Fulcrum Perspectives

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

Francis Kelly Francis Kelly

Recommended Weekend Reads

December 22 - 24 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. 

We hope you have a Merry Christmas!

Global Perspectives

  • "“Is Geopolitical Risk Getting Worse?”   Peterson Institute for International Economics

    As 2023 draws to an end, major wars are raging in Europe and in the Middle East, between Russia and Ukraine and between Israel and Hamas. According to the Uppsala Conflict Data Program, there are more active armed conflicts involving sovereign states than ever since World War II. The same can be said of displaced persons. With tensions rising in the South China Sea, geopolitical risk seems higher than at any point in recent memory. Things, as they say, have been better. But are conditions worse, or at least riskier, than ever? The Geopolitical Risk Index (GPR), developed by Dario Caldara and Matteo Iacoviello to assess risk in broader historical perspective, suggests otherwise.

  • “Attitudes on an Interconnected World”   Pew Research Center

    How close do people feel to others around the world? How much do they want their countries involved in international affairs? How do people’s experiences with travel and feelings of international connectedness relate to their views about the world? These are among the questions Pew explored in a recent 24-nation survey. We found that while most respondents feel close to people in their countries and their local communities, they are more divided over how close they feel to others across the globe.

United States

 

  • “Other Countries’ Activities During the 2022 Election Cycle”  Office of the Director of National Intelligence

    The US intelligence community observed other countries engaging in efforts to either support or undermine specific US candidates during the 2022 elections.  This NDI report relays how China, Iran,  Russia, and Cuba were the leading agents perpetuating these efforts to undermine American democracy.

  

European Union/Critical Materials

  • “Critical Material: The EU’s and Chile’s New Relation in the Multipolar World”  European Council on Foreign Relations

    The EU’s relationship with Chile is a test case for the EU’s capacity to navigate the emerging “à la carte” multipolar order, in which countries pragmatically choose their partners depending on the issue at hand. Chile is the world’s largest producer of copper and the second largest producer of lithium, a domination that is set to last, given its proven reserves of both metals. From the vantage point of Europe, Chile could provide immense assistance in powering the green transition – literally, by supplying the materials to power the batteries that Europeans are relying on to digitize and electrify their economy. The EU already imports 80 percent of its lithium from Chile – a crucial dependency in the rapidly evolving world economy.

  

Israel/Gaza War

  • “Life in Israel After October 7 in 5 Charts”  Gallup

    Gallup surveyed Israelis between Oct. 17 and Dec. 3, just weeks after Hamas launched its attack on Israel on Oct. 7. As the war between Israel and Hamas continues, here are five key insights into public opinion in Israel.  There were five key takeaways from the survey:

    1.     Israelis no longer support a two-state solution

    2.     Hopes for peace grow further out of reach

    3.     Negative emotions soar after the attack

    4.     Approval of US leadership reaches new high

    5.     Approval of Israel’s leadership remains flat

China

  • “Why are so many young Chinese depressed?”   Australian Strategic Policy Institute

    China’s high youth unemployment rate and increasingly disillusioned young people—many of whom are ‘giving up’ on work—have attracted much attention from global media outlets and Chinese policymakers. The standard narrative is to associate the problem with the country’s recent growth slowdown. In fact, the issue goes much deeper. 

    The rise of youth depression has been decades in the making and owes much to China’s rigid education system, past fertility policies, and tight migration restrictions. Chinese youth are burned out from spending their childhood and adolescence engaged in ceaseless, intense study. Attending a good university is seen as necessary for securing a good job, and for rural children, a university degree is the only path to legal residence in cities under the hukou registration system. In a city, the average household annual disposable income is US$6,446, which enables a middle-class lifestyle.

    By contrast, in rural areas, an income averaging only US$2,533 means living in relative poverty.  As if the pressure to get into a university wasn’t bad enough, the rigid structure of the school system makes matters worse. After nine years of compulsory schooling, children must pass an exam to enter an academic high school, and only 50% of them are allowed to pass. Teenagers who don’t make the cut attend vocational high school and are destined for low-paying jobs.

  

  • “Five big uncertainties facing the Chinese economy in 2024” Peterson Institute for International Economics

    The Chinese economy’s rebound started slowly last spring, shaking off the effects of an estimated 1.41 million excess deaths from the pandemic and China’s zero-COVID policies. Today, although growth will likely meet the government’s 5 percent target for 2023, the Chinese economy remains troubled, plagued by flat private investment, flagging consumer confidence, and high youth unemployment. Falling prices and depressed business and consumer confidence are flashing warning signs about the year ahead.  Here are five big uncertainties about Chinese economic performance and the government’s policy responses that will determine whether growth can be sustained in 2024.

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Francis Kelly Francis Kelly

The U.S. Financial Regulatory Week Ahead

December 18 - 22, 2023

It is the week before Christmas, and Washington, for the most part, has gone quiet. Congress is scheduled to be out of session (although that is in flux – the Senate is likely to return Monday to vote on a Ukraine/Israel/Border Security bill, but the House of Representatives is gone until January 9). 

The regulators are quiet this coming week. No open meetings, speeches, or other significant events are scheduled for next week. The one event of note next week is over at the Institute for International Finance (IIF), where they will host Bank of England Deputy Governor for Financial Stability Sarah Breeden for a “Talking Policy” series.

This past week, the Financial Stability Oversight Council (FSOC) released its annual report. You can find it HERE.  The report drilled into several significant issues, including:

  • The Banking Sector: FSCOC says “lessons can be learned” from the SVB and other bank collapses earlier this year, but overall, the system is solid (which begs the question: why do you need a new capital increase for the largest banks?)

  • Cybersecurity: The report argues that cyber risk is pervasive throughout the economy, and more must be done in all sectors, not just financial.

  • Artificial Intelligence (AI): FSOC sees AI as a vulnerability to the overall financial system and urges financial institutions to work hard and fast to ramp up their expertise on the issue. 

  • Nonbank Financial Intermediation: Citing the “evolving participation of nonbank financial institutions” in the financial system, FSOC pays particular attention to nonbank mortgage servicers and the rise in private credit as a potential risk to focus on.

  • Climate Risk: The report discusses how severe and frequent climate-related events create new risks and significant costs for the public and the economy. FSOC urges state and local governments to improve their dialogue with federal regulators while encouraging regulators to promote better disclosures for investors to understand the risk.

  • Digital Assets: FSOC notes “that financial stability vulnerabilities may arise from crypto-asset price volatility, the market’s high use of leverage, the level of interconnectedness within the industry, operational risks, and the risk of runs on crypto-asset platforms and Stablecoins.” The report urges Congress to pass legislation allowing regulators to regulate the sector better.

We will likely take the week of December 25 off, but we will update you if anything changes or any special events/meetings pop up. Below is the (very slim) list of events in the coming week. Please let us know if you have any questions. We hope you have a restful and blessed Christmas!  

 

U.S. Congressional Hearings 

U.S. Senate

  • The Senate is out of session for the Christmas and New Year holidays.  They return to work on January 8.

 

House of Representatives

  • The House is out of session for the Christmas and New Year holidays.  They return to work on January 9.

 

US Regulatory Meetings & Events

Federal Reserve Board and Federal Reserve Banks

  • no meetings or speeches of note are scheduled for the coming week.

 

U.S. Treasury Department

  • No meetings or speeches of note are scheduled for the coming week.

 

Securities and Exchange Commission

  • December 21, 2:00 p.m. – The SEC holds a closed meeting.

 

Commodities Futures Trading Commission

  • No meetings or speeches of note are scheduled for the coming week.

 

Federal Deposit Insurance Corporation

  • No meetings or speeches of note are scheduled for the coming week.

Office of the Comptroller of the Currency

  • No meetings or speeches of note are scheduled for the coming week.

 

The Consumer Financial Protection Bureau

  • No meetings or speeches of note are scheduled for the coming week.

National Credit Union Administration

  • No meetings or speeches of note are scheduled for the coming week.

 

Federal Trade Commission & Department of Justice Antitrust Division

  • No meetings or speeches of note are scheduled for the coming week.

Farm Credit Administration

  • No meetings or speeches of note are scheduled for the coming week.

Trade Associations & Think Tank Events

Trade Associations

  • There are no events of note scheduled for the coming week.

  

Think Tanks

  

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

 Merry Christmas!

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Francis Kelly Francis Kelly

The Global Week Ahead

December 17 - 24, 2023

It is a week until Christmas, and the political and financial worlds are relatively quiet this week.  But there are several important events we are keeping our eye on this coming week.

In the US, the Senate will return to work Monday, hoping that negotiations between the White House and Senate Republicans have hammered out a border security deal allowing a vote on aid packages to Ukraine and Israel.  But even if an agreement is reached, the House of Representatives is gone until January 9 and will not make return until then. 

 In Hong Kong, newspaper publisher and democracy advocate Jimmy Liu is on trial for supposedly violating the Beijing-imposed and highly controversial National Security Law, which is seen as crushing free speech.  The trial outcome will likely be seen as an inflection point by markets as to the very future of Hong Kong as a safe place to live and conduct business. 

 Meanwhile, in Taiwan, presidential candidates will hold their first public policy presentations on national television.  This will be the first of three such presentations (the other two are scheduled for December 26 and December 28).   Each candidate is given ten minutes to present their views on a specific topic.  Observers will be watching closely for reactions from Beijing for what the candidates say about Taiwan-China relations.

 In Europe, the EU begins formal negotiations with Ukraine for accession to the Union.  European leaders voted this past Thursday to begin the talks despite the staunch opposition of Hungarian Prime Minister Viktor Orban. 

 On the global economic radar screen this week, it is a relatively quiet week ahead.  The biggest event of the week is the Bank of Japan meeting to discuss interest rates.  The other big event of the week is the 6th ECB Biennial Conference on Fiscal Policy and EMU Governance.  Several central bankers will be speaking at the conference. 

 In the US, markets will be looking at the personal income figures and the PCE inflation figures released on Friday. 

 Finally, a quick scheduling note: We will publish an abbreviated Global Week Ahead next week.

 Here is what else we are watching around the world this coming week.  Our best wishes for a joyful Christmas!

Sunday, December 17, 2023

Global

 

Americas

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • Italy’s Brothers of Italy Party holds its annual “Atreju” gathering in Rome. The four-day gathering will bring together conservative leaders from across Italy and abroad: UK Prime Minister Rishi Sunak, Elon Musk, and other notable figures are scheduled to attend.

  • The United Russia Party (the ruling party in Russia, which holds 72% control of the Russian Duma), holds its 21st Party Congress in Moscow.  President Vladimir Putin will address the meeting.

