Recommended Weekend Reads

May 3 - 5, 2024

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list. 

European Union

• Enrico Letta’s Report: More Than a Market, But Less Than An Agenda  Centre For European Reform

  On April 18th, former Italian prime minister Enrico Letta published his long-awaited report on the future of the EU’s single market, entitled ‘Much more than a market’. Letta describes the EU single market as unsuited for a world where the EU’s share of the world economy is shrinking and where it faces competitors less willing to play by global norms. His report correctly identifies many of the EU’s most urgent problems. It has proposals on everything from the need for high-speed rail, investments in outer space, and a more unified health sector, to more quotidian efforts to improve EU law-making processes. But many of Letta’s recommendations echo ideas which have been raised repeatedly in recent years, offering something for everyone while glossing over trade-offs. This is illustrated by his somewhat quixotic call for the EU to strike “a balance between competitiveness, strategic independence and equitable global conditions, avoiding the imposition of detrimental regulations and instead fostering strategic partnerships based on well-founded policies”.

• EU’s red tape Is helping Russia Australian Strategic Policy Institute

  The European Union’s spending rules and public-procurement processes are plainly inadequate to the threat posed by Russia’s full-scale invasion of Ukraine. If the World War II Allies had been subject to such strictures, they would have been unable to buy landing craft for the invasion of Normandy in 1944, equip General Charles de Gaulle’s Free French Army, or issue war bonds in time. The EU’s regulations undermine its capacity to mitigate the war’s effects on Europe itself, weaken its ability to protect itself from a broad range of hybrid attacks, and prolong Russia’s military aggression against Ukraine.

• Security of Supply in Times of Geopolitical Fragmentation  German Institute for International and Security Affairs

  The recent political consensus on the European Critical Raw Materials Act (CRMA) marks a significant step towards a common raw materials policy within the European Union (EU). Against the backdrop of increasing geopolitical tensions, the EU aims to bolster its “strategic autonomy” within its raw material supply chains. To achieve this goal, it is essential for the EU and its member states to enhance collaboration with mineral-rich third countries. The current geopolitical environment will require a concerted effort on the part of the EU with respect to its raw material diplomacy, as only through such effective engagement will the EU be able to diplomatically and programmatically implement raw material partnerships that appeal to third countries. 

• Europe can’t afford to decouple from China  UnHerd

  Last week, US Secretary of State Antony Blinken travelled to Beijing to meet senior Chinese government representatives.  His reception was somewhat frosty, as officials told him that the United States must choose between a policy of “confrontation or cooperation” with the Chinese. Beijing’s diplomatic well is now pretty dry, and its representatives are signaling clearly that the Americans need to make a decision on their Chinese strategy.

China

• “Keeping Up with the Pacing Threat: Unveiling the True Size of Beijing’s Military Spending”  American Enterprise Institute

  Beijing’s publicly released military budget is inaccurate and does not adequately capture the colossal scope and scale of China’s ongoing military buildup and wide-ranging armed forces modernization.  After accounting for economic adjustments and estimating reasonable but uncounted expenditures, the buying power of China’s 2022 military budget balloons to an estimated $711 billion—triple Beijing’s claimed topline and nearly equal with the United States’ military budget that same year.  Equal defense spending between the United States and China plays to Beijing’s benefit. As a global power, the United States must balance competing priorities in the Indo-Pacific and elsewhere, which spreads Washington’s budget thinly across multiple theaters. Meanwhile, each yuan China invests in its military directly builds its regional combat power in Asia.

• The Potential Chinese Responses to a U.S. Ban on TikTok  Carnegie Endowment for International Peace

  In March, the U.S. House of Representatives overwhelmingly passed a bill that would require TikTok to divest from its Chinese parent company, ByteDance, or face a ban within the United States. The Senate is expected to vote on this matter soon, with President Joe Biden expressing his intention to sign the bill into law. However, factors such as the timing of the Senate vote, the November U.S. presidential election, and legal action by TikTok make the app’s U.S. future anything but certain. 

Russia and Ukraine

• Russia’s Shadow Fleet Goes Rogue  Center for European Policy Analysis

  The frequent presence of the Kremlin’s sanctions-dodging vessels off the coast of Gotland, where they perform dangerous ship-to-ship transfers of oil, is a clear provocation, not to mention a looming threat to marine life. Now the Swedish Navy reports that shadow vessels in the waters of Sweden’s exclusive economic zone don’t just conduct their regular business: they’re also equipped with communications gear that is in no way needed by standard merchant vessels. The Russian shadow fleet appears to simultaneously be a spy fleet.

•  These four Ukrainian families hoped to return home one day. Now all they have left of their homes is their keys.  Meduza

  In the aftermath of Russia’s full-scale invasion of Ukraine, over 14 million people — nearly one-third of Ukraine’s pre-war population — were forced to flee their homes.  For many of those hoping to someday return, however, Moscow’s war of aggression has left them without a home to go back to. In addition to homes now under Russian occupation, approximately 250,000 buildings in Ukraine (the majority of which were residential) have been completely destroyed.  Meduza spoke to four Ukrainian families who once dreamed of the day they could finally return home. Today, all that remains of their homes can fit in the palm of their hands: their keys.

• Stick, Carrot and More Stick: The Kremlin and Russian Youth Center for European Policy Analysis

  The Russian authorities are increasing the indoctrination of children and young people in an attempt to secure their support. In mid-April, the Ministry of Education ordered teachers to tell pupils about heroes of the “Special Military Operation,” “wartime heroic deeds” and “spiritual-moral values, including service to the Fatherland.”

• Does It Matter If Ukraine Loses?  Centre for European Reform

  In war, the ‘right’ side does not always win. Franco’s Nationalists won the Spanish Civil War; the Taliban drove the West out of Afghanistan. Ukraine’s president, Volodymyr Zelenskyy, said recently that without more US help, Ukraine would lose the war.  The commander of Ukrainian forces, Oleksandr Syrskyy, warned on April 13th that the situation in the east of the country had deteriorated significantly.  Even if the aid belatedly approved by the US House of Representatives on April 20th arrives in the next few weeks, democratic Ukraine could still be defeated by authoritarian Russia. Western countries – especially European countries – need to decide how much this matters to them.  At present, some, such as the Baltic states, are doing all they can to ensure that Russia does not win. A few, such as Hungary, seem to be actively working against Ukraine. But for most countries, there is a sizeable gap between leaders’ rhetoric, proclaiming support for Ukraine, and their revealed priorities, in terms of defense spending, weapons delivery and willingness to talk honestly to their domestic audience about the war.

United States

• Immigration Has Helped Boost US Economic Growth  Peterson Institute for International Economics

  Immigration into the United States has surged in recent years, and it has boosted economic growth. Based on an analysis of records from the Department of Homeland Security and other sources, the Congressional Budget Office (CBO) has substantially revised up its estimates of net immigration into the United States. CBO now estimates net annual immigration averaged 3 million in both 2022 and 2023 and projects that this year’s pace will be high as well. Many new immigrants have likely joined the US labor force, increasing the productive capacity of the macroeconomy. The implied increase in “potential output growth” helps explain how the US economy could have grown at a robust 3.1 percent pace over the four quarters of 2023 without generating more inflation pressures. 

The Hidden Monetary State  Arizona State Law Journal

Money is a motley.  While the state typically enjoys a monopoly on issuing new physical currency, a variety of instruments serve money-like roles in the financial system. The United States relies heavily on its commercial banking system to augment the money supply through issuing deposits. Alongside, and on top of the commercial banking system, a shadow banking system has also developed, offering a range of deposit substitutes. This article seeks to cast new light on the U.S. financial system by exploring how, over the course of the twentieth century, federal policymakers engaged in a series of distinct and largely uncoordinated monetary experiments. As we show through historical case studies, federal authorities designed, promoted, and repurposed financial instruments, endowing them with money-like characteristics by providing them with liquidity support, credit support, or both. In essence, policymakers created special purpose moneys to further national policy ambitions. 

