Fulcrum Perspectives

An interactive blog sharing the Fulcrum team's policy updates and analysis.

Francis Kelly Francis Kelly

Speaking at the Barron’s Advisor 100 Summit

September 19, 2023

It was great fun being a part of the “Morning News with Barron’s” panel today hosted by Jack Otter, Global Head of Barron’s Wealth & Asset Management Group and host of Fox Business News’s weekly “Barron’s Roundtable” show. What made it even better was to sit with Tony Crescenzi, Executive Vice President, Strategist, and Portfolio Manager at PIMCO. Tony is not only one of the most brilliant market strategists out there but also a true intellectual and student of history, not to mention an all-around wonderful guy.

This was the kick-off session to the Barron’s Advisor 100 Summit being held at the Phoenician Hotel in Phoenix, Arizona. More than 400 financial advisors and strategists are in attendance.

Our conversation covered a great deal of ground, ranging from the looming U.S. government shutdown to a host of geopolitical issues and what the Federal Reserve is likely to do going forward with regard to interest rates. Tony had some brilliant insights into the issue of liquidity many major firms are grappling with now as a result of the Dodd-Frank Act and what it means for investors.

Thank you, Barron’s for asking me to be a part of this great conference. And in particular, thank you, Jack, for your superb hosting and questioning - never any softballs, always penetrating and smart! It was really fun!

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Francis Kelly Francis Kelly

Presenting at the Iowa Bankers Association Annual Convention

Des Moines, Iowa

December 18, 2023

It was a great honor and true delight to have the chance to speak at the Iowa Bankers Association Annual Convention in Des Moines, Iowa. When you get in a room with a group of state and local bankers - the men and women who play such a critical role in keeping their community’s economy going and growing — you know you are going to get some very smart, thoughtful questions on the global economy and geopolitics and what it means for their clients and customers.

And being in Iowa - and despite being the one speaking about the upcoming 2024 elections - I came away learning an awful lot from these great folks about where the elections may be headed (not the conventional wisdom!).

My presentation can be accessed below. And a few shots of the event, which was enormous - held in the Des Moines Convention Center. Thank you, Iowa Bankers Association, for having me out to speak - it was a great event, and I really enjoyed meeting and talking with so many of you!

The Iowa State House, Des Moines, Iowa. The golden dome is stunning as the sun sets every night.

Make it stand out

Being introduced inside the stunning Des Moines Convention Center!

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Francis Kelly Francis Kelly

The Global Week Ahead

September 17 - 24, 2023

The coming week is jammed with high-level diplomatic meetings in New York as part of the beginning of the 78th United Nations General Assembly. Leaders worldwide will be present, and many will address the General Assembly.

Concurrent with the General Assembly will be several high-level climate-focused summits, some hosted by the UN and others by private sector organizations, to elevate climate engagement.

We will be watching for a likely side-line meeting between senior US and Chinese officials to come to pass to discuss a possible visit to the US in November of Chinese President Xi as part of the ASEAN Leaders Summit in San Francisco. News reports on Sunday morning revealed that US National Security Advisor Jake Sullivan recently held two days of meetings with Chinese officials on the upcoming summit and Xi’s involvement.

Also, President Biden, who will address the UN General Assembly, will likely meet in New York with Israeli Prime Minister Benjamin Netanyahu. The two leaders have had a contentious relationship, and any meeting between the two will be seen as a vital thaw in tensions.

Senior EU officials are expected to have a set of sideline talks at the UN with senior Chinese officials to discuss ongoing trade and political tensions, particularly around sales of advanced EU technology to China.

Ukrainian President Volodymyr Zelensky will address the UN before traveling to Washington to meet with members of Congress in a bid to obtain increased military aid. He will also meet with President Biden.

On the global economic radar screen this week, three big central bank interest rate decisions will be made - the Bank of England, the Bank of Japan, and the US Federal Reserve. Markets are on a hair-string, wondering if this will be the Bank of England’s last rate increase and if the Federal Reserve is finally done (at least for now) with raising rates. Several emerging market central banks are also deciding rate levels this week.

Also, next week, the OECD and the Asia Development Bank will publish updated economic forecasts, which markets will read closely.

Finally, we would note Sunday is the Autumn Equinox, officially beginning the season of Autumn. Get ready to start raking those leaves.

Here is what else we are watching around the world this week:

Sunday, September 17, 2023

Global

  • UN Secretary-General António Guterres is expected to deliver remarks at a UN Global Compact Board Meeting. 

Americas

Political/Social Events –

  • Nothing Significant to Report (NSTR)

Economic Reports/Events –

  • NSTR

Asia

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Reserve Bank of Australia Philip Lowe steps down as Governor and is succeeded by Michele Bullock.

Europe

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 Africa

  • Political/Social Events –

NSTR

Economic Reports/Events –

  • NSTR

 

Monday, September 18, 2023

Global

 

Americas

Political/Social Events –

  • Ukrainian President Volodymyr Zelensky will travel to Washington from New York (where he will attend the UN General Assembly).  Zelensky will meet with US members of Congress in a bid to obtain increased military aid.  He will also meet with President Biden.

Economic Reports/Events –

  • US NAHB Housing Market Index (September), Long Term TIC Flow (July)

  • Canada PPI (August), Raw Material Prices (August), Housing Starts (August)

  • Brazil IBC-Br Economic Activity (July), BCB Focus Market Readout

  • Mexico Private Spending (Q2), Aggregate Demand (Q2)

  • Colombia ISE Economic Activity (July)

Asia

Political/Social Events –

  • Chinese Foreign Minister Wang Yi will travel to Moscow for meetings with Russian Foreign Minister Sergey Lavrov as a follow-up to the recent meeting between President Putin and North Korean Leader Kim Jong-un.  China has proposed a 12-point peace plan for the Ukraine War and now wishes to understand the nature of the newly rejuvenated Russia-North Korean relationship.

  • India’s Parliament begins a special session through September 22.  It is expected the session will cover a number of big issues ranging from officially changing India’s name to “Bharat,” press and registration of periodicals legislation, reform of the Post Office, a “One Election” proposal, and a Chief Election and other Election Commissioners legislation. 

  • Chinese and EU senior officials are expected to meet on the sidelines of the UN General Assembly in New York to discuss ongoing trade tensions, artificial intelligence, research, and other issues.

  • ASEAN will hold its first-ever joint military drills through September 23.  The drills will be conducted in the Strait of Malacca and focus on non-combat usage of military assets (e.g., disaster relief and other humanitarian exercises.)

Economic Reports/Events –

  • In Japan, today is Respect for the Aged Day. Financial markets are closed.

  • Singapore Balance of Trade (August), Non-Oil Exports (August)

  • New Zealand Composite & Services PCI (August)

 

Europe

Political/Social Events –

  • EU President Ursala von der Leyden will participate in the 2023 Sustainable Development Goals Summit in New York.

  • The EU Agriculture and Fisheries Council meets in Brussels.  They are expected to consider the annual consultation on fishing opportunities with the UK as well as EU-Norwegian annual consultations.

  • There will be an informal meeting of the EU Ministers of Education and Youth through September 19 in Zaragoza, Spain.

  • NATO begins conducting “Dynamic Messenger” Joint Exercises in Portugal.

  • Great Britain’s Prince William visits New York for the Earthshot Prize Innovation Summit, taking place in conjunction with the UN General Assembly and  New York Climate Week.