  • Serbia holds snap parliamentary elections. The Serbian Progressive Party is expected to retain its majority in the Parliament, but opposition parties may pull off a surprise win.  President Aleksander Vucic is under pressure from the European Union (EU) and the US to normalize relations with Kosovo, which has refused to recognize its independence since it broke off from Serbia in 2008.  Serbia is a candidate for membership to the EU, but much depends on Serbia settling relations with Kosovo.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Israel GDP (Q3)

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Monday, December 18, 2023

Global

 

Americas

Political/Social Events –

Economic Reports/Events –

  • US NAHB Housing Market Index (December)

  • Canada New Housing Price Index (November)

  • Mexico Aggregate Demand (Q3), Private Spending (Q3)

  • Brazil BCB Focus Market Readout

 

Asia

Political/Social Events –

Economic Reports/Events –

  • Australia Westpac Consumer Confidence (Q4), Services & Composite NZ PSIs (November)

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

 

Europe

Political/Social Events –

Economic Reports/Events –

  • The European Central Bank holds the 6th ECB Biennial Conference on Fiscal Policy and EMU Governance through December 19. ECB Board Member Isabel Schnabel will give the keynote lecture. Later, ECB Board Member Philip Lane chairs a panel entitled “New policy challenges and reform needs for the EMU.”

  • Bank of England Deputy Governor for Monetary Policy Ben Broadbent gives as speech at the London School of Business.

  • Germany Ifo Business Climate (December), IFO Current Conditions (December)

  • Spain Balance of Trade (October)

  • Poland Inflation (November)

  • Belarus GDP (November), Industrial Production (November)

 

Middle East

Political/Social Events –

  • The results of the Egyptian presidential election are formally announced.  President Abdel Fatah al-Sisi is all but assured of being re-elected.

  • Today is the 13th anniversary of the start of the Arab Spring.  They are seen as beginning in Tunisia in 2010 when a street merchant, Mohamed Bouazizi, self-immolated in protest over the confiscation of his wares and subsequent harassment by corrupt municipal officials.  Bouazizi was subsequently awarded posthumously the Sakharov Price for his contributions to “historic changes in the Arab world.”

Economic Reports/Events –

  • Israel Unemployment (November)

  • Jordan PPI (October), Unemployment (Q3)

  • Qatar Inflation (November)

 

Africa

Political/Social Events –

  • Today is Republic Day in Niger, a national holiday commemorating the creation of the Republic and independence from France in 1960.

Economic Reports/Events –

  • Angola FX Reserves (November) 

 

Tuesday, December 19, 2023

Global

 

Americas

Political/Social Events –

  • In Ecuador, A court holds a hearing for the suspect in the assassination case of former Ecuadorian presidential candidate Fernando Villavicencio.

  • Today is the 25th anniversary of the House of Representatives of President Bill Clinton for his affair with White House intern Monica Lewinsky.

Economic Reports/Events –

  • Atlanta Federal Reserve Bank President Raphael Bostic to speak on the U.S. economy, outlook for business, and the Federal Reserve's role before a Harvard Business School Club of Atlanta alumni luncheon.

  • US Building Permits (November), Housing Starts (November), Redbook (December 16)

  • Canada Inflation (November), CPI (November), Raw Materials (November)

  • Brazil BCB Copom Meeting Minutes

  • Colombia ISE Economic Activity (October), Central Bank Interest Rate Decision

  • Chile Central Bank Interest Rate Decision

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Bank of Japan Interest Rate Decision

  • Reserve Bank of Australia Meeting Minutes

  • New Zealand Imports/Exports/Balance of Trade (November), ANZ Business Confidence (December)

  • Hong Kong Unemployment (November)

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

 

Europe

Political/Social Events –

Economic Reports/Events –

 

Middle East

Political/Social Events –

Economic Reports/Events –

  • Israel Manufacturing PMI (November)

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • South Africa Leading Business Cycle Indicator (October)

 

Wednesday, December 20, 2023

Global

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • US CB Consumer Confidence (December), Existing Home Sales (November), MBA Mortgage Market Index (December 15), Current Account (Q3)

  • Bank of Canada Summary of Deliberations

  • Mexico Retail Sales (October)

  • Colombia Imports (October), Balance of Trade (October)

  • Argentina Balance of Trade (November), Leading Indicator (November)

  • Costa Rica Central Bank Interest Rate Decision

  • Paraguay Central Bank Interest Rate Decision

 

Asia

Political/Social Events –

  • Taiwanese presidential candidates will hold their first public policy presentations on national television.  This will be the first of three such presentations (the other two are scheduled for December 26 and December 28).   Each candidate is given ten minutes to present their views on a specific topic. While these are not debates, each candidate can respond or comment on what other candidates say in their ten-minute presentation.  Observers will be watching closely for reactions from Beijing for what the candidates say about Taiwan-China relations.

  • After 74 years on the Tokyo Stock Exchange, Toshiba will be delisted.  The massive conglomerate is in the midst of being restructured under the leadership of a private equity firm that wants to re-list the company in five years.

Economic Reports/Events –

  • China Loan Prime Rate 1Y, Loan Prime Rate 5Y

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

  • Taiwan Export Orders (November)

  • Australia Westpac Leading Index (November)

  • New Zealand ANZ Roy Morgan Consumer Confidence (December), Global Dairy Trade Price Index

  • Indonesia Motorbike Sales (November)

  • Thailand New Car Sales (November)

 

Europe

Political/Social Events –

  • Today is the 60th anniversary of the opening of the Berlin Wall in West Berlin.  West Germans were allowed one-day visits to see relatives in the East for the holidays. 

  • There will be an informal video conference of EU Economy and Finance Ministers.  They are expected to discuss the EU economic governance framework.

  • In the UK, junior doctors in England begin another three days of strike action in their ongoing dispute over pay and conditions in the National Health Service (NHS).

Economic Reports/Events –

 

Middle East

Political/Social Events –

  • Iraq is scheduled to hold local and regional elections.

Economic Reports/Events –

  • Turkey Consumer Confidence (December), Central Government Debt (November)

  • Israel Inflation (December)

  • Egypt Current Account (Q3)

  • Oman Inflation (November)

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

 

Africa

Political/Social Events –

Economic Reports/Events –

  • Nothing Significant to Report. 

 

Thursday, December 21, 2023

Global

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • US GDP (Q3), Philadelphia Fed Manufacturing Index (December), Core PCE Prices (Q3), Corporate Profits (Q3), PCE Prices (Q3), Philly Fed CAPEX Index (December), Philly Fed Employment (December), Philly Fed New Orders (December), Retail Consumer Spending (Q3), CB Leading Index (November), Kansas Fed Composite Index (December), Kansas Fed Manufacturing Index (December)

  • Canada Retail Sales (October), Average Weekly Earnings (October)

  • Brazil Federal Tax Revenues (November)

  • Mexico Mid-Month Inflation (December)

  • Paraguay PPI (November)

  • El Salvador GDP (Q3)

  • Argentina Economic Activity (October), Retail Sales (October), Unemployment (Q3)

  • Costa Rica Balance of Trade (November)

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • South Korea PPI (November)

  • New Zealand Credit Card Spending (November)

  • Indonesia Central Bank Interest Rate Decision, Loan Growth (November)

  • Hong Kong Current Account (Q3), Inflation (November)

  • Sri Lanka Tourist Arrivals (November)

 

Europe

Political/Social Events –

Economic Reports/Events –

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

  • UK Public Sector Net Borrowing (November), CBI Distributive Trades (December)

  • Italy PPI (November), Construction Output (October)

  • Hungary Gross Wage (October)

  • Greece Current Account (October)

  • Poland Retail Sales (November)

  • Slovakia PPI (November), Consumer Confidence (December), Unemployment (October)

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Turkey TCMB Interest Rate Decision, Overnight Borrowing Rate (December), FX Reserves (December 15)

  • Egypt Central Bank Interest Rate Decision, Overnight Lending Rate

  • Lebanon Inflation (November)

 

Africa

Political/Social Events –

  • Today is São Tomé Day, commemorating when the first Europeans arrived on the island in 1471 (it was uninhabited).

Economic Reports/Events –

  • Botswana GDP (Q3)

  • Ghana PPI (November)

 

Friday, December 22, 2023

Global

  • The UN Security Council is scheduled to hold a briefing on the Middle East (Syria).

  • Today is the Winter Solstice, the shortest day of the year and the first day of winter in the northern hemisphere.

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • US Core PCE Price Index (November), Durable Goods Orders (November), Personal Income (November), Personal Spending (November), Michigan Consumer Sentiment (December), New Home Sales (November), Michigan 5-Year Inflation Expectations (December), Michigan Current Conditions (December), Building Permits (November)

  • Canada GDP (October), Budget Balance (October)

  • Brazil Current Account (November), FDI (November), Current Account (November), FDI (December 15), FGV Consumer Confidence (December)

  • Mexico Balance of Trade (November), Economic Activity (October), Mid-month Inflation (December)

  • Chile PPI (November)

  • Colombia Business Confidence (November)

  • El Salvador Current Account (Q3)

  • Paraguay GDP (Q3)

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Japan Inflation (November), Bank of Japan Monetary Policy Meeting Minutes

  • Reserve Bank of India Meeting Minutes, FX Reserves (December 15)

  • Thailand Imports/Exports/Balance of Trade (November)

  • Malaysia Inflation (October), Leading Index (October)

  • Taiwan Unemployment (November), M2 Money Supply (November)

  • Philippines Consumer Confidence (Q4)

 

Europe

Political/Social Events –

Economic Reports/Events –

  • France PPI (November), Consumer Confidence (December)

  • UK GDP (Q3), Retail Sales (November), Current Account (Q3), Business Investment (Q3)

  • Spain GDP (Q3)

  • Italy Business Confidence (December), Consumer Confidence (December), Industrial Sales (October)

  • Ireland Wholesale Prices (November),

  • Poland Unemployment (November)

  • Slovenia Business Confidence (December)

  • Hungary Balance of Trade (October), Current Account (Q3)

  • Kosovo Balance of Trade (November)

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Turkey Tourist Arrivals (November)

  • Kuwait Inflation (November)

 

Africa:

Political/Social Events –

  • Zimbabwe celebrates Unity Day, a day celebrating the union of two political parties, ZANU and ZAPU, ending a nationwide conflict between the two parties.

Economic Reports/Events –

  • Angola M3 Money Supply (November) 

 

Saturday, December 23, 2023

Global

  • Nothing significant to report.

