2023/02/22 (176) Column

Using Power?
You Also Have To Learn!


Not every current politician had a happy childhood, let alone such a close relationship with his parents that today, looking back, he speaks of a princely childhood with both feet firmly planted on the ground. So be lenient with our current politicians – we don’t have others! They too have a conscience and try to do what is best for their taxpayers and/or consumers – whether from Belgium, Bulgaria, Denmark, Germany, Estonia, Finland, France, Greece, Ireland, Italy, Croatia, Latvia, Lithuania, Luxembourg, Malta , the Netherlands, Austria, Poland, Portugal, Romania, Sweden, Slovakia, Slovenia, Spain, the Czech Republic, Hungary and Cyprus, in our EU. And or other worldwide. But please don’t expect them, in public, to openly admit their imperfections in our flawed world. Because of the public pressure, you are under the X-ray vision of taxpayers and/or consumers who are interested in us.

And so, looking ahead to 2023, it is more than likely that energy prices will once again have the greatest impact on the economy and markets. Freedom, in our so-called West, is veiled by left-wing lust for power under a cloak of freedom! Whether it’s socialism, communism, whatever political green variant you can think of – in the end we taxpayers and consumers (who we all are) will realize that all the state programs that have been launched will only cost us! Because our political leaders have only 2 ways to accumulate money: either through taxes and/or by getting into debt on the bond market.

Once you let that melt in your mouth, you quickly realize that green politicians have no interest in seeing energy’s contribution to the consumer price index disappear. Wherever green politics reacts, it is at a historic high and where there is no green politics, no politician has any interest in promoting green politics; unless he lets his taxpayers and consumers pay.

That energy prices will fall back to 10 percent (from 20 percent and a third respectively) in the US and UK by the end of 2023. And/Or will have largely disappeared in the euro zone. This is the goal that left-wing liberals are selling us under the guise of satisfying green lusts for power. However, everyone involved knows implicitly that the fall in energy prices from the current high level is a necessary but probably not sufficient condition for inflation to return close to the central bank’s target values. And so green politicians pose as saviors for their voters, and or more and more conservative ones (sometimes even with God on their side) in order to abolish the monetary material damage that they (un)consciously (un)wantedly organized . And always future-scared taxpayers and/or consumers always have continue to pay. Therefore, most economists expect that the major economies will also enter a recession for the first time in this year 2023. And I, too, expect tension in 2023 between the disinflationary effects of the recession and the inflationary effects of the subsequent cost pressure and tight labor markets. But as long as taxpayers and consumers still don’t vote out green politics, like an annoying ex-girlfriend that only costs, nothing will change in the basic stagflation. Because that is the goal of green politics. The result of all forms of left-wing government in our so-called West. That’s why I don’t expect interest rate cuts before 2024!
If any?
DEVISE 2 DAY 48h
– Last News About What Drives The News Media

Ukrainian President Volodymyr Zelenskyy has condemned the deadly Russian artillery raid on the city of Kherson in the south of the country. While fierce fighting continues to rage on the fronts, China’s highest foreign politician is exploring the chances of a peace plan by his state and party leaders in Moscow this Wednesday.

Zelenskyj: Those responsible for the attacks will be found
Russia’s foreign minister meets China’s top officials
Zelenskyy continues «diplomatic marathon»

Zelenskyj: Those responsible for the attacks will be found

“This Russian attack had no military purpose,” said Zelenskyj in his nightly video speech on Tuesday. “Just like thousands of similar Russian attacks that are a real message from Russia to the world.” At least six people were killed and twelve injured in the artillery raid on a residential area and a bus station in Kherson.

“The terrorist state is trying to show the world that terror is to be expected by shelling streets, houses, schools, pharmacies and hospitals, churches, bus stops, markets and power plants with rockets,” Zelensky said. However, he is confident that the attacker will be put in his place. Namely «all together – Ukrainians and the world».