Economic Reports/Events –

  • ECB Board Member Luis de Guindos will give remarks online at an event organized by Foment del Treball 

  • ECB Board Member Fabio Panetta will chair a panel on "Value chain reconfiguration in an uncertain world - how far will it go?" at the 9th Joint Bank of Canada and European Central Bank Conference in Frankfurt, Germany.

  • German Bundesbank Monthly Report

  • Ireland Construction PMI (August), Residential Property Prices (July)

  • Poland Core Inflation (August)

 

Middle East

Political/Social Events –

Economic Reports/Events –

  • Qatar Inflation (August)

  • Israel Budget Balance (August)

Africa

Political/Social Events –

NSTR

Economic Reports/Events –

Angola FX Reserves (August), M3 Money Supply (August)

 

Tuesday, September 19, 2023

Global

  • The UN Global Compact Leaders Summit begins. Alongside the SDG Summit 2023, during the UN General Assembly High-Level Week, this year’s UN Global Compact Leaders’ Summit will convene business leaders, UN officials, Government leaders, SDG stakeholders, and civil society professionals from across the globe to comprehensively review the private sector’s contribution to advancing the SDGs. 

  • Global Dairy Trade Price Index (New Zealand)

  • The OECD releases its Interim Economic Report.

Americas

Political/Social Events –

Asia

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Reserve Bank of Australia Meeting Minutes

  • Malaysia Imports/Exports/Balance of Trade (August)

Europe

Political/Social Events –

  • The EU General Affairs Council meets in Brussels.  Their agenda of issues can be found HERE.

  • UK Opposition Leader, Sir Keir Starmer, will meet with French President Emmanuel Macron in Paris. This is considered something of a political coup for Starmer, who will meet with Macron one day before British King Charles III arrives in Paris for his first official visit. It also polishes Starmer’s foreign policy credentials going into the elections next year.

  • Milan Fashion Week begins.

Economic Reports/Events –

  • ECB Board Member  Frank Elderson will give a speech at the 10th Banking Union Conference organized by Freshfields Bruckhaus Deringer/Institute for Law and Finance at Goethe-Universität/Center for Financial Studies in Frankfurt, Germany.

  • Eurozone Current Account (July), Inflation (August), CPI (August)

  • Switzerland Balance of Trade (August)

  • Italy Current Account (July)

  • Serbia Inflation (August), Current Account (July)

  • Bulgaria Current Account (July)

Middle East

Political/Social Events –

  • Israel’s Supreme Court will hear an appeal over recent highly controversial legislation limiting the powers of courts.

Economic Reports/Events –

  • Israel GDP (Q2), Unemployment (July), Manufacturing PMI (August)

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Wednesday, September 20, 2023

Global

  • At the UN, the High-level Dialogue on Financing for Development will take place in the Trusteeship Council Chamber. The High-level Dialogue is organized by the UN Department of Economic and Social Affairs (DESA). The Secretary-General is expected to deliver remarks.  

  • The UN Security Council is scheduled to hold an Open Debate on the Maintenance of International Peace and Security: “Upholding the purposes and principles of the UN Charter through effective multilateralism: maintenance of peace and security of Ukraine”. The Secretary-General is expected to deliver remarks.  

 

Americas

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • U.S. Federal Reserve’s Open Market Committee Interest Rate Decision & Press Conference, US MBA Mortgage Market Index Figures (September 15)

  • Bank of Canada Summary of Deliberations

  • Argentina Unemployment Rate (Q2), Leading Indicators (August)

  • Brazil Central Bank Interest Rate Decision

  • Paraguay Central Bank Interest Rate Decision

Asia

Political/Social Events –

  • China’s Special Representative on Eurasian Affairs, Li Hui, meets with Roman Catholic Cardinal Matteo Zuppi in Beijing to discuss the normalization of Vatican-Chinese relations.

Economic Reports/Events –

  • China Loan Prime Rate 1-Year, Loan Prime Rate 5-Year Decisions

  • Japan Imports/Exports/Balance of Trade (August)

  • South Korea PPI (August)

  • Australia Westpac Leading Index (August)

  • New Zealand Current Account (Q2)

  • Taiwan Export Orders (August)

Europe

Political/Social Events –

  • EU President Ursala von der Leyden will give a speech at the Climate Ambition Summit in New York.

  • King Charles III and Queen Camilla visit Paris to meet with French President Macron.  This is a rescheduled visit as the King had to cancel his trip earlier this year due to riots in France over pension reform.

  • There will be an informal meeting of EU Transport Ministers through September 22 in Barcelona, Spain. 

  • In the UK, Junior doctors and consultants simultaneously walk out in pay dispute with the government.

Economic Reports/Events –

  • ECB Board Member Fabio Panetta will give introductory remarks at the 4th joint workshop of European Independent Fiscal Institutions and the ESCB in Frankfurt, Germany.

  • ECB Board Member Andrea Enria will give opening remarks at the ECB Supervision Innovators Conference "Technology and banking supervision connected" in Frankfurt, Germany.

  • ECB Board Member Isabel Schnabel will participate in an exchange of views on "Current aspects of monetary policy" with Association of German Banks (Bundesverband deutscher Banken e. V.) in Frankfurt, Germany.

  • ECB Board Member Kerstin af Jochnick will give the keynote speech at the 28th Financials CEO Conference organized by Bank of America Securities, Inc. in London, United Kingdom.

  • ECB Board Member Elizabeth McCaul will give the keynote speech on "Technology, data and innovation – Shaping the future of supervision" at the ECB Supervision Innovators Conference "Technology and banking supervision connected" in Frankfurt, Germany.

  • ECB Board Member Frank Elderson will give a speech at the Springtij Forum 2023 in Terschelling, Netherlands.

  • Eurozone Construction Output (July), New Car Registration (August)

  • Germany PPI (August)

  • UK Inflation (August), PPI (August), Retail Prices (August)

  • Switzerland SECO Economic Forecasts

  • Croatia Central Bank Interest Rate Decision

  • Greece Current Account (July)

  • Poland Employment (August), PPI (August), Corporate Sector Wages (August)

  • Hungary Unemployment (August)

  • Montenegro GDP (Q2)

  • Russia PPI (August), Consumer Confidence (Q3)

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Israel Current Account (Q2)

  • Turkey Central Government Debt (August)

  • Kuwait Central Bank Interest Rate Decision

  • Saudi Central Bank Interest Rate Decision

  • Qatar Deposit Interest Rate Decision

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • South Africa SACCI Business Confidence (August), Inflation, (August), Retail Sales (July)

  • Rwanda GDP (Q2) 

 

Thursday, September 21, 2023 

Global

  • NSTR

Americas

Political/Social Events –

  • President Biden may meet with Israeli Prime Minister Benjamin Netanyahu on the sidelines of the UN General Assembly in New York.  The meeting is yet to be confirmed.

Economic Reports/Events –

  • US Current Account (Q2), Initial Jobless Claims (September 16), Philadelphia Fed Manufacturing Index/Business Conditions/CAPEX Index/Employment/New Orders/Prices Paid Reports (September), Existing Home Sales (August), CB Leading Index (August)

  • Canada New Housing Starts (August)

  • Colombia Business Confidence (August)

  • El Salvador Balance of Trade (August)

  • Argentina Balance of Trade (August)

Asia

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • New Zealand GDP (Q2), Credit Card Spending (August)

  • Reserve Bank of Australia Bulletin

  • Hong Kong Central Bank Interest Rate Decision, Current Account (Q2), Inflation (August)

  • Taiwan Central Bank Interest Rate Decision

  • Philippines Central Bank Interest Rate Decision

  • Indonesia Central Bank Interest Rate Decision, Loan Growth (August), Lending Facility Rate (September)

Europe

Political/Social Events –

  • EU President Ursula von der Leyden will give a speech at the 2023 Atlantic Council Awards Dinner in New York.  Earlier in the day, she will give the keynote speech at the Global Citizen NOW Climate Session.

