ME VOY DE VACACIONES. SI QUIERES ALGO ME LLAMAS POR TELEFONO, O ME ESCRIBES SOLO A MI EMAIL PARTICULAR
China posts biggest monthly trade surplus in at least 24 years, nearly $100B in June
Y mientras tanto en EEUU:
This week’s report on the US trade balance shows a continued and substantial decline, primarily driven by a significant increase in imports.
At first glance, this might seem irrelevant.
However, when a country runs a fiscal deficit exceeding 6% of GDP, a trade balance deficit approaching 4% is certainly noteworthy.
The reality is that the US now has a 10% twin deficit, worse than during the peak of the Tech Bust and not far from the depths of the Global Financial Crisis.
This is a critical issue at the heart of funding risks for US Treasuries, forcing the Fed to increasingly resume its role as the primary financier of government debt.
This is why, despite my strong belief in long-term inflation, given the drastic shift in market expectations from seven rate cuts to now only two, I firmly believe several interest rate cuts are more likely than not.
The central point for that view is that the potential benefits of cutting interest rates to alleviate surging debt service payments are beginning to outweigh the fight against inflation.
To put this in perspective, three Fed cuts could reduce the annual cost of federal debt by one-third. In that sense, today’s environment is remarkably similar to the 1940s.
Back then, when the debt problem was as severe as it is today, the Fed had to set aside inflation concerns to focus almost solely on the government’s ability to service its debt through yield curve control measures.
However, today’s inflation problem is arguably more entrenched than it was then.
Two main differences are that, in the 1940s, we were at the tail end of a highly deglobalized macro environment with the end of World War II, and the US monetary system operated under a much more disciplined policy with the dollar strictly pegged to gold.
Today, the situation is almost the opposite.
Geopolitical risks continue to escalate, the money supply appears to be in an unending increase, government spending is on a reckless path, and global economies desperately need to rebuild their infrastructure capabilities in a historically constrained commodity environment.
This serves as a strong reminder of how hard assets will likely re-emerge as a key alternative for investors in the coming decade.
Y la paridad del yuan con el dólar ha estado yendo a favor del dólar que se fortalece, luego empeora su balanza:
Abrazos,
PD: El verano es tiempo de descanso, de familia, de ver a amigos, de tratar a Dios en la oración. Tenemos mucho más tiempo que hay que aprovechar. Hay que seguir siendo apóstoles y cumplir el mandato del Señor de evangelizar allá donde estemos. En eso no podemos descansar… Que pases un buen verano y disfrutes de la vida.
