Investor and Trader | AI + Crypto + Macro 🌐 Daily market analysis. No noise. Not financial advice.
Joined November 2023
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🚨 THIS IS HOW THE NEXT GLOBAL CRISIS BEGINS, AND IT IS ALREADY UNDERWAY IN THE ONE MARKET NOBODY WATCHES
Three weeks ago I warned about a debt crisis building.
Since then every number moved the wrong way.
Here is the truth almost nobody wants to hear.
The S&P 500, Bitcoin, all of crypto,
they are dust compared to the bond market.
The global bond market sets the price of money itself.
Every stock, every coin, every mortgage, every government
is built on top of it. When it moves, everything moves.
And right now, it is cracking on three fronts at once.
THE UNITED STATES
→ 30Y yield: 5.31%, a 19-YEAR high
→ 10Y: 4.73%, closing in on 5%
→ Levels last seen right before 2008
→ Foreign buyers pulled $72B out in a single month
America's biggest lenders are walking away.
CHINA
→ Cut its US Treasury holdings to $633B, an 18-YEAR low
→ The lowest since September 2008
For years China was one of the biggest buyers of US debt.
Now it is doing the opposite, steadily backing away
from funding America and the rest of the world.
The buyer that helped keep borrowing cheap is gone.
JAPAN
→ Near-zero rates for THREE DECADES, now ending
→ 10Y yield hit 3%, highest since 1996
→ 30Y broke above 4%
When Japanese bonds pay again, Japanese money stops funding the world and stays home. Another giant buyer disappears.
EUROPE
→ France's 10Y at 4.10%, highest since 2009
→ Germany's 30Y at 3.73%, highest since 2011
→ UK's 30Y gilt at 5.85%
France is the weak link. Italy must refinance debt
worth 17% of its GDP this year.
Every major government on earth is paying more to borrow, at the same time, for the same reasons.
The trigger could be anything.
But the weakest point in the whole system is Japan.
Three decades of cheap money unwinding at once
is the crack that could split the entire foundation.
Watch the bond market first.
Everything else is a sideshow.
12 years in these markets. This is what I do.
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🚨 EVERYONE'S WATCHING THE WRONG NUMBER — THE FED IS ALREADY TRAPPED, AND THE 10Y PROVES IT
The whole market is glued to the Fed funds rate
and the September hike odds. Wrong screen.
The real story is the long end and the debt behind it.
The curve, mapped to what you actually trade:
→ 2Y: 4.22% → your $SHY
→ 10Y: 4.69% → your $IEF
→ 20Y: ~5.2% → your $TLT
→ 30Y just printed a 19-YEAR high
Here's the trap:
→ Cut → inflation reignites, long end sells off, $TLT drops anyway
→ Hold/hike → borrowing costs stay high and the deficit detonates
No exit that doesn't hurt. That's what "trapped" means.
Now run the debt math at today's 10Y (4.69%):
→ Total debt: ~$39.9T
→ Blended rate now: 3.41% → ~$1.36T/yr in interest
→ Reprice that stack at 4.69% → ~$1.87T/yr
→ That's +$500B/yr for doing NOTHING but rolling old debt
$1.87T in interest alone would be more than
the entire FY2025 deficit ($1.78T) —
and about a THIRD of all federal tax revenue (~$5.2T).
It doesn't hit overnight. It bleeds in as the debt rolls.
But it's one-way — every refi swaps cheap debt for expensive debt.
This is arithmetic, not opinion:
Once interest eats a third of revenue, the budget loses its flexibility.
Every dollar to bondholders is a dollar that can't go anywhere else.
At these rates it compounds instead of stabilizing.
That's the box the Fed is stuck in.
Inflation is the easy problem here.
12 years in these markets — this is what I do.
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🚨 BREAKING: THE FED HOLDS AT 3.75%-4.00%. WARSH HAS 30 MINUTES TO MOVE THE MARKET.
The Fed left rates unchanged, as the market expected. The hike odds were only about 10%.
But a hold is NOT a green light. A December hike is priced near 80%, and the Fed has not taken it off the table.
Warsh press conference starts at 18:30 UTC (2:30 PM ET). One wrong sentence from him can turn this hold into a selloff. On September 16 the hike was fully priced, and stocks still fell because of his tone.
Stocks and crypto, stay alert.
12 years in these markets. This is what I do.
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🚨 BREAKING
THE FED ANNOUNCES ITS RATE DECISION TODAY AT 18:00 UTC (2:00 PM ET)!
IF HOLD (3.75%-4.00%) → MARKET PUMPS
IF HIKE (4.00%-4.25%) → BLOODBATH
CME FedWatch has the hike odds at about 10%. In a Reuters poll, 94 of 100 economists expect a hold.
But the decision is only half of the story. Warsh press conference starts at 18:30 UTC (2:30 PM ET). On September 16 the hike was fully priced, and stocks still fell because of his tone.
A December hike is priced near 80%. If Warsh confirms it, even a hold can turn ugly.