  • In the UK, NHS junior doctors are due to walk out on strike over pay. 

Economic Reports/Events –

  • ECB President Christine Lagarde will give a lecture at Rencontres méditerranéennes in Marseille, France.

  • ECB Board Member Isabel Schnabel will chair Session IV – Jean Monnet Lecture "Postwar Reconstruction Assistance and Local Governments in Ukraine" at the 8th ECB Annual Research Conference in Frankfurt, Germany.

  • Eurozone Consumer Confidence (September)

  • ECB Board Member Philip R. Lane will give a dinner speech and Q&A at the Money Marketeers of New York University in New York.

  • Bank of England Interest Rate Decision and Meeting Minutes, UK Public Sector Net Borrowing (August)

  • France Business Confidence (September), Business Climate Indicator (September)

  • Switzerland Central Bank Interest Rate Decision

  • Italy Construction Output (June)

  • Poland Retail Sales (August)

  • Spain Balance of Trade (July)

  • Serbia Consumer Confidence (September), PPI (August)

  • Slovenia Unemployment (July)

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Saudi Arabia Balance of Trade (July)

  • Turkey Consumer Confidence (September), Central Bank Interest Rate Decision, FX Reserves (September 15)

  • Israel Manufacturing Production (July)

  • Egypt Central Bank Interest Rate Decision

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • South Africa Reserve Bank Interest Rate Decision,  Building Permits (July) 

 

Friday, September 22, 2023

Global

  • NSTR

Americas

Political/Social Events –

  • Secretary of Treasury Janet Yellen will convene a meeting of the Financial Stability Board in executive session.  The preliminary agenda includes a discussion of international market conditions and development., the Council’s proposed analytic framework for financial stability risk identification, assessment, and response, and the Council’s proposed guidance on nonbank financial company determination.

Economic Reports/Events –

Asia

Political/Social Events –

  • The Asian Games begin in Hangzhou, China. Athletes from 45 countries will compete in 61 disciplines from 40 sports.  The games go through October 8.

Economic Reports/Events –

  • Bank of Japan Interest Rate Decision, Japan Inflation (August), Jibun Bank/Services/Composite PMIs (September)

  • India Deposit Growth (September 8)

  • Taiwan Unemployment (August)

  • Australia Judo Bank Services/Manufacturing/Composite PMIs (September)

  • Malaysia Inflation (August)

  • Thailand New Car Sales (August)

  • New Zealand Imports/Exports/Balance of Trade (August)

  • Philippines Business & Consumer Confidence (Q3)

Europe

Political/Social Events –

  • German Chancellor Olaf Scholz addresses the UN General Assembly.

  • French President Emmanuel Macron welcomes Pope France to Marseille for a two-day visit.

Economic Reports/Events –

  • ECB Board Member Luis de Guindos will give remarks
    followed by Q&A at an event organized by Kreab in Madrid, Spain.

  • Eurozone HCOB Manufacturing/Services/Composite PMIs (September)

  • Germany HCOB Manufacturing/Services/Composite PMIs (September)

  • UK Gfk Consumer Confidence (September), Retail Sales (August), S&P Global/CIPS Manufacturing & Services & Composite PMIs (September), CBI Industrial Trends Orders (September)

  • Spain GDP (Q2)

  • Switzerland Current Account (Q2)

  • Poland M3 Money Supply (August)

  • France HCOB Manufacturing/Services/Composite PMIs (September)

  • Ireland Consumer Confidence (September), Wholesale Prices (August)

  • Slovenia Business Confidence (September)

  • Slovakia Unemployment (August)

  • Ukraine GDP (Q2)

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

Israel Inflation Expectations (September)

  • Qatar Total Credit Growth (August), M2 Money Supply (August)

  • Kuwait Inflation (August)

  • Lebanon Inflation (August)

Africa:

Political/Social Events –

  • In Nigeria, The National Labour Congress union may launch a nationwide indefinite strike over the government's removal of fuel subsidies. A two-day warning strike in early September involved aviation, banks, government offices, utilities, and other sectors in several states.

Economic Reports/Events –

  • Mozambique Central Bank Interest Rate Decision

 

Saturday, September 23, 2023

Global

  • Today is the arrival of the Autumn Equinox, officially beginning the season of Autumn.

Americas

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

Asia

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Taiwan Industrial Production (August), Retail Sales (August), M21 Money Supply (August)

Europe

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Sunday, September 24, 2023

Global

  • NSTR

Americas

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

Asia

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Europe

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Middle East

  • Political/Social Events –

NSTR

Economic Reports/Events –

  • NSTR

 

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

  

 

Please let us know if you have any questions or a colleague would like to be added to our distribution list.

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Francis Kelly Francis Kelly

U.S. Regulatory Week Ahead

September 18 - 22, 2023

It will be a busy week for regulators and Congress this coming week.   The Senate Banking Committee will tackle the issue of AI in financial services, coming off last week’s closed-door Senate meetings with tech CEOs to better understand the potential impact AI will have on all of us.  The House Financial Services Committee’s Subcommittee on Capital Markets will hold an oversight hearing of the SEC’s Division of Investment Management – the day before the SEC votes on stricter regulations on using ESG labels on funds.  Expect a lot of hard questions for William Birdthistle, Director of the SEC’s Investment Management Division, about ESG and other major mutual fund issues.

Also, this week, the Nation Credit Union Administration holds a board meeting on new regulations.  CFTC Chair Benham and other CFTC Commissioners are making important speeches on climate-related regulatory issues and crypto regulations.

Also of note to markets, Federal Trade Commission Chair Lina Kahn will speak in New York on international antitrust issues, a hot topic these days with so many international mergers and acquisitions in motion, which the FTC is reviewing. 

Here is the full regulatory calendar as we see it for the coming week.  Please let us know if you have any questions.

 

U.S. Congressional Hearings

  • Wednesday, September 20 – 10:00 a.m.: The Senate Banking Committee will hold a hearing on “Artificial Intelligence in Financial Services.”  Testifying will be Melissa Koide, Director and CEO, FinRegLab; and Daniel Gorfine, Founder & CEO, Gattaca Horizons, LLC, Adjunct Professor of Law, at Georgetown University, and former Chief Innovation Officer, of the Commodity Futures Trading Commission. Additional witnesses may be added at a later date.

 

  • The House Financial Services Committee will hold several hearings this week, including:

    • Tuesday, September 19, 10:00 a.m.: The Subcommittee on Capital Markets will hold a hearing on “Oversight of the SEC’s Division of Investment Management”.   The witness testifying will be William Birdthistle, Director of the Division of Investment Management, Securities and Exchange Commission.

    • Tuesday, September 19, 2:00 p.m.: The Subcommittee on Financial Institutions and Monetary Policy will hold a hearing on “A Holistic Review of Regulators: Regulatory Overreach and Economic Consequences.”  Witnesses testifying will include Hal Scott, Nomura Professor of International Financial Systems, Emeritus, Harvard Law School, Karen Petrou, Managing Partner, Federal Financial Analytics Inc., and Mayra Rodríguez Valladares, Managing Principal, MRV Associates.