 

Americas

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

  •  

Sunday, December 24, 2023

Global

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Libya celebrates Independence Day, commemorating the day in 1951 when the country gained independence from France and Britain after the U.N. General Assembly voted for its independence.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

  

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

Merry Christmas!

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Francis Kelly Francis Kelly

Recommended Weekend Reads

December 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. 

 

Americas

  • “The Entirely Manufacturing and Dangerous Crisis over the Essequibo”  Center for Strategic and International Studies

    The authoritarian government of Venezuela held a referendum on December 3, 2023, concerning the Essequibo, a large region controlled by neighboring Guyana but claimed by both nations.  In essence, The Venezuela Regime laid claim to more than half of Guyana. Despite an anemic turnout, Venezuelan president Nicolás Maduro has claimed that he now has a mandate to annex the region, significantly raising tensions with his smaller neighbor and putting the militaries of both countries on high alert. There is a small but real risk of military conflict between the two South American nations.

The European Union

  • “European Elections: A Game-changer in 2024?”   Geopolitical Monitor

    In 2024, the EU will hold a major election, and from it is expected to be a new composition of the European Parliament, a significant change among the existing EU Commissioners, the possibility of a new Commission President, and undoubtedly a new President of the European Council. This political transition will inevitably bring a shift in policies.  The major challenge will be fiscal: Since 2020, the EU has borrowed about €807 billion. Extending foreign policy and influence actions, such as providing aid, and helping conflict zones (Ukraine) and southern European states to manage migration, is expected to require an additional €70 billion in 2024. The EU deficit rules were suspended during the Covid pandemic, which allowed Member States to take whatever they needed to support their economies. In this, the leading borrowers are Italy and Spain. However, we can expect old deficit rules to come back into force in 2024. This will likely impact proposals, with highly indebted countries possibly getting more time to get their affairs in order. It will certainly create tensions between the Member States over who will bear the costs. EU Finance Ministers and leaders are set to make their final decisions on the matter starting next week.  


    The Ukraine War

  • “How Much Aid Has the U.S. Sent Ukraine? Here are Six Charts” the Council on Foreign Relations

    As the U.S. Congress and EU struggle politically to figure out how to further fund Ukraine in her defense against Russian aggression, two questions repeatedly come up: How much has the U.S. and other allies of Ukraine contributed already?  And what is it being spent on?  The Council on Foreign Relations answers the question in six interactive charts.

 

 

International Economics/Trade

  • “The Comeback of Industrial Policy: The Next Geopolitical Great Game”  Italian Institute for International Political Studies

    The ISPI report details how industrial policies are the key element underlying today’s geopolitical scramble and a pillar of national security. In the global supply chains, highlighted by multiple shocks, the US and the EU have started introducing new industrial legislation to make up for lost ground with respect to other industrial powerhouses, such as China.

 

  • Geopolitical Shocks and Commodity Market Dynamics: New Evidence from the Russian-Ukraine Conflict” Working Paper by Joshua Aizenman, Robert Lindahl, David Stenvall, Gazi Salah Uddin

    Abstract: We investigate the event-based geopolitical shocks from the Russian invasion of Ukraine on selected agricultural and energy commodities using daily event-based structural vector autoregression (SVAR).  We find that the geopolitical shock affects the markets of wheat (3%) and European natural gas (12%).  However, substantial heterogeneity is observed among the food and energy markets.  The regional segment of natural gas markets could explain this.  Finally, the dynamics of the impacts of geopolitical news are analyzed in the stock, currency, and bond markets.

 

China

  • “Scared Strait: Understanding the Economic and Financial Impacts of a Taiwan Crisis”   Center for Strategic and International Affairs

    Following Russia’s invasion of Ukraine and Beijing’s demonstrations of force against Taiwan since 2022, Western governments and corporate boardrooms have increasingly debated the likelihood, timing, and methods of a possible invasion or blockade of Taiwan by the People’s Republic of China (PRC).  Yet the real economic and financial dimensions of a potential cross-strait conflict remain underemphasized in this policy discourse. All realistic scenarios of PRC aggression will induce fast-moving and unpredictable dynamics, many of which would manifest before the outbreak of hostilities. The Taiwan Strait is central to global maritime trade, and Taiwan is the world’s most advanced and critical semiconductor manufacturing hub. For its own part, China remains an important manufacturing and trade partner for advanced and developing economies. As such, any crisis or conflict in the Taiwan Strait would impose substantial costs on China, the United States and its allies and partners, and the global economy.   

 

Chart of the Week 

India Dominated Wikipedia in 2023 

Semafor reported this past week that among the top 10 most-read English-language pages on Wikipedia, six were about Indian events and issues.  ChatGDPT was the #1 most looked-up issue, followed by “Deaths in 2023.”  But after that, India dominated Wikipedia searches.  We would also note Oppenheimer (the man and the movie) both made the top 10, too. 

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Francis Kelly Francis Kelly

The Global Week Ahead

December 10 - 17, 2023

It was already going to be a particularly busy week for markets as the Federal Reserve, the European Central Bank, and the Bank of England all meet to discuss interest rates.  The general market consensus is all three will pause – and may well be done – raising rates.  But as important as this is to markets, geopolitical events this week may steal market participants' attention.  At the top of that list is the make-it-or-break-it moment in the US Congress as to whether a much-needed aid package for Ukraine and Israel is approved. Congress is scheduled to adjourn Thursday for Christmas break and will return on January 9th.

As an indication of how critical the situation is, Ukrainian President Volodymyr Zelensky is coming to Washington on Tuesday to meet with President Biden and Congressional leaders to make his case for funding.

The impasse is not so much whether Congress should approve further funding for Ukraine but whether they can agree on new US border security provisions. However, a new poll released late Sunday night by the Financial Times may make it even harder to finalize a deal. The poll found that 48 percent of Americans believe the US is spending "too much" on Ukraine, and only 11 percent said it is not spending enough. 

Elsewhere this week, European Union leaders gather for the European Council to consider Ukraine's accession to the EU, how to provide further aid to Ukraine, and discuss growing budgetary challenges in member states (most notably Germany and France). 

In Latin America, Venezuelan. President Nicolas Maduro will meet with Guyana President Mohamed Irfaan Ali to discuss the ongoing tensions between the two countries after Maduro ran a rigged election to claim Guyana's oil and gas deposits.   Maduro has threatened to invade Guyana in the face of growing regional and global criticism for his sudden and oddly timed aggressive demand.  Maduro’s national referendum backfired on him as the vast majority of Venezuelans did not show up to vote. Oil markets are watching this issue closely.

Moving to Asia, we are watching South Korean President Yoon Suk Yeol’s visit to the Netherlands this week.  It is a further indication of how semiconductors and foreign policy are becoming even more intertwined. South Korean wants to establish a “chip alliance” with the Netherlands.  The Dutch chip firm ASML is a major supplier to South Korea’s chip giant Samsung Electronics and SK Hynix.  Yoon is going to visit the ASML headquarters in recognition of ASML building a massive new assembly facility in South Korea. This all comes after the Netherlands curbed the sale of advanced semiconductor manufacturing equipment to China this past June.  

Moving back to market events and what else is on the economic radar screen this week aside from the Big Three Central Bank Rate Decisions, markets will be watching key US data releases, including the CPI report and retail sales data. They will also be keenly looking at China's release of inflation data and other economic releases later this week.

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

Sunday, December 10, 2023

Global

 

Americas

Political/Social Events –

  • Argentine President-elect Javier Milei will be sworn into office.  Meanwhile, the Argentine Union of State Employees (ATE) is expected to conduct a 24-hour strike to protest Milei’s planned fiscal plans.

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • The EU Agriculture and Fisheries Council will meet through December 11 to discuss the market situation and to exchange views on the first year of implementation of the CAP strategic plans.  Additionally, the Council is expected to address the new genomic techniques regulation, the sustainable use of pesticides regulation, and the proposals for plant reproductive material and for forest reproductive material. Finally, fisheries ministers will aim to reach a political agreement on the proposal for fishing opportunities in the Atlantic and the North Sea for 2024 and, in the case of some stocks, also for 2025 and 2026, as well as on the proposal concerning fishing opportunities in the Mediterranean and the Black Sea for 2024.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Egypt holds presidential elections. President Abdel Fattah al-Sisi is widely expected to win re-election.

  • The Doha Forum begins in Doha, Qatar.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report. 

 

Monday, December 11, 2023

Global

 

Americas

Political/Social Events –

  • The US Congress returns to work, their final week before their schedule to break for the Christmas holiday.  They are expected to focus on finding a way to approve funding for Ukraine and Israel, but ongoing disagreements over funding for US border security will likely make reaching a comprehensive deal unlikely.

  • Former President Donald Trump is expected to testify at his fraud trial in New York. Additionally, House Republicans are expected to unveil a bill that would formalize an impeachment inquiry of President Biden.

Economic Reports/Events –

  • Brazil BCB Focus Market Readout

  • El Salvador PPI (November)

 

Asia

Political/Social Events –

Economic Reports/Events –

  • Japan BSI Large Manufacturing (Q4), Machine Orders (November)

  • Indonesia Retail Sales (October)

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

  • Pakistan Consumer Confidence (November)

 

Europe

Political/Social Events –

  • The Eastern Partnership Foreign Affairs Ministerial meeting takes place in Brussels.  The Foreign Ministers of Armenia, Azerbaijan, Georgia, the Republic of Moldova, and Ukraine will gather with EU Foreign Ministers to discuss how the Eastern Partnership can continue to ensure that the needs of member states and partner countries are met, what should be the key priorities of joint work in 2024, how to accelerate the delivery of the Economic and Investment Plan for the Eastern Partnership and how to increase cooperation with regions such as Central Asia and the Western Balkans and synergies with other regional policies such as the Black Sea Synergy. Ministers will aim to solidify their commitment on concrete deliverables for 2024, notably in the area of regional roaming, road safety, and transport.  The meeting will also likely see side-mediated talks between Armenia and Azerbaijan over ongoing tensions after recent military action Azerbaijan took to seize land from Armenia.

  • Separately, the EU Foreign Affairs Council meets by themselves separately to discuss the situation in Ukraine as well as the situation in Israel and the Sahel.

  • Estonian President Alar Karis hosts Latvia President Edgars Rinkevics and Lithuania President Gitanas Nauseda in Tallinn, Estonia. They are expected to discuss mutual security and economic issues.

  • Donald Tusk, the former European Council President and former Prime Minister of Poland, is expected to be appointed Poland’s Prime Minister again.

