Markets Weekly October 5, 2024

Hello my friends, today is October 5th and this is Markets Weekly. So this week I'm on the road so we're going to do this Asian Zion style. Tons of really interesting things happening in the markets so we have a lot to talk about. First off, the big news of the past week was of course rising geopolitical tensions that look like they're going to boil over imminently. Secondly, we got some pretty good US data on the jobs Trump and on the ISM front and that's shifting rate expectations. And lastly, we got a little, a lot of actually random central banks, foreign central banks that have or about to move and we should talk about that as well.

你好，我的朋友们，今天是10月5日，欢迎来到《市场周报》。本周我在旅途中，所以我们将以亚洲Zion风格进行。本周市场上发生了许多有趣的事情，我们有很多内容要讨论。首先，上周的大新闻当然是不断加剧的地缘政治紧张局势，看起来这些局势即将爆发。其次，我们收到了美国就业和ISM方面的一些不错的数据，这些数据正在改变利率预期。最后，我们还有许多外国中央银行的随机动作，或是即将采取行动，我们也应该讨论这一点。

Alright, starting with geopolitical tensions. So last week, as we all know, Iran launched a whole bunch of ballistic missiles against Israel and now we're all expecting Israel to retaliate. Now let's think about this a little bit with a bit of a broader perspective. So a year ago, of course, Israel was attacked by Hamas. Over a thousand people died. I was very sad. But since then, it seems like Israel's foreign policy has changed a lot. It's become a lot more aggressive. Now remember, after that Israel went to Gaza, basically demolished that place. So depending on the estimates, maybe 40,000 people died, maybe over 100,000. But at least a million or millions of people are now basically homeless and had their entire lives destroyed. It's a humanitarian catastrophe. Again, the international community has been aware of this and they sent lots of aid and many people in Israel basically shot and killed the aid workers and so that's also a disaster as well.

好的，从地缘政治紧张局势开始。上周，大家都知道，伊朗向以色列发射了一大堆弹道导弹，现在我们都在期待以色列的报复。让我们从更广的角度来思考这个问题。大约一年前，以色列确实受到了哈马斯的攻击，当时有超过一千人丧生，真是非常悲惨。但从那以后，以色列的对外政策似乎发生了很大变化，变得更加激进。记得当时以色列进入了加沙地区，基本上摧毁了那里。根据不同的估计，可能有4万人，甚至超过10万人丧生。但至少有上百万甚至几百万人现在基本上无家可归，整个生活都被毁。这是一场人道主义灾难。同时，国际社会对此有所了解，他们送去了大量援助，但许多人在以色列被枪杀，包括援助人员，这也成了一场灾难。

And then after that, again, Israel has become a lot more aggressive towards Iran. However, they had an attack in Tehran, the Iranian capital, where they assassinated a senior foreign official there. I believe he was involved in Hamas. So basically assassinations on Iranian soil in their capital. And more recently, we have Israel going all out against Hezbollah by attacking southern Lebanon. Hezbollah is closely related to Iran and enemy of Israel. So what Israel did was basically go and take out the entire senior leadership of Hezbollah very successfully. But of course, that was not without collateral damage. In order to do that, they had to go and basically bomb and demolish many places in southern Lebanon. So you got thousands of people died as collateral damage. Basically, it's kind of like there's a bad guy under block and so the government goes and kills everyone on the block.

随后，以色列对伊朗的态度变得更加激进。他们在伊朗首都德黑兰发动了一次袭击，暗杀了一名高级外国官员。我相信他与哈马斯有关。基本上就是在伊朗首都进行刺杀。更近期，以色列全面打击位于黎巴嫩南部的真主党。真主党与伊朗关系密切，是以色列的敌人。以色列的行动主要是成功地清除真主党的高级领导层。 但这次行动当然伴随着附带伤害。为了达到目的，他们轰炸并摧毁了南黎巴嫩的许多地方，导致成千上万人因此丧生。基本上来说，这就像是在街区有一个坏人，政府于是选择摧毁整个街区的所有人。

So all throughout this, the United States has been very supportive of Israel. Now, these things have come at a very large political cost to the Biden administration. There's a lot of protests about US foreign policy and a lot of protests in the international community as well. But the Biden administration continues to provide Israel with arms, with money, with intelligence, and it looks like they're going to continue to do this. So where does that leave us today? So one of the common thoughts right now in the geopolitical community is that Israel is thinking that this is their generational opportunity to really fundamentally shape Middle Eastern politics. So right now, they have Hezbollah on the run and they have the momentum behind them and they have a good opportunity to take out their arch enemy Iran. And they have the White House in their pocket.

