Reading Habits and Impact on Society: Analyzing Political Hyperbole, Economic Reports, and Global Conflicts

Reading Habits and the Impact on Society

Recent US opinion polls have shown a mixed bag of results, with some showing a slight advantage for Trump. Early voting data from Nevada and Georgia seems to be favoring Trump as well. The markets are currently taking a break from the 'Trump trade', but yesterday saw a significant rise in the US 10-year yield and a push past 153 for USD/JPY. This unusual market behavior is indicative of the extraordinary times we are living in.

Political Hyperbole and the US Election

The US election is in a 'ludicrous speed' phase, with headlines alleging more Trump sex scandals from 30 years ago and a link to Jeffrey Epstein. Vice President Harris has compared Trump to Hitler and fascism, while Trump has labeled Harris a Marxist. This level of hyperbole is causing confusion and despair among those who desire proper policy analysis and debate.

US Beige Book and Economic Activity

The US Beige Book has noted that economic activity has seen little change in nearly all Districts since early September. Despite elevated uncertainty, contacts were somewhat more optimistic about the longer-term outlook. However, this doesn't necessarily justify a 50 basis point cut. The labor market has seen a slight increase in employment, with wages continuing to rise at a modest to moderate pace.

Inflation and the Beige Book

The Beige Book also reported that inflation continued to moderate, with selling prices reportedly increasing at a slight or modest pace in most Districts. However, the prices of some food products, such as eggs and dairy, were reported to have increased more sharply. Rising insurance and healthcare costs are putting more pressure on several industries.

Global Monetary Policy and Mindsets

Until recently, the mindset was that the Fed would lead the monetary policy charge, and everyone else would follow in a synchronized fashion, but less aggressively. However, we might be moving towards a scenario where the Fed is not the most dovish major central bank. The 'Trump trade' is dollar positive and suggests higher US yields. This could lead to higher yields for everyone else, even if their economies can't handle it, unless they cut rates by more.

Geopolitical Issues and the BRICS

Major geopolitical issues that few in markets are focusing on were recently discussed by the BRICS. Israel's Defense Minister Gallant stated that planned airstrikes on BRICS member Iran will demonstrate its military might to the world. The timing of these airstrikes could potentially fall after the US election to minimize political fallout.

Global Conflicts and Central Banks

The US has expressed its belief that North Korea may send troops to fight in Ukraine, leading South Korea to threaten to send arms to Kyiv. These developments highlight how wars in Europe and the Middle East risk conflating, as would any geopolitical tensions in East Asia. Central banks will likely not be able to do much about these situations, except follow the directives of politicians.

Bottom Line

These fat tail risks have been repeatedly flagged for years in various thought pieces and dailies. However, it seems that people often don't read reports thoroughly. What are your thoughts on this matter? Do you think the lack of direct reading is impacting our society and decision-making processes? Share this article with your friends and let's start a discussion. You can also sign up for the Daily Briefing, which is delivered every day at 6pm.