De-globalization here, globalization there

Link to the report: https://docs.google.com/viewerng/viewer?url=https://institutdeslibertes.org/wp-content/uploads/2024/01/Traduction-Francaise-.pdf

On top of that, in no specific order:

• the West is pushing a green energy transition when China builds two coal power plants a week: good luck with reducing carbon emissions !
• the components of this transition are controlled by China & Russia essentially, both in terms of raw materials (domestic & soft control in Africa) and in terms of production
• China and India are producing extremely well educated engineers/physicist/mathematicians (as I can confirm from what I've seen in multiple hedge funds) when we focus on DEI, with the results we know
• Europe lost access to cheap energy and is now buying Russian oil and gas at a premium from India or Kazakhstan as well as liquefied natural gas from the US
• Europe does not have the capacity of the US being energy independent (the US is a net exporter of oil for instance), and is the true loser of the current world situation
• The West behave like pirate states seizing all kind of Russian accounts in US$ not necessarily linked with the Russian power, without due process. The message to other countries was: if you have assets in US$, your assets are not safe. Many took note, especially among emerging countries, and are turning to other partners.
• BRICS are ditching the US $ to trade in their own currencies, and now will have little use of their dollar reserves if the trend continues and the BRICS continue growing

On the markets, this first week of the year was weak for Equities and Bonds, as 2024 Fed rate cuts collapsed to prior Powell speech levels late December

Equities and bonds down, Energy up

At a time investors are the most bullish bonds in 15 years ...

This might escalate quickly.

Are we ripe for another 2022 ?

Despite deeply searching, I still can not find much positive to say about banks, when the BTFP bank bailout program surged to another new high,

and bank deposits are diminishing at about the same rate as investments in money markets rise

If the trend continues, when will banks have to realize their losses in Treasuries I mentioned last week.

I may sound like a broken record, but every week brings more consistence to the dire situation for banks.

Oh, I was about to forget: the BTFP is expected to close in March ...

Finally, I had the pleasant surprise to see that my post supporting Liz Warren fight against fraud and corruption was by far my most popular post of the week.

See you next week !