A few macro thoughts today...

A few macro thoughts today...

European harmonisation – ‘Brussels is to propose the creation of a standing European border force that can take control of the bloc’s external borders – even if a government objects – in a move that would arguably mean the biggest transfer of sovereignty since the creation of the single currency’ (FT).  The migrant crisis has had large implications…

Greece – Greek government runs "Call for Applications" ad for Gen-Sec Public Revenue position in yesterday’s FT. Deadline: 4 days ago!  Deadlines mean little in anything to do with Greek revenue collection? Meanwhile ‘Foreign Investors Tiptoe Through Minefield of Greek Banking System’ (link here). 

(h/t @GreekAnalyst)

Germany – Weidmann said yesterday that the ‘Weak euro adds to German current account surplus’.  He’s not kidding, in the first 3Q of 2015, Germany's current account surplus equated to 7.9% of GDP.  That’s a big distortion and shows the need for either European domestic regional reform or a higher euro.

US markets - A close Friday below 2088.5 in S&P futures would mark the 2nd consecutive week of losses. Run has not extended for 47 weeks.  Meanwhile YTD the top ten stocks in the S&P500 are up 21%. The other 490 are down an average of 3%. This is the biggest differential since 1999 (stats highlighted by Predicted Mkts & Jim Cramer respectively).

Meanwhile talking about US markets…a rate rise expected by 97%...

…and the US dollar still warming up for its post rate hike fall?

(h/t @Callum_Thomas)

Meanwhile high yield indices fall to new recent lows...

…and distress seems to be spreading across different sectors:

Worthwhile noting this research showing that private creditors get hurt a lot more in any debt haircuts.  Not too difficult a prediction to anticipate more debt haircut chat in 2016 in not just sovereign bonds but corporate bonds too...

...especially with corporate margins where they are:

Just where are stock markets versus historical highs?  Great chart via @MktOutperform.  Greece leading something! 

And finally...Climate change - It’s the last day of COP21, and world leaders have been working nonstop to reach an agreement on how to combat global warming.  Will it be more than…hot air? :-)