 

US Regulatory Meetings & Events

 

Federal Reserve Board

  • Tuesday and Wednesday, September 19 & 20: The Federal Open Markets Committee meeting and press conference.

  • Friday, September 22, 8:50 a.m.: Governor Lisa Cook gives a keynote address at the National Bureau of Economic Research Economics of Artificial Intelligence Conference Fall 2023 in Toronto, Canada.

 

Securities and Exchange Commission

  • Tuesday, September 19, 10:00 a.m. – 3:00 p.m.: The SEC’s Small Business Advisory Committee will meet to discuss funding for early-stage companies and alternative funding for small businesses.  The complete agenda can be found HERE.

  • Tuesday, September 19, 8:30 a.m. – 5:30 p.m.: SEC Regional Directors from Chicago, Fort Worth, and Denver) will speak at the Securities Enforcement Forum Central 2023 in Chicago.   Also scheduled to speak is the head of the SEC’s Crypto Asset and Cyber Unit.

  • Wednesday, September 20, 10:00 a.m.: The SEC will hold an Open Meeting to consider whether “to adopt amendments to the rule under the Investment Company Act of 1940 that addresses investment company names that are likely to mislead investors about an investment company’s investments and risks. The amendments the Commission will consider also include enhanced prospectus disclosure requirements for terminology used in investment company names, as well as public reporting regarding compliance with new names-related requirements” – in short, whether to finalize tougher rules for mutual funds that use ESG labels.

  • Thursday, September 21, 10:00 a.m.:  The SEC will convene its Investor Advisory Committee.  A complete agenda and list of panelists can be found HERE.

 

Federal Deposit Insurance Corporation

  • Nothing significant to report.

 

Commodities Futures Trading Commission 

  • Tuesday, September 19, 10:00 a.m.: CFTC Chair Rostin Behnam will speak at the IETA North America Climate Summit – NACS 2023 in New York.   Later that afternoon (2:30 p.m.),  Chair Behnam will speak at the Flowcarbon’s Carbon Smart Summit, also in New York.

  •  

  • Wednesday, September 20, 1:00 p.m. EST: CFTC Commissioner Summer Mersinger will participate in a fireside chat at the World Federation of Exchanges General Assembly & Annual Meeting in Bermuda.

  •  

  • Thursday, September 21, 9:30 a.m. EST: CFTC Commissioner Kristin Johnson will deliver a keynote address and participate in the “Optimal Market Design for Digital Assets” session at the World Federation of Exchanges Annual Meeting in Bermuda.

 

 

National Credit Union Administration

  • Thursday, September 21, 10:00 a.m.:  The National Credit Union Administration holds a Board Meeting in Alexandria, Virginia.  The Board will be briefed on the Share Insurance Fund Quarterly Report and vote on a final rule regarding Parts 701 and 714 dealing with loan participation, eligible obligations, and notes of liquidating Credit Unions.

 

 

Federal Trade Commission & Department of Justice Antitrust Division

 

Farm Credit Administration

  •   Nothing significant to report.

 

Trade Associations & Think Tank Events

  

  

Please let us know if you have any questions or would like to be added to our email distribution list.

 

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Francis Kelly Francis Kelly

Recommended Weekend Reads

September 15-17, 2023

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list.

Indo Pacific

  • “Electric Shock: Interpreting China’s Electric Vehicle Export Boom”  Center for Strategic and International Studies

    China’s rise as an automotive exporter is fueled by the growing importance of the country’s globally leading electric vehicle (EV) industry. However, despite the rapidly increasing sales by domestic firms like BYD, many of the EVs exported from China are made by Western companies like Tesla that have significant production capacity in the country. Exports of EVs made in China have critical implications for both legacy carmakers and policymakers in regions like Europe and the United States that have strived to diversify clean tech supply chains away from China while also advancing decarbonization. For the United States and Western Europe, focusing on boosting domestic innovation and manufacturing will continue to be an important tool to face this challenge.

 

  • “Measurement Muddle: China’s GDP Growth Data and Potential Proxies”  Big Data China

    How fast is China’s economy growing? Or, given the recent trends, how much is it slowing down? Obtaining a reliable answer to these seemingly straightforward questions has proved amazingly elusive. Despite the production of mountains of official data and a plethora of unofficial estimates, these are questions for which there are no consensus answers. There has long been a concern that China’s statistical officials have inflated the country’s data for its gross domestic product (GDP), which is ascribed to political incentives to present a rosy economic picture to its populace and the rest of the world (see Figure 1). Another recurring concern has been the undercounting of the contribution of the private sector to the country’s growth and employment, which may be due to its second-class citizen status, which may make it harder for statistical authorities to monitor effectively, and the large share of economic activity that comes from the service sector, which is inherently harder to count than produced goods.

 

Africa

 

Geo-Economics 

  • “The Origins and Efficacy of the Price Cap on Russian Oil”   Russia Matters/Harvard Kennedy School Belfer Center for Science and International Affairs

    In the wake of Russia’s illegal invasion of Ukraine, the international community levied a series of sweeping and unprecedented sanctions designed to disrupt the Russian economy and limit Russian President Vladimir Putin’s ability to wage war. This effort included a price cap on Russian oil, a novel sanctions regime collectively imposed by the G-7, the European Union, and Australia, designed to simultaneously lower Russian revenue while preserving the supply of oil in the global markets. Preliminary assessments, such as an Aug. 3, 2023, analysis by the U.S. Treasury Department, suggest that the price cap has largely achieved these goals to date. Global supply remains mostly stable, and Russian oil continues to be sold at a discount relative to similar products produced by other countries.

 

Global

  • “Five Things to Watch for at the UN General Assembly Opening”   Carnegie Endowment for International Peace

    The coming days will reveal whether the UN can remain relevant in a divided world. Top of FormBottom of Form  When world leaders convene next week for the annual opening of the UN General Assembly, the assembled nations will be anything but united. Geopolitical rivalries, political grievances, economic upheaval, and ecological crises are testing the legitimacy and credibility of the seventy-eight-year-old body. 

 

Graphic of the Week 

Where is Your Cup of Coffee Coming From?

 We are addicted to it in many forms.  But do you know where your coffee was grown?  It might surprise you. Bloomberg did a deep dive this week in the coffee industry.  Coffee is grown in about 70 countries, with five of them — including Brazil and Vietnam — making up about 85% of the world’s output. The rest comes from some 9.6 million growers in smaller producers around the world.

 

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Francis Kelly Francis Kelly

The Global Week Ahead

September 10 - 17, 2023

First and foremost, we remember this week the victims of the 9/11 terror attacks, which took place 23 years ago.  The pain and memories of that tragic day do not dim for most of us.

Looking at the rest of the week ahead, it is jam-packed with major geopolitical and economic events.  President Biden visits Vietnam after the conclusion of the G20 Summit on Sunday, seeking stronger diplomatic and trade relations – a move being watched closely by Beijing.  Meanwhile, Chinese President Xi Jinping hosts Venezuelan President Nicholas Maduro to strengthen ties with the oil-rich dictatorial Latin American country as Hong Kong hosts the annual Belt and Road Summit of participating countries.

 Also this week, Russian President Vladimir Putin will meet with North Korean leader Kim Jong-un in Vladivostok to arrange North Korean weapons and ammunition sales to help bolster Russian military efforts in Ukraine – risking new, tougher sanctions on both nations.