Africa

• The Mirage of African Independence  Compact Magazine

  50 years ago, Portugal’s colonial project in Africa unraveled, bringing to a close the age of overt European imperialism on the continent. In the decades after World War II, dozens of newly independent nations arose in the African territories previously colonized by Britain, France, and Belgium. By the end of the 1960s, among Europe’s imperial powers, just one holdout had remained: Portugal, which had also been the first European nation to acquire African territory with the 1415 conquest of Ceuta, on the North African coast.

Chart of the Week

The Rainy Season Hits Panama and the Canal May Be Getting Back to Normal 

The long drought in Panama appears to be over.  Per Bloomberg: “The rainy season is arriving at the Panama Canal as predicted, fueling hopes that a prominent trade chokepoint will clear up just in time for shipping’s busy time of year. The seven-day moving average of daily vessel crossings reached 25 last week, up from a low of about 21 set in late-January but still well below the long-term average before the drought of about 35 a day, according to data compiled by IMF PortWatch. The canal authority announced recently that it will lift booking slots to 31 daily transits in the second half of May and then to 32 starting in June. Maximum draft rules — which limit the total weight of a ship’s cargo — will rise starting in June, too.”

CFA Society of Houston

Energy, Economics, Elections, and Geopolitical Risk

It was a great pleasure to speak to the CFA Society of Houston this past week in my role as Chief Political Strategist for DWS. As one of the leading global asset management firms, DWS really makes a superb effort to reach out and offer thought leadership content to clients and market participants. It’s a real credit to their leadership and vision, and I’m humbled to be part of it.

Houston is at the crossroads of many political and economic issues: energy, immigration, and economic growth from the boom in semiconductor and other tech businesses moving to Texas.

The questions came fast and furious and were superb—I had so much fun talking with everyone. Thank you, CFA Society of Houston, for having me and giving me the opportunity to talk with you!

The Global Week Ahead

April 28 - May 5, 2024

It is hard to believe May arrives this week. With it comes May Day, celebrated in many countries around the world. This means many financial markets and governments will be closed on Wednesday. But that does not mean this week will be quiet. We are tracking several important events.

First, next Sunday, Chinese President Xi Jinping is expected to make a rare visit to Europe for meetings with French President Emmanuel Macron, Hungarian Prime Minister Viktor Orbán, and Serbian Prime Minister Ana Brnabić. But Xi’s visit to Serbia will also come around the 25th anniversary of when the U.S. bombed the Chinese Embassy during a series of NATO strikes against the Serbian government. Three Chinese journalists were killed, and the White House called the incident a regrettable mistake.  

Also this week, U.S. Secretary of State Antony Blinken heads back to the Middle East for talks with Saudi and Israeli leaders in an attempt to jump-start negotiations to release Israeli hostages held by Hamas and perhaps find an avenue to reach a cease-fire. 

Looking at the global economic radar screen, markets will be watching the Federal Reserve’s FMOC meetings this week for any signal of possible interest rate cuts (which seems increasingly unlikely for the rest of the year). Also this week, U.S. employment figures are released.

In Europe, The April CPI prints from the greater Eurozone, Germany, and Spain are coming out, as are the first quarter GDP figures. In Asia, this week, China releases PMIs and the Caixin manufacturing PMI, hopefully giving markets more assurances that China’s economy is leveling out and returning to normal. Japan releases industrial production and labor data this week, as well as the Bank of Japan minutes from their March meeting.

Here is what else we are watching around the world this week:

Sunday, April 28, 2024

 Global

·       G& Climate, Energy, and Environmental Ministers meet in Torino, Italy, through April 30.

· The World Economic Forum is holding a Special Meeting on Global Collaboration, Growth, and Energy for Development in Riyadh, Saudi Arabia, through April 29.

Americas

Political/Social Events –

·       US Secretary of State Antony Blinkin will leave for meetings in the Middle East through April 30.  The meetings will be around the World Economic Forum event in Riyad, Saudi Arabia, where Blinken will also speak.  He then goes on to Israel for meetings.

·       The second Mexican presidential debate takes place in Mexico City.

·       China will host three separate Latin American foreign ministers for separate meetings through April 30:

• Bolivian Foreign Minister Celinda Sosa Lunda will visit Beijing for talks with Chinese Foreign Minister Wang Yi.

• Argentinian Foreign Minister Diana Mondino will visit Beijing for talks with Foreign Minister Wang Yi.  Mondino will seek to extend a currency swap with Beijing and seek to stabilize relations as Argentine President Javier Milei is seen growing away from China and closer to the US.

• Peru’s Foreign Minister Javier Gonzalez-Olaechea Franco will visit Beijing for talks with Chinese Foreign Minister Wang Yi.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       India’s national elections continue.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Monday, April 29, 2024

Global

·       The UN Security Council is scheduled to hold a vote related to the United Nations Mission in South Sudan (UNMISS).

Americas

Political/Social Events –

·       A criminal hearing against Colombian President Gustavo Petro's son, Nicolas Petro, will begin in Barranquilla, Colombia, over allegations of taking bribes and money laundering. 

Economic Reports/Events –

·       Brazil IGP-M Inflation (April)/ BCB Focus Market Readout

·       USA Dallas Fed Manufacturing Index (April)/ Treasury Refunding Financing Estimates

·       Colombia Unemployment Rate (March)

·       Mexico Fiscal Balance (March)

Asia

Political/Social Events –

·       Singapore Prime Minister Lee Hsien Loong will visit Indonesia for meetings with President Joko "Jokowi" Widodo. This will be Lee’s final meeting with a foreign leader before he transfers power to Deputy Prime Minister Lawrence Wong in mid-May. Wong will accompany him on the trip, Indonesia's foreign ministry said. The discussions are expected to cover topics such as food resilience, the green energy transition, and the development of Indonesia's new capital city, Nusantara.

·       The IMF’s executive board meets to discuss the approval of $1.1bn funding for Pakistan, the last tranche of a $3bn standby arrangement secured last summer to avert a sovereign default and which runs out this month

·        Japan will celebrate its Golden Week holiday through May 4, which will include multiple public holidays and spur significant travel in the country.

Economic Reports/Events –

·       Singapore URA Property Index Final (Q1)/ Unemployment Rate Prel (Q1)/ Imports/ Exports/ PPI (March)

·       Vietnam Balance of Trade (April)/ Inflation Rate (April)/ Industrial Production (April)

·       Thailand Industrial Production (March)/ Retail Sales (February)

·       Indonesia Foreign Direct Investment (Q1)

·       Sri Lanka PPI (March)

·       Pakistan Interest Rate Decision

·       Australia CoreLogic Dwelling Prices (April)

Europe

Political/Social Events –

·       Spain’s Prime Minister, Pedro Sánchez, is expected to announce whether he will step down from office following revelations his wife is under investigation for corruption.

·       Candidates for the European Commission presidency will debate in Brussels. Taking part in the debate are Walter Baier (Party of the European Left); Bas Eickhout (European Green Party); Valeriu Ghilețchi (European Christian Political Movement); Ursula von der Leyen (European People’s Party); Maylis Roßberg (European Free Alliance); Nicolas Schmit (Party
of European Socialists); Marie-Agnes Strack-Zimmermann (Alliance of Liberals and Democrats for Europe Party); and Anders Vistisen (Identity and Democracy Party).

·       The EU Agriculture and Fisheries Council meets in Brussels.  They will focus on the measures that have been proposed or taken so far that are aimed at simplifying the common agricultural policy (CAP) and strengthening the position of farmers in the food supply chain.

·       The EU General Affairs Council will hold informal meetings in Brussels through April 30.

·       Heathrow Airport Border Force employees are expected to go on strike through May 2.

Economic Reports/Events –

·       ECB Vice President Luis de Guindos will give remarks at a dinner at the Royal Automobile Club organized by Euro50 Group in London, UK.

·       Slovakia Business and Consumer Confidence (April)

·       Spain Inflation Rate Prel (April)/ Business Confidence (April)

·       Turkey Economic Confidence Index (April)

·       Germany Baden Wuerttemberg/ Bavaria/ Brandenburg/ Hesse/ North Rhine Westphalia/ Saxony CPI (April)/ Inflation Rate Prel (April)

·       Euro Area Economic Sentiment (April)/ Industrial Sentiment (April)/ Consumer Confidence Final (April)

·       Ireland GDP Growth Rate Prel (Q1)/ Harmonised Inflation Rate Prel (April)/ Retail Sales (March)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Togo holds legislative and regional elections.

