.spglobal.com/Public/Home/PressRelease/cf25d7bb494046ae9256a00ca028f09ahttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU