Morning in Europe

Everything quiet as the grave. The SPX breaking through its ATH yesterday was met with a shrug, with everything slightly down, except the FTSE, which was down 1%. That is except Borsa Istanbul, which was up 0.6%, in TRY terms. In EUR terms, not so much, which also goes for the SPX. The Euro is up a lot against the dollar this year. Robin Brooks was quoted in the FT as saying that it’s unsustainable, which I guess is another way of saying that the ECB is going to lose the race to devalue its currency to the Fed. Clearly, the Fed has a lot going for it, not least over a hundred years of doing its own thing. However, the dollar has a lot going for it too, not least the US military, which means a lot, I think, even in today’s world.

Afternoon thoughts

$TSLA is sui generis. Although there are many companies that make battery electric vehicles, there are none quite as extraordinary as $TSLA. Maybe Musk is a genius, maybe he’s a charlatan. Edison was a bit of both. The story of the company is going to make a blockbuster film, one day, but for the moment you have to be satisfied with less visual sources. I would recommend this podcast for one side of the argument, but put by a measured sane individual (the Skeptic), being interviewed by a rather more excitable individual (Chris Irons). The QTR podcast series is rather uneven in quality, providing a platform for some out and out conspiracy theorists that the mainstream media would not touch with a bargepole. My view is that we should be grown up enough to make up our own minds. Please do so for the episode above.

Wolf Richer says that most of us didn’t actually get richer, from the Fed’s actions. The divergence is not so extreme in Europe, but I can’t believe that the BoE really reduced inequality by its actions. There is generational inequality too, for sure.

Close

Everything went into reverse today. Turkish Lira rallied, against the odds, commodities rallies, apart from precious metals, the dollar index went up by 0.5%. Equities were generally up, with the exception of China and China-related (e.g. HK & Singapore). Volumes probably thin, but I didn’t bother to check. A time when market manipulators can have a big impact.

FOMC minutes released today. Chatter about yield curve control, somehow supposed to explain drop in precious metals. I will read the FT tomorrow to try to understand the logic.