·       The World Bank hosts the International Development Association Africa Heads of State Summit in Nairobi, Kenya.

Economic Reports/Events –

·       Kenya Inflation Rate (April)

·       Nigeria Unemployment Rate Q4

Tuesday, April 30, 2024

Global

·       The UN will hold a joint event of the General Assembly and the Economic and Social Council on the theme “El Niño 2023-2024: Actions for the safety, sustainability and resilience of people and the planet”.

·       The IMF’s Regional Economic Outlook for Asia and the Pacific is released.

·       Today is the last day of Passover.

Americas

Political/Social Events –

·       The International Court of Justice holds preliminary hearings in Mexico’s case against Ecuador.  In early April, Ecuadorian police broke into the Mexican Embassy to arrest former Ecuadorian Vice President Jorge Glas, who had been residing there to avoid arrest.

Economic Reports/Events –

·       Brazil Unemployment Rate (March)/ PPI (March)

·       Mexico GDP Growth Rate Prel (Q1)

·       Canada GDP (February)

·       USA Employment Cost Index (Q1)/ Redbook (April/27)/ House Price Index (February)/ Chicago PMI (April)/ CB Consumer Confidence (April)/ Dallas Fed Services Index (April)/ API Crude Oil Stock Change (April/26)

·       Chile Industrial & Manufacturing Production (March)/ Retail Sales (March)/ Unemployment Rate (March)

·       Colombia Interest Rate Decision/ Cement Production (March)

·       Uruguay Balance of Trade (March)

Asia

Political/Social Events –

·       The Periklino Electric Vehicle Show begins in Jakarta.  More than 80 brands will be there to show the latest in EVs.

Economic Reports/Events –

·       South Korea Industrial Production (March)/ Retail Sales (March)

·       Japan Unemployment Rate (March)/ Retail Sales (March)/ Industrial Production Prel (March)/ Housing Starts (March)/ Construction Orders (March)

·       New Zealand ANZ Business Confidence (April)

·       Philippines PPI (March)

·       Australia Housing Credit (March)/ Retail Sales Prel (March)/ Private Sector Credit (March)

·       China NBS & Non-Manufacturing & General PMI (April)/ Caixin Manufacturing PMI (April)

·       Singapore Bank Lending (March)/ Business Confidence (Q1)

·       Malaysia M3 Money Supply (March)

·       Thailand Current Account (March)/ Private Investment & Consumption (March)

·       Taiwan GDP Growth Rate Adv (Q1)

·       Sri Lanka Inflation Rate (April)/ Balance of Trade (March)

·       India Infrastructure Output (March)

·       Pakistan Consumer Confidence (April)

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       ECB Board Member Claudia Buch gives the keynote speech at a conference entitled "Globalization: What's Next?" co-organized by Banque de France, CEPR, the World Bank, and the University of Surrey in Paris, France.

· Bank of England Executive Director for Financial Market Infrastructure Sasha Milles gives a speech at the London Institute of Banking and Finance.

·       France GDP Growth Rate Prel (Q1)/ Household Consumption (March)/ Inflation Rate Prel (April)/ PPI (March)

·       Germany Retail Sales (March)/ Import Prices (March)/ Unemployment Rate (April)/ GDP Growth Rate Flash (Q1)

·       Hungary GDP Growth Rate Prel (Q1)/ PPI (March)

·       Spain GDP Growth Rate Flash (Q1)/ Current Account (February)

·       Switzerland KOF Leading Indicators (April)

·       Italy GDP Growth Rate Adv (Q1)/ Inflation Rate Prel (April)

·       Poland Inflation Rate Prel (April)

·       Turkey Imports/ Exports/ Balance of Trade Final (March)/ Tourism Revenues (Q1)

·       Slovenia Inflation Rate (April)

·       Great Britain BoE Consumer Credit (March)

·       Euro Area GDP Growth Rate Flash (Q1)/ Inflation Rate Flash (April)/ CPI Flash (April)

·       Greece PPI (March)/ Retail Sales (February)

·       Russia Balance of Trade (March)/ Industrial Production (March)/ Retail Sales (March)/ GDP Growth Rate Flash (Q1)/ M2 Money Supply (March)

·       Ukraine Current Account (March)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel Manufacturing Production (February)

·       Saudi Arabia M3 Money Supply (March)/ Private Bank Lending (March)

·       Qatar Balance of Trade (March)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa M3 Money Supply (March)/ Private Sector Credit (March)/ Balance of Trade (March)/ Budget Balance (March)

·       Nigeria Foreign Exchange Reserves (April)

Wednesday, May 1, 2024

Global

·       May Day is celebrated around the world.  Many financial markets and banks globally are closed today.

Americas

Political/Social Events –

·       Sentencing of co-founder of crypto platform Binance, Changpeng Zhao, over money laundering.

Economic Reports/Events –

·       The Federal Reserve Board’s Open Market Committee begins meetings through May 2 on interest rates.

·       Bank of Canada Governor Tiff Macklern and Senior Deputy Governor Carolyn Rogers will appear before the Canadian Parliament’s Senate Committee on Banking, Commerce, and the Economy.

·       USA MBA Mortgage Market Index (April/26)/ ADP Employment Change (April)/ Treasury Refunding Announcement/ S&P Global Manufacturing PMI Final (April)/ ISM Manufacturing PMI (April)/ EIA Crude Oil Stocks Change (April/26)/ JOLTs Job Openings (March)

·       Canada S&P Global Manufacturing PMI (April)

·       Brazil Balance of Trade (April)

Asia

Political/Social Events –

·       Today is Constitution Day in the Marshall Islands.

Economic Reports/Events –

·       New Zealand RBNZ Financial Stability Report/ Unemployment Rate (Q1)/ Participation Rate (Q1)

·       Australia Ai Group Industry, Construction, & Manufacturing Index (April)/ Judo Bank Manufacturing PMI Final (April)/ TD-MI Inflation Gauge (April)/ Commodity Prices (April)

·       South Korea Imports/ Exports/ Balance of Trade (April)

·       Japan Jibun Bank Manufacturing PMI Final (April)/ Consumer Confidence (April)

·       Kazakhstan Current Account (Q1)

·       India M3 Money Supply (April/19)

Europe

Political/Social Events –

·       Today is Labor Day in most of Europe. Banks and financial markets are closed.

·       Today is the 20th Anniversary of the EU trading bloc enlarging to 25 member states (from 15 states).

Economic Reports/Events –

·       Ireland AIB Manufacturing PMI (April)/ Unemployment Rate (April)

·       Greece S&P Global Manufacturing PMI (April)

·       Great Britain S&P Global Manufacturing PMI (April)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Saudi Arabia GDP Growth Rate Prel (Q1)

·       Israel Composite Economic Index (March)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Thursday, May 2, 2024

Global

·       The OECD Ministerial Council meeting takes place in Paris through May 3.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Mexico Foreign Exchange Reserves (March)/ Business Confidence (April)/ S&P Global Manufacturing PMI (April)

·       Brazil Current Account (March)/ Foreign Direct Investment (March)/ S&P Global Manufacturing PMI (April)

·       USA Challenger Job Cuts (April)/ Imports/ Exports/ Balance of Trade (March)/ Initial Jobless Claims (April/27)/ Unit Labour Costs Prel (Q1)/ Jobless Claims 4-week Average (April/27)/ Factory Orders (March)/ EIA Natural Gas Stocks Change (April/26)/ LMI Logistics Managers Index (April)/ Total Vehicle Sales (April)

·       Canada Imports/ Exports/ Balance of Trade (March)

·       Chile IMACEC Economic Activity (March)

·       Colombia Davivienda Manufacturing PMI (April)

·       Peru Inflation Rate (April)

·       Argentina Tax Revenue (April)

Asia

Political/Social Events –

·       Japan's Prime Minister Fumio Kishida is expected to announce the creation of an international framework for generative AI at the Organization for Economic Co-operation and Development's Ministerial Council Meeting. During the two-day meeting in Paris.  The framework is expected to include more than 40 countries.