  • The Salzburg Forum takes place through December 12 in Salzburg, Austria.  The Forum is a Central European security partnership of Austria, Bulgaria, Croatia, the Czech Republic, Hungary, Poland, Romania, Slovakia and Slovenia that cooperates on police, illegal immigration, fighting illegal drug trade, traffic safety, and other areas of internal security. Interior Ministers of these country are expected to discuss extending Schengen rules for air travel among their borders.

  • German Chancellor Olaf Scholz and outgoing Dutch Prime Minister Mark Rutte to discuss the upcoming European Council meeting and is expected  hold a joint press conference in Berlin, Germany.  Rutte is seeking to be named the next NATO Secretary General.

  • UK Prime Minister Rishi Sunak all-day evidence session at the COVID-19 inquiry.

Economic Reports/Events –

  • ECB Board Member Elizabeth McCaul participates on a panel entitled "Greek Banking Sector – Growth & Development Outlook" at the 25th Annual Capital Link "Invest in Greece Forum" organized by Capital Link in New York.

  • Slovakia Industrial Production (October)

  • Romania Balance of Trade (October)

  • Ukraine GDP (Q3)

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Egypt Inflation (November)

  • Saudi Arabia Industrial Production (October)

  • Turkey Industrial Production (October), Current Account (October), Participation Rate (October), Unemployment (October)

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

 

Africa

Political/Social Events –

  • Today is Republic Day in Burkina Faso, celebrating the nation’s independence in 1958.

Economic Reports/Events –

  • Nothing significant to report.

 

Tuesday, December 12, 2023

Global

 

Americas

Political/Social Events –

  • President Biden will host Ukrainian President Volodymyr Zelensky at the White House.   Zelensky will also meet with Speaker of the House Michael Johnson (D-LA) and other senior House leaders, as well as with senior Senate members.  The meeting comes at a critical time as Congress is at an impasse on finalizing an aid package for Ukraine and Israel.

  • n US Federal Court, former Venezuelan military intelligence director Hugo Carvajal appears for a procedural hearing ahead of a forthcoming trial on drug-trafficking charges.

Economic Reports/Events –

  • US Inflation (November), CPI (November), Redbook (December 9), Monthly Budget Statement (November), NFIB Business Optimism Index (November)

  • Mexico Industrial Production (October)

  • Brazil Inflation (November), Business Confidence (December)

  • Colombia Balance of Trade (October)

  • Uruguay Industrial Production (October)

 

Asia

Political/Social Events –

Economic Reports/Events –

  • Reserve Bank of Australia Michelle Bullock Speech

  • Japan PPI (November)

  • India Inflation (October), Manufacturing Production (October)

  • Australia Westpac Consumer Index (December), NAB Business Confidence (November)

  • Philippines Imports/Exports/Balance of Trade (October)

  • Pakistan Central Bank Interest Rate Decision

 

Europe

Political/Social Events –

  • Russia's Central Election Commission will decide whether to hold elections in annexed Ukrainian regions.   The Commission is consulting with the Russian Ministry of Defense, FSB, and local occupation officials over when to conduct them.

  • The EU General Affairs Council meets in Brussels in preparations for the upcoming European Council.  They are expected to also discuss enlargement, annual rule of law dialogue, and managing demographic change in Europe. Ministers will also take stock of negotiations for an association agreement with Andorra and San Marino and discuss Spain’s request to amend regulation no 1/1958.

  • The European Parliament will debate and take a final vote on the Critical Raw Materials Act, which aims to boost the supply of strategic raw materials and increase the EU’s competitiveness and sovereignty.

  • European Parliament President Roberta Metsola will award the 2023 Sakharov Prize for Freedom of Thought to Jina Mahsa Amini and the Woman, Life, Freedom Movement in Iran. Jina Mahsa Amini was a 22-year-old Iranian Kurdish woman who died following physical abuse at the hands of the Iranian security services while in custody. Her death sparked massive women-led protests in Iran against the hijab law and other discriminatory laws.

Economic Reports/Events –

  • ECB Board Member Elizabeth McCaul participates on a panel entitled "Risk stemming from the intertwined financial markets" organized by the European American Chamber of Commerce New York (EACCY) in New York,

  • Eurozone ZEW Economic Sentiment Index (December)

  • Germany ZEW Economic Sentiment Index (December)

  • UK Unemployment (October)

  • Serbia Inflation (November)

  • Slovakia Construction Output (October)

  • Bulgaria Balance of Trade (October)

  • Russia Balance of Trade (October)

 

Middle East

Political/Social Events –

  • In Geneva, the Foreign Ministers of Saudi Arabia, Qatar, Egypt, Jordan, Indonesia, and Palestinian Territories hold a joint press conference on the situation in Gaza Strip.

Economic Reports/Events –

  • Turkey Auto Production (November)

  • Egypt Current Account (Q3)

 

Africa

Political/Social Events –

  • The Senegal Supreme Court is considering if opposition leader Ousmane Sonko can run for president in February 2024.

  • The African Development Bank and OECD Development Centre will host an online panel to discuss the role natural gas can play in developing countries for a balance between reducing poverty, achieving a green transition and protecting the planet. 

  • Today is Jamhuri Day in Kenya, a national holiday commemorating when the country was admitted to the Commonwealth in 1964.

  • Economic Reports/Events –

  • South Africa Mining Production (October), Manufacturing Production (October), SACCI Business Confidence (October & November)

  • Angola Inflation (November)

 

 

Wednesday, December 13, 2023

Global

 

Americas

Political/Social Events –

Economic Reports/Events –

  • US Federal Reserve Open Market Committee Interest Rate Decision and Press Conference

  • US PPI (November), MBA Mortgage Market Index (December 8), NIESR Monthly GDP Tacker (November)

  • Brazil Central Bank Interest Rate Decision

  • Colombia Consumer Confidence (November)

  • Argentina Inflation (November)

  • Peru Balance of Trade (October)

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Japan Tankan Manufacturing & Industry Outlooks (Q4)

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

 

Europe

Political/Social Events –

Economic Reports/Events –

  • Eurozone Industrial Production (October)

  • Germany Current Account (October)

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

  • Hungary Industrial Production (October)

  • Switzerland SECO Economic Forecasts

  • Ireland Residential Property Prices (October)

  • Romania Industrial Production (October), Inflation (October)

  • Russia GDP (Q3)

 

Middle East

Political/Social Events –

  • Today is the 20th anniversary of the capture of toppled Iraqi president Saddam Hussein by US troops.

Economic Reports/Events –

  • Turkey Retail Sales (October)

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

 

Africa

Political/Social Events –

  • The International Monetary Fund is expected to discuss a possible debt relief program for Somalia.

Economic Reports/Events –

  • South Africa Inflation (November)

 

 

Thursday, December 14, 2023

Global

 

Americas

Political/Social Events –

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

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

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

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

  • Australia Consumer Inflation Expectations (December), Unemployment (November)

  • Taiwan Central Bank Interest Rate Decision

  • Hong Kong Interest Rate Decision, Industrial Production (Q3)

  • Singapore Unemployment (Q3)

  • Philippines Central Bank Interest Rate Decision

 

Europe

Political/Social Events –

  • The European Council meets in Brussels through December 15. The leaders may decide on Ukraine’s accession to the EU at this meeting.  They are also expected to discuss Russia’s war of aggression against Ukraine in all its dimensions, the situation in the Middle East, enlargement, the revision of the Multiannual Financial Framework 2021-2027, progress in the implementation of previous conclusions on security and defense, as well as specific foreign policy issues.

  • The German Bundestag is expected to debate and then vote on the government’s emergency draft supplemental budget for 2023.

  • Russian President Vladimir Putin will hold his annual end-of-year press conference under a new format branded "Results of the Year."  This will replace his usual “combined format’ where he would allow call-in questions.

Economic Reports/Events –

  • European Central Bank Interest Rate Decision and Press Conference

  • Bank of England Interest Rate Decision and meeting minutes

  • Spain CPI (November), Inflation (November)

  • Ireland CPI (November), Inflation (November)

  • Switzerland Central Bank Decision, Producer & Import Prices (November)

  • Slovakia Inflation (November), CPI (November)

  • Romania Current Account (October)

  • Poland Balance of Trade (October), Current Account (October)

  • Ukraine Central Bank Interest Rate Decision

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Israel Current Account (October), M1 Money Supply (October)

  • Turkey FX Reserves (December 8)

  • Oman Total Credit (October), M2 Money Supply (October)

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • South Africa SARB Quarterly Bulletin, South Africa Inflation (November), Wholesale Prices (November), PPI (November) 

 

Friday, December 15, 2023

Global

  • The UN Security Council will hold an open debate on small arms: Addressing the threat posed by diversion, illicit trafficking, and misuse of small arms and light weapons and their ammunition to peace and security.

  • Hanukkah ends today.

 

Americas

Political/Social Events –

  • In US Federal Court in Washington, D.C., for his role in planning the 1988 bombing of Pan Am Flight 103 over the Scottish town of Lockerbie.

Economic Reports/Events –

  • US NY Empire State Manufacturing Index (December), Industrial Production (November), Manufacturing Production (November), S&P Global Manufacturing & Services & Composite PMIs (December), NOPA Crash Report

  • Bank of Canada Governor Tiff Macklem will give a speech at the Canadian Club in Toronto.

  • Canada Housing Starts (November), Wholesale Sales (October)

  • Brazil IBC-BR Economic Activity (October)

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

  • Paraguay Consumer Confidence (November)

  • Argentina GDP (Q3)

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • China Industrial Production (November), Retail Sales (November), FDI (November), Vehicle Sales (November) Fixed Asset Investment (November), Unemployment (November)

  • Japan Jibun Bank Manufacturing & Services & Composite PMIs (December), Tertiary Industry Index (October)

  • India Imports/Exports/Balance of Trade (November), Bank Loan Growth (December 1)

  • Australia Judo Bank Composite PMI (December)

  • Philippines Cash Remittances (October), Business Confidence (Q4)

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

  • Sri Lanka PPI (October), GDP (Q3), Manufacturing PMI (November), Services PMI (November)

 

Europe

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Bank of England Deputy Governor Dave Ramsden will give a speech at Deloitte’s On “the Bank’s Resolution Regime” in London.

  • Eurozone HCOB Manufacturing & Services & Composite PMIs (December), Balance of Trade (October), Labor Costs (Q3)

  • Germany Wholesale Prices (November), HCOB Manufacturing & Services & Composite PMIs (December)

  • UK GfK Consumer Confidence (December), S&P Global/CIPS Manufacturing & Services & Composite PMIs (December)

  • France Inflation (November), HCOB Manufacturing & Services & Composite PMIs (December)

  • Italy CPI (November), Inflation (November)

  • Ireland Balance of Trade (October)

  • Poland Inflation (November)

  • Greece Construction Output (Q30

  • Hungary Construction Output (October), Inflation (November), CPI (November)

  • Bulgaria Inflation (November)

  • Ukraine Balance of Trade (October)

  • Russia Central Bank Interest Rate Decision

 

Middle East

Political/Social Events –

  • Nothing significant to report. 