ALL EYES ON 18:00 UTC!!
12 years in these markets. This is what I do.
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🚨 BREAKING: US CRUDE STOCKS FELL AGAIN, AND OIL IS ALREADY CRUSHING THE ECONOMY. THIS IS BAD NEWS FOR THE MARKET.
EIA Crude Oil Inventories: -1.892M barrels. Expected: +0.1M. Previous: -3.06M.
That is the fourth draw in a row. US stocks fell by about 16.7 million barrels in four weeks. Supply is getting tighter, while oil is already near $100.
And oil is already hurting:
→ US gasoline rose 9.1% in September alone
→ US CPI is at 3.7%
→ Producer prices jumped 1.3% in one month
→ Euro area energy prices are up almost 19%
→ Consumers expect 6.1% inflation over the next year
Every barrel that leaves storage keeps the price high. And a high oil price hits everything: transport, food, factories and your wallet.
Stocks and crypto do not like this.
12 years in these markets. This is what I do.
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🚨 THE WEEK THAT CAN BREAK THE MARKET: FED, ECB, BOJ, GDP, PCE AND BIG TECH EARNINGS. OCT 26-30
MONDAY, OCT 26
🟢 17:00 UTC (1:00 PM ET): US 2-Year Note Auction
Earnings: Verizon, Cadence and 8 others
TUESDAY, OCT 27
🟡 12:15 UTC (8:15 AM ET): US ADP Weekly Employment Change
🔴 14:00 UTC (10:00 AM ET): US CB Consumer Confidence (Oct)
🔴 14:00 UTC (10:00 AM ET): US New Home Sales (Sep)
🟡 17:00 UTC (1:00 PM ET): US 5-Year Note Auction
Earnings: Visa, Coca-Cola, Boeing, UPS and 41 others
WEDNESDAY, OCT 28
🔴 14:30 UTC (10:30 AM ET): US EIA Crude Oil Inventories
🔴 18:00 UTC (2:00 PM ET): FOMC Rate Decision
🔴 18:30 UTC (2:30 PM ET): Warsh Press Conference
Earnings: Microsoft, Alphabet (both after the close) and 41 others
THURSDAY, OCT 29
🔴 12:30 UTC (8:30 AM ET): US Q3 GDP (advance)
🔴 12:30 UTC (8:30 AM ET): US Core PCE (Sep)
🔴 12:30 UTC (8:30 AM ET): US Initial Jobless Claims
🔴 13:15 UTC (14:15 Frankfurt): ECB Rate Decision
🔴 13:45 UTC (14:45 Frankfurt): ECB Press Conference
🟡 17:00 UTC (1:00 PM ET): US 7-Year Note Auction
🟡 23:30 UTC: Japan Tokyo Core CPI (Oct), Friday morning in Tokyo
Earnings: Amazon, Intel, Coinbase, Strategy and 62 others
FRIDAY, OCT 30
🔴 03:00 UTC (12:00 Tokyo): BoJ Rate Decision and Outlook Report
🟡 06:30 UTC: BoJ Press Conference
🟡 13:45 UTC (9:45 AM ET): US Chicago PMI (Oct)
Earnings: ExxonMobil, Chevron and 11 others
What to watch:
→ FOMC on Wednesday: a hold is the base case. The real risk is the Warsh press conference and his tone on inflation and oil.
→ GDP and PCE on Thursday: consensus sees Q3 GDP at 3.2% and core PCE at 3.1% y/y. Goldman still expects one more hike in December.
→ Fed, ECB and BoJ all decide within three days. A surprise from any of them hits the dollar, the yen and bitcoin.
→ Microsoft and Alphabet report Wednesday, Amazon Thursday. The AI trade gets tested after the mid-October tech sell-off, with Brent still above $100.
→ Coinbase reports Thursday after the close, Strategy the same day. Watch what they say about bitcoin.
12 years in these markets. This is what I do.
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🚨 BREAKING
THE FED ANNOUNCES ITS RATE DECISION TODAY AT 18:00 UTC (2:00 PM ET)!
IF HOLD (3.75%-4.00%) → MARKET PUMPS
IF HIKE (4.00%-4.25%) → BLOODBATH
CME FedWatch has the hike odds at about 10%. In a Reuters poll, 94 of 100 economists expect a hold.
But the decision is only half of the story. Warsh press conference starts at 18:30 UTC (2:30 PM ET). On September 16 the hike was fully priced, and stocks still fell because of his tone.
A December hike is priced near 80%. If Warsh confirms it, even a hold can turn ugly.
ALL EYES ON 18:00 UTC!!
12 years in these markets. This is what I do.
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🚨 CONSUMER CONFIDENCE JUST EXPLODED TO 91.7. THE FED MEETS TOMORROW. BLOODBATH WARNING.
Conference Board Consumer Confidence (October): 91.7. Expected: 81. Previous: 81.9.