·       The Asian Development Bank holds its 57th annual meeting in Tbilisi, Georgia.

Economic Reports/Events –

·       New Zealand Building Permits (March)

·       South Korea Inflation Rate (April)/ S&P Global Manufacturing PMI (April)

·       Japan BoJ Monetary Policy Meeting Minutes/ Foreign Bond Investment (April/27)/ Stock Investment by Foreigners (April/27)

·       Indonesia S&P Global Manufacturing PMI (April)/ Inflation Rate (April)/ Tourist Arrivals (March)

·       Malaysia S&P Global Manufacturing PMI (April)

·       Philippines S&P Global Manufacturing PMI (April)

·       Taiwan S&P Global Manufacturing PMI (April)

·       Thailand S&P Global Manufacturing PMI (April)

·       Vietnam S&P Global Manufacturing PMI (April)

·       Australia Imports/ Exports/ Balance of Trade (March)/ Building Permits Prel (March)

·       India HSBC Manufacturing PMI Final (April)

·       Kazakhstan Tengri Partners Manufacturing PMI (April)/ Inflation Rate (April)

·       Hong Kong GDP Growth Rate Adv (Q1)

·       Singapore SIPMM Manufacturing PMI (April)

·       Pakistan Inflation Rate (April)/ Wholesale Prices (April)/ Balance of Trade (April)

Europe

Political/Social Events –

·       EU President von der Leyen will travel to Lebanon with Cyprus President Cyprus Nikos Christodoulides.  Together, they will meet with Lebanon Prime Minister Najib Azmi Mikati and Speaker of the Parliament Nabih Berri.  They are expected to discuss the situation in Israel and Gaza as well as migration issues.

·       In England and the UK, local elections will be held for ten mayoral seats.  Also, a by-election will be held for a Parliament seat.

Economic Reports/Events –

·       ECB Board member Philip R. Lane will give a virtual guest lecture at the University of Stanford in Stanford, California.

·       Russia S&P Global Manufacturing PMI (April)

·       Great Britain Nationwide Housing Prices (April)

·       Hungary Balance of Trade Final (February)/ HALPIM Manufacturing PMI (April)

·       Switzerland Inflation Rate (April)/ Retail Sales (March)/ procure.ch Manufacturing PMI (April)

·       Poland S&P Global Manufacturing PMI (April)

·       Turkey Istanbul Chamber of Industry Manufacturing PMI (April)/ Imports/ Exports/ Balance of Trade Prel (April)

·       Spain HCOB Manufacturing PMI (April)/ New Car Sales (April)

·       Italy HCOB Manufacturing PMI (April)/ PPI (March)/ New Car Registrations (April)

·       France HCOB Manufacturing PMI (April)

·       Germany HCOB Manufacturing PMI (April)

·       Euro Area HCOB Manufacturing PMI (April)

·       Greece Unemployment Rate (March)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nigeria Stanbic IBTC Bank Nigeria PMI (April)

·       South Africa ABSA Manufacturing PMI (April)/ Total New Vehicle Sales (April)

·       Egypt M2 Money Supply (March)

Friday, May 3, 2024

Global

·       FAO Food Price Index (April)

Americas

Political/Social Events –

·       Japanese Prime Minister Fumio Kishida will meet with Brazilian President Luiz Inacio Lula da Silva in Brasilia, Brazil, and Paraguayan President Santiago Pena in Asuncion, Paraguay, through May 6.

Economic Reports/Events –

· New York Federal Reserve Bank President John Williams and Federal Reserve Bank of Chicago President Austan Goolsbee to participate in the panel before the hybrid" Getting Global Monetary Policy on Track" event hosted by the Hoover Institution at Stanford University.

·       Brazil IPC-Fipe Inflation (April)/ Bank Lending (March)/ Industrial Production (March)

·       Mexico Gross Fixed Investment (February)

·       USA Unemployment Rate (April)/ S&P Global Services & Composite PMI Final (April)/ ISM Services PMI (April)/ Baker Hughes Total Rigs Count (May/03)

·       Canada S&P Global Services & Composite PMI (April)

·       Uruguay Inflation Rate (April)

·       Paraguay Inflation Rate (April)

Asia

Political/Social Events –

·       Today is Constitution Day in Japan, a national holiday.  It commemorates when a new constitution was ratified in 1945.

Economic Reports/Events –

·       Australia Judo Bank Services & Composite PMI Final (April)/ Home Loans (March)/ Investment Lending for Homes (March)

·       Singapore Retail Sales (March)

·       Hong Kong Retail Sales (March)

·       India Bank Loan Growth (April/19)/ Deposit Growth (April/19)/ Foreign Exchange Reserves (April/26)

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Ireland AIB Services PMI (April)

·       France Industrial Production (March)/ Budget Balance (March)/ New Car Registrations (April)

·       Spain Unemployment Change (April)/ Tourist Arrivals (March)

·       Turkey Inflation Rate (April)/ PPI (April)/ MPC Meeting Summary/ Foreign Exchange Reserves (April/26)

·       Euro Area ECB Survey of Professional Forecasters/ Unemployment Rate (March)

·       Italy Unemployment Rate (March)

·       Slovenia Balance of Trade (March)

·       Great Britain S&P Global Services & Composite PMI Final (April)

·       Germany New Car Registrations (April)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       United Arab Emirates S&P Global PMI (April)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Kenya GDP Growth Rate Q4

·       Egypt Foreign Exchange Reserves (April)

Saturday, May 4, 2024

Global

·       The Organization of Islamic Cooperation Banjul Summit is being held in the Republic of Gambia through May 5.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Federal Reserve Board Governor Lisa Cook gives two commencement speeches at Georgia College and State University (GCSU) in Milledgeville, Georgia.  

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       Today is National Remembrance Day in the Netherlands.  At 8 p.m., citizens across the country hold a two-minute vigil honoring the civilians and soldiers who died since the beginning of World War II.

·       Today is the 800th day of the War in Ukraine.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Sunday, May 5, 2024

Global

·       Nothing significant to report.

Americas

Political/Social Events –

·       Panama holds general elections, choosing a new president and vice president.  Currently, José Raúl Mulino of the Realizing Goals Party is leading over several other candidates.

·       The 2024 Milken Institute Global Conference begins and runs through May 8 in Los Angeles.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Chinese President Xi Jinping is expected to begin a tour of European nations beginning with a visit to France for meetings with French President Emmanuel Macron.  He then will go on to visit Hungary and Serbia.  The visit comes at a time when the European Commission has recently launched an investigation into alleged preferences Beijing gives to Chinese companies in medical devices and green products such as wind turbines and solar panels.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       Today is the 75th Anniversary of the Council of Europe being founded with the Treaty of London.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Recommended Weekend Reading

April 26 - 28, 2024

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list. 

U.S. National Economic Security Policy

• Onshoring Semiconductor Production: National Security Versus Economic Efficiency Council on Foreign Relations

  Semiconductors—commonly known as microchips, chips, or integrated circuits—enable modern life. Those small devices make everything from computers, smartphones, microwaves, and cars to advanced weaponry work. A car, for instance, needs as many as 3,000 semiconductors, while one Javelin anti-tank missile requires more than 250 chips. As artificial intelligence (AI) and quantum computing continue to advance, the global demand for semiconductors will only increase, while power will accrue to those countries that can develop, produce, and harness the most advanced chips.

• What can be done about the high and rising national debt?  Brookings Institution

  U.S. policymakers and the American public have expressed significant concerns about the rising national debt, but there have been few meaningful actions in recent decades to address it. On April 16, at an event co-hosted by the Brookings Institution and Miami Dade College, fiscal policy experts and local officials came together to discuss the prospects for policies that can address concerns over rising public debt. You can watch the full video of the event here.

U.S. Election Outlook

• Census Bureau Releases 2022 Congressional Election Voting Report United States Census Bureau

  The voter registration rate (69.1%) for the 2022 congressional election was the highest registration rate of a midterm election in 30 years. However, the voter turnout rate (52.2%) was lower than in the 2018 (53.4%) midterm elections, according to the new Voting and Registration in the Election of November 2022 report released today by the U.S. Census Bureau. The report, based on data from the 2022 Current Population Survey (CPS) Voting and Registration Supplement, builds on detailed tables released earlier this year.