Economic Reports/Events –

  • Turkey Budget Balance (November)

  • Israel GDP (Q3), Inflation (November)

 

Africa:

Political/Social Events –

  • Madagascar’s president, Andry Rajoelina, will be sworn in for a third term after winning the election on November 16. 

Economic Reports/Events –

  • Angola GDP (Q3), Wholesale Prices (November) 

 

Saturday, December 16, 2023

Global

  • Nothing significant to report.

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

  • The ASEAN-Japan Summit will meet in Tokyo for a three-day special summit to discuss their response to a number of issues focused on mutual security matters.

  • Kazakhstan celebrates Independence Day today, a national holiday commemorating the country gaining its independence from the Soviet Union in 1991.

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Today is National Day in Bahrain, a national holiday.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Sunday, December 17, 2023

Global

 

Americas

Political/Social Events –

 

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Israel GDP (Q3)

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

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Francis Kelly Francis Kelly

U.S. Financial Regulatory Week Ahead

Christmas may be around the corner, but the financial regulatory world in Washington is as busy as ever this coming week. While there are important regulatory meetings at the SEC, CFTC, and Financial Stability Oversight Council (FSOC), the real action this coming week will be the growing focus on scandals at the FDIC and OCC and a congressional hearing questioning the role of FINRA.

Pressure on FDIC Chair Marty Gruenberg significantly grew this past week as Senate Banking Committee Ranking Republican Senator Tim Scott (R-SC) joined a growing chorus of members of Congress demanding Gruenberg’s resignation. This all comes in the wake of shocking revelations Gruenberg ignored bad behavior among the FDIC staff, including sexual harassment. 

 We think there is little chance he will step down and will almost surely try to fight through the scandal. If Gruenberg steps aside, the Republican FDIC Vice Chair, Travis Hill, would become the acting chair. Hill is an opponent of Gruenberg’s (and the Federal Reserve’s) new bank capital increase and would likely put it on ice.

Gruenberg took heat on another issue this past week from two unlikely critics: Senator Elizabeth Warren (D-MA) and Senator J.D. Vance (R-OH).  Warren and Vance sent Gruenberg a letter aggressively questioning and criticizing Gruenberg for the agency’s sale of First Republic Bank to J.P. Morgan earlier this year.  Warren and Vance accused Gruenberg of “using a loophole to ignore viable bids, and instead held the nation’s largest bank grow even bigger.” The letter goes on to demand the FDIC’s reasoning and legal rationale for accepting the J.P. Morgan bid and why there was a $20 billion spread between competing bids (something Gruenberg indicated in answering a question by Senator Vance in a recent Senate Banking Committee hearing).

The other bank regulator to take heat this past week is Acting Comptroller of the Currency, Michael Hsu. Three House Financial Services Committee members fired off a letter to Hsu demanding to know how Hsu, who in October 2022 announced the creation of a new senior position called “the Financial Technology Officer,” then filled the position with someone with shockingly false credentials. Specifically, Hsu hired Prashant Bhardwaj in March for the role.  The OCC announcement stated, “Mr. Bhardwaj joins the agency after nearly 30 years of experience serving a variety of roles across the financial sector.”  But doing that math, that would have meant he started working on Wall Street when he was 13 years old.  

Moreover, Bhardwaj claimed to have been the Chief Information Officer at Fifth Third Bank before taking a similar role at Huntington Bank. In fact, he never worked at either bank. He also falsely claimed educational credentials and concealed his extensive criminal record. All this puts Hsu – who the Biden Administration has never put up for Senate confirmation, preferring to keep him in an acting role – in a very uncomfortable position with Congress.

Finally, FINRA, facing a grave threat to its very existence via a current Supreme Court case, will take further heat this week at the House Financial Services Committee’s Subcommittee on Capital Markets. FINRA President & CEO Robert Cook will testify Tuesday – along with Financial Accounting Standards Board (FASB) Chair Richard Jones and the Public Company Accounting Oversight Board (PCAOB) Chair Erica Williams – on the “agenda of regulators, SROs (Self-Regulatory Organizations), and Standard Setters for Accounting, Auditing.” 

In advance of the hearing, Cook received a letter this past week from the Subcommittee Chair, Representative Blaine Luetkemeyer (R-MS), and two other Subcommittee members charging that “In recent years, FINRA has deviated from its role as a member-driven [self-regulatory organization]...into a quasi-private, quasi-governmental entity that wields largely unchecked executive powers with virtually no regulatory or legislative accountability.” It is likely to be a rough hearing for Cook.

Finally, back to more normal regulatory activities, we will watch closely as the SEC holds an Open Meeting on Wednesday to consider reforms to the U.S. Treasury Market. The CFTC also has an open meeting to consider four new regulatory proposals, including new capital and financial reporting requirements for swap deals. Last, Treasury Secretary Janet Yellen will chair a Financial Stability Oversight Council (FSOC) meeting on Thursday to review various issues ranging from hedge fund oversight to climate regulations to cybersecurity.

Below is a listing of all issues and events U.S. regulators are engaged in this week, along with relevant think tank and trade association events. Please let us know if you have any questions.

U.S. Congressional Hearings

U.S. Senate

 

House of Representatives

 

US Regulatory Meetings & Events

Federal Reserve Board and Federal Reserve Banks

  • December 12 – 13: The Federal Reserve’s Federal Open Market Committee holds a closed meeting to consider interest rates. Federal Reserve Board Chair Jay Powell will hold a press conference at 2:30 p.m. on the 13th.

 

U.S. Treasury Department

  • December 14, 4:15 p.m. – The Financial Stability Board will meet at the US Treasury Department (Treasury Secretary Janet Yellen will chair).  The preliminary agenda for the executive session includes an update on the Council’s Nonbank Mortgage Servicing Task Force; an update on the Council’s Hedge Fund Working Group; an update on the Council’s Climate-related Financial Risk Committee; and an update on cybersecurity developments. The preliminary agenda for the public session includes the Council’s 2023 annual report. 

  • December 13, 1:00 p.m. – The Treasury Department holds a virtual meeting of the Federal Advisory Committee on Insurance.  The agenda includes: a discussion of topics related to climate-related financial risk and the insurance sector; discussion on cyber insurance developments and international insurance issues; status updates from each of its subcommittees and from FIO on its activities, as well as consideration of any new business

 

Securities and Exchange Commission

 

Commodities Futures Trading Commission

  • December 11, 9:30 a.m. – The CFTC holds a meeting of the Market Risk Advisory Committee to discuss current topics and developments in the areas of central counterparty risk and governance, market structure, climate-related risk, and innovative and emerging technologies affecting the derivatives and related financial markets.

 

  1. Operational Resilience Framework for Futures Commission Merchants, Swap Dealers, and Major Swap Participants

  2. Capital and Financial Reporting Requirements for Swap Dealers and Major Swap Participants

  3. Protection of Clearing Member Funds Held by Derivatives Clearing Organizations

  4. Amendments to Swap Data Recordkeeping and Reporting Requirements

  5. They will also consider an Amended Application of the Binomial Clearinghouse, LLC for Registration as a Derivatives Clearing Organization.

 

  • December 14, 9:00 a.m. – The CFTC holds a meeting of the Agricultural Advisory Committee to discuss topics related to the agricultural economy, including geopolitical and sustainability issues, as well as recent developments in the agricultural derivatives markets.

 

Federal Deposit Insurance Corporation

 

Office of the Comptroller of the Currency

  1. December 10, 6:45 p.m. – Acting Comptroller Michael Hsu will participate in a discussion about the state of financial inclusion with Operation Hope founder and CEO John Hope Bryant during the Hope Global Forum 2023 Annual Meeting in Atlanta, Georgia.

 

The Consumer Financial Protection Bureau

  • No significant events are scheduled at this time.

 

National Credit Union Administration

  • No significant events are scheduled at this time.

 

Federal Trade Commission & Department of Justice Antitrust Division

  • No significant events are scheduled at this time.

  

Farm Credit Administration

 

Farm Credit System Insurance Corporation

  • December 13, 10:00 a.m. – The Farm Credit System Insurance Corporation holds a meeting of the board of directors.  Agenda includes: (Open) Quarterly FCSIC financial reports; Quarterly report on insured obligations; Quarterly report on annual performance plan; Strategic Plan 2024-2029 (Closed) Report on insurance risk; Federal Managers Financial Integrity Act review; Audit plan for the year ended December 31, 2023; and Executive session of the Audit Committee with the auditor.

 

 Trade Associations & Think Tank Events 

Trade Associations

December 12, 1:30 – 5:00 p.m. – ISDA holds its “Trading Book Capital: Basel 3 Implementation Conference.”  FDIC Director Jonathan McKernan will give a keynote speech and participate in a fireside chat.

 

December 14, 10:00 a.m. – The Institute for International Finance holds a virtual report on Emerging Market Capital Flows for Latin America (in Spanish).

 

Think Tanks

 

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Francis Kelly Francis Kelly

Recommended Weekend Reads

December 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.   

Americas

  • “Africa’s Lessons for Latin America”  Americas Quarterly

    Fellow members of the Global South show what a more unified regional approach can achieve. Recent developments in African regional development, from a free trade area to the rise of the African Union, show that it’s time for a paradigm shift: Latin America must consider the invaluable lessons Africa has to offer.

  • “3 Key Issues Ahead of Mexico’s 2024 Election Cycle”  Wilson Center Mexico Election Guide

    As the Mexican presidential cycle gets underway, many will talk about the likelihood of each candidate winning or the role that the Lopez Obrador government will play in deciding this outcome. This report argues much more attention should be paid to the policies that these candidates promise to implement if elected to office. For the Mexican elections in 2024, these are three key issues I think everyone should keep an eye out for: Security, Poverty and Inequality, and Tax Reform.

  

The Ukraine War

  • “The Impact of the War on Ukraine’s Energy Landscape”  Foreign Policy Insitute Eurasia Program

    Before Russia’s full-scale invasion in 2022, Ukraine was able to generate substantial revenues from the transit costs of Russian hydrocarbons destined for the European market. Despite the war, Russian oil (and some gas) continues to flow to Europe via Ukraine, and the latter continues to receive transit fees. In the field of hydrocarbons, although Ukraine is far from having hydrocarbon reserves equivalent to those of Russia, it has several assets to offer Europeans, including particularly large storage capacities. Fortunately, these storage facilities are located in the western part of the country, away from much of the fighting.

