Jim’s Mailbox

Posted at 8:32 AM (CST) by & filed under Jim's Mailbox.

Courtesy of JB.



A warning about the world economy.


A Growing List Of Companies From Fedex To BMW Are Warning About The World Economy
March 20, 2019

Corporate giants doing business abroad are painting a dreary picture of the world’s economy.

With an ongoing trade war between the U.S. and China, Brexit uncertainty weighing on Europe and the U.K., and new weakness out of Japan, some business leaders say it’s harder than ever to rake in profits.

This week, top executives at FedEx, BMW, UBS and others described bleak global business conditions while discussing quarterly results. Fitch Ratings also “aggressively” cut its forecast for the year.

The head of UBS was among the latest to blame the world’s backdrop for weaker-than-expected results. CEO Ermotti told a conference in London on Wednesday that it “one of the worst first-quarter environments in recent history,” Reuters reported. The Swiss bank slashed another $300 million from 2019 costs after revenue at its investment bank plunged. Investment banking conditions are among the toughest seen in years, especially outside the U.S., he said.



The turn churn has turned.


Yield Curve Inverts For The First Time Since 2007: Recession Countdown Begins
March 22, 2019

Update: The most prescient recession indicator the market just inverted for the first time since 2007.










Don’t believe us? Here is Larry Kudlow last summer explaining that everyone freaking out about the 2s10s spread is silly, they focus on the 3-month to 10-year spread that has preceded every recession in the last 50 years (with few if any false positives)… (fwd to 4:20)




The real reason Powell succumbed to easing, leading to an inverted yield curve?

“Another month, another frightening jump in the US budget deficit. And this time it was a record.”

Gotta keep those rates low, else they kill us!

CIGA Wolfgang Rech

US Budget Deficit Hits A Record $234 Billion As Interest On Debt Soars
March 22, 2019

Another month, another frightening jump in the US budget deficit. And this time it was a record.

According to the latest Treasury data, the US budget surplus in February – traditionally the worst month of the year due to tax refunds – was a whopping $234 billion, missing the $227 billion deficit expected, and well worse than the $214 billion deficit recorded last February. And even though there may have been one-time tax refund and government shutdown factors at play, the February deficit was also the biggest budget deficit on record.