Russia

• Russian US election interference targets support for Ukraine after slow start Microsoft Threat Analysis Center

  Russian influence operations (IO) have picked up steam in the past two months. The Microsoft Threat Analysis Center (MTAC) has tracked at least 70 Russian actors engaged in Ukraine-focused disinformation, using traditional and social media and a mix of covert and overt campaigns.

• The Black Sea Region Endures Beyond the Theater of War Panorama

  Many strategic surprises have come from the combat operations on the Black Sea theatre in the last 25 months, and they keep coming as the long Russo-Ukrainian war continues to evolve while the prospect of peace is barely visible through its fog. In the domain of politics, one surprise is that the Black Sea region has not been completely transfigured into the theater of war but endured, even if its key institution – the Black Sea Economic Cooperation (BSEC) – barely functions in a few working groups and the Parliamentary Assembly.

• US vs. Russia: Why the Biden strategy in Africa may be failing Politico

  U.S. officials are starting to accept that their strategy of pressing Niger and other war-battered African countries to break off ties with Moscow and embrace democratic norms is no longer working. The recent breakdown in relations with Niger, where American troops are set to withdraw as Russian fighters arrive, has forced a reckoning inside the Biden administration over its approach to maintaining its allies in volatile parts of Africa.

• Back in Stock? The State of Russia's Defense Industry after Two Years of the War CSIS

  This report examines Russia’s evolving defense industrial capabilities and limitations during the second year of the Russia-Ukraine war and analyzes how these changes have affected and will continue to affect battlefield outcomes in Ukraine. The report starts with an overview of Russia’s domestic arms production efforts throughout 2023, followed by a detailed examination of key Russian weapons systems (such as tanks, artillery, drones, missiles, and electronic warfare systems) and their changing roles on the battlefield. The report then analyzes Russia’s general procurement dynamics and identifies the imported components and weapons categories that Russia’s defense industry has particularly relied on in the second year of the war.

India

• How India’s democracy shapes its global role and relations with the West  Chatham House

  Two narratives dominate global discussions about India today: one is on the country’s rise as an increasingly prominent geopolitical and economic actor; the other centers on concerns – particularly among India’s Western partners – about democratic backsliding. As India goes to the polls in 2024, this paper examines the interplay between these two narratives, or more specifically, what India’s status as the world’s largest democracy means for its global role and relations with the West. It does so by analyzing how the changing nature of India’s national identity impacts the country’s foreign policy.

China

•   Why the U.S. and China Suddenly Care About a Port in Southern Chile Americas Quarterly

  Perched on the pylons of a century-old coal pier, sleek black cormorants gaze out at cruise ships, propane tankers, and research vessels dotting the white-capped Strait of Magellan. Farther into the horizon, a humpback whale blows a misty plume toward the sky.

• China is Battening Down for the Gathering Storm Over Taiwan War On The Rocks

  Chinese war drums beat on as pundits hotly debate if or when Beijing will try to seize Taiwan by force. There is no apparent countdown to D-day for initiating a blockade or invasion, but major strategic indicators clearly show that General Secretary Xi Jinping is still preparing his country for a showdown. Developments underway suggest Taiwan will face an existential crisis in single-digit years, most likely in the back half of the 2020s or the front half of the 2030s.

• Middle East

• Six Options for Israel in Gaza The Washington Quarterly

  In response to its devastating October 7, 2023 attack, Israeli leaders have stated that they seek to “destroy” Hamas–a goal easier in rhetoric than in reality.1 Israel’s actions—bombing Gaza, sending in troops to kill Hamas fighters and destroy Hamas’ infrastructure, and targeting Hamas leaders in Gaza and around the region—have killed over 30,000 Palestinians in Gaza, including many children. In solidarity with Hamas, Iranian-backed groups have conducted attacks against Israeli and US targets around the region.2 If, understandably, Israel is loath to allow Hamas a victory and seeks to ensure its security, what options does it have?

• Iran and the de-escalation myth Atlantic Council

  Forgive the Israelis if they aren’t in the mood to take the victory lap the White House has suggested to them, following the remarkable defense of their territory from an unprecedented Iranian barrage of more than three hundred explosive-laden drones, ballistic missiles, and cruise missiles. “You got a win,” US President Joe Biden told Israeli Prime Minister Benjamin Netanyahu over the weekend, as reported by Axios from a White House source. “Take the win.” Translate that into a strong US suggestion, straight from the Oval Office, that Israel demonstrate restraint in its response and refrain from attacking Iranian territory to avoid further escalation. To drive his point home, Biden also told the Israeli prime minister that US forces wouldn’t participate in any reprisal attack.

International Economics 

• 24-9 Economic Multilateralism 80 Years after Bretton Woods Peterson Institute for International Economics

  The global economic institutions that grew from the Bretton Woods conference of 1944 aimed to create a cooperative policy environment conducive to recovery, development, continuing prosperity, social stability, and democracy. Prominent in the minds of the architects were the macroeconomic and trade policy coordination failures of the 1930s, which accompanied a world depression and the march toward the Second World War. The assumption of “embedded” liberalism’ underlying Bretton Woods gave way to a much more market-oriented system by the early 1990s, fueling strong growth in several large emerging markets and a period of hyper-globalization—but also social tensions in advanced economies. The result has been a changed geopolitical balance in the world as well as a backlash against aspects of globalization in many richer countries, notably the main sponsor of postwar international cooperation, the United States. At the same time, global cooperation is threatened despite the emergence of a broader range of shared global threats requiring joint action. The rich industrial countries that dominate the existing multilateral institutions should recognize them as being instrumental for channeling superpower competition into positive-sum outcomes that can also attract broad-based international support. However, leveraging those institutions will require buy-in from middle- and low-income countries, as well as from domestic political constituencies in advanced economies. The future of multilateralism depends on reconciling these potentially conflicting imperatives.

• Newcomers Bring New Rules  CSIS

  The world’s challenges are increasingly complex. Borders could not stop the spread of the COVID-19 pandemic, but Russia’s 2022 invasion of Ukraine demonstrated that the kinds of national wars that characterized the 20th century were still relevant. Ideology has faded, and the states of the Global South have grown larger and wealthier. They now expect a larger share of the global pie. While cooperation has become more necessary, the world has entered an era of increased national contestation.

• Jobs, Trade, and Investment: Cyclical Weakness, Structural Strength The Transatlantic Economy

  Lenin once quipped, “There are decades where nothing happens, and there are weeks where decades happen.” So, it is with the 2020s. While barely at the half mark of this decade, the world economy has been buffeted by a global pandemic, Russia’s stunning war of aggression in the heart of Europe, an Israel-Hamas conflict that could engulf the broader Middle East, ongoing violence across large swathes of Africa, massive movements of displaced peoples, major disruptions to flows of goods, services, and commodities, and a spike in inflationary pressures reminiscent of the 1970s. Rarely have the challenges seemed so acute.

• Are We Fragmented Yet? Measuring Geopolitical Fragmentation and its Causal Effects UPenn

  After decades of rising global economic integration, the world economy is fragmenting. To measure this phenomenon, we introduce an index of geopolitical fragmentation distilled from diverse empirical indicators. To do so, we rely on the use of a flexible, dynamic factor model with time-varying parameters and stochastic volatility. Then, we employ structural vector autoregressions and local projections to gauge the causal effects of changes in fragmentation. We show that more fragmentation impacts the global economy detrimentally but harms emerging economies more than advanced ones. We also document a key asymmetry: fragmentation immediately harms the global economy, while reduced fragmentation only unfolds gradually. A sectoral analysis within OECD economies highlights the adverse effects on those industries intricately linked to global markets, including manufacturing, construction, finance, wholesale, and retail trade.

U.S. Regulatory Week Ahead

April 29 - May 4, 2024

The regulatory week ahead is poised to bring two pivotal events that will directly influence the pending CapitalOne – Discover merger.

The first event, a hearing by the House Financial Services Committee on Wednesday, is aptly titled “Merger Policies of the Federal Banking Agencies.” This hearing holds significant implications for the future of financial mergers. 