Almost 10 points above the forecast. The consumer is NOT scared, even with high prices and fuel costs. And that is exactly the problem.
A strong consumer means the Fed has no reason to go easy. The December hike gets harder to stop, and yields stay high.
The Fed decides tomorrow at 18:00 UTC (2:00 PM ET).
Stocks and crypto, be careful.
12 years in these markets. This is what I do.
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🚨 US CONSUMER CONFIDENCE DROPS TODAY, ONE DAY BEFORE THE FED. LAST MONTH IT HIT A 12 YEAR LOW.
Conference Board Consumer Confidence (October), out at 14:00 UTC (10:00 AM ET). Expected: 81. Previous: 81.9.
IF confidence > 81 → market dumps
IF confidence = 81 → nothing changes near-term
IF confidence < 81 → market pumps
In September the index fell 6.7 points. Consumers said prices and fuel costs were their biggest worry. Average inflation expectations for the next 12 months were 6.1%, and 68% of consumers expected higher interest rates.
The Fed decides tomorrow at 18:00 UTC (2:00 PM ET). A stronger consumer gives the Fed more room to hike in December. A weaker one gives it a reason to wait.
12 years in these markets. This is what I do.
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🚨 US CONSUMER CONFIDENCE DROPS TODAY, ONE DAY BEFORE THE FED. LAST MONTH IT HIT A 12 YEAR LOW.
Conference Board Consumer Confidence (October), out at 14:00 UTC (10:00 AM ET). Expected: 81. Previous: 81.9.
IF confidence > 81 → market dumps
IF confidence = 81 → nothing changes near-term
IF confidence < 81 → market pumps
In September the index fell 6.7 points. Consumers said prices and fuel costs were their biggest worry. Average inflation expectations for the next 12 months were 6.1%, and 68% of consumers expected higher interest rates.
The Fed decides tomorrow at 18:00 UTC (2:00 PM ET). A stronger consumer gives the Fed more room to hike in December. A weaker one gives it a reason to wait.
12 years in these markets. This is what I do.
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🚨 THE WEEK THAT CAN BREAK THE MARKET: FED, ECB, BOJ, GDP, PCE AND BIG TECH EARNINGS. OCT 26-30
MONDAY, OCT 26
🟢 17:00 UTC (1:00 PM ET): US 2-Year Note Auction
Earnings: Verizon, Cadence and 8 others
TUESDAY, OCT 27
🟡 12:15 UTC (8:15 AM ET): US ADP Weekly Employment Change
🔴 14:00 UTC (10:00 AM ET): US CB Consumer Confidence (Oct)
🔴 14:00 UTC (10:00 AM ET): US New Home Sales (Sep)
🟡 17:00 UTC (1:00 PM ET): US 5-Year Note Auction
Earnings: Visa, Coca-Cola, Boeing, UPS and 41 others
WEDNESDAY, OCT 28
🔴 14:30 UTC (10:30 AM ET): US EIA Crude Oil Inventories
🔴 18:00 UTC (2:00 PM ET): FOMC Rate Decision
🔴 18:30 UTC (2:30 PM ET): Warsh Press Conference
Earnings: Microsoft, Alphabet (both after the close) and 41 others
THURSDAY, OCT 29
🔴 12:30 UTC (8:30 AM ET): US Q3 GDP (advance)
🔴 12:30 UTC (8:30 AM ET): US Core PCE (Sep)
🔴 12:30 UTC (8:30 AM ET): US Initial Jobless Claims
🔴 13:15 UTC (14:15 Frankfurt): ECB Rate Decision
🔴 13:45 UTC (14:45 Frankfurt): ECB Press Conference
🟡 17:00 UTC (1:00 PM ET): US 7-Year Note Auction
🟡 23:30 UTC: Japan Tokyo Core CPI (Oct), Friday morning in Tokyo
Earnings: Amazon, Intel, Coinbase, Strategy and 62 others
FRIDAY, OCT 30
🔴 03:00 UTC (12:00 Tokyo): BoJ Rate Decision and Outlook Report
🟡 06:30 UTC: BoJ Press Conference
🟡 13:45 UTC (9:45 AM ET): US Chicago PMI (Oct)
Earnings: ExxonMobil, Chevron and 11 others
What to watch:
→ FOMC on Wednesday: a hold is the base case. The real risk is the Warsh press conference and his tone on inflation and oil.
→ GDP and PCE on Thursday: consensus sees Q3 GDP at 3.2% and core PCE at 3.1% y/y. Goldman still expects one more hike in December.
→ Fed, ECB and BoJ all decide within three days. A surprise from any of them hits the dollar, the yen and bitcoin.
→ Microsoft and Alphabet report Wednesday, Amazon Thursday. The AI trade gets tested after the mid-October tech sell-off, with Brent still above $100.
→ Coinbase reports Thursday after the close, Strategy the same day. Watch what they say about bitcoin.
12 years in these markets. This is what I do.
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🚨 THE MARKET IS BETTING ON A FED PAUSE AT OVER 90%. WARSH HAS NOT SAID A WORD.
