2024-01-05: Markets

After a sizzling end to 2023, with global equities up 9.4% in the last two months (Euro terms), it was perhaps to be expected that the first short week in January would be somewhat muted. There are at least three identifiable events which contributed to this performance: the figure on European inflation (higher), the disclosure Fed governors were reticent to declare when the first cut in rates would come (disappointing), and the strong US employment report (worrisome).

Despite a new year, then, we are still stuck with one old theme: the direction of monetary policy. Addiction is a serious matter.

Avoiding partisan politics, there is a data bit I noticed this week. The cover graph shows the amount of legislative work accomplished by congress in the last two years. It’s true that achievement is not measured in terms of how many bills you pass, but when you couple the statistics with the rhetoric and focus of the Republicans you have to wonder whether anyone in the party is interested in the national wellbeing. This is a stunning moment in history for the US: if the country’s political system does not return to governing it will risk pushing the nation to become a failed state.

[Source: Axios]