In the U.S., the House of Representatives returns from the August recess and immediately begins battling over getting appropriations bills done before the end of the month or risk a government shutdown.  Also, in the U.S. this week, the United Auto Workers are scheduled to go on strike unless new contracts are struck with the Big Three auto manufacturers, a potential new drag on the U.S. economy.

On the economic radar screen this week, markets will be watching the European Central Bank’s meeting and announcement on Thursday whether they have decided to raise interest rates again (which seems to be the consensus) as much of Europe – especially Germany – is struggling to stem stagnant economies.  Also of note, U.S. CPI figures are out later this week, as well as unemployment numbers.  In Asia, China will release inflation figures on Saturday and new unemployment figures. 

Below is our weekly report of what else we are watching around the world this coming week:

Sunday, September 10, 2023

Global

 

Americas

Political/Social Events –

  • Mexican President Andres Manuel Lopez Obrador visits Chile.

  • Mexico’s Morena party concludes a weeklong selection process to determine who will represent the party during next year’s presidential election.

Economic Reports/Events –

  • Nothing Significant to Report (NSTR)

 

Asia

Political/Social Events –

Economic Reports/Events –

  • NSTR

Europe

Political/Social Events –

  • The Eastern Economic Forum will be held in Vladivostok, Russia. The purpose of the meeting, which includes leaders from Central Asia, is the encourage investment and economic development in Russia’s Far East.  Russian President Vladimir Putin is expected to use the Forum to meet with North Korean leader Kim Jong-un on greater weapons sales to Russia to support Russian forces in Ukraine.

  • Russia will hold regional and local elections.

Economic Reports/Events –

  • NSTR

 

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Egypt Inflation (August)

 

Africa

Political/Social Events –

  • The Africa Venture Capital Summit 2023 begins in Kenya, bringing more than 300 investors from 35 countries to look at investment opportunities on the continent.

Economic Reports/Events –

  • NSTR 

Monday, September 11, 2023 

Global

 

Americas

Political/Social Events –

  • Today is the 23rd anniversary of the terrorist attacks in New York, Pennsylvania, and on the Pentagon.

  • The trial begins of ex-Peruvian President Alejandro Toledo, accused of taking bribes from Brazilian company Odebrecht.

Economic Reports/Events –

  • US Consumer Inflation Expectations (August), The American Bar Association's Economic Advisory Committee holds a virtual discussion with leading Wall Street bank economists on "Economic Forecast” in Washington, D.C.

  • Brazil BCB Focus Market Readout

  • Mexico Industrial Production (July)

  • El Salvador PPI (August)

  • Uruguay Industrial Production (July)

 

Asia

Political/Social Events –

  • Japanese Prime Minister Fumio Kishida is expected to shuffle his Cabinet.

  • French President Emmanuel Macron will visit Dhaka, Bangladesh, following the Group of 20 summit in New Delhi, India, to discuss climate change, trade issues, and the Rohingya crisis.

Economic Reports/Events –

  • Japan machine tool orders (August)

  • India passenger vehicle sales (August)

  • Malaysia Industrial Production (July), Retail Sales (July)

 

Europe

Political/Social Events –

  • U.S. and Armenian troops will carry out military exercises in Armenia until Sept. 20 in a sign of deepening ties and waning Russian influence.

  • The defense ministers of Germany, Estonia, and Latvia will visit German arms maker Diehl in Roethenbach an der Pegnitz, Bavaria.

  • Norway holds local elections.

  • Today is National Day in Catalonia, Spain.  It is expected that large independence rallies will be held throughout the region.

Economic Reports/Events –

  • The European Commission publishes economic forecasts for 2023 and 2024.

  • Italy Industrial Production (July)

  • Romania Balance of Trade (July)

  • Serbia Industrial Production (July)

  • Slovenia Industrial Production (July)

  • Russia Balance of Trade (July)

 

Middle East

Political/Social Events –

  • special envoy to Lebanon, former Foreign Minister Le Drian, visits Beirut for talks aimed at resolving a year-long impasse over filling Lebanon’s presidency and forming a stable government.

  • The United Arab Emirates campaign season for its Oct. 7 legislative elections will begin.

Economic Reports/Events –

  • Saudi Arabia industrial production (July)

  • Turkey unemployment (July), Industrial production (July), Current Account (July)

 

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • South Africa Manufacturing Production (July) 

 

Tuesday, September 12, 2023

Global

  • Today is the opening of the 78th UN General Assembly.

  • Russia is expected to request a U.N. Security Council meeting to discuss Western arms supplies to Ukraine.

  • The World Trade Organization (WTO) will launch its World Trade Report.

 

Americas

Political/Social Events –

  • The U.S. House of Representatives returns from its August recess to begin considering appropriations bills that must be completed by the end of the month or risk a federal government shutdown. The U.S. Senate will begin considering three bipartisan spending bills this week, which will pressure House Republicans to move more quickly on passing legislation and avoid a shutdown.

  • Google’s antitrust trial begins.  The U.S. Justice Department’s Antitrust Division has brought the case, and it is seen as the keystone to the Biden Administration’s policy toward restraining Big Tech’s growing market share of the tech sector (DoJ is also reportedly investigating Amazon, Apple, Ticketmaster, and other big tech companies).

  • Apple holds its annual event – dubbed “Wonderlust” – to unveil new products, including the highly-anticipated iPhone 15.

  • The U.S. Chamber of Commerce holds its 2023 Global Aerospace Summit, with the theme, "Innovating the Skies, Connecting the World," through September 13.

Economic Reports/Events –

  • US NFIB Business Optimism Index (August), Redbook (September 9), WASDE Report

  • Brazil Inflation (August)

  • Colombia Balance of Trade (July)

  • Paraguay Balance of Trade (August)

 

Asia

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • China Total Social Financing (August), M2 Money Supply (August), Vehicle Sales (August), New Yuan Loans (August), Outstanding Loan Growth (August)

  • India Manufacturing Production (July), Inflation (August)

  • Australia Westpac Consumer Confidence Change (September), NAB Business Confidence (August)

  • Philippines FDI (June)

  • Pakistan Consumer Confidence (August)

 

Europe

Political/Social Events –

Northern Ireland's investment summit will occur through Sept. 13 in Belfast, Northern Ireland.

Economic Reports/Events –

  • Bank of England Monetary Policy Committee member Catherine Mann gives a speech at the Canadian Association for Business Economics Conference ‘Post-Pandemic Economics: What does the "New Normal" look like?  in Ontario, Canada.

  • Eurozone ZEW Economic Sentiment Index (September)

  • Germany ZEW Economic Sentiment Index (September), Current Account (July)

  • UK Employment (July)

  • Spain CPI (August), Inflation (August)

  • Serbia Construction Output (July), Inflation (August)

 

Middle East

Political/Social Events –

  • Israel's Supreme Court will hear petitions against the government's "reasonableness" judicial reform law in a potentially major constitutional challenge between the country's different branches of government.

Economic Reports/Events –

  • Turkey Retail Sales (July)

  • Israel Budget Balance (August), Consumer Confidence (August)

 

Africa

Political/Social Events –

  • The Africa Crime Prevention Forum begins in Abidjan, Côte d’Ivoire.

Economic Reports/Events –

  • Rwanda Inflation Rate (August)

  • Nigeria Balance of Trade (June)

  • Angola Inflation (August), Wholesale Prices (August)

 

Wednesday, September 13, 2023

Global

  • UN Secretary-General António Guterres is scheduled to deliver remarks at the United Nations Peace Bell Ceremony on the occasion of the International Day of Peace.  This event will take place in the Japanese Garden.