The Fed decides on October 28 at 18:00 UTC (2:00 PM ET). After the hot CPI, hike odds briefly jumped to about 50%. Now they are 9.4%.
Why the market expects a hold:
→ The Fed hiked on September 16
→ Warsh gave no signal in Bangkok
→ Hiring is weak. September payrolls were only 29K
→ Oil is easing on Iran talks
A hike in December is priced near 80%. So the base case is a hold with hawkish words. The words matter more than the decision: on September 16 the hike was priced above 90%, and stocks still fell.
The risk: Warsh stopped giving signals before meetings, and GDP and PCE come out the day after the decision.
12 years in these markets. This is what I do.
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🚨 THE WEEK THAT CAN BREAK THE MARKET: FED, ECB, BOJ, GDP, PCE AND BIG TECH EARNINGS. OCT 26-30
MONDAY, OCT 26
🟢 17:00 UTC (1:00 PM ET): US 2-Year Note Auction
Earnings: Verizon, Cadence and 8 others
TUESDAY, OCT 27
🟡 12:15 UTC (8:15 AM ET): US ADP Weekly Employment Change
🔴 14:00 UTC (10:00 AM ET): US CB Consumer Confidence (Oct)
🔴 14:00 UTC (10:00 AM ET): US New Home Sales (Sep)
🟡 17:00 UTC (1:00 PM ET): US 5-Year Note Auction
Earnings: Visa, Coca-Cola, Boeing, UPS and 41 others
WEDNESDAY, OCT 28
🔴 14:30 UTC (10:30 AM ET): US EIA Crude Oil Inventories
🔴 18:00 UTC (2:00 PM ET): FOMC Rate Decision
🔴 18:30 UTC (2:30 PM ET): Warsh Press Conference
Earnings: Microsoft, Alphabet (both after the close) and 41 others
THURSDAY, OCT 29
🔴 12:30 UTC (8:30 AM ET): US Q3 GDP (advance)
🔴 12:30 UTC (8:30 AM ET): US Core PCE (Sep)
🔴 12:30 UTC (8:30 AM ET): US Initial Jobless Claims
🔴 13:15 UTC (14:15 Frankfurt): ECB Rate Decision
🔴 13:45 UTC (14:45 Frankfurt): ECB Press Conference
🟡 17:00 UTC (1:00 PM ET): US 7-Year Note Auction
🟡 23:30 UTC: Japan Tokyo Core CPI (Oct), Friday morning in Tokyo
Earnings: Amazon, Intel, Coinbase, Strategy and 62 others
FRIDAY, OCT 30
🔴 03:00 UTC (12:00 Tokyo): BoJ Rate Decision and Outlook Report
🟡 06:30 UTC: BoJ Press Conference
🟡 13:45 UTC (9:45 AM ET): US Chicago PMI (Oct)
Earnings: ExxonMobil, Chevron and 11 others
What to watch:
→ FOMC on Wednesday: a hold is the base case. The real risk is the Warsh press conference and his tone on inflation and oil.
→ GDP and PCE on Thursday: consensus sees Q3 GDP at 3.2% and core PCE at 3.1% y/y. Goldman still expects one more hike in December.
→ Fed, ECB and BoJ all decide within three days. A surprise from any of them hits the dollar, the yen and bitcoin.
→ Microsoft and Alphabet report Wednesday, Amazon Thursday. The AI trade gets tested after the mid-October tech sell-off, with Brent still above $100.
→ Coinbase reports Thursday after the close, Strategy the same day. Watch what they say about bitcoin.
12 years in these markets. This is what I do.
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🚨 BRENT JUST HIT $116.72, A SIX MONTH HIGH. THE IRAN WAR IS NOW A TAX ON THE WHOLE WORLD.
Brent closed Friday at $116.72, up about 6% this week. WTI is above $103.
Why now:
→ Houthi attacks on Saudi energy sites. Aramco ordered the evacuation of its Dhahran headquarters
→ Two tanker attacks confirmed near Hormuz this week
→ Traders expect the US to resume strikes on Iran
Oil is still moving through Hormuz, so a big part of this jump is fear. That can change fast in both directions.
What it does to the world:
→ US gasoline rose 9.1% in September alone. US CPI is 3.7%
→ Euro area inflation is 3.8%, with energy up 18.8%
→ The IMF says Asia and Europe are hit the hardest
→ US, German and Japanese 10 year yields are at their highest since 2007, 2009 and 1996
→ The Fed, the ECB, the BoJ and Korea are all tightening, and Canada may hike next week
The IMF also warns that high oil prices could last into 2027, even if the conflict ends soon.
Higher oil means higher inflation. Higher inflation means higher rates. Higher rates mean pressure on stocks and crypto.
The Fed decides on October 28. If it talks tough on energy prices, the market will notice.
12 years in these markets. This is what I do.