In the end, Ukrainian intelligence and the army would find those responsible for the attacks on Kherson and other cities. “And beyond that, we will prove that only humanity, only the UN Charter and only the right of every people to live free and safe from terror and insane aggressions like those of Russia are worth considering.” Shortly before, the Ukrainian general staff had reported that the situation on the various front sections of the country was relatively stable. Once again, the Donetsk and Luhansk regions in the east of the country were heavily contested. “We are doing everything we can to repel enemy attacks there – constant intensive attacks that Russia does not stop, although it suffers great losses there,” said Zelenskyy.

Russia’s foreign minister meets China’s top foreign officials

On the eve of the anniversary of Russia’s invasion of neighboring Ukraine, senior Chinese foreign policy maker Wang Yi will meet with Russia’s Foreign Minister Sergei Lavrov in Moscow on Wednesday. In addition to relations between the two countries, the conflict in Ukraine is certainly on the agenda. In Moscow, Wang wants to sound out Russia’s positions on the peace initiative of its head of state Xi Jinping to end the Ukraine war. The Chinese foreign policy expert had already exchanged views with the head of the National Security Council, Nikolai Patrushev, in Moscow on Tuesday.

Xi wants to present the position paper on the anniversary on Friday (February 24), of which only the basics are known so far. Among other things, it is about “respect for sovereignty and territorial integrity”, as reported by the foreign office in Beijing. Ukraine is demanding the complete withdrawal of Russian troops from its territory, including Crimea, as a prerequisite for talks with Moscow.

Zelenskyy continues «diplomatic marathon»

The day after US President Joe Biden’s surprise visit to Kiev, Zelenskyy continued his “diplomatic marathon” that had lasted for almost a year. He met with Italian Prime Minister Giorgia Meloni on Tuesday, who promised Ukraine continued military, financial and civilian support to her country. Among other things, Kiev is to receive additional air defense systems.

In addition, Zelenskyj also received a delegation from the US Congress, as he announced in the evening. “This is a very important signal for our country, the entire region and the world,” he said. “Yesterday President Biden was in Kiev, today there are representatives of Congress, namely members of the Republican Party.”
DEVISE 2 DAY Another 48h
– Last News About How Drives The Price Action

The Dow Jones has now given up all of its annual gains, with the S&P 500 down just 3.4%. The many bears that have been wrong since the beginning of the year see themselves confirmed. Yesterday Morgan Stanley, J.P. Morgan and Bank of America have been negative about Wall Street’s prospects. The head of the St Louis Federal Reserve, James Bullard, has again spoken out in favor of a short-term, larger interest rate hike before the opening. Disinflation and a solid labor market are quite conceivable. Walmart’s results would show that the process of lower inflation is underway. In terms of earnings, most numbers reported since last night have been encouraging, with Palo Alto Networks, Toll Brothers and Coinbase all gaining ground. TJX reports a sluggish outlook with no major reaction from the stock. After the closing, the focus will be on NVIDIA, Etsy, Lucid and Ebay.Forex 10-Year Bond Yield Stock Markets

NZ Dollar Gains After RBNZ Decision South Africa 10-Year Bond Yield Eases Asian Markets Close Lower
Indonesian Rupiah Trades Below 15,200 UK 10-Year Bond Yield at 7-Week High Hang Seng Closes at Near 7-Week Low
South African Rand Firms Slightly After Budget Speech Australian Shares Hit 6-Week Lows
European Stocks Fall on Wednesday
FTSE 100 Extends Losses
US

Forex
NZ Dollar Gains After RBNZ Decision
Indonesian Rupiah Trades Below 15,200
South African Rand Firms Slightly After Budget Speech

NZ Dollar Gains After RBNZ Decision
The New Zealand dollar edged above $0.62 after the Reserve Bank of New Zealand raised interest rates by 50 basis points in a widely expected move, but the central bank maintained its projection for rates to peak at 5.5%, a hawkish sign for markets. The board cited elevated inflationary pressures, high inflation expectations and tight labor markets as factors they considered for the move. The RBNZ has now lifted its policy rate by a total of 450 basis points in ten consecutive meetings, bringing the cash rate to a 41-year high of 4.75%. Meanwhile, the kiwi remains under pressure from strong US economic data and hawkish signals from Federal Reserve officials who hinted at a bigger half-percentage point rate hike in March.