  • OPEC Monthly Report

  • International Energy Agency (IEA) Oil Market Report

 

Americas

Political/Social Events –

  • U.S. Senate Majority Leader Chuck Schumer (D-NY) begins a series of Artificial Intelligence (AI) Forums featuring tech leaders, activists, and academics.  The purpose of the Forums is to educate senators on AI and the potential implications of its power.

Economic Reports/Events –

  • US Inflation (August), CPI (August), MBA Mortgage Market Indexes (September 8)

 

Asia

Political/Social Events –

  • Hong Kong will host the annual Belt and Road Summit.  Trade and foreign ministers from countries participating in the Belt and Road effort are expected to attend.  The event will also have a special Middle East Forum to discuss greater economic and trade opportunities.

Economic Reports/Events –

  • Japan Reuters Tankan Index (August), BSI Large Manufacturing (Q3), PPI (August)

  • South Korea Import & Export Prices (August), Unemployment (August)

  • Hong Kong Industrial Production (Q2)

 

Europe

Political/Social Events –

  • EU President Ursula von der Leyen gives the 2023 State of the Union address in Strasbourg, France.

Economic Reports/Events –

  • Eurozone Industrial Production (July)

  • UK GDP (July), Goods Trade Balance (July), Industrial Production (July), Manufacturing Production (July), Balance of Trade (July), Construction Output (July)

  • Poland Industrial Production (July), Balance of Trade (July), Current Account (July)

  • Romania Industrial Production (July), Inflation Rate (August), Current Account (July)

  • Hungary Central Bank Interest Rate Decision, Industrial Production (July)

  • Bulgaria Balance of Trade (July)

 

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Turkey Auto Production (August)

  • Israel Imports/Exports/Balance of Trade (August)

 

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Thursday, September 14, 2023

Global

  • UN Secretary-General António Guterres will travel to Cuba to attend the G77 + China meeting (he is expected to deliver remarks on Friday).  The purpose of the meeting is to bolster the voice of the Global South at the upcoming UN Assembly.  Interestingly, India’s foreign minister canceled his planned attendance at the summit, which some observers see as retaliation for Chinese President Xi Jinping’s last-minute decision to skip the G20 meetings hosted in India earlier this week.

 

Americas

Political/Social Events –

  • Auto workers will go on strike in the US at midnight unless a new contract is agreed to between the Big Three Auto manufacturers and the United Auto Workers.

Economic Reports/Events –

  • US Retail Sales (August), PPI (August), Initial Jobless Claims (September 9), Business Inventories (July),

  • Canada Wholesale Sales (July)

  • Argentina Inflation (August)

  • Peru Balance of Trade (July)

 

Asia

Political/Social Events –

  • An IMF delegation will visit Sri Lanka through September 27 to assess the bankrupt island’s progress in implementing a $3 billion bailout deal that was agreed to earlier this year.  If the assessment is positive, the country would qualify for more funding.

  • Workers at Chevron’s Gorgon and Wheatstone LNG facilities in Australia will vote on whether to extend and escalate their strike in a bid to improve pay.

  • South Korean Railway Union workers are expected to go on strike for better wages.

  • Taipei Aerospace Defence Technology Exhibition and Taipei Aerospace Show begins.

Economic Reports/Events –

  • Japan Machinery Orders (July), Industrial Production (July), Capacity Utilization (July)

  • India WPI Inflation (August), WPI Food Index (August), WPI Fuel (August), WPI Manufacturing (August)

  • Australia Employment (August)

  • Singapore Unemployment (Q2)

  • Indonesia Car Sales (August)

 

Europe

Political/Social Events –

  • Italian Prime Minister Giorgia Meloni will chair the fourth Budapest Demographic Summit through Sept. 16.

  • EU foreign policy chief Josep Borrell hosts Kosovar PM Albin Kurti and Serbian President Aleksandar Vucic for talks.

Economic Reports/Events –

  • The European Central Bank’s Governing Council meets in Frankfurt, Germany, to consider interest rate policy. ECB President Christine Lagarde holds a press conference afterward.

  • ECB Board Member Fernandez-Bollo chairs a panel entitled "Priorities for improving the EU bank crisis management framework for medium-sized banks" at The EUROFI 2023 Financial Forum organized in association with the Spanish Presidency of the Council of the EU in Santiago de Compostela, Spain.

  • ECB Board Member Elizabeth McCaul participates in a panel "Managing risks in the banking sector" at The EUROFI 2023 Financial Forum organized in association with the Spanish Presidency of the Council of the EU in Santiago de Compostela, Spain.

  • ECB Board Member Andrea Enria gives a speech at The EUROFI 2023 Financial Forum organized in association with the Spanish Presidency of the Council of the EU in Santiago de Compostela, Spain.

  • Switzerland Producer & Import Prices (August)

  • Serbia CPI (August), Inflation (August)

  • Ukraine Central Bank Interest Rate Decision, Balance of Trade (June)

 

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Saudi Arabia Wholesale Prices (August), Inflation (August)

  • Turkey FX Reserves (September 8)

 

Africa

Political/Social Events –

  • Nigerian separatist leader Nnamdi Kanu will appeal to the Nigerian Supreme Court to release him from detention.  A year ago, a lower court cleared him of terrorism charges, but the Nigerian government appealed that decision.

Economic Reports/Events –

  • South Africa Mining Production (July), Gold Production (July), SACCI Business Confidence (August)

  

Friday, September 15, 2023

Global

  • Rosh Hashana begins marking the Jewish New Year.

 

Americas

Political/Social Events –

Economic Reports/Events –

  • US Import & Export Prices (August), New York Empire State Manufacturing Index (September), Industrial Production (August), Manufacturing Production (August), Michigan Consumer Sentiment ((September), Michigan Inflation Expectations (September), Michigan Current Conditions (September)

  • Canada New Motor Vehicles Sales (July)

  • Brazil Retail Sales (July)

  • Colombia Retail Sales (July), Industrial Production (July)

  • Peru GDP (Q2), Unemployment (August)

 

Asia

Political/Social Events –

  • South Korea and the United States will hold their fourth round of extended deterrence talks in Seoul, South Korea.

  • The Milken Asia Summit begins in Singapore.  US Secretary of Commerce Gina Raimondo will speak.

Economic Reports/Events –

  • China People’s Bank of China 1-Year MLF Announcement, Industrial Production (August), Retail Sales (August), Unemployment (August)

  • India Imports/Exports/Balance of Trade (August), FX Reserves (September 8)

  • Indonesia Imports/Exports/Balance of Trade (August)

  • Japan Tertiary Industry Index (July)

 

Europe

Political/Social Events –

Economic Reports/Events –

  • The Eurogroup meets in Santiago de Compostela, Spain.  They are expected to discuss macroeconomic developments in the EU as well as the selection process of a new ECB Executive Board member.  ECB President Christine Lagarde holds a press conference following the meeting.

  • The EU Economic and Financial Affairs Ministers will hold informal meetings through September 16 in Santiago de Compostela, Spain.

  • ECB Board Member Edouard Fernandez-Bollo chairs a panel entitled "Bank diversity in Europe: consolidation and/or preservation?" at The EUROFI 2023 Financial Forum organized in association with the Spanish Presidency of the Council of the EU in Santiago de Compostela, Spain.