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🚨 US MANUFACTURING PMI CAME IN HOT AT 56. THE FED JUST GOT MORE PRESSURE TO KEEP HIKING.
US S&P Global Manufacturing PMI (October flash): 56.0. Expected: 55.5. Previous: 55.9.
Factories are growing faster than expected. That keeps the economy strong while inflation is already at 3.7%. A strong economy gives the Fed room to keep hiking.
The Fed meets on October 27-28. Hike odds go up. Stocks and crypto feel the pressure.
12 years in these markets. This is what I do.
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🚨 US MANUFACTURING PMI DROPS TODAY. FACTORIES COULD DECIDE IF INFLATION GETS EVEN HOTTER.
US S&P Global Manufacturing PMI (October flash), out at 13:45 UTC (9:45 AM ET). Expected: 55.5. Previous: 55.9.
IF PMI > 55.5 → market dumps
IF PMI = 55.5 → nothing changes near-term
IF PMI < 55.5 → market pumps
Also at 13:45 UTC (9:45 AM ET): Services PMI (October flash), expected 57.9, previous 58.8.
And at 14:00 UTC (10:00 AM ET): University of Michigan final sentiment and inflation expectations.
A reading above 50 means growth, and 55.9 last month was strong. The PMI survey also tracks the prices companies pay and charge. With oil above $100 and inflation at 3.7%, a strong factory number with rising costs adds to the inflation story.
The Fed meets on October 27-28. After a week of hot inflation data, every strong number raises the pressure.
12 years in these markets. This is what I do.
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🚨 US MANUFACTURING PMI DROPS TODAY. FACTORIES COULD DECIDE IF INFLATION GETS EVEN HOTTER.
US S&P Global Manufacturing PMI (October flash), out at 13:45 UTC (9:45 AM ET). Expected: 55.5. Previous: 55.9.
IF PMI > 55.5 → market dumps
IF PMI = 55.5 → nothing changes near-term
IF PMI < 55.5 → market pumps
Also at 13:45 UTC (9:45 AM ET): Services PMI (October flash), expected 57.9, previous 58.8.
And at 14:00 UTC (10:00 AM ET): University of Michigan final sentiment and inflation expectations.
A reading above 50 means growth, and 55.9 last month was strong. The PMI survey also tracks the prices companies pay and charge. With oil above $100 and inflation at 3.7%, a strong factory number with rising costs adds to the inflation story.
The Fed meets on October 27-28. After a week of hot inflation data, every strong number raises the pressure.
12 years in these markets. This is what I do.
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🚨 TESLA, META AND FLASH PMIS HIT THIS WEEK, OCT 19 TO 23. THE FED MEETS RIGHT AFTER.
MONDAY, OCT 19
🟡 02:00 UTC (10:00 Beijing): China Q3 GDP and September activity data
🟡 12:30 UTC (8:30 AM ET): Canada CPI (September)
🟢 14:00 UTC (10:00 AM ET): US NAHB Housing Market Index
TUESDAY, OCT 20
🟡 01:00 UTC (9:00 Beijing): China Loan Prime Rate
🟢 09:00 UTC (11:00 Berlin): Germany ZEW survey
🟡 12:30 UTC (8:30 AM ET): US Housing Starts and Building Permits (September)
🟢 14:00 UTC (10:00 AM ET): US Pending Home Sales (September)
🟡 Earnings: GE Aerospace, GM, RTX and many others before the open. Netflix after the close.
WEDNESDAY, OCT 21
No major US data.
🔴 Earnings after the close: Tesla, Meta, IBM, Texas Instruments, Lam Research and many others.
🟢 Earnings before the open: AT&T, Abbott, NextEra and others.
🟢 ECB President Lagarde speaks.
THURSDAY, OCT 22
🟡 12:30 UTC (8:30 AM ET): US Initial Jobless Claims
🟢 14:00 UTC (10:00 AM ET): US Leading Index (September)
🟢 15:00 UTC (11:00 AM ET): Kansas City Fed Manufacturing Survey
🟡 01:00 UTC (10:00 Seoul): Bank of Korea rate decision
🟡 11:00 UTC (14:00 Istanbul): Turkey central bank rate decision
🟡 Earnings: Procter and Gamble, Union Pacific, Lockheed Martin, Blackstone and many others.
FRIDAY, OCT 23
🔴 13:45 UTC (9:45 AM ET): US S&P Global Flash PMIs (manufacturing and services)
🔴 14:00 UTC (10:00 AM ET): University of Michigan final sentiment and inflation expectations
🟡 Morning in Europe: Eurozone flash PMIs
🟡 Japan CPI (September), Friday morning in Tokyo
🟡 12:30 UTC (8:30 AM ET): Canada Retail Sales (September)
🟡 11:30 UTC (14:30 Moscow): Russia central bank rate decision
🟢 Credit rating reviews: Moody's on France, S&P on Germany
🟡 Earnings: American Express, SLB
Why it matters:
Fed officials are now in the quiet period before the October 27-28 meeting, so they will not speak. The market will trade on data and earnings only.
