And the old men walk slowly, the old bones stiff and sore
They are old heroes tired of a forgotten war
And young people ask: “why are they walking?
And I ask myself the same question
But the band plays Waltzing Mathilda
And old people always answer the call
But over the years more and more old people are disappearing
One day no one will walk there at all
– “The Band Played Waltzing Mathilda” Eric Bogle, 1980
On this day, 80 years ago, Japanese naval and air forces attacked in waves the United States military installations in Pearl Harbor, Hawaii. The attack was unexpected, and the United States’ armed forces would be drawn into a two-front world war unlike anything the United States had been involved in before.
The attack of December 7, 1941 claimed the lives of 2,403 Americans, including 68 civilians. Nineteen US Navy ships, including eight battleships, were damaged or destroyed. As I scan these 2,403 names, I stop by Private First Class Charles Robert “Bobby” Taylor of the United States Marine Corps who was serving aboard the. USS Oklahoma.
Taylor enlisted in the Marines on May 8, 1940, ironically from Oklahoma City, Okla. It took the Japanese military 12 minutes from the time the first torpedo hit the Oklahoma when the vessel capsized. More than 400 sailors and Marines were killed on board. These men were then buried in 52 mass graves on the island of Oahu. Bobby Taylor, son of Charles and Helen Taylor, never returned home.
The battleship was righted and refloated in 1944, in time to resume the war. After the war, the Ministry of the Navy exhumed and identified as many of the remains of these servicemen as possible using methods of the time. In 2015, the Navy tried again, using modern science to try to identify the remaining original crew members of the Oklahoma. The PFC Charles Robert Taylor was officially counted on July 26, 2021.
Unidentified for nearly 80 years, hopefully never forgotten, we now pray for the rest of the soul of Bobby Taylor, United States Marine.
Stock markets broadly rallied on Monday, and now stock index futures have recovered overnight as more good news has been recorded in China. No, it has nothing to do with a “diplomatic” boycott of the Winter Olympics where the athletes who were going to go again, and the diplomats who still weren’t going. This information, China’s trade balance, released at 10 p.m. ET on Monday night in New York City (11 a.m. Tuesday morning in Beijing) had an immediate favorable impact on global stocks, US stock index futures and prices. Energy.
What happened was that while China’s trade balance (in dollars) contracted in November compared to October and the overall surplus was well below expectations, China’s exports. China and imports to China have exceeded expectations and reached record levels. This is obviously seen as a very positive signal for global economic growth.
China’s exports rose 22% (vs. 20.3% expectation) to $ 326 billion, while imports to China soared 32% (vs. just 21.5% expectation) to $ 254 billion. The United States was China’s main import destination. Exports to the United States in the first 11 months of 2021 are now up 28.3% above trend, while exports from the United States to China are up 36.9%.
The green energy crowd (not to mention planet Earth) isn’t going to like it, but the volume of imported coal into China hit 2021 highs before winter, as natural gas imports hit record highs. 10-month highs and crude imports hit their highest level in three months. It might not be very good ecologically, but certainly good economically at the moment.
That puts a bit of spice on top of a Monday that was kicked off by China’s central bank signaling easier money coming by December 15. The date probably sounds familiar, as this is precisely when we expect the Federal Reserve to announce an acceleration in the pace of this central bank’s removal of surplus housing in an effort to deal with the downturn. soaring inflation at the level of consumption.
On Monday, the S&P 500 rallied 1.2%, roughly matching what our largest large-cap equity index dropped all last week. While that fits perfectly into the story, it wasn’t really the S&P 500 that made the headlines. Economically sensitive sectors of the economy have outperformed investments driven by less elastic forces. The Dow Transports (+ 2.26%) easily beat the Nasdaq Composite (+ 0.93%) and the Nasdaq 100 (+ 0.85%), while small caps (S&P 600 + 2.41%, Russell 2000 + 2.05%) even beat the blue chips (DJIA + 1.87%).
Width was solid for the day as value slowed growth, but growth still worked well. The 11 SPDR ETFs selected by S&P sector ended the regular session in the green, with nine out of 11 moving more than one percent. The winners beat the losers in the NYSE by about three to one, and the Nasdaq by about seven to four.
Rising volume included 78.9% of the NYSE composite and even 66% of the Nasdaq composite despite an apparent decrease in overall trading volume for names domiciled on both exchanges. While not positive, the contraction in trading volume is expected for a Monday and has not brought the total trading volume for the constituents of the S&P 500 or the Nasdaq Composite back to their respective 50-day simple moving averages. .
In addition, yield spreads on Treasuries eventually widened, if only a little …
… while the Put / Call ratios, still high, have also eased the gas …
… and the VIX at least continues to make its way, albeit at dangerous levels.
On that note, the inner days of the red candlesticks could signal reduced volatility going forward. They could also signal a continuation of the trend, which for the VIX is currently on the rise. I wish I could be more helpful than that.
Here is the deal
While it will still take at least a week, if not several weeks, to have concrete data on the Omicron variant based on anything clinical, anecdotal evidence from southern Africa and elsewhere continues to paint a picture that , although perhaps as transmissible as measles, this version of Covid could still prove to be potentially less severe in nature than its predecessors. A small study of infected individuals in South Africa revealed a milder disease pattern. This is more powerful now, at least for the markets, than the overwhelming likelihood of monetary policy tightening is.
Do not worry. Once hard evidence suggests that our lives may not be more at risk than they already were – and all we have to worry about is the ever-booming Delta variant and the global thermonuclear war – the removal of accommodation and the possibility of higher interest rates again of importance. I promise.
Now that would be a deal
If it looks like President Biden and Defense Secretary Lloyd Austin have their hands full as Presidents Putin and Xi threaten Ukraine and Taiwan respectively, it looks like maybe someone else, strategically enough. important, may prefer to align with the West.
If Finland came on board as a client state of the F-35, it would add the Scandinavian nation to countries like Poland, Norway, Denmark, UK, Italy, Netherlands, Belgium and Israel, forming a “stealth” defensive shell against potential Russians. aggression against Western Europe. At the same time, Australia, Japan, South Korea and Singapore are all clients of the F-35 capable of defending themselves against regional influence from China.
One thing is fairly certain. This decision would in fact capitalize on the transformation underway in the automotive industry and allow the release of huge amounts of capital at a high valuation.
Economy (All Eastern hours)
8:30 a.m. – Trade balance (October): Expecting -67 billion dollars, last 80.9 billion dollars.
8:30 a.m. – Unit labor costs (T3-rev): Flashed at 8.3% q / q.
8:30 am – Non-agricultural productivity (T3-rev): Flashed 5.0% t / t.
08:55 – Redbook (weekly): Last 16.9% y / y.
3:00 p.m. – Consumer credit (Oct): Last $ 29.91 billion.
4:30 p.m. – API oil inventories (weekly): Last -747K.
The Fed (All Eastern hours)
Highlights of today’s earnings (Consensus expectations for BPA)
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