The Morning Call--The Japanese government bond liquidity crisis is a global warning.

 

The Morning Call

 

5/22/25

 

The Market

         

    Technical

 

            Wednesday in the charts.

            https://www.zerohedge.com/market-recaps/ugly-auction-triggers-bond-bloodbath-big-tech-black-gold-dumped-bitcoin-bullion-jump

 

            Wednesday in the technical stats.

            https://www.barchart.com/stocks/momentum

            https://www.barchart.com/stocks/sectors/sectors-heat-map

 

            The real move is hiding in plan sight.

            https://talkmarkets.com/content/ghost-prints-and-volatility-say-the-real-move-is-still-ahead?post=498798

           

            Update on sentiment.

            https://econbrowser.com/archives/2025/05/sentiment-confidence-news

 

            Shorting is hot again.

            https://www.ft.com/content/deecb2a2-04a3-40cf-b835-577b2879d719

 

            Q1 hedge fund monitor.

            https://www.zerohedge.com/markets/hedge-fund-trend-monitor-q1-short-interest-soars-6-year-high

 

            Macro storm clouds gather.

            https://www.zerohedge.com/the-market-ear/markets-pause-macro-storm-clouds-gather

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

                          Weekly initial jobless claims totaled 227,000 versus consensus of 230,000.

 

The April Chicago Fed national activity index came in at -.25 versus expectations of -.20.

 

                        International

 

The May German flash manufacturing PMI was 48.8 versus estimates of 48.9; the May flash services PMI was 47.2 versus 49.5; the May flash composite PMI was 48.6 versus 50.4; the May EU flash manufacturing PMI was 49.4 versus 49.3; the May flash services PMI was 48.9 versus 50.3; the May flash composite PMI was 49.5 versus 50.7; the May UK flash manufacturing PMI was 45.1 versus 46.0; the May flash services PMI was 50.2 versus 50.0; the May flash composite PMI was 49.4 versus 49.3.

 

The May German business climate index was 87.5 versus projections of 87.4; the May current conditions index was 86.1 versus 86.8.

 

The May UK industrial trades orders index was -30 versus forecasts of -25.

 

                        Other

 

                          Ten risks to the US economy.

                              https://www.apolloacademy.com/10-downside-risks-to-the-us-economic-outlook/

 

                          Update on consumer credit.

  https://wolfstreet.com/2025/05/20/credit-card-delinquencies-balances-debt-to-income-ratio-and-credit-limits-in-q1-2025-our-drunken-sailors-and-their-credit-cards/

 

 

            Fiscal Policy

 

               House passes Big, Beautiful Bill.

              https://www.zerohedge.com/political/trumps-big-beautiful-bill-narrowly-passes-house-215-214-vote

 

               The reason we should be worried about the deficit.

                https://www.foxnews.com/opinion/trumps-big-beautiful-bill-needs-fat-shot-end-our-dangerous-debt-addiction

 

              A reason not to worry (Note, the author ignores the impact on inflation).

              https://www.realclearmarkets.com/articles/2025/05/21/what_market_signals_can_teach_the_national_debt_alarmists_1111495.html

 

              Lance Roberts isn’t worried.

              https://www.advisorperspectives.com/commentaries/2025/05/21/moodys-debt-downgrade-matter-does

 

              However, don’t ignore what is happening in Japan.

              https://talkmarkets.com/content/economics--politics/japan-is-going-bust-and-the-us-is-not-far-behind?post=498788

 

              But the ten year Treasury will decide who is right and who is wrong.

              https://www.capitalspectator.com/markets-still-expect-fed-to-keep-rates-steady-for-near-term/

 

              And right now, it is not amused. (See Wednesday in the charts---above)

              https://bonddad.blogspot.com/2025/05/the-bond-market-is-not-amused-on.html

 

              So maybe we should be worried.

              https://www.zerohedge.com/markets/single-most-important-market-indicator-accelerating-us-fiscal-risks-deutsche-bank

 

Tariffs

 

              An economic lesson from Daivd Ricardo.

              https://www.ft.com/content/9e5b5b77-df41-4215-a512-51e04d0aad65

 

     Investing

 

            Japanese government bond liquidity crisis is a global warning.

            https://www.zerohedge.com/markets/price-rice-jgb-liquidity-crisis-global-warning

 

            Innovation and stock market bubbles.

            https://mailchi.mp/verdadcap/innovation-and-stock-market-bubbles?e=513c9c4eac

 

            Outlook for May dividends.

            https://politicalcalculations.blogspot.com/2025/05/the-outlook-for-s-500-dividends-in-may.html

 

            At what interest rate do stocks care?

            https://www.zerohedge.com/markets/10y-yields-surge-what-rate-do-stocks-break

 

    News on Stocks in Our Portfolios

 

 

What I am reading today

 

           

 

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