  • Eurozone Budget Balance (August), Balance of Trade (August), Labor Cost Index (Q2), Wage Growth (Q2)

  • Germany Wholesale Prices (August)

  • France Inflation (August), Inflation (August), New Car Registrations (August)

  • Italy Inflation (August), CPI (August), Balance of Trade (July)

  • Poland Inflation (August)

  • Ireland Balance of Trade (July)

  • Hungary Construction (July), CPI (August), Inflation (August)

  • Greece Construction Output (Q2)

  • Bulgaria Inflation (August)

  • Serbia Building Permits (July)

  • Ukraine GDP (Q2)

  • Russia Central Bank Interest Rate Decision and press conference

 

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Israel Inflation (August)

 

Africa:

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Botswana Inflation (August)

  • Nigeria Food Inflation (August), Inflation (August)

  • Angola Central Bank Interest Rate Decision

 

Saturday, September 16, 2023

Global

  • NSTR

 

Americas

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Asia

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Europe

Political/Social Events –

  • Germany begins the 188th Annual Oktoberfest in Munich.

Economic Reports/Events –

  • NSTR

 

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR 

 

Sunday, September 17, 2023 

Global

  • NSTR

 

Americas

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Asia

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • Reserve Bank of Australia Philip Lowe steps down as Governor and is succeeded by Michele Bullock.

 

Europe

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Middle East

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

 

Africa

Political/Social Events –

  • NSTR

Economic Reports/Events –

  • NSTR

Please let us know if you or a colleague would like to be added to our distribution list.

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Francis Kelly Francis Kelly

It’s Not Business All Time... Fly Fishing in Banff!

Lest our clients and blog readers think all we do is work here at Fulcrum Macro, we want to share some photos of our recent fly fishing adventures on the Bow River in Calgary and Banff. We fished the Lower Bow River for Rainbows and Brownies and, the next day, the Upper Bow River for Brownies.

While it was rainy and chilly on the Upper Bow, it was a grand adventure and incredible fun. My first fly fishing trip where I had to constantly watch out for bears when we occasionally fished from the shoreline!

At the Fairmont Banff Hotel.

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Francis Kelly Francis Kelly

Recommended Weekend Reads

September 8 - 10, 2023

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list.

 

Indo Pacific

  • “India’s Strategic Evolution”  Center for Strategic and International Affairs “The Asia Chessboard” Podcast

    The podcast begins by examining India’s strategic outlook since the end of the Cold War, considering India’s history, the evolution of its economic model, and shifts in the political perspectives and priorities of the Indian government. The participants turn to India’s role in BRICS – examining the relationship between India and China within the organization, the reasoning behind India's participation in BRICS, and the implications of the August 2023 BRICS summit. Next, they discuss Delhi’s changing relationship with Taipei and expanding engagement with Japan and Australia. The conversation concludes with an assessment of what India wants for its strategic future and how it would interact with the international world order. 

 

  • “US-led effort to diversify Indo-Pacific supply chains away from China runs counter to trends”  Peterson Institute for International Economics

    The global economy is threatened by the potential for another devastating pandemic, Russia’s invasion of Ukraine, and a belligerent China, all of which have raised concerns about the resilience of worldwide supply chains. Hence, an important outcome of the US-initiated Indo-Pacific Economic Framework (IPEF) negotiations is a proposed supply chain agreement, the outlines of which were published by the US Department of State after negotiations were concluded in May in Jakarta. But diversifying the region’s supply chains—an objective repeated by Treasury Secretary Janet Yellen during her Beijing visit in July—could prove elusive.

 

Africa

  • “African Energy Boom Sparks Power Grab in Senegal”  Real Clear World

    As Senegal stands on the cusp of an energy boom with its recent discovery of substantial oil and natural gas reserves, the nation faces a pivotal crossroads between economic prosperity and the risk of descending into autocracy. The energy boom's significance extends beyond Africa toward Europe’s ongoing struggle with Russian aggression, holding promise to help European nations reduce Russian oil and natural gas influence with a new supplier. This juncture also comes at a time when governments with strong Western ties across Africa are falling following a series of coups, amplifying concern for Senegal, a former French colony with strong Western ties dealing with its own growing instability. With the government’s ongoing enforcement of crackdowns and imprisonment of opposition members ahead of next year’s election, Senegal’s political institutions are in jeopardy.

 

  • “Africa’s ‘Coup Belt,’ Russia, and the Waning Global Order”  European Council on Foreign Relations

    Coups d’états have returned to Africa. In the 1990s and 2000s, the number of forced takeovers of power on the continent fell, but the figure began to creep back up around 15 years ago. This deterioration has come to particular prominence with the emergence of a ‘coup belt’ spanning from Sudan to Niger (and mostly recently Gabon), where eight coups have taken place in the last three years. The drivers behind coups range from state fragility to weak economic development. But such factors were also a constant in the decades immediately after the end of the Cold War – when Africa experienced fewer coups. The overlooked factor is the weakening of global order and the coup-enabling international environment it has created. Policymakers should consider, in particular, the role that activist ‘middle powers’ and Russia are now playing in taking advantage of an increasingly lawless international setting. 

 

Geo-Economics

  • “Elevating the Role of Critical Minerals for Development and Security”  Center for Strategic and International Studies

    Over the next few decades, the role that copper and critical minerals play in achieving the energy transition, spurring economic development, and strengthening national security will continue to grow. The world is slowly shifting its energy mix to one that is greener, but this transition will require significant mining resources. Mining and the processing of minerals are also crucial in maintaining the military’s technological edge, securing manufacturing supply chains, and pursuing sustainable development practices. The United States Geological Survey (USGS) has designated 50 critical minerals “essential to the economic and national security of the U.S.,” and the Department of Defense (DOD) has identified more than 250 “strategic and critical materials,” defined as those “those that support military and essential civilian industry.” Yet, unlike some strategic allies, such as Canada, the United States does not consider copper to be a critical mineral (see Box 1 for more on these definitions).

 

  • “The Rise of the Walking Dead: Zombie Firms Around the World”  VoxEU/CEPR

    The rise in the number of unproductive and unviable (‘zombie’) firms worldwide does not bode well for future productivity growth. This column documents global trends in zombification over the last two decades by creating a new dataset of nonfinancial zombie firms, listed and private, for a large set of countries. Despite the widespread increased zombification, the results point to a silver lining: negative macro-financial spillovers from zombie firms to non-zombies can be mitigated by strengthening banks and improving insolvency frameworks.

 

  • “Living with High Public Debt”   Kansas City Fed/Serkan Arslanalp and Barry Eichengreen

    Public debts have soared to unprecedented peacetime heights. These high debts pose economic, financial, and political challenges. Multilateral financial institutions and others have consequently laid out scenarios for bringing them back down. Our thesis in this paper is that high public debts are not going to decline significantly for the foreseeable future. Countries are going to have to live with this new reality as a semi-permanent state of affairs. These are not normative statements of what is desirable; they are positive statements of what is likely.  Financial liberalization, internal and external, is an economic fact of life. The genie is out of the bottle. All of which is to say that, for better or worse, high public debts are here to stay.

 

Russia/Ukraine

  • “Behind the Lines: Voting at Gunpoint in Russia’s Sham Elections”  Center for European Policy Analysis

    Russian occupation forces began conducting “elections” in some occupied regions on August 31 and will finish them on September 10.  The aim of the Kremlin is to boost voter participation to add credibility to the elections for local “legislative bodies” and “self-government bodies.”  The whole process, which is intended for domestic Russian and international audiences, seeks to show a vibrant political life and create the illusion that local residents have a say over their future. The reality is many are being forced to vote at gunpoint for pre-selected candidates.