Indonesian Rupiah Trades Below 15,200
The Indonesia rupiah depreciated 0.2% to 15,215 against the USD on Wednesday, falling for the second day, amid a resilient US dollar following a surprise rebound in business activity that raised the possibility for the Federal Reserve to deliver more rate hikes. Meantime, Bank Indonesia last week kept its key interest rate unchanged at 5.75% after delivering six straight hikes before that and said the current level should be enough to guide inflation back to the target of between 2 to 4%. The country’s annual inflation hit a five-month low of 5.28% in January, easing from a seven-year record of 5.95% in last September. The central bank recently mentioned it would utilize its ongoing “operation twist”, in which it sells short-term notes and buys up longer ones in the secondary market, to help mitigate the impact of potential rate hikes in the US.

South African Rand Firms Slightly After Budget Speech
The South African rand appreciated slightly toward 18.1 against the US dollar after the country’s finance minister delivered his 2023 budget speech in the wake of shockingly severe daily power outages and rising food prices. Enoch Godongwana said he sees lower budget deficits ahead despite the debt stabilizing at a higher level and economic growth weakening amid the ongoing Eskom power crisis. In this regard, he stated the government plans to take on over half of the struggling state power company’s debt over the next three years to help strengthen its balance sheet and operations and enable it to restructure. Meanwhile, Godongwana warned that the state’s debt-servicing costs will rise and power shortages are likely to persist for some time to come.

10-Year Government Bond Yields
South Africa 10-Year Bond Yield Eases
UK 10-Year Bond Yield at 7-Week High

South Africa 10-Year Bond Yield Eases
South Africa’s 10-year government bond yield traded around 10.15%, down from a nearly two-month high of 10.26% hit on February 21st, as investors welcomed the government’s plans for indebted Eskom during the budget speech dominated by the power crisis. Finance Minister Enoch Godongwana said the government would take on 254 billion rands of Eskom’s 423-billion-rand debt over the next three years. Mainly due to this relief, government debt will stabilize at a higher level of 73.6% of GDP in 2025/26, about three years later than anticipated in the 2022 Medium Term Budget Policy Statement. Godongwana also claimed the government was reducing the fiscal deficit without resorting to tax increases or further cuts in social wages. Meanwhile, the primary risks to the fiscal outlook incl. a worsening economic outlook, a further weakening of the state-owned companies finances, and an unaffordable public-service wage agreement.UK 10-Year Bond Yield at 7-Week High
The yield on the UK’s 10-year Gilt stabilized around 3.6%, its highest level since January 3rd, on hopes Britain might avoid a long recession and as the Bank of England is seen keeping rates higher for longer following the release of stronger-than-expected economic data. The latest PMI survey showed the UK business activity unexpectedly returned to growth in February, ending a six-month period of contraction, while the country’s retail sales rebounded in January thanks to sales promotions and a decline in fuel prices. The Bank of England raised its benchmark interest rate to 4% this month, its highest level since late 2008, and is expected to raise rates just twice more to peak at 4.5% by June, with a risk that it stops earlier at 4.25%. Elsewhere, solid economic data out of the US pointing to a still-tight labor market and sticky inflation ramped up bets that the Federal Reserve will stick to its aggressive tightening path.

Stock Markets
Asian Markets Close Lower
Hang Seng Closes at Near 7-Week Low
Australian Shares Hit 6-Week Lows
European Stocks Fall on Wednesday
FTSE 100 Extends Losses

Asian Markets Close Lower
Asian bourses came under heavy selling pressure on Wednesday, mirroring overnight losses in Wall Street, with investors fretting about the global economy’s health as central banks move aggressively to tamp down inflation. Rate-setters in New Zealand announced a widely expected 50 bps interest rate hike to 4.75%, the highest in over 14 years, as it seeks to tame stubbornly high inflation. South Korean shares led declines among the region’s major markets, with the benchmark Kospi losing 1.7% to around 2,418. Japan’s Nikkei 225 plunged 1.3% to end at 27,104. In China, the Shanghai Composite dropped roughly 0.5% to about 3,291. Meantime, the Hang Seng index went down 0.5% to 20,424 while Australia’s S&P/ASX 200 index fell 0.3% to close at 7,315 points.