    Thanks to the successful synchronization of the Ukrainian and the EU power grids, the electricity trade continues. It has become a field of increased cooperation between Kyiv and Brussels, offering a potential blueprint for other sectors with a view to future integration. Despite the immense destruction caused by the Russian army, which specifically targeted the country’s energy infrastructure, Ukraine has shown extraordinary resilience. Ukraine can export electricity to its European partners, creating a profitable situation for both parties and good promises for the future.

  • “The Sanctions Against Russia are Starting to Work”  The Atlantic

  • Leon Aron, a noted Russia expert, writes that before invading Ukraine, Russia imported most of its key commodities.  Parallel markets cannot make up for the loss of supplies since early 2022.  Many necessities are more expensive, a lot are adulterated, and the quantities available are far smaller than before the war.  Shortages are now emerging across Russia, involving products as varied as tires, printed paper, airplane parts, and cellular towers.  Among the more painful privations is the disappearance of up to 65 percent of crucially important medicines in some large cities.  The Russian Ministry of Health has advised of a coming deficit of almost 200 essential drugs.  More than 40 percent of the Russian government budget goes to defense outlays, and that is set to double in 2024.  The author asks: How long before Putin starts raising taxes and printing banknotes?

     

  

International Economics/Trade

  • “The Radical Reshaping of Global Trade”   Harvard Business Review

    The world is shifting from a global trade order to a devolved one in which bilateral agreements, multiple spheres of influence, and self-interested government policies are likely to loom large. Companies should prepare now for a new, fragmented, non-system that will operate in a “permissionless” manner, where organizations will leverage technology to provide coordination amongst stakeholders. The view of globalization as an arm-in-arm march forward has officially been shattered. As companies navigate the reality of new spheres of influence, and bilateral, rules-based trading agreements, those who can build organizations that are resilient and permissionless will benefit the most

 

  • “Norway’s Parliament Backs Deep-Sea Mining Plans”   Financial Times
    Norway has secured a parliamentary majority for its plans to open up for deep-sea mining despite opposition from environmentalists and the fishing industry, who warn that the move risks further damage to fragile oceans.  This opens up about 280,000 sq km — an area just smaller than Italy — for exploration, where they believe there are vast deposits of minerals needed for electric batteries, wind turbines, and other green industries, including copper, cobalt, and rare earth metals such as neodymium and dysprosium.

     

  • “Outlier or not? The Ukrainian Economic Preparedness for EU Accession”  The Vienna Institute for International Economics

    Ukraine’s status as an EU candidate country has prompted a debate about its readiness for the accession process and some doubts about whether Ukraine can meet the Copenhagen Criteria to join the EU. In this study, VIIE investigates Ukraine's ability to meet the economic aspects of the Copenhagen Criteria, comparing it with EU-CEE countries at the time of their membership applications and accession. The study finds that Ukraine is mostly a typical CESEE country and on many indicators, can be compared with the likes of Romania, Poland, and the Baltic countries at the time of their application or accession or both. In certain industries, we already find that Ukraine has a decent level of competitiveness, which bodes well for future convergence prospects. When the war ends, if Ukraine receives security guarantees, it can feasibly follow the successful EU-CEE convergence and integration path with the EU. Ukraine’s main weaknesses are its negative demographic outlook, historical difficulties in attracting FDI, and limited level of existing economic integration with the EU. Tackling these issues should be among the main economic priorities when the war ends. 

 

China

  • “EU and China Between De-Risking and Cooperation: Scenarios by 2035”  Jacques Delors Institute

    At a time when China’s political and economic future and its global relationships have never been so uncertain, the Jacques Delors Institute has gathered experts to chart scenarios for 2035 on key issues in Sino-European relations.  The aim is to pinpoint transformative factors and shed light on pivotal decisions to prevent shifts harmful to European interests.  The scenarios are not mutually exclusive for a given issue. They don’t follow either a predictable path across different sectors based on whether they predict cooperation or conflict. Rather than searching for broad, overarching narratives, the study reveals a labyrinth of possible interconnections. In this age of de-risking, a one-size-fits-all approach to China is inadequate. Europe must craft tools for a finely tuned understanding of mutual strengths and strategies to prevent systemic rivalry from overshadowing partnership and competition.  

  • “China’s Economic Plan is Bankrupt”  UnHerd

    Cambridge University Political Economist John Rapley argues the legitimacy of the ruling Communist Party rests substantially on its ability to deliver better lives for its citizens. The historical memory of China’s “century of humiliation” — when the proud country became the playground for Western empires from the mid-19th century to the end of the Second World War — hangs heavily over the country’s leaders. They know they must keep pace with their major Western rivals, not least the United States. But the debt-fuelled economic model of the last 25 years is running out of road. News this week that Chinese borrowers are defaulting in record numbers on their debts, everything from mortgages to business loans, led Moody’s credit agency to downgrade the country’s debt rating, highlighting the challenges it faces trying to reinvigorate its economy.

  • “Will Property Implode China’s Economy?  Not Necessarily”   Kenneth Rogoff/Asia Times

    China’s property problems are deep, the remedies will be difficult, and the future holds much slower economic growth – but not financial collapse.

  • “Who Killed the Chinese Economy?”    Foreign Affairs Podcast

    The Foreign Affairs Podcast has a conversation with Peterson Institute for International Economics President Adam Posen and economists Zonguyan Zoe Liu and Michael Pettis – all of whom have different views on the exact causes of China’s economic stagnation.

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U.S. Regulatory Week Ahead

December 4 - 8, 2023

The holidays are just around the corner, and Washington regulators are working hard this week to make their cases on various policy issues before year's end.  SEC Chair Gary Gensler will give two high-profile speeches, first at the American Bar Association’s Federal Regulation of Securities Winter Meeting and then at the Council on Foreign Relations in Washington.  SEC Commissioner Hester Pierce will also be speaking at the ABA meeting.

Meanwhile, the CFTC is fanning out globally this week with CFTC Chair Rostin Benham and CFTC Commissioners Christy Goldsmith Romero attending and speaking at COP28 in Abu Dhabi.  At the same time, Commissioner Kristin N. Johnson delivers a keynote address at the Financial Times Crypto and Digital Assets Summit in London.

But this week's big regulatory-related media event will be in the U.S. Senate Banking Committee as the CEOs of the eight biggest banks in America will testify at the annual "Oversight of Wall Street Firms" hearing. 

At this point, we do not see any particular "hot-button" issues the CEOs will likely be hammered by Senators over.  In fact, this hearing is likely to give the CEOs a major public platform to push back on the Federal Reserve's recently proposed new capital rules (which most of these CEOs have been publicly pillaring for weeks, most recently from Goldman Sachs CEO David Solomon who argued it would "impact everything from flight prices to pensioners retirement savings.”)

Below is a listing of issues and events U.S. regulators are engaged in this week, along with relevant think tank and trade association events.   Please let us know if you have any questions.

 

U.S. Congressional Hearings 

U.S. Senate

  • December 5, 9:30 a.m. – The Senate Banking Committee is holding its “Annual Oversight of Wall Street Firms” hearing.  Testifying will be Charles W. Scharf, CEO and President of Wells Fargo & Company; Brian Thomas Moynihan, Chairman and CEO of Bank of America; Jamie Dimon, Chairman and CEO of JPMorgan Chase & Co.; Jane Fraser, CEO of Citigroup; Ronald O’Hanley, CEO of State Street; Robin Vince, CEO of BNY Mellon; David Solomon, CEO of Goldman Sachs; and James P. Gorman, CEO of Morgan Stanley.

 

House of Representatives

 

US Regulatory Meetings & Events

Federal Reserve Board and Federal Reserve Banks

  • December 5, 10:00 a.m. – Federal Reserve Board Director for the Division of Supervision and Regulation Michael Gibson will testify before the House Financial Services Subcommittee on Digital Assets on “Fostering Financial Innovation” (see above).

 

U.S. Treasury Department

  • No significant events are scheduled at this time.

 

Securities and Exchange Commission

  • December 4, 10:15 a.m. – SEC Chair Gary Gensler will speak at the Council on Foreign Relations in Washington, D.C.

  

Commodities Futures Trading Commission

  • December 4, 2:00 p.m. (UAE Time) – CFTC Commissioner Christy Goldsmith Romero will participate on a UN Sustainable Stock Exchanges Initiative panel regarding Exchanges and Climate Innovation at COP28 UAE with IOSCO Secretary General Martin Moloney, ESMA Chair Verena Ross, and others in Dubai.

  • December 5, 12:20 p.m. (UAE Time) – CFTC Commissioner Christy Goldsmith Romero will participate in a fireside chat at the Sustainable Innovation Forum 2023 on Building Climate Resilient Markets and Supply Chains Through Derivatives during COP28 in Dubai.

  • December 5, 12:35 p.m. (London Time) – CFTC Commissioner Kristin N. Johnson will deliver a keynote address and participate in a fireside chat at the Financial Times Crypto and Digital Assets Summit: Winder Edition in London, England.

  • December 7, 9:40 a.m. (UAE Time) – Chairman Rostin Behnam will participate in a conversation at the Milken Institute Middle East and Africa Summit in Abu Dhabi.

  • December 8, 8:15 a.m. (MST) – CFTC Commissioner Summer K. Mersinger will participate in the Energy Council, Global Energy and Environmental Matters Conference in Jackson, Wyoming.

 

Federal Deposit Insurance Corporation

  • December 5, 9:00 a.m. – The Federal Deposit Insurance Corporation holds a meeting of the FDIC Systemic Resolution Advisory Committee to discuss a range of issues and developments related to the resolution of systemically important financial companies.

  

Office of the Comptroller of the Currency

  • December 5, 3:00 p.m. – Acting Comptroller Michael Hsu will give a virtual speech on financial inclusion at the Aspen Institute Financial Security Program.

 

The Consumer Financial Protection Bureau

  • No significant events are scheduled at this time.

  

National Credit Union Administration

  • No significant events are scheduled at this time.

 

Federal Trade Commission & Department of Justice Antitrust Division

  • No significant events are scheduled at this time.

 

Farm Credit Administration

  • No significant events are scheduled at this time. 

 

Trade Associations & Think Tank Events

 

Trade Associations

 

Think Tanks

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The Global Week Ahead

December 3 - 10, 2023

(NOTE: We apologize for the late publication of our Global Week Ahead.  We experienced technical problems, which have now been fixed).