在整个过程中，美国一直非常支持以色列。然而，这些支持对拜登政府来说付出了巨大的政治代价。对于美国的外交政策，不仅国内有很多抗议，国际社会也有很多反对声音。但拜登政府依然继续向以色列提供武器、资金和情报，并且看起来还会继续这样做。那么现在的局势如何呢？目前，地缘政治圈普遍认为，以色列认为这是他们这一代人能够从根本上塑造中东政治格局的机遇。现在，他们在对抗黎巴嫩真主党时占据上风，且势头强劲，并有很好的机会打击他们的主要对手伊朗，同时还得到了美国白宫的大力支持。

Now the White House, of course, the US has always been very supportive of Israel. For those of you who don't know, the Israeli lobby is very influential in the US. John Miraszheimer has a very good book on that topic called the lobby. Basically Israeli politicians donate a lot of money to US lawmakers and basically own them. But even given that history of strong support, the Biden administration is really exceptional and even though they're paying a big political price internally to go and allow Israel to do all this, they're still letting Israel go. And maybe Biden is seen out. He doesn't know what's happening and lets his deputies run everything.

现在白宫，当然，美国一直非常支持以色列。对于那些不知道的人来说，以色列游说团在美国非常有影响力。约翰·米尔沙默就这个话题写了一本非常好的书，叫《游说团》。基本上，以色列的政界人士向美国议员捐赠大量资金，从而对他们产生很大影响。但即便有着这种强有力的支持历史，拜登政府在这个问题上的态度仍然极为特别，尽管在国内因此承受着巨大的政治代价，他们还是允许以色列继续其行动。而且，或许是因为拜登年纪见长，他可能不太清楚发生了什么，让他的副手们掌管一切。

Now Secretary of State Blinken, I would also remind everyone, when he flew to Israel last year, he, you know, Secretary of State of the United States basically introduced himself as coming there as a Jew. So which is what he is. So maybe that is influencing his priorities in this situation. In any case, it looks like the United States is going to support Israel with whatever they're going to do. Now this past week, we had former Prime Minister of Israel and also Jared Kushner posted on X what a lot of people there seem to be thinking. So that is to say, we got to take this chance before the election, before we get a new president that might not be as supportive to what we want to do and just change the world. So they're saying three things could happen. One is that they could do a big decapitation strike in Iran, just like they did in Lebanon against Hezbollah. Second, they can go and take out Iran's nuclear facilities. As we all know, nuclear weapons are present an existential threat to Israel and Iran seems to be at the cusp of obtaining those. And lastly, what they're thinking of is going out and taking out the energy infrastructure of Iran, where that way the Iran can't make money anymore and that will set them back significantly.

现在的美国国务卿布林肯，我要提醒大家，当他去年飞往以色列时，他基本上是以一个犹太人的身份去的。也许这会影响他在这个情况下的优先事务。不管怎样，美国似乎将支持以色列的任何行动。在过去的一周里，以色列前总理和贾里德·库什纳在社交媒体上发帖，表达了很多人似乎持有的看法。也就是说，我们必须抓住这个机会，在选举前行动，因为可能会有一位不那么支持我们行动的新总统上台，我们应该趁机改变世界。他们认为可能会发生三件事：一是对伊朗进行大规模的斩首打击，就像他们在黎巴嫩对付真主党时那样；二是攻击伊朗的核设施，因为众所周知，核武器对以色列构成存在性的威胁，而伊朗似乎快要获得这些武器了；最后，他们考虑破坏伊朗的能源基础设施，这样伊朗就无法再赚钱，从而让他们大大倒退。