 Amidst the buzz among financial lobbyists and regulatory circles, the stance of key figures like Vice Chair for Supervision Michael Barr, FDIC Chair Marty Gruenberg, CFPB Direct Rohit Chopra, Acting Comptroller of the Currency Michael Hsu, and the new entrant Jonathan Kanter, Assistant Attorney General for Antitrust, is being closely watched. Their potential opposition to significant-sized financial mergers, including the CapitalOne-Discover merger, makes the upcoming hearing even more intriguing.

The second (albeit lesser) event will be Tuesday at the Independent Community Bank Association annual conference, Capital Summit 2024. FDIC Chair Gruenberg and CFPB Director Chopra will jointly participate in a Fireside Chat to discuss the state of banking.

This comes on the heels of regulators announcing they were extending the public comment period for the CapitalOne-Discover deal another month (from April 26 to May 31). Progressive Democrats on Capitol Hill, along with many community organizations, are ramping up their opposition to the deal, and being given an extra month to make their case is not good news for either company.

Last week, there were three particularly big actions in the regulatory world worth noting: one that successfully made it through (although we think that is going to be temporary) and the other that failed. 

First, a divided Federal Trade Commission (FTC) voted to ban noncompete agreements. That action – long expected – ignited several almost immediate federal lawsuits seeking to block the FTC action (making the point that the FTC lacks the statutory authority to make and enforce such a regulation. Our money is on the lawsuits winning this one and quickly).

The second event was the Department of Labor finalizing the rule on retirement savings protections. This proposal has had a long tenure, first emerging during the Obama Administration. After being struck down by federal courts, the SEC passed Regulation Best Interest (Reg BI) in 2019. However, the Labor Department and advocates argued that Reg BI left too many gaps and pushed through the current iteration. Expect several federal lawsuits soon challenging this new rule.

The third event was a rather odd, almost last-minute move by FDIC Chair Gruenberg aimed at large asset managers. At the last possible legal moment, Gruenberg called a board meeting last Monday for a board meeting on Thursday to take up possible measures to deal with the size and scope of asset managers who have large stakes in large banks. FDIC Board member and CFPB Director Chopra had offered a rule that would have given the FDIC broad authority to investigate asset management firms’ investments in big banks. Countering his proposal was FDIC Director Jonathan McKernan’s proposal to do some “basic” monitoring of a few large index funds that have large stakes in big banks. The Investment Company Institute and several large mutual funds lobbied furiously against the Chopra measure and, to the surprise of many, FDIC Director and Acting Comptroller Michael Hsu opposed the Chopra measure.

McKernan then took down his proposal and, to make a long dramatic event short, nothing happened.  

But that does not mean regulators are done looking at the largest mutual funds and their holdings in big banks.  We recommend watching this space closely and reading Capital Account, edited by our friend Rob Schmidt, for the most detailed and best reporting on this (and every financial regulatory event going on).  It is well worth the subscription.

Below is a listing of all the other significant regulatory-related events this coming week:

U.S. Congressional Hearings

U.S. Senate

• Thursday, May 2, 10:00 a.m.: the Senate Banking Committee holds a hearing entitled “Higher Prices; How Shrinkflation and Technology Impact Consumers’ Finances.”

House of Representatives

• Tuesday, April 30, 2:00 p.m.: The House Oversight and Accountability Health Care and Financial Services Subcommittee holds a hearing on "Health of the Commercial Real Estate Markets and Removing Regulatory Hurdles to Ensure Continued Strength."

• Wednesday, May 1, 10:00 a.m.: The House Financial Services Committee holds a hearing entitled “Merger Policies of the Federal Banking Agencies.”

US Regulatory Meetings & Events

Federal Reserve Board and Federal Reserve Banks

• Tuesday & Wednesday, April 30 – May 1: The Federal Reserve Board’s Open Market Committee meets to discuss interest rates and the economy.  Fed Chair Jay Powell holds a press conference on May 1 at 2:00 p.m.

• ·Saturday, May 4, 9:20 a.m. and 2:20 p.m.:  Federal Reserve Board Governor Lisa Cook gives two commencement speeches at Georgia College and State University (GCSU) in Milledgeville, Georgia.  

U.S. Treasury Department

• April 30, 9:00 a.m.: The Treasury Department’s Borrowing Advisory Committee holds a meeting to discuss the economy, financial markets, Treasury financing, and debt management and for a written report from the committee of its recommendations.

Securities and Exchange Commission

• Thursday, May 2, 1:30 p.m. – The SEC holds a Closed Meeting.

Commodities Futures Trading Commission

• Monday, April 29, 9:00 a.m. – 12:00 p.m. (UK time): CFTC Commissioner Christy Goldsmith Romero will participate virtually in an MSCI Sustainability Institute roundtable event on derivatives and climate in London.

• Thursday, May 2, 1:00 p.m. – 4:00 p.m.: Commissioner Christy Goldsmith Romero, sponsor of the Commodity Futures Trading Commission’s Technology Advisory Committee (TAC), will host an “AI Day during a TAC meeting. The public is invited to come in person or watch the meeting via live webcast at CFTC.gov.  The scheduled speakers include Dr. Nicol Turner Lee, Director of the Center for Technology Innovation at the Brookings Institution; Todd Smith, Director of Centralized Data Science and Analytics at the National Futures Association; Francesca Rossi, AI Ethics Global Leader, IBM; Todd Conklin, Chief AI Officer and Deputy Assistant Secretary of Cyber at the U.S. Treasury Department, Sunayna Tuteja, Chief Innovation Officer of the Federal Reserve Board, and Kirsten Wegner, Chief Executive Officer of Modern Markets Initiative.

• Friday, May 3, 10:45 a.m.: CFTC Commissioner Kristin N. Johnson will give remarks and participate in a fireside chat at the 2024 Fintech and Blockchain Symposium, Co-Hosted by Rutgers Law School’s Center for Blockchain and Fintech and Sidley Austin LLP in New York.

FINRA

• There are no significant events scheduled at this time.

Federal Deposit Insurance Corporation

• April 29, Monday, 3:25 p.m.: FDIC Chair Marty Gruenberg and CFPB Director Rohit Chopra will participate in a Fireside Chat with Independent Community Bankers Association President Rebecca Romero Rainey at the ICBA’s Capital Summit 2024 in Washington, DC.

• May 2, 9:00 a.m.: The FDIC Advisory Committee on Community Banking to provide advice and recommendations on a broad range of policy issues that have particular impact on small community banks throughout the United States and the local communities they serve.

Office of the Comptroller of the Currency

• There are no significant events scheduled at this time.

The Consumer Financial Protection Bureau

• April 29, Monday, 3:25 p.m.: FDIC Chair Marty Gruenberg and CFPB Director Rohit Chopra will participate in a Fireside Chat with Independent Community Bankers Association President Rebecca Romero Rainey at the ICBA’s Capital Summit 2024 in Washington, DC.

• April 30, 1:00 p.m.: The CFPB holds a meeting by teleconference of the Community Bank Advisory Council to discuss broad policy matters related to the Bureau's Unified Regulatory Agenda and general scope of authority.

National Credit Union Administration

• There are no significant events scheduled at this time.

Federal Trade Commission & Department of Justice Antitrust Division

• There are no significant events scheduled at this time.

Farm Credit Administration

• There are no significant events scheduled at this time.

International Monetary Fund & World Bank

• There are no significant events scheduled at this time.

Trade Associations & Think Tank Events

Trade Associations

• April 28 – May 1, Sunday—Wednesday: The Independent Community Bankers of America will hold their Capital Summit 2024 in Washington, D.C.  Several members of Congress and regulators, including FDIC Chair Marty Gruenberg and CFPB Director Rohit Chopra, as well as all the Federal Home Loan Bank Board presidents, will speak.

• May 1, Thursday, 8:30 – 10:00 a.m.: The Institute for International Finance, in conjunction with PWC, will hold a hybrid Roundtable entitled “Liquidity Lessons Learned from the 2023 Banking Turmoil”  in New York and online.