The Gaza War and the Ukraine War will be dominant issues again this week on the geopolitical calendar.  The US Congress is going to try to move a spending package providing military aid to Israel and Ukraine this week if they can work out an agreement on US border security.  This goal is proving challenging as negotiations keep breaking down.  The White House told Congress that Ukraine will run out of money by the end of the month unless they can approve new funding. 

In Europe, in the wake of the German Constitutional Court decision striking down the German budget and as other EU nations begin struggling with budgets, European Finance Ministers will gather this week to try to hammer out an EU 2024 budget with Ukrainian funding, a critical component of the package. 

On Tuesday, the 44th Gulf Cooperation Council will meet in Qatar, where Gulf leaders will focus on the War in Gaza and prospects for a two-state solution.  But there is little hope of concrete developments from the meetings.

Also, this week, the EU-China Summit will take place in Beijing.  Following the recent success of the APEC Summit and the meeting between President Biden and President Xi, it is hoped EU leaders can achieve new cooperating workstreams with China on several contentious issues, including tech transfer, direct investment, and security.

On the global economic radar screen this week, markets will look at the US jobs report on Friday as a further indication the Federal Reserve has achieved its goals to reduce inflation and no longer need to raise rates ahead of the December 13 Open Market Committee meeting.  Also, this week, markets will be watching the ECB consumer expectation survey and the Bank of Canada interest rate meetings.

Turning to Asia, markets will look at China’s trade balance numbers and Japan’s CPI later this week. 

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

Sunday, December 3, 2023

Global

  • Nothing significant to report.

 

Americas

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report. 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Monday, December 4, 2023

Global

  • The UN Security Council is scheduled to hold a meeting on threats to international peace and security. In the afternoon, the Security Council is scheduled to hold consultations on the Middle East.  

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • US Factory Orders (October)

  • Mexico Gross Fixed Investment (September)

  • Brazil Current Account (October), FDI (October), IPC-Fipe Inflation (November)

  • Colombia Exports (October)

  • Argentina Tax Revenue (December)

 

Asia

Political/Social Events –

  • The first Cambodia-Laos-Vietnam Parliamentary Summit will take place in Vientiane, Laos, through December 7.

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • Brazilian President Lula meets Chancellor Olaf Scholz and President Frank-Walter Steinmeier in Berlin.  They are expected to discuss the G20 Agenda for 2024 (Brazil has just become the chair of the G20) and how to save the EU-Mercosur Treaty negotiation.

  • The EU Justice and Home Affairs Council meet through December 5.  They are expected to get a progress report on all the legislative files of the Pact on asylum and migration. Ministers will also receive a state of play of the external dimension of migration. The impact of the crisis in the Middle East and Russia’s war of aggression against Ukraine on the EU’s internal security will also feature on the agenda.  Justice ministers will aim to reach a general approach on a regulation on the transfer of proceedings and approve the e-justice strategy for 2024-2028.

  • EU Transport, Telecommunications and Energy Council will meet.  They are expected to agree a general approach on several legislative files related to three transport modes (horizontal, land and shipping): two Commission proposals of the ‘road safety’ package

  • The Financial Times Business Book of the Year is announced.

Economic Reports/Events –

  • ECB President Christine Lagarde gives a speech and participates in a Q&A at the Académie des Sciences Morales et Politique's conference in Paris, France.

  • ECB Board Member Frank Elderson participates in a panel discussion on Nature and Water Finance for Climate Action organized by the COP 28 Presidency in Dubai, UAE.  Later in the day, he participates in a high-level panel on financial regulation organized by the World Bank.  After that, he participates in a panel discussion at a high-level session, "Inside Green Finance’s Regulatory Landscape," organized by the Abu Dhabi Global Market.  From there, he participates in a  Fireside chat with Mr Elderson and NGFS Chairs (past, current and future) organized by the Network for Greening the Financial System (NGFS) in Dubai, United Arab Emirates.  He then participates on a panel “Accelerating Action: Private Sector Accountability & Regulation for Net-Zero Transition" organized by the COP28 Presidency.

  • ECB Vice President Luis de Guindos gives the opening speech at the conference "Una banca en transformación" organized by Prensa Iberica and Grant Thornton in Madrid, Spain.

  • Germany Imports/Exports/Balance of Trade (October)

  • Spain Unemployment (November)

  • Switzerland Inflation (October), CPI (October)

  • Romania Unemployment (October)

  • Slovakia Real Wages (Q3)

  •  

Middle East

Political/Social Events –

  • Turkish President Recep Tayyip Erdogan is expected to arrive in Qatar for talks on the Middle East conflict. 

Economic Reports/Events –

  • Turkey Inflation (October), CPI (October), PPI (October)

  • Bahrain M2 Money Supply (October), Private Sector Credit (October)

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report. 

 

Tuesday, December 5, 2023

Global

 

Americas

Political/Social Events –

Economic Reports/Events –

  • US Redbook (December 2), S&P Global Services & Composite PMIs (November), ISM Services PMI (November), JOLTs Job Openings (October), ISM Services Employment (November), RCM/TIPP Economic Optimism Index (December), LMI Logistics Managers Index (November), Total Vehicle Sales (November)

  • Brazil GDP (Q3), BCB Focus Market Readout, Bank Lending (October), S&P Services & Composite PMIs (November)

  • Colombia PPI (November)

  • Uruguay Inflation (November)

 

Asia

Political/Social Events –

Economic Reports/Events –

  • China Caixin Services & Composite PMIs (November)

  • Japan Tokyo Core CPI (November) Jibun Bank Services & Composite PMIs (November)

  • India S&P Global Services & Composite PMIs (November)

  • Singapore S&P Global PMI (November), Retail Sales (October)

  • South Korea GDP (Q3), Inflation (November), CPI (November), FX Reserves (November)

  • Reserve Bank of Australia Interest Rate Decision

  • Australia Judo Bank Services PMI (November), Current Account (q3), Next Exports Contribution to GDP (Q3)

  • Taiwan FX Reserves (November)

  • Hong Kong S&P Global PMI (November)

  • Philippine Inflation (November)

 

Europe

Political/Social Events –

  • The foreign ministers of Azerbaijan, Iran, Kazakhstan, Russia and Turkmenistan will meet in Moscow, Russia. 

  • The EU Transport, Telecommunications and Energy Council (Telecommunications) meets to discuss a general approach on the regulation on measures to reduce the cost of deploying gigabit electronic communications networks (gigabit infrastructure act) and take note of a progress report on the cyber solidarity act (CSoA) laying down measures to strengthen solidarity and capacities in the EU to detect, prepare for and respond to cybersecurity threats and incidents. Ministers will also hold a policy debate on technological leadership and competitiveness and discuss the state of play on a number of current legislative files in the field of telecommunications.

Economic Reports/Events –

 

Middle East

Political/Social Events –

Economic Reports/Events –

  • Egypt S&P Global PMI (November)

  • Saudi Arabia Riyad Bank PMI (November)

  • Lebanon BLOM PMI (November)

  • Israel Business Confidence (November)

 

Africa

Political/Social Events –

  • Kenya’s President William Ruto will pay a three-day state visit to India. He will meet Prime Minister Narendra Modi and participate in a business and investment event in New Delhi.

Economic Reports/Events –

  • South Africa S&P Global PMI (November), GDP (Q3)

  • Kenya Central Bank Interest Rate Decision, Stanbic Bank PMI (November)

 

 

Wednesday, December 6, 2023

Global

Americas

Political/Social Events –

Economic Reports/Events –

  • US Imports/Exports/Balance of Trade (October), Nonfarm Productivity (Q3), MBA Mortgage Market Index (December 1), ADP Employment Change (November)

  • Bank of Canada Interest Rate Decision

  • Canada Imports/Exports/Balance of Trade (October), Ivey PMI (November)

  • Brazil Gross Debt to GDP (October), Nominal Budget Balance (October), Car Production (November)

  • Mexico Consumer Confidence (November), Auto Exports (November), Auto Production (November)

  • Colombia Inflation (November)

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Taiwan Inflation (November)

  • Australia GDP ((Q3), RBA Chart pack, Ai Group Industry Index (November), Ai Group Construction Index (December)

 

Europe

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Eurozone Retail Sales (October)

  • Germany Factory Orders (October), HCOB Construction PMI (November)

  • Italy HCOB Construction PMI (November)

  • UK Financial Stability Report,  S&P Global/CIPS Construction PMI (November)

  • France HCOB Construction PMI (November)

  • Ireland Unemployment (November)

  • Greece GDP (Q3)

  • Poland Central Bank Interest Rate Decision

  • Romania Retail Sales (October)

  • Hungary Industrial Production (October), Retail Sales (October), Central Bank Monetary Policy Meeting Minutes

  • Slovakia Retail Sales (October)

  • Ukraine FX Reserves (November)

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • UAE S&P Global PMI (November)

  • Egypt Current Account (Q3)

 

Africa

Political/Social Events –

  • The African Union Congress of African Economists will gather in Lusaka, Zambia, to discuss the link between illicit financial flows, debt management, and development in Africa.

Economic Reports/Events –

  •  Nothing significant to report.

  

Thursday, December 7, 2023

Global

 

Americas

Political/Social Events –

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • China Imports/Exports/Balance of Trade (November)

  • Japan Coincident Index (October), Leading Economic Index (October)

  • Indonesia FX Reserves (November)

  • Australia Exports/Imports/Balance of Trade (October), Building Permits (October)

  • Philippines Unemployment (October)

  • Hong Kong FX Reserves (November)

  • Singapore FX Reserves (November)

  • Thailand CPI (November), Inflation (November)

 

Europe

Political/Social Events –

  • The EU-China Summit begins in Beijing.  The agenda items include Among items on the agenda at the first in-person summit in four years is to seek what European Commission President Ursula von der Leyen called a level playing field in trade. The European Union posted the highest trade deficit on record with China in 2022, at nearly 400 billion euros ($436 billion).

  • The Eurogroup (European Finance Ministers) will meet in Brussels. They will will discuss the overall budgetary situation and prospects in the euro area and review the economic and fiscal situation of the euro area member states. This discussion is based on Commission opinions on the draft budgetary plans (DBPs) of the euro area member states and on the Commission's communication on its overall assessment of the DBPs, published on 21 November 2023.  They will also exchange first views on the euro area recommendation published with the autumn package on 21 November 2023. The euro area recommendation is expected to be agreed at the Eurogroup and ECOFIN meetings on 15 and 16 January 2024 before being transmitted to the European Council for its meeting on 21-22 March 2024.