Now all these things have pros and cons. And so one of the things that is being talked about right now is of course, if Iran says that if they strike their energy infrastructure, what the Iranians would do is that they will guard and strike everyone else's energy infrastructure. And what that means is that there will be tremendous disruption in the Middle East. Oil is going to go to the moon. So when the use came out that after the attacks by Iran and Israel retaliates, then you have to know not yet retaliating. But as you're thinking about retaliating, you see oil go up significantly this past week and fixed strike fall has been pretty elevated as well. We have some news that Biden says, you know, don't do the don't attack. He doesn't want them to attack the oil infrastructure. But as we all know, Biden says it doesn't matter. Now President Trump has made comments that he's supportive of Israel attacking Iran's nuclear facility. So maybe that will happen. So it's totally unclear. But what is clear though is that they have this very, very, very small window to achieve their dreams, expand their territory, take out their rivals. And it seems like they're going to do it. So I think we should brace for significant impact in markets these coming weeks. Now some people might say that, you know, this is not Biden. It's not going to do that because high oil prices and disorder is not going to be good for Harris's election. And that may be. But you know, I'm getting the sense that Biden probably doesn't really care about the Harris's reelection.

现在所有这些事情都有优缺点。因此，目前正在讨论的问题之一当然是，如果伊朗表示如果他们的能源基础设施受到攻击，那么伊朗会保护并攻击其他国家的能源基础设施。这意味着中东地区将会有巨大的混乱。油价会飙升。因此，当关于伊朗的袭击消息传出来，并以色列进行报复时，你必须知道尽管还没有进行报复，但在考虑报复时，你会看到过去一周油价显著上涨，而且固定利率跌幅也相当大。我们有一些消息称，拜登表示不要攻击，不想让他们攻击石油基础设施。但我们都知道，拜登说这无关紧要。现在特朗普总统评论称他支持以色列攻击伊朗的核设施。所以这也许会发生。但情况完全不明确。明确的是，他们有非常、非常、非常小的窗口来实现他们的梦想，扩大他们的领土，消灭他们的对手。而且看起来他们会这样做。因此，我认为我们应该准备好迎接未来几周市场的重大影响。现在有些人可能会说，这不是拜登，因为高油价和混乱对哈里斯的选举不利。这可能是对的。但我有种感觉，拜登可能不太在意哈里斯的连任。

You know, Biden was all set on being the nominee. He wanted to be president again. He disappeared for a few days, came back and he had to basically step down. I'm guessing he's now getting doesn't seem to have been very supportive of Harris. So these past weeks, I'm guessing he's really upset that they they pushed him out. After all, President Biden basically picked Harris out of the trash can in 2020 and made her vice president recall. President Harris did very poorly in the Democratic primaries back then. And if not for Biden would be nowhere. Now Biden made her vice president and now she's kicking him out. Maybe he's not too happy about that. In any case, we have big, big geopolitical tensions rushing up. So we should be very careful going forward. All right.

你知道吗，拜登原本准备再次成为总统提名人，他想要再做总统。他消失了几天，回来后基本上就不得不退位了。我猜他现在对哈里斯的支持似乎不太高兴。这几个星期，我猜他真的很不满他们把他赶走。毕竟，当初拜登在2020年基本上从"垃圾桶"里捡了哈里斯出来，让她成为副总统。回想一下，哈里斯在那时的民主党初选中表现很差，如果不是拜登，她可能一无所获。现在拜登让她当了副总统，而现在她又要赶他下台，他可能对此不太乐意。不管怎样，我们正面临巨大的地缘政治紧张局势，所以在未来我们要非常小心。好的。

The second thing we got to talk about is the really good US jobs data that we got the past week. Now, non-farm payrolls printed at about 250,000, 100,000 higher than estimates. Now, as we all know, we got to go and look beneath the details to get a better idea of what's happening. But the details were very good as well. So the unemployment rate went down to about 4.1%. Now, you remember a couple of months ago was at 4.3 went down to 4.2 and now it's at 4.1. So a lot of people were afraid. Some rule triggered unemployment is going to shoot to the moon. We're going to have imminent recession. But since it's been triggered, we've had the unemployment rate go steadily down. So that's one thing. The second thing, of course, is that wages.

