Greetings, United States: The first-quarter GDP contracted by 4.8% (annualized), the biggest decline since 2008. This contraction in the GDP was just a taste for what’s to come in Q2. Here is a forecast from Oxford Economics. Eurozone: Business confidence plummeted in April, with services sentiment hitting a record low. Here is the …
The Daily Shot Brief – April 29th, 2020
Greetings, United States: The biggest post-WW-II drop in consumer spending will drive the contraction in the GDP. The decline in the second quarter is expected to be much worse (the consensus is a 26% contraction). Below is Goldman’s monthly current activity indicator (CAI). The Fed’s balance sheet, as a percentage of the …
The Daily Shot Brief – April 28th, 2020
Greetings, Energy: Crude oil is under pressure again as stockpiles approach physical storage capacity globally. June WTI futures are nearing $11/bbl. Will inventories exceed maximum available storage capacity? Commodities: Processing plant closures continue to wreak havoc on US meat markets. Meat processing margins have spiked. Equities: Hedge funds are positioned …
The Daily Shot Brief – April 27th, 2020
`Greetings, United States: Half of Americans see their financial situation getting worse. The percentage of Americans who think it is a good time to buy a house hit a new low. Eurozone: Here are the IMF’s unemployment rate projections. Commodities: US wholesale meat prices keep climbing as processing plants shut down. …
The Daily Shot Brief – April 24th, 2020
`Greetings, United States: Another four million Americans filed for unemployment last week. While the weekly applications are expected to slow, millions more will be applying for unemployment benefits in the weeks ahead. Here is a forecast from Pantheon Macroeconomics. This map shows what portion of the workforce has filed for unemployment since March 15th. …
The Daily Shot Brief – April 23rd, 2020
`Greetings, United States: Will the April unemployment rate hit 15%? The Bloomberg consensus for the second quarter is 12.8%. Eurozone: The ECB’s portion of the Eurozone government debt will keep rising. Energy: The implied demand for US refined products seems to have stabilized. Credit: How much will the high-yield default rate …
The Daily Shot Brief – April 22nd, 2020
Greetings, Energy: The extraordinary rout in crude oil continues as Brent futures dip below $17/bbl, lowest since 1999. The June US oil futures contract is below $11/bbl. The CBOE crude oil volatility index has become meaningless. Volatility models typically assume a lognormal distribution, with prices never going to zero or below. That assumption no …
The Daily Shot Brief – April 21st, 2020
Greetings, United States: In an unprecedented market dislocation, the May NYMEX crude oil (WTI) contract hit negative $40 per barrel. With storage increasingly scarce, nobody wants to take delivery on the expiring contract. Oil implied volatility hit a record high. Equities: This could be the first time the S&P 500 registers five straight quarters of …
The Daily Shot Brief – April 20th, 2020
Greetings, United States: Morgan Stanley expects the unemployment rate to drop below 6% by the end of next year after hitting 15%. China: The percentage of overdue household loans has risen sharply. Energy: US crude oil dipped below $15/bbl on oversupply concerns. We are now near the lowest levels since 1999. Part …
The Daily Shot Brief – April 17th, 2020
Greetings, United States: Bloomberg’s consumer comfort indicator points to further deterioration in sentiment. But the levels remain well above the 2008 lows. Part of the reason is that household balance sheets were much healthier going into this downturn than what we saw before the financial crisis. Eurozone: Euro-area firms depend much more on …
