Uncle Jim’s World of Bonds

10 years ago Bill Gross said the U.K. was in severe danger on account of its budget deficits. It didn’t work out like that. Also today I look at my favourite gilt, UKT 8% 2021.

This week we find out more about the Fed’s monetary policy outlook given recent softer jobs data, and the likely timing and size of Biden’s stimulus package. Which will bond markets care about most?

5 reasons why inflation comes back in 2021 from Morgan Stanley. Plus a musical tribute to the new Treasury Secretary.

When Smaug captured the dwarves treasure, he plunged the economy of Middle Earth into depression and deflation. Perhaps leading the rise of the far right (Sauron).

Stimulus, fallen angels, sovereign defaults, and a CDS disaster that will go down in bond market history.

Yields are rising, curves are steepening. A big Biden stimulus is expected. Will we get higher Fed rates and inflation though?

A bumper edition looking at the key issues for bond markets in 2021, and beyond.

Today I look at EMD’s default experience so far this year, and then at the forward projections for default risk. Also I preview Thursday’s ECB meeting. And Weird Left Finance Twitter gets a shout out.

Valery Giscard d’Estaing, the former French President, died this week. He was a key player in France’s economic relationship with the US. He also invented the Giscard Bond - linked to gold.

But a good day for the US economy as the Democrats and Republicans showed that they might be able to work together around fiscal stimulus. USTs sold off heavily. Also today I discuss a new Fed paper on corporate debt overhang.

RIP the GOAT. Also today, RPI reform, Tesla, Copper, and Debt Cancellation.

Lots of new appointments in the world of US economics to talk about today. Also, RPI reform in the U.K., and pressure on the New Zealand central bank.

With Zambia having defaulted on international bonds last week, it’s a good time to interview Greg Smith, emerging market debt analyst, and former World Bank African economist. How was the Covid shock for the region, will we see more defaults, and what’s China’s new role in African debt dynamics?

I’m guessing we all agree that the recent vaccine news makes a strong economic recovery likely in 2021. But how much long lasting damage - or scarring - has already occurred?

In today’s podcast we have a new series from the “Girls” star, we have Fed speak, bitcoins, WFH and a HUGE bond auction.

Ok the podcast is mainly about central bank rate expectations, but I also suggest that puppy inflation is not being captured in the U.K. RPI stats.

3 things about the market for pushbikes that tell us about the global economy.

Corporate America got the result it wanted - no prospect of regulatory pressure given the Dems didn’t win the Senate. Risk assets rally, but the US dollar is weakening. More Fed cuts to come?

A quick morning update on last night’s US elections. US Treasuries rallying hard as fiscal expansion expectations are scaled back.

The EU has issued its own bonds. And the film of Capital in the 21st Century.

Today I look at sovereign CDS markets given the UK’s downgrade last week, and ask whether the IMF really has changed its tune over austerity.

Today I look at the newly minted Nobel Economics prize winners, and their work on auction theory. Also Moody’s and the U.K. credit rating, and EMD fund flows.

Today I look at a weak US CPI print, and an Economist article called “Eternal Zero” about low bond yields.

Today I look at some new IMF research, as well as at a Chinese policy change, and an interview with the ECB’s Lane.

Chances of negative rates have increased in the U.K. after a disappointing growth number for August. It should have been strong given Eat Out To Help Out.