第二件我们需要讨论的事情是上周我们获得的美国就业数据表现得非常好。非农就业人数达到了大约25万，比预期高出了10万。如我们所知，我们需要深入细节来更好地了解发生了什么。但细节部分也非常不错，失业率下降到了4.1%左右。你可能还记得几个月前失业率是4.3%，然后降到了4.2%，现在是4.1%。很多人之前担忧某些规则触发后失业率会飙升，我们将面临即将到来的经济衰退。然而，自从规则被触发以来，失业率却在稳步下降。这是其一。其二，当然是工资问题。

Wages are printed higher than expected. So wage growth is fine. So all in all, this was a really good unemployment print. And when the markets saw it, they immediately, immediately shifted their expectation of the path of Fed policy. They were thinking maybe the Fed might cut 50 again this year. Now that's that now they don't think that anymore. They're thinking maybe we'll get 225s. So you saw the 10-year yield rise significantly. Actually the entire rates go rise significantly and dragging the dollar up as well. Now, in addition to that, we also got the ISM services print last week that showed pretty good expansion in the services sector. So if you were thinking that there was a US recession, we have these data points that are arguing against you and the market is affecting that as well. Okay.

工资增长超过预期。所以工资增长情况良好。总的来说，这是一份非常不错的失业率报告。当市场看到这份报告时，立即改变了对于美联储政策走向的预期。他们原本认为美联储可能在今年再次降息50个基点，但现在不这么认为了，而是考虑可能会有两次25个基点的加息。因此，10年期国债收益率显著上升，实际上整个利率水平都显著上升，带动美元走强。此外，我们上周还得到了反映服务业有良好扩张的ISM服务业报告。因此，如果你认为美国经济会陷入衰退，这些数据会与这种观点相反，同时市场也在反映这些变化。

The last thing let's talk about is we got a whole bunch of central bank news throughout the world now. So in Japan, for example, remember recently we had a new prime minister in Japan and the market was pricing in a more hawkish bank of Japan because this new prime minister was perceived by the market to be more open to the bank of Japan normalizing monetary policy. And so the yen strengthened a lot and the Nikkei tumbled. But this past week he seemed to be saying something different. You know, he's like, you know, let's not hike rates. And so maybe he's not as hawkish as the markets thought. Marketing immediately has been pricing in a weaker yen and the Nikkei loved it. So you can see that very cool USDJPUI rising quite significantly the past week in part due to, of course, the stronger dollar. So looking to the UK, we got a notable depreciation of the USDJPU, yeah, the USDGBP. So the pound weakened a lot because it seems like Governor Andrew Bailey over there is beginning to hint that, you know, he might be comfortable with a faster than expected pace of rate cuts. That seems to be due to data in the UK coming in weaker than expected or at least inflation coming down faster than expected. So he's going to be joining the greater global rate cut cycle pretty soon as well. But I'm looking into, ah, yes, of course, looking into the European Union. It looks like October is a done deal for cuts as well. Looks like that is a very noble. I think we talked about this last time. Motioning greater concern about growth. And so it seems like that's going to be leading to a rate cut in October and the Swiss National Bank also inflation coming in lower than expected. It looks like they're going to be cutting maybe sooner than expected as well. So we got global rate cutting cycles really in full swing. But then again, really big geopolitical risk on the horizon.

最后，我们来谈谈全球央行的动态。比如在日本，最近日本有了一位新任首相，市场原本预期这位首相会支持日本央行更积极的货币政策正常化，因此日元大幅升值，日经指数下跌。但上周，他的话似乎表明他并不打算加息，可能没有市场想象的那么鹰派。市场迅速回应，日元走弱，日经指数上扬。美元兑日元在过去一周中明显上涨，部分原因是美元走强。 在英国，英镑大幅贬值，因为英国央行行长安德鲁·贝利似乎暗示他可能接受比预期更快的降息步伐。这可能是因为英国的数据表现不如预期，或者至少是通胀下降速度快于预期。因此，他也可能很快加入到全球降息的行列中。 至于欧盟，看来10月将确定降息，我们上次也讨论过这点。他们对经济增长的担忧加剧，10月降息似乎已成定局。瑞士国家银行的通胀数据也低于预期，他们也可能比预期更早降息。全球降息周期已经全面展开。然而，未来依然存在重大地缘政治风险。

So I would say guys, be careful out there at least until after the election and maybe even then, you know, we'll have significant uncertainties because we won't know who will be the winner. All right. So I have today. Talk to you all next week.

我的建议是，大家在外面一定要小心，至少要小心到选举结束，甚至在那之后可能还是会有很多不确定性，因为我们还不知道谁会当选。好的，那我今天就谈到这里。下周再和大家聊。