It's probably time to brush up on the Jacobins and the Committee of Public Safety.
Maybe the history of the XMI on October 20, 1987 as well.
More to come as the summer progresses.
From Marc to Market:
Monday Blues: Consolidation Threatened
Overview: The MSCI Asia Pacific Index rose for a sixth consecutive session. Japan, Taiwan, Singapore, and Indonesian markets advanced more than 1%. European bourses are mixed, with the peripheral shares doing better than the core, leaving the Dow Jones Stoxx 600 about 0.5% lower near midday after surging 2.5% ahead the weekend. US shares are firm, as is the 10-year yields, hovering near 92 bp. Core 10-year benchmark yields are a softer in Europe, while peripheral yields are edging higher to start the week. The Scandis and Antipodean currencies continue to lead the move against the dollar, while the other major currencies are less than 0.2% higher. Emerging market currencies continue their run higher, led by Russia, South Africa, and Mexico. The JP Morgan Emerging Market Currency Index is extending its recovery for the eighth consecutive session. Gold has steadied below $1700 after falling 2.6% last week. Oil reacted favorably to the OPEC+ agreement to extend the maximum output cuts until the end of next month. July WTI is higher for the fifth straight session and briefly traded above $40 a barrel.....MUCH MORE
Asia Pacific
China reported May trade and reserve figures over the weekend. The reserves rose by about $10 bln, which is a little more than twice what economists had anticipated. Still, on a $3.09 trillion-base, it is little more than a rounding error and has no significance. On the other hand, the trade surplus jumped by more than a third, those economists had anticipated a small decline.
The rise in the trade surplus to a record of almost $63 bln is not a function of China's economic prowess. Exports fell 3.3% year-over-year after a 3.5% increase in April. A Reuters poll found a median forecast of a 7% increase. Imports plunged 16.7%, worse than the 14.2% decline in April and the sharpest decline since January 2016. The Reuters poll looked for a 9.7% decline. It appears that weaker prices contributed to the decline in imports. For example, Bloomberg cites a 5.2% rise in oil import volumes so far this year, while the average purchase price has declined by over a fifth.
This, in turn, speaks to a positive terms of trade shock. China may indeed be pursuing an import substitution strategy, but it is not the key driver of the dramatic widening of the trade surplus in May. It will not feel like an import substitution strategy for Brazil. China appears to be the destination of a growing share of Brazilian exports, taking 54% of its outbound shipments in May. In the first five months of the year, Brazilian exports to China have risen by 128% year-over-year, according to data released last week. Much of what Brazil ships to China (agriculture and energy) compete directly with US exports to China....
