This could be potentially a significant week. The election is tomorrow, and the polls indicate an extremely tight race. The betting markets suggest a different scenario with the possibility of a Red Sweep.
Democracy is an ugly type of government, but it is the best form yet followed. Differences are generally resolved by words instead of guns. Many will state today’s vitriol is historic. I beg to differ. It is at a level that has not been perhaps experienced in about 60 years. What is different is social media where there are no barriers to entry nor editorial boundaries.
Everyone could immediately opine about an event, with confirmation of all views readily available via the echo chamber of social media. Most psychologists would state that objectivity is a fictitious state. Everyone has a confirmation bias based upon preconceived expectations partially predicated by the culture or environment that we live in.
Wednesday is a FOMC meeting. At the time of this writing markets are suggesting a 97% chance of 23 bps of easing on Wednesday and a total of 44 bps by the end of the year. While this yet another change in monetary policy [the Fed again not acting as aggressively as previously forecasted] October’s weaker than expected unemployment data did little to alter expectations.
The large miss was almost entirely blamed upon the BA strike and the two hurricanes.
Commenting about Friday’s market activity, oil rose on reports that Iran will attack Isreal via Iraqi missile sites. The Treasury market was volatile ultimately ending with the yield curve steeping as the 2-year Treasury rallied and longer dated Treasuries sold off. Equites gave up about 50% of their gains, closing marginally higher.
Radically changing topics and perhaps adding some levity, below is a fine levied on Google by Russia. The information is from Armstrong William’s The Daily World Brief dated November 1, 2024.
- A Russian court fined Google 20 undecillion rubles ($2.5 decillion) for removing 17 state-run propaganda channels from YouTube after Russia invaded Ukraine.
- To put that number into perspective:
- Google’s fine: $2,500,000,000,000,000,000,000,000,000,000
- Global 2024 GDP forecast: $110,000,000,000,000 (1/23 quadrillionth Google’s fine)
- 2023 Google net profit: $73,700,000,000 (1/33 quintillionth Google’s fine)
- For even more math fun, the fine doubles daily after the mid-2025 due date.
- Given that it would take Google 33 quintillion years of profits to pay the fine at its starting level, Russia clearly doesn’t expect payment any time soon: the penalty is effectively a ban on Google operations in Russia.
Wow! And I thought when my kids were young, they had asked both Santa Claus and the Easter Bunny for some really big things.
The economic calendar is comprised of several manufacturing statistics, the ISM Services Index, a sentiment indicator and the a for mentioned FOMC meeting
Last night the foreign markets were up. London was up 0.60%, Paris up 0.09% and Frankfurt down 0.05%. China was up 1.17%, Japan down 2.63% and Hang Seng up 0.30%.
Futures are flat. Oil is up about 3% after OPEC+ agreed to ush back its December production increase and tensions rising further in the Middle East. The 10-year is up 25/32 to yield 4.29%.