Hang Seng Closes at Near 7-Week Low
The Hang Seng lost 105.65 points or 0.51% to end at 20,423.84 on Wednesday, its lowest close since the first trading day of the year, with a sell-off on Wall Street Tuesday and geopolitical tensions ahead of the Ukraine war’s first anniversary weighing on sentiment. Meantime, Hong Kong’s economic contraction at 4.2% yoy in Q4 of 2022 was confirmed, the fourth straight quarter of the downturn, amid weak external demand.

Australian Shares Hit 6-Week Lows
The S&P/ASX 200 Index dropped 0.3% to close at 7,315 on Wednesday, sliding to its lowest levels in six weeks and tracking sharp losses on Wall Street overnight, as investors fretted about the prospect of continued rate hikes from the US Federal Reserve.

European Stocks Fall on Wednesday
European equity markets closed in the red Wednesday, with the benchmark Stoxx 600 down 0.4% as downbeat earnings reports dragged down mining stocks and banks while media stocks rose. Domestically, the German DAX closed nearly flat at 15,400 ahead of the minutes of the Federal Reserve’s last meeting later today and after data showed German business morale improved further to an eight-month high, while CPI reports from Germany and France suggested inflation in Europe’s largest economies will remain high for some time.

FTSE 100 Extends Losses
Equities in London declined for a second consecutive session on Wednesday, with the benchmark FTSE 100 closing around the 7,900 mark, dragged by heavyweight materials and energy stocks. British businesses reported an unexpected bounce in activity in February, a survey showed on Tuesday, suggesting the economy may be sidestepping the risk of recession but raising the prospect of further central bank policy tightening.

Wall Street Ends Mixed After Fed Minutes
The Dow Jones finished 84 points lower on Wednesday, and the S&P 500 dipped 0.1% while Nasdaq 100 lost 0.1%, as investors digested the last Federal Reserve meeting minutes. A solid majority of policymakers agreed to slow down the pace of rate increases, delivering a smaller 25 bps hike in February. Still, they warned that the tightening cycle is not over as inflation risks remain tilted to the upside. The minutes’ release came before a slew of stronger-than-expected US employment and consumer prices data, which, in turn, prompted markets to price in at least three more 25 basis point rate hikes this year. On the corporate side, Palo Alto Networks jumped 12.5% after the cybersecurity company lifted its earnings forecast for this year. Shares of Intel fell 1.5% after the chipmaker slashed its dividend. The market movement comes after Wall Street recorded its worst daily performance of 2023 on Tuesday.DEVISE 2 DAY 48h
– Where I Was Wrong, Where I Was Right

The week after!
This could be the title for this week after the US inflation figures turned out worse, i.e. higher, than expected. US Inflation Fall Losing Momentum! And if things continue like this, then we are threatened with an increase again compared to the previous year, om March 2020? But I don’t want to play Kassdandra; which also doesn’t work because I have another genitalia between my legs 😉 but that’s just by the way! Because the US yield curve is becoming more attractive to all of us, which is putting pressure on the US WallStreet. That`s why, I`m staying away from a new 4XSetUp again for the time being in relation to the DOW Future.

However,
we remain long in EURUSD, long in the DAX Future, and or also (since the beginning of last week) now long in the ADIDAS share & BITCOIN.

I still don’t dare to formulate a new 4XSetUp in UKOIL (CFD on the Brent Crude Oil Future)! And that although Brent Remains Under Pressure today, on wednesdays trading session. Brent crude futures held recent declines to trade around $83 per barrel on Wednesday, remaining under pressure ahead of the release of the Federal Reserve’s latest minutes that may provide clues on the trajectory of interest rate hikes in the US. Major US retailers including Walmart and Home Depot also issued dire economic warnings as high inflation continued to pressure consumers and squeeze corporate margins. Keeping a floor under prices, Russia has recently announced plans to cut output by 500,000 barrels a day in March or about 5% of total production in retaliation to Western sanctions.