Europolitics, Fiscal Policy & Market Expectations. Updates from: (12-31 to 01-04) (Paid)

In this week we will be looking at 8 separate sources for our macro recap.
We strive to incorporate as many independent views into this newsletter. We want to identify & synthesis this data for our audience, allowing you to get an understanding from a high level what is happening, then be able to quickly dig into the details of the newsletters linked below.
Let's Dive In!

Newsletter: Stenos Signals

Title: Europolitics watch #2: The Tory Tragedy isnt about division - its about defeatism.
Link: https://andreassteno.substack.com/p/europolitics-watch-2-the-tory-tragedy

Here are the top takeaways:

• Rishi Sunak was elected as the MP for Yorkshire in 2015 and has quickly climbed the ranks of the Conservative Party. Sunak is now the Prime Minister after Liz Truss stepped down following her controversial mini-budget.

• The cost-of-living crisis and loyalty crisis within the Conservative Party are the two major issues facing Sunak's government.

• UK households are struggling with increases in electricity and gas prices, and the lack of incentive for landlords to renovate properties has led to poor home insulation.

• The Conservative Party has a 26-majority lead in the House of Commons, but 12 years of Tory government has left a legacy of former ministers kicking their heels on the back benches and emboldened a growing number of serial rebels.

Newsletter: Exorbitant Privilege

Title: Happy New Year.
Link: https://exorbitantprivilege.substack.com/p/happy-new-year

Here are the top takeaways:

• Government funding (Fiscal dominance) is seen as the primary driver of economic disruption. This is already happening in the early stages of global liquidity distress.

• The main US banks will be fine, but other assets are vulnerable to default strikes.

• The ECB is already hawkish and may deploy their Transmission Protection Instrument to ease financial distress in some countries.

• The BoJ is considering policy changes, especially when Kuroda leaves office in April 20

• The PBoC is actively engaged in monetary easing, which explains the recent behaviour of the renminbi.