Tesla and Meta report on Wednesday, so the AI trade gets a big test.
Flash PMIs and Michigan inflation expectations on Friday show if the price pressure from this week is spreading into expectations. That is what the Fed watches most.
12 years in these markets. This is what I do.
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🚨 JAPAN CORE CPI IS ABOVE 2%. THE LAST CHEAP MONEY ON EARTH IS ENDING.
Japan CPI (September), y/y:
Headline: 2.1%. Expected: 2.1%. Previous: 1.9%
Core (without fresh food): 2.1%. Expected: 2.1%. Previous: 1.7%
Core-core (without fresh food and energy): 2.4%. Expected: 2.3%. Previous: 1.9%
The most important number is core-core. It rose to 2.4%, so prices are rising beyond energy, not only because of oil.
For years, Japan was the cheapest place for global traders to borrow. The policy rate is still only 1.25%, but the direction is changing.
The Bank of Japan meets on October 29-30. A hold is expected. But Ueda said this week that underlying inflation is close to the 2% target, and the market prices a hike in December at about 80%.
The yen got a small lift after the data. USD/JPY is still stuck around 157-159, and Tokyo has already said it is ready to step in again if needed.
Inflation is now rising in the US, Europe and Japan at the same time. The Fed, the ECB and Korea are already tightening, and Japan is next in line.
For stocks and crypto, a stronger yen is a risk. When the yen rises fast, global traders close their yen funded trades.
12 years in these markets. This is what I do.
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🚨 JOBLESS CLAIMS CAME IN AT 194K. THE FED JUST GOT ANOTHER REASON TO KEEP HIKING.
US Initial Jobless Claims: 194K. Expected: 200K. Previous: 199K.
Fewer people lost jobs than expected. Layoffs stay low, so the Fed can focus on inflation. After last week hot CPI, PPI and import price data, this is bad news for risk assets.
Hike odds go up. Stocks and crypto feel the pressure.
12 years in these markets. This is what I do.
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🚨 JOBLESS CLAIMS DROP TODAY. THE FED MEETS NEXT WEEK, AND THIS NUMBER CAN MOVE THE HIKE ODDS.
US Initial Jobless Claims, out at 12:30 UTC (8:30 AM ET). Expected: 200K. Previous: 199K.
IF claims > 200K → market pumps
IF claims = 200K → nothing changes near-term
IF claims < 200K → market dumps
Layoffs are still low while hiring is weak. September payrolls were only 29K. That mix keeps the Fed in hike mode.
The Fed meets on October 27-28. After last week hot CPI, PPI and import price data, a strong labor number brings hike talk back. A weak number gives the market a reason to relax.
12 years in these markets. This is what I do.
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🚨 JOBLESS CLAIMS DROP TODAY. THE FED MEETS NEXT WEEK, AND THIS NUMBER CAN MOVE THE HIKE ODDS.
US Initial Jobless Claims, out at 12:30 UTC (8:30 AM ET). Expected: 200K. Previous: 199K.
IF claims > 200K → market pumps
IF claims = 200K → nothing changes near-term
IF claims < 200K → market dumps
Layoffs are still low while hiring is weak. September payrolls were only 29K. That mix keeps the Fed in hike mode.
The Fed meets on October 27-28. After last week hot CPI, PPI and import price data, a strong labor number brings hike talk back. A weak number gives the market a reason to relax.
12 years in these markets. This is what I do.
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🚨 THE US JUST SOLD 20 YEAR BONDS AT 5.469%. THE GOVERNMENT NOW PAYS MORE TO BORROW FOR 20 YEARS.
Results of the $13 billion 20 year auction on October 21:
High yield: 5.469%. Previous: 5.420%
Bid to cover: 2.73. Average: 2.62
Indirect bidders: 58.2%. Average: 65.2%
It was a mixed auction. Total demand was good, with bid to cover above average. But the Treasury paid more than the market expected, and indirect bidders, which include foreign buyers, took less than usual.
TLT, the ETF that holds long US Treasuries, trades at $80.24. When long term yields go up, TLT goes down.
Why it matters:
The 20 year yield shows what investors demand to lend to the US for a long time. It is now above 5.4%, while the Fed rate is 3.75-4.00%.
The Fed is expected to hold on October 28, but long term yields keep rising. The market asks for more pay because of inflation and government debt.
Mortgage rates are already around 7.4%.
When government bonds pay 5.5%, stocks and crypto have to offer more to attract money.
Next to watch: the Treasury refunding announcement in early November.
12 years in these markets. This is what I do.
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🚨 JAPAN IS THE NEXT TRIGGER. THE YEN IS STUCK AT 158 AND TOKYO IS READY TO ACT AGAIN.
USD/JPY is trading near 158.5. Last time it went above 160, Japan and the US stepped in together to buy yen. That was in late July, the first joint move in 15 years. Japan also spent about 11.7 trillion yen in April and May.