• May 1, Thursday, 11:00 a.m.: SIFMA holds an event entitled “U.S.-China Relations: Outlook for Financial Services.” This is the first of a four-part series and will be conducted under Chatham House Rules.

Think Tanks and Other Events

• April 30,  Tuesday, 9:00 a.m.: The Peterson Institute for International Economics holds an event entitled “The International Sustainability Standards Board’s First Two Years.”  Sue Lloyd 
  Vice-Chair, International Sustainability Standards Board and Sylvie Goulard 
  Professor of Practice in Global Affairs and Geopolitics, SDA Bocconi School of Management, will speak.

• April 30, Tuesday, 4:00 p.m.: The Cato Institute holds a book discussion on "Build, Baby, Build: The Science and Ethics of Housing Regulation."

• May 1, Thursday, 2:30 p.m.:  The Brookings Institution holds an event entitled “Putting public assets to work through innovative finance.”  They will discuss how the U.S. Department of Transportation (USDOT) Build America Bureau recently announced an unprecedented grant opportunity: the Innovative Finance and Asset Concession Program. The program makes available $100 million in grants over five years to public entities doing pre-development work to structure public-private partnerships and other innovative finance and delivery mechanisms for transportation and transit-oriented development projects. The grant provides up to $1 million in funding with no local match requirement and an additional $1 million in funding with a match. Eligible applicants are public entities that own, control, or maintain assets that could be enhanced through projects eligible for Transportation Infrastructure Finance and Innovation Act (TIFIA) credit assistance.

The Future of TikTok in America: My Interview in Handelsblatt

April 20, 2024

I was delighted to be interviewed this week by Handelsblatt, the leading German newspaper, about the U.S. Congress’ legislative move to ban TikTok.

The legislation now looks assured of passage following the House of Representatives passing a new version to meet the demands of key Senators. A final vote in the Senate is likely on Tuesday, April 23, but it could be delayed by a week.

Is this really the end for TikTok in the U.S.? Not immediately. While the legislation now about to be passed dealt with some of the potential legal issues, look for ByteDance (the parent company of TikTok) to immediately go to the U.S. Federal Court to overthrow the legislation, likely on an argument that it violates the First Amendment rights of both the company and its users. That all but assures a prolonged - perhaps multi-year - battle before TikTok disappears from users’ screens.

You can read the interview HERE (and unless you speak or read German, you might want to use Google Translate or another system to read it!).

The Global Week Ahead

April 21 - 28, 2024

As Israeli-Iranian tensions seem to be receding, events in China this week will likely garner the most attention from global markets.  U.S. Secretary of State Antony Blinken visits Beijing for talk arriving just as the U.S. Congress passes legislation granting a military aid package to Taiwan (as part of the Ukraine/Israel military aid package) along with legislation banning TikTok from operating in the U.S., the release of a tough House of Representatives report detailing the Chinese Governments' role in supporting the fentanyl trade, and less than a week after President Biden announced his intention to triple tariffs on some Chinese steel imports.   

Blinken is expected to press Chinese leaders to step back from providing Russia with substantial dual-use technologies and materials that are being used by the Russian military in its war on Ukraine.  All in all, it will not be a leisurely visit for Blinken.

Amid Blinken's visit, China's National People's Congress meets this week to discuss new anti-money laundering laws, a second and final review of a major pending Tariff Law, and consideration of new national nuclear energy laws.

Also, this week, even though the Israeli counter-strike on Iran was seen as de-escalatory, markets and political leaders around the world will continue to watch the situation warily.  Israel begins the observation of Passover Monday night (which goes through April 30), and the hope is the situation in Gaza cools down enough for renewed negotiations with Hamas for the release of Israeli hostages (something Turkish President Recep Erdogan met with Hamas leader Ismail Haniyeh in Istanbul to discuss).  But all indications from Israeli Prime Minister Benjamin Netanyahu regarding a planned assault on the Gaz city of Rafah seem to be on track, despite the pleas from President Biden and other Western leaders not to do so.

Turning the global economic radar screen, markets will be focused on the U.S.'s Q1 GDP reading and U.S. personal income and outlays reports.  Among those reports is the Federal Reserve's favorite economic metric—the personal consumption expenditures price index—which they use to factor in interest rates. Moving to Europe, the purchasing managers' indexes (PMIs) for the Eurozone and important economic data from Germany and France will be released, giving the European Central Bank more guidance on rates going forward. 

Looking at Asia this coming week, the big event will be on Friday when the Bank of Japan meets to decide on interest rates while Japan's Producer Price Index (PPI) is also being released.

Below is what else of note we are watching around the world this coming week:

Sunday, April 21, 2024

 Global

·       Nothing significant to report.

Americas

Political/Social Events –

·       Ecuador will hold a series of referendums on reforms to fight organized crime which has become a major problem for the country.

·       The Colombian government and the National Liberation Army will hold peace negotiations in Venezuela through April 22.

·       Colombian opposition groups will protest the government of President Gustavo Petro in major cities. 

·       In Rio de Janeiro, supporters of former Brazilian President Jair Bolsonaro will protest the criminal case against him. 

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       The Maldives hold parliamentary elections.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       German Chancellor Olaf Scholz will jointly open with Norwegian Prime Minister Jonas Gahr Støre the Hannover Messe, one of the largest industrial trade fairs in the world.

·       The Basque region of Spain will hold local elections.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Turkish President Recep Erdogan continues a series of diplomatic meetings in the Middle East.  He met late last week with Hamas leader Ismail Haniyeh in Istanbul to discuss the release of Israeli hostages.  He now goes on to Iraq for discussions with Iraqi Prime Minister Mohammed Shia’ Al Sudani about the situation in Iraqi Kurdistan and the operations of the Kurdistan Workers Party (PKK) whom Turkey considers to be terrorist.

Economic Reports/Events –

·       Israel Inflation Expectations (April)

Africa

Political/Social Events –

·       The UN’s African Science, Technology, and Innovation Forum will take place in Addis Ababa through April 22.

·       The Connected Africa Summit 2024 will be hosted by Kenya’s information ministry in Nairobi.

Economic Reports/Events –

·       Nothing significant to report.

Monday, April 22, 2024

Global

·       The Jewish festival of Passover begins tonight and goes through April 30.

·       The UN Security Council is scheduled to hold a briefing on the United Nations Interim Administration Mission in Kosovo (UNMIK). Also in the morning, the Security Council will resume a debate on Maintenance of international peace and security: The role of young persons in addressing security challenges in the Mediterranean. In the afternoon, the Security Council is scheduled to hold a briefing, followed by consultations, on the United Nations Integrated Office in Haiti (BINUH). 

Americas

Political/Social Events –

·       The opening arguments will be made in the criminal trial of former President Donald Trump in New York.  The case revolved around alleged hush money being paid to former porn star Stormy Daniels.

Economic Reports/Events –

·       Mexico Economic Activity (February)

·       Canada New Housing Price Index (March)/ PPI (March)

·       USA Chicago Fed National Activity Index (March)

·       Paraguay Interest Rate Decision

·       Brazil BCB Focus Market Readout

·       Costa Rica Balance of Trade (March)

Asia

Political/Social Events –

·       The Philippines and the U.S. commence the 39th Balikatan military exercises.  The training exercise includes plans to simulate the sinking of an enemy warship and retaking territory from hostile forces. An estimated 16,700 personnel from both sides participate.

·       Indonesia’s Supreme Court is expected to rule on Defense Minister Prabowo Subianto’s presidential election victory in February.  He won the election, but the two losing candidates charged there were widespread irregularities.

·       In New Delphi, Prime Minister Narendra Modi is expected to make an announcement with Elon Musk about the opening of a major Tesla factory ($3 billion) in India.

Economic Reports/Events –

·       China Loan Prime Rate 1 & 5Y

·       New Zealand Credit Card Spending (March)

·       Indonesia Imports/ Exports/ Balance of Trade (March)

·       Taiwan Export Orders (March)/ Unemployment Rate (March)

·       Sri Lanka PPI (February)

Europe

Political/Social Events –

·       The EU Foreign Affairs Council meets in Luxembourg to discuss the Ukraine War and the EU’s response and sanctions on Russia.

