In China, it looks like infrastructure and building (both Government sponsored) will be the flagship sectors to lead the recovery followed by consumer spending in essentials. Once confirmed, this will be a major support for European markets. To put the size in perspective this could amount to 3.2% of Italian GDP for Italy alone. The likely size will be EUR750bn of which EUR500bn in grants and EUR250bn in loans. The European Recovery Fund is the backdoor to a fiscal union.

Even if Democrats were to win big in November all US politicians sense an unease that America was growing too dependent on China. Until November’s election the relation will be tense and the countries on the brink of war.

It has the potential to change supply chains in a major way.

The question is on the shape of the US recovery.Ī new cold war between America and China is a dominant concern. Continental Europe might look more like the Nike swoosh logo. It could emerge that China is growing into a V-shaped recovery. As we go about our business the true extent of the impact will be visible. It was not a spindle that put us to sleep but decrees by concerned politicians. Once the market realizes that the Fed will not be able to support asset prices through the current economic downturn selling momentum could be vicious. Why then did markets rally?Ī stark dichotomy between financial markets and the real economy is unfolding. The unemployment rates are 16.7% for Black Americans, 18.9% for Hispanics and 40% (!) for low-wage workers. Over 41 million Americans claim benefits. George Floyd’s murder rocks America to the core. America is burning: Seven days of protests in over 75 cities, curfews imposed in nearly 40 cities, the National Guard activated in 15 states, violence across the land. “A riot is the language of the unheard,” said Martin L.

7 days to die merchant