On October 15, Japan Finance Minister Katayama said Tokyo is ready to act again if needed.
The Bank of Japan meets on October 30. The rate is 1.25%. Markets price a very small chance of a hike this month, but about an 80% chance of one in December.
Ueda told parliament on Monday that underlying inflation is close to the 2% target. Japan CPI comes on Friday.
Why it matters:
The yen is a funding currency for global trades. When the yen rises fast, traders close those trades, and stocks and crypto can fall together. This happened in August 2024.
The Fed decides on October 28 and the BOJ on October 30. Two big central banks within three days.
If the BOJ turns hawkish or Tokyo steps in, the yen can jump quickly.
12 years in these markets. This is what I do.
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🚨 THIS IS STAGFLATION. PRICES UP, HIRING DEAD, AND THE FED IS HIKING ANYWAY.
Look at the numbers:
CPI: 3.7%, up from 3.4% in August
Gasoline: +9.1% in September alone
Payrolls: +29K. July was revised to -10K
Unemployment: 4.2%, up from 4.1%
Real wages: down 0.7% y/y
Michigan current conditions: 44.7, a record low
Prices rise faster than pay. Moody's economist Mark Zandi says payroll growth was about 40K a month over the past year, and close to zero outside health care. People feel it: consumer conditions just hit the lowest level on record.
And the Fed? It is hiking into this. The inflation comes from energy, and higher rates do not bring oil down. They only slow the economy more.
GDP is the last number to show it. Real pay and hiring show it first.
Higher prices, no jobs, higher rates. Call it what you want. I call it stagflation.
This is the beginning of the end.
12 years in these markets. This is what I do.
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🚨 TESLA, META AND FLASH PMIS HIT THIS WEEK, OCT 19 TO 23. THE FED MEETS RIGHT AFTER.
MONDAY, OCT 19
🟡 02:00 UTC (10:00 Beijing): China Q3 GDP and September activity data
🟡 12:30 UTC (8:30 AM ET): Canada CPI (September)
🟢 14:00 UTC (10:00 AM ET): US NAHB Housing Market Index
TUESDAY, OCT 20
🟡 01:00 UTC (9:00 Beijing): China Loan Prime Rate
🟢 09:00 UTC (11:00 Berlin): Germany ZEW survey
🟡 12:30 UTC (8:30 AM ET): US Housing Starts and Building Permits (September)
🟢 14:00 UTC (10:00 AM ET): US Pending Home Sales (September)
🟡 Earnings: GE Aerospace, GM, RTX and many others before the open. Netflix after the close.
WEDNESDAY, OCT 21
No major US data.
🔴 Earnings after the close: Tesla, Meta, IBM, Texas Instruments, Lam Research and many others.
🟢 Earnings before the open: AT&T, Abbott, NextEra and others.
🟢 ECB President Lagarde speaks.
THURSDAY, OCT 22
🟡 12:30 UTC (8:30 AM ET): US Initial Jobless Claims
🟢 14:00 UTC (10:00 AM ET): US Leading Index (September)
🟢 15:00 UTC (11:00 AM ET): Kansas City Fed Manufacturing Survey
🟡 01:00 UTC (10:00 Seoul): Bank of Korea rate decision
🟡 11:00 UTC (14:00 Istanbul): Turkey central bank rate decision
🟡 Earnings: Procter and Gamble, Union Pacific, Lockheed Martin, Blackstone and many others.
FRIDAY, OCT 23
🔴 13:45 UTC (9:45 AM ET): US S&P Global Flash PMIs (manufacturing and services)
🔴 14:00 UTC (10:00 AM ET): University of Michigan final sentiment and inflation expectations
🟡 Morning in Europe: Eurozone flash PMIs
🟡 Japan CPI (September), Friday morning in Tokyo
🟡 12:30 UTC (8:30 AM ET): Canada Retail Sales (September)
🟡 11:30 UTC (14:30 Moscow): Russia central bank rate decision
🟢 Credit rating reviews: Moody's on France, S&P on Germany
🟡 Earnings: American Express, SLB
Why it matters:
Fed officials are now in the quiet period before the October 27-28 meeting, so they will not speak. The market will trade on data and earnings only.
Tesla and Meta report on Wednesday, so the AI trade gets a big test.
Flash PMIs and Michigan inflation expectations on Friday show if the price pressure from this week is spreading into expectations. That is what the Fed watches most.
12 years in these markets. This is what I do.
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🚨 THREE HOT INFLATION REPORTS IN THREE DAYS, BUT THE ODDS OF AN OCTOBER FED HIKE ARE ONLY 15.5%. WARSH JUST CHANGED THE MOOD.
CPI came in at 3.7%. PPI rose 1.3% in one month. Import prices rose 1.1% and export prices rose 2.2%.
Then Fed Chair Warsh spoke in Bangkok. He gave no signal on the October 27-28 meeting. He said he does not decide on meetings in advance.
