Crumbs

• This is a fantastic interview with el Erain. He basically says that he would not invest in anything at the moment. He is also highly critical of central banks.

• Lyn Alden has produced her Jan newsletter. She’s good, and interesting, but as nothing much has changed in the economic situation, the newsletter doesn’t contain much that’s new. It’s worth subscribing to, as it’s free and sufficiently infrequent that you can afford the time to read it.

• High yield debt is about to get higher yields still, according to Jim Grant, who knows a thing or two about debt and securities. Clearly, there is going to be non-payment, but the market will not move until the bulls capitulate. The more people who listen to this kind of publication, the more likely this is,

• Unite, which owns a huge amount of student accommodation (‘PBSA’ or purpose-built student accommodation), is halving the rent on its accommodation when students cannot use it. This suggests that the market for such accommodation is not very strong, to me.
• Citron is pumping a stock in the energy sector, for a change.

Wrap

Mildly risk off:

• Yen up,
• all indexes down, although Russell 2000 by only 0.1%,
• value sectors (finance, energy, health) up,

but:

• yields on shorter dated maturities in EU and GB govt. bonds down, for all other markets, yields were up,
• USD up against everything,
• commodities up, mainly except wheat and gold and silver (silver is crashing, down 5%), NG up 3.5%,
• US and UK curves continue to steepen.

News: Trump going to be impeached, US politics up in arms, most countries failed to get vaccines into people’s arms, infection rates continuing to go up, lots of finger pointing at those who supported the Proud Boys and their attack on Washington. Biden continues to appoint Wall St. lobbyists to positions of power. Parler now seems to have been totally destroyed by a pincer movement by Amazon and Apple.