  • Russian President Vladimir Putin will speak at the plenary session of the 30th annual "Russia Calling!" Investment Forum.

  • The EU Competitiveness Council (Internal market and industry) will meet to adopt a general approach on the Net-Zero Industry Act. They will hold a policy debate concerning the Regulation on forced labor. During lunch, ministers will exchange views on SME policy.

  • NATO Secretary General, Mr. Jens Stoltenberg, will receive the Prime Minister of the Grand Duchy of Luxembourg, Luc Frieden, at NATO Headquarters.  

Economic Reports/Events –

  • ECB Board Member Frank Elderson gives a speech at an event organized by the Centre for European Policy Studies (CEPS) in Brussels, Belgium.

  • Eurozone GDP (Q3), Employment Change (Q3)

  • Germany Industrial Production (October)

  • UK Halifax House Price Index (November), BBA Mortgage Rate (November)

  • France Imports/Exports/Balance of Trade (October)

  • Italy Retail Sales (October)

  • Romania GDP (Q3)

  • Bulgaria Industrial Production (October)

  • Switzerland Unemployment (November), FX Reserves (November)

  • Hungary PPI (November)

  • Serbia Central Bank Interest Rate Decision

  • Russia FX Reserves (November)

 

Middle East

Political/Social Events –

Economic Reports/Events –

  • Egypt FX Reserves (November)

  • Saudi Arabia GDP (Q3)

  • Turkey Treasury Cash Balance (November)

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • South Africa FX Reserves (November), Current Account (Q3)

 

 

Friday, December 8, 2023

Global

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • US Non-Farm Payrolls (November), Unemployment (November), Michigan Consumer Expectations (December), WASDE Report

  • Canada Capacity Utilization (Q3)

  • Brazil Business Confidence (December)

  • Costa Rica Inflation (November)

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • China FX Reserves (November)

  • Japan GDP (Q3), Current Account (October), Household Spending (October), Average Cash

  • Earnings (October), Overtime Pay (October), Bank Lending (November), Eco Watchers Survey (November)

  • India Reserve Bank Interest Rate Decision, Cash Reserve Ratio, FX Reserves (December 1)

  • Taiwan Imports/Exports/Balance of Trade (November)

  • Philippine FDI (September)

  • Indonesia Consumer Confidence (November)

  • Malaysia Unemployment (October)

  • Thailand Consumer Confidence (November), FX Reserves (November)

 

Europe

Political/Social Events –

  • The UK’s National Audit Office issues a report on financial services regulation, examining the Financial Conduct Authority’s effectiveness in working with others, particularly Treasury officials.

  • The EU Economic and Financial Affairs Council (ECOFIN) will meet to seek a general approach on the proposed reform of the economic governance framework. Ministers will adopt implementing decisions approving modified recovery and resilience plans submitted by some member states. The presidency will present progress reports on own resources and the single currency package. Ministers will discuss the economic and financial impact of Russia’s aggression against Ukraine and the European Semester.

  • The EU Competitiveness Council (Research and space) will meet seek a general approach on the proposed reform of the economic governance framework. Ministers will adopt implementing decisions approving modified recovery and resilience plans, submitted by some member states. The presidency will present progress reports on own resources and the single currency package. Ministers will discuss the economic and financial impact of Russia’s aggression against Ukraine and the European Semester. The Council will approve report to the European Council on tax issues and conclusions on the progress achieved by the Code of Conduct Group.

  • UK train drivers' union ASLEF will hold a rolling seven-day strike impacting services at 14 British railway companies.

  • Germany’s Social Democrats will meet through Sunday for their annual national party conference in Berlin, Germany.

Economic Reports/Events –

  • Germany Inflation (November), CPI (November)

  • France Non-Farm Payrolls (Q3)

  • Hungary Inflation (November), Balance of Trade (October)

  • Greece Inflation (November), Balance of Trade (October)

  • Ireland Industrial Production (October)

  • Slovakia Balance of Trade (October)

  • Bulgaria Construction Output (October), Industrial Production (October), Retail Sales (October)

  • Poland Central Bank Monetary Policy Minutes

  • Ukraine Inflation (November)

  • Russia Vehicle Sales (November), Inflation (November)

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Israel FX Reserves (November), Budget Balance (November)

 

Africa:

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Tanzania Inflation (November) 

 

Saturday, December 9, 2023

Global

  • Nothing significant to report.

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • China Inflation (November), PPI (November)

 

Europe

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

 

Sunday, December 10, 2023

Global

  • The Nobel Prize Awards Ceremony is held in Stockholm, Sweden.

 

Americas

Political/Social Events –

  • Argentine President-elect Javier Milei will be sworn into office.  Meanwhile, the Argentine Union of State Employees (ATE) is expected to carry out a 24-hour strike to protest Milei’s planned fiscal plans.

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

  • Hong Kong holds local District Council elections.

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • The EU Agriculture and Fisheries Council will meet through December 11 to discuss the market situation and to exchange views on the first year of implementation of the CAP strategic plans.  Additionally, the Council is expected to address the new genomic techniques regulation, the sustainable use of pesticides regulation, and the proposals for plant reproductive material and forest reproductive material. Finally, fisheries ministers will aim to reach a political agreement on the proposal for fishing opportunities in the Atlantic and the North Sea for 2024 and, in the case of some stocks, also for 2025 and 2026, as well as on the proposal concerning fishing opportunities in the Mediterranean and the Black Sea for 2024.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Egypt holds presidential elections. President Abdel Fattah al-Sisi is widely expected to win re-election.

  • The Doha Forum begins in Doha, Qatar.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

  

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Recommended Weekend Reads

December 1 - 3, 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. 

Americas

 

  • “On the Uses and Misuses of Venezuela Sanctions” Center for Strategic and International Studies

    Over the last month, the Biden administration has presided over a sea change in U.S. policy toward Venezuela. The recent lifting of sanctions on the Maduro regime is the most significant alteration of Venezuela's policy in the last several years, coupled with routine deportation flights started on the same day as the sanctions relief to address a torrent of Venezuelan irregular migration. Gone is the policy of “maximum pressure” that Biden inherited from his predecessor, which had garnered bipartisan support on Capitol Hill. From its earliest days, the Biden administration signaled its discomfort with a maximum pressure campaign and its intent to unwind sanctions in exchange for concessions from the Maduro regime toward a free and fair election.

 

  • “Henry Kissinger, Colossus on the World Stage”  Foreign Policy

    Henry Alfred Kissinger, one of the most influential statesmen in American history, died on Nov. 29 at age 100 after a long and tumultuous career in which he helped author some of the greatest triumphs—as well as some of the most tragic failures—of U.S. foreign policy. He was credited with several of the most epoch-making diplomatic achievements since World War II. These included launching detente with the Soviet Union to preserve peace during the Cold War and, along with his boss, President Richard Nixon, dramatically altering the terms of that 40-year conflict by opening relations with communist China in 1972.

  • “What America Wants from China”  Foreign Affairs

    Brookings Institution John Thorton China Center Director Ryan Hass writes that Washington needs to set an objective on China that would enjoy durable domestic support and be compatible with foreign partners’ priorities, allowing them to anticipate the direction of U.S. policy and its guiding logic.  He then presents a smart and highly compelling strategy for keeping Beijing entangled in the World Order and keeping peace globally.

 

 

The Middle East

  • “The Gaza War and the Rest of the World”  Malcolm Kerr Carnegie Middle East Center

    Scholars from Carnegie’s global network comment on how the ongoing conflict between Israelis and Palestinians is affecting their areas of interest and what the implications of this may be.

  • “Why Israel Won’t Change”  Foreign Affairs

    Almost from the moment Hamas broke through Israel’s security barrier with the Gaza Strip on October 7 and began its rampage, it felt as if Israel would never be the same. Within hours, Israelis were forced to confront the reality that many of the assumptions that had long guided Israeli policy toward the Palestinians had crumbled. Yet, in one major way, Israel remains unchanged. Although Israelis blame the country’s leadership for the catastrophic security failures surrounding the attacks, their basic political orientation seems unlikely to budge. Prime Minister Benjamin Netanyahu may well be forced to step down when the war is over—if not before since the war has no clear endpoint. But as Israeli history has repeatedly shown, especially in recent decades, episodes of war or extreme violence like the current one have only reinforced a rightward tilt in Israeli politics.

  • “Stormy Waters for Saudi Arabia: Regional Conflict and Red Sea Security”  Carnegie Endowment for International Peace

    In recent years, Red Sea security has become a key pillar of Saudi Arabia’s domestic and foreign policy. Driven by geostrategic ambitions and plans to diversify its oil economy, the kingdom has strengthened security relations in the area by building alliances with Israel and coastal African countries and by de-escalating conflicts with Iran and Yemen’s Iranian-backed Houthis. There have been efforts made to modernize the Royal Saudi Naval Forces, particularly the Western Fleet, which operates in the Red Sea, and to tighten naval cooperation with Egypt. Multilateral initiatives have seen Riyadh at the forefront—including the Saudi-led Red Sea Council and U.S.-led task forces deployed in the Red Sea to counter smuggling and train local navies. 

 

North Asia

 

 

Global Finance & Economics

  • “What We Heard: Bank of Canada Publishes Report on Digital Dollar Consultations, Outlines Further Engagement Plans”  Bank of Canada

    In a public update on the prospects of moving the Canadian dollar to digital, the Bank of Canada reports they heard: 1) Financial sector stakeholders generally wanted more concrete details about how a digital dollar would work so they could better understand the potential impacts on their business models and overall financial stability. 2) Focus group participants largely accepted the potential need for a digital dollar in the future but wanted more information on how exactly it would work. 2) Civil society groups mainly supported a digital dollar if its design would remove existing barriers to accessibility and financial inclusion. 3) Respondents to the public questionnaire were largely opposed to a digital dollar and to the Bank of Canada researching it. They were concerned about the impacts that a digital dollar could have on their rights.

 

Chart of the Week 

America’s High Schoolers Are Running Out of Time

Bloomberg’s editorial board writes that America’s high schools face a growing crisis: Millions of students who entered ninth grade in the fall of 2020, at the height of the pandemic, are set to graduate this spring, with little hope of recovering from the learning loss incurred while schools were shut. Simply put, they’re running out of time.

They note that since 2022, the average scores on ACT exams were the lowest in 30 years and the number of students receiving failing grades has soared.

This comes as the U.S. rapidly ramps up the re-shoring of hi-tech manufacturing – via the CHIPS Act and the Inflation Reduction Act –  which demands a massive new workforce proficient in science and math.  Clearly, the challenges of meeting those needs are obviously becoming starker.

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