He also said inflation is a global problem, with central banks tightening at the same time. And he said AI can lift productivity over time, which could help the Fed keep rates high without breaking growth.
The market heard no panic. The odds of an October hike are now 15.5%. Stock futures rose and the dollar went softer.
This is not a pivot. Prices are still running hot, and a hike later this year is still on the table. It just may not come in two weeks.
Next test: the data before October 28.
12 years in these markets. This is what I do.
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🚨 US IMPORT PRICES JUMPED 1.1% IN SEPTEMBER. EXPORT PRICES ROSE 2.2%. THE INFLATION PIPELINE IS STILL FILLING UP.
US Import Price Index (September): +1.1% m/m. Expected: +0.8%.
US Export Price Index (September): +2.2% m/m. Expected: +1.0%.
Export prices came in more than double the forecast. Imports were also above expectations.
This is the third hot inflation report in three days. CPI was 3.7% y/y, PPI was +1.3% m/m, and now this. Import prices are an early signal of what companies pay before the cost reaches shoppers.
The Fed gets more reason to hike on October 27-28. That keeps pressure on stocks and crypto.
Why it matters:
Import prices show what the US pays for goods from abroad, including oil. When they rise, costs move into producer prices first and consumer prices later.
Export prices show how global demand and the dollar affect US sellers.
The ex-fuel number tells us if inflation is only about energy or spreading wider. That is what the Fed cares about most.
12 years in these markets. This is what I do.
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🚨 US CPI IS BACK THIS WEEK. HERE IS EVERYTHING THAT CAN MOVE THE MARKET, OCT 12-16.
MON, OCT 12
No major data. US bond market is closed for Columbus Day. Canada and Japan are on holiday.
TUE, OCT 13
🟡 Q3 earnings start: JPMorgan, Goldman Sachs and 4 others (before US market open)
WED, OCT 14
🟡 China CPI: 01:30 UTC (9:30 AM Beijing)
🔴 US CPI (September): 12:30 UTC (8:30 AM ET)
🟡 Fed Beige Book: 18:00 UTC (2:00 PM ET)
🟡 Earnings: Bank of America, Morgan Stanley and 4 others (before US market open)
THU, OCT 15
🔴 US Retail Sales, PPI, Jobless Claims and Philly Fed: 12:30 UTC (8:30 AM ET)
🟡 Earnings: TSMC, Charles Schwab and 2 others
FRI, OCT 16
🔴 Fed Chair Warsh speaks at the IMF meeting in Bangkok: 03:30 UTC (10:30 AM Bangkok)
🟢 US Import and Export Prices: 12:30 UTC (8:30 AM ET)
🟢 Eurozone final CPI
Why it matters:
CPI on Wednesday is the main event. It lands two weeks before the Fed meeting on Oct 28, and the hike debate is still open.
Thursday brings retail sales and PPI on the same morning, so inflation and consumer data hit together.
Warsh speaks on Friday, right after CPI. That is when the market gets his reaction.
Bank earnings show how the credit side holds up with the 10 year yield near 5.3%.
12 years in these markets. This is what I do.
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🚨 JOBLESS CLAIMS CAME IN LOW AND PPI JUST EXPLODED. THE FED HAS NO REASON TO STOP HIKING.
US Initial Jobless Claims: 199K. Expected: 200K. Previous: 197K.
Also out at 12:30 UTC (8:30 AM ET):
PPI (September): +1.3% m/m. Expected: +0.5%. Previous: +0.4%.
Retail Sales (September): +0.8% m/m. Expected: +0.3%. Previous: +1.2%.
Layoffs stay low. Consumers keep spending. Producer prices rose more than 2 times faster than expected.
After a hot CPI yesterday, this is another hot day. Higher producer prices usually end up in consumer prices later, and the Fed knows it.
Hike odds for the October 27-28 meeting go up. Stocks and crypto stay under pressure.
12 years in these markets. This is what I do.
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🚨 JOBLESS CLAIMS DROP TODAY. LAYOFFS ARE AT THE LOWEST SINCE 2022 AND THE FED IS WATCHING.
US Initial Jobless Claims, out at 12:30 UTC (8:30 AM ET). Expected: 200K. Previous: 197K.
IF claims > 200K → market pumps
IF claims = 200K → nothing changes near-term
IF claims < 200K → market dumps
Also at 12:30 UTC (8:30 AM ET):
PPI (September), expected +0.5% m/m, previous +0.4%
Retail Sales (September), expected +0.3% m/m, previous +1.2%
Philly Fed Index (October)
And tonight: Fed Chair Warsh speaks in Bangkok at 03:30 UTC Friday (10:30 AM Bangkok).
The 4 week average of claims is 198K, the lowest since 2022. Hiring is weak, with September payrolls at just 29K, but layoffs are still low. That mix keeps the Fed in hike mode.
After yesterday CPI, the S&P 500 fell about 1.1% and the Nasdaq about 1.9%. Another hot number today keeps the pressure on.
12 years in these markets. This is what I do.
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