 

Graphic of the Week

China’s  New “Standard Map” Offends and Outrages Multiple Countries

 Less than two weeks  before India hosts the G20 Leaders’ Summit (which Chinese President Xi Jinping is not attending), the Chinese government released its new “standard map.”  The map has China claiming ownership of vast territories that are actually controlled by India, the Philippines, Malaysia, Vietnam, and Taiwan.  All these countries have strongly repudiated the map and its claims.   In India’s case, China claims power over the Indian state of Arunachal Pradesh as well as the Aksai Chin plateau, a disputed area in the Western Himalayas that is claimed by India but controlled by China.  All in all, the map serves to inflame regional tensions with China further but also shows Beijing’s willingness to challenge and anger its neighbors.

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Francis Kelly Francis Kelly

U.S. Regulatory Week Ahead

September 11 - 16, 2023

Washington is fully back to work this coming week as the House of Representatives returns Tuesday from their August recess.  The big event of the week in Congress will be Tuesday’s testimony by SEC Chair Gary Gensler before the Senate Banking Committee.  We expect Republican senators to go hard at Gensler over a range of regulatory issues he has been pursuing, ranging from ESG regulations to regulation of private capital. 

 Chair Gensler will also participate in a conference reflecting on the 15th anniversary of the Lehman Brothers collapse (was it that long ago?). 

Meanwhile, the  House Financial Services Committee is holding three hearings this week on Basel III implementation, oversight of foreign acquisitions of U.S. assets in the U.S., and the implications of the Federal Reserve developing a digital currency.

Also in the House of Representatives this week, the House Select Committee on Competition with China will hold a field hearing in New York on the potential risk China poses to the U.S. financial sector.  Former SEC Chair Jay Clayton is scheduled to be among those testifying.

Looking at events from last week, the Federal Reserve will now field a full complement of Governors as the U.S. Senate confirmed Phillip Jefferson as Vice Chair and Adriana Kugler to a Fed Governorship, making her the first Latino to serve on the Board.

Finally, the Treasury Department will hold the Committee on Foreign Investment in the United States (CFIUS) Conference 2023.  Treasury Secretary Janet Yellen will make a keynote speech, and markets will listen closely for comments she may make about new regulations being developed on outbound U.S. investments to China.

Below is our listing of major regulatory events this week in Washington and elsewhere in the U.S. and Canada.  Please let us know if you have any questions.

U.S. Congressional Hearings

U.S. Senate

 

U.S. House of Representatives

  • September 12 – 8:30 a.m.  at the Council on Foreign Relations in New York: The House Select Strategic Competition Between the United States and the Chinese Communist Party Committee holds a field hearing on "Systemic Risk: The Chinese Communist Party's Threat to U.S. Financial Stability."  Witnesses will include Jay Clayton, Former chairman of the Securities and Exchange Commission, Jim Chanos, President and founder of Kynikos Associates, and Anne Stevenson-Yang, Founder of J Capital Research.

  • September 13 – 10:00 a.m.: The House Financial Services Committee holds an oversight hearing  entitled “ Foreign Investment in the U.S. (CFIUS) and Other Efforts to Strengthen National Security in the U.S.”

  •  

  • September 14 – 10:00 a.m.: The House Financial Services Committee’s Subcommittee on Financial Institutions and Monetary Policy holds a hearing entitled “Implementing Basel III: What’s the Fed’s Endgame?”

  •  

  • September 14 – 2:00 p.m.: The House Financial Services Committee’s Subcommittee on Digital Assets, Financial Technology and Inclusion holds a hearing entitled “Digital Dollar Dilemma: The Implications of a Central Bank Digital Currency and Private Sector Alternatives.”

 

 

US Federal & State Regulatory Meetings & Events

U.S. Treasury Department

  • September 14 – 8:00 a.m. – 5:00 p.m.: The U.S. Treasury will host the Committee on Foreign Investment in the United States (CFIUS) Conference 2023.  Treasury Secretary Janet Yellen will deliver a keynote address, and Homeland Security Secretary Alejandro Majorkas will deliver the closing keynote address.

U.S. Federal Reserve Board

  • Nothing significant to report; The Fed Board is in its quiet period in advance of the FMOC meeting on September 20.

 

Office of the Comptroller of the Currency

  • Nothing of significance is scheduled for this coming week.

 

Federal Deposit Insurance Corporation

  • Nothing of significance is scheduled for this coming week.

  

Securities and Exchange Commission

  • September 13 – 12:30 p.m.:  Chair Gary Gensler will participate in a virtual fireside chat at the 15th Anniversary Lehman Collapse Conference hosted by Better Markets.  The title of the chat is “A Market Regulator’s View of Too-Big-To-Fail.”

    • NOTE: SEC Chair Gary Gensler is scheduled to testify before the House Financial Services Committee on Sept. 27th.

  

Commodities Futures Trading Commission

  • September 11 – 10:00 a.m. – 10:15 a.m. PST: Commissioner Christy Goldsmith Romero will give opening remarks on “Modernizing Investor Protection for the Digital Age” at the North American Securities Administrators Association 2023 Fall Annual Meeting.  The meeting will be held at the InterContinental San Diego Hotel in San Diego.

  • September 12 – 9:20 a.m. – 9:50 a.m. (Tokyo): Commissioner Caroline Pham will deliver a keynote speech titled “Digital Assets, Retail, Social Media & AI: What’s Next?” at the 13th Nasdaq Surveillance Conference in Tokyo, Japan.

 

Federal Trade Commission

  • September 14 – 11:00 a.m.: The Federal Trade Commission will hold an open meeting virtually.  The agenda includes:

    • Improper Listing of Patents in the Orange Book: The Commission will consider whether to issue a policy statement concerning the improper listing of patents in the Food and Drug Administration’s publication of Approved Drug Products With Therapeutic Equivalence Evaluations, commonly known as the “Orange Book.” The policy statement will discuss whether improper listing of patents in the Orange Book may increase the cost of and reduce access to essential prescription drugs, imposing costs on individuals and society alike. The policy statement also assesses whether the listing of patents in the Orange Book that do not comport with listing requirements may constitute an unfair method of competition.

    • Protecting Kids from Stealth Advertising in Digital Media: The Commission will vote on whether to release a staff perspective and recommendations on the blurring of advertising and content on digital media and how it affects kids, including teens. This staff perspective builds on an October 19, 2022 event that staff hosted to survey existing research, understand the potential harms to kids from blurred advertising, and discuss possible solutions.

Consumer Financial Protection Bureau

  • September 13 – 2:30 – 3:30 p.m.:  CFPB Director Rohit Chopra will give a keynote speech entitled “Too-Big-To-Fail from a Financial Consumer’s Point of View” at the 15th Anniversary Lehman Collapse Conference hosted by Better Markets in Washington, D.C.

 

Farm Credit Administration

  • September 14 – 10:00 a.m.: The FCA Board holds its monthly board meeting in McLean, Virginia.

 

The North American Securities Administrators Association (NASAA)

 

 

Trade Associations & Think Tank Events

 

 

Please let us know if you have any questions or would like to be added to our email distribution list.

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Francis Kelly Francis Kelly

Speaking in Banff, British Columbia to the National Credit Union Management Association

Banff is one of the most beautiful places in the world and I had the honor to speak to the National Credit Union Management Association (NCUMA) this past week. A fantastic event with wonderful attendees. the NCUMA is a world-class organization and I’m very grateful they invited me to speak!

View from my room at the glorious Fairmont Banff Springs Hotel in Banff, British Colombia.

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