·       The European Parliament's plenary session will convene through April 25 for the last time before the upcoming EU elections in June.  During this session, the Parliament is set to discuss new corporate due diligence requirements under the Corporate Sustainability Due Diligence Directive.  They will also likely move on new amendments to the Common Agricultural Policy following widespread protests across the EU by farmers angry at export laws. 

Economic Reports/Events –

·       ECB Board President Christine Lagarde gives the Presidential lecture at Yale University.

·       Euro Area Government Budget and Debt to GDP 2023/ Consumer Confidence Flash (April)

·       Turkey Consumer Confidence (April)

·       Poland Employment Growth (March)/ Industrial Production (March)/ PPI (March)

·       Ireland Wholesale Prices (March)

·       Great Britain CBI Industrial Trends Orders (April)

·       Slovenia Unemployment Rate (February)

Middle East

Political/Social Events –

·       Iranian President Ebrahim Raisi travels to Pakistan to meet with Prime Minister Shehbaz Sharif and military leaders.  In January, Iran launched a series of missiles and drones into Pakistan’s Baluchistan province against the Iranian Baloch militant group, Jaish ul-Adi.   Raisi then travels to Sri Lanka for meetings with President Wickremesinghe.

Economic Reports/Events –

·       Kuwait Inflation Rate (March)

·       Jordan Industrial Production (February)

Africa

Political/Social Events –

·       The African Counter-Terrorism Summit held in Abuja, Nigeria. President Bola Tinubu, in conjunction with the UN, will host representatives from the African Union and West African bloc Ecowas.

·       The 5th Africa Climate Talks, hosted by the African Union Commission’s African Climate Policy Centre and African Development Bank, will take place in Addis Ababa, Ethiopia.

·       The African Counter-Terrorism Summit held in Abuja, Nigeria. President Bola Tinubu, in conjunction with the UN, will host representatives from the African Union and West African bloc Ecowas. The Summit goes through April 25.

Economic Reports/Events –

·       Ivory Coast Inflation Rate (February)

Tuesday, April 23, 2024

Global

·       The UN Security Council is scheduled to hold an open debate on Women and peace and security: Conflict-related sexual violence. 

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       USA Redbook (April/20)/ S&P Global Manufacturing PMI Flash (April)/ New Home Sales (March)/ Richmond Fed Manufacturing and Services Index (April)/ API Crude Oil Stock Change (April/19)/ Building Permits Final (March)

·       Argentina Economic Activity (February)

Asia

Political/Social Events –

·       China’s National People’s Congress meets through April 26.  The agenda items to be discussed are likely to include money laundering laws, give a second review of a pending Tariff Law, and consider energy related laws.

Economic Reports/Events –

·       South Korea PPI (March)

·       Australia Judo Bank Manufacturing/Services/ Composite PMI Flash (April)

·       Japan Jibun Bank Manufacturing/Services/ Composite PMI Flash (April)

·       India HSBC Manufacturing/Services/ Composite PMI Flash (April)

·       Singapore Core Inflation Rate (March)/ Inflation Rate (March)

·       Taiwan Industrial Production (March)/ Retail Sales (March)

·       Hong Kong Inflation Rate (March)

Europe

Political/Social Events –

·       EU Health Ministers will hold informal meetings through April 24 in Brussels.

·       Today is St George’s Day. It is celebrated in Bosnia and Herzegovina, Bulgaria, Canada, Catalonia, Croatia, Cyprus, England, Georgia, Greece, North Macedonia, Portugal, Romania, and Serbia.

Economic Reports/Events –

·       ECB Board Member Edouard Fernandez-Bollo participates in a roundtable on AI organized by Regulation Partners in Lanzarote (Canary Islands), Spain.

·       Bank of England Chief Economist Huw Pill speaks at the London campus of the University of Chicago’s Booth School of Business.

·       Euro Area HCOB Manufacturing/Services/ Composite PMI Flash (April)

·       Great Britain Public Sector Net Borrowing (March)/ S&P Global Manufacturing/Services/ Composite PMI Flash (April)

·       France HCOB Manufacturing/Services/ Composite PMI Flash (April)

·       Germany HCOB Manufacturing/Services/ Composite PMI Flash (April)

·       Poland Retail Sales (March)/ M3 Money Supply (March)

·       Slovenia Consumer Confidence (April)

·       Hungary Deposit Interest Rate (April)/ Interest Rate Decision

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa Leading Business Cycle Indicator (February)

Wednesday, April 24, 2024

Global

·       The UN  Security Council is scheduled to hold a briefing, followed by consultations, on the Great Lakes region. In the afternoon, the Security Council is scheduled to hold a vote related to Non-proliferation, and it is also scheduled to hold a briefing, followed by consultations, on the Middle East.  

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       The Bank of Canada releases the summary of deliberations from the most recent interest rate decision.

·       Brazil FGV Consumer Confidence (April)

·       USA MBA Mortgage Market Index (April/19)/ EIA Crude Oil Stocks Change (April/19)/ NY Fed Treasury Purchases 7 to 10 yrs.

·       Mexico Mid-month Inflation Rate (April)

·       Canada Retail Sales (February)

·       Chile PPI (March)

·       Paraguay PPI (March)

·       Argentina Retail Sales (February)

·       El Salvador Balance of Trade (March)

Asia

Political/Social Events –

·       U.S. Secretary of State Antony Blinken will be in Beijing for meetings with senior Chinese officials.  This follows the recent visit of U.S. Treasury Secretary Janet Yellen.  Blinken is expected to discuss the Ukraine War, President Biden’s recent announcement of his intent to triple tariffs on Chinese steel, the U.S. Congress’ newly passed ban on TikTok, and other major issues.

·       Indonesia will host the Asia-Pacific Economic Cooperation's 57th working group on small and midsize enterprises in Bali through April 25.

Economic Reports/Events –

·       South Korea Consumer Confidence (April)

·       New Zealand Imports/ Exports/ Balance of Trade (March)

·       Australia Inflation Rate (Q1)/ CPI (Q1)/ RBA Trimmed Mean and Weighted Median CPI (Q1)

·       Indonesia Interest Rate Decision/ Deposit & Lending Facility Rate (April)/ Loan Growth (March)

·       Vietnam Foreign Direct Investment (April)

·       Taiwan M2 Money Supply (March)

·       Philippines Budget Balance (March)

·       Thailand New Car Sales (March)

Europe

Political/Social Events –

·       North Macedonia holds the first round of presidential elections.  The vote comes in the midst of heightened tensions between the country’s Albanian minority and Macedonian majority.  If no candidate wins an outright victory, a run-off election will take place on May 8, which will coincide with the country’s planned parliamentary elections. 

·       Russian President Vladimir Putin may hold a meeting of the Council on Interethnic Relations. 

Economic Reports/Events –

·       ECB Vice President Piero Cipollone gives the keynote speech at the  ECB retail payments conference 'Strengthening an innovative and integrated European retail payments market' in Frankfurt, Germany.  Later in the day, he chairs a panel entitled "Strengthening the European retail payments landscape: Public and private sectors join forces" at the conference.

·       ECB Board Member Elizabeth McCaul chairs a plenary session and delivers concluding remarks at a high-level seminar on "Governance and risk culture: going forward by looking back" jointly organized by the ECB and the Florence School of Banking and Finance of the European University Institute (EUI), in Florence, Italy.

·       ECB Board Member Isabel Schnabel gives opening remarks at "Frankfurt liest ein Buch" organized by Frankfurt liest ein Buch e.V. in Frankfurt, Germany.  Later in the day, she gives the opening speech at the Inaugural conference of the ChaMP Research Network "Challenges for Monetary Policy Transmission in a Changing World ("ChaMP")."

·       ECB Board Member Anneli Tuominen gives the keynote speech at a high-level seminar on "Governance and risk culture: going forward by looking back" jointly organized by the ECB and the Florence School of Banking and Finance of the European University Institute (EUI), in Florence, Italy.

·       Hungary Gross Wage (February)

·       Turkey Business Confidence (April)/ Capacity Utilization (April)

·       Germany Ifo Business Climate (April)

·       Italy Business and Consumer Confidence (April)

·       Poland Unemployment Rate (March)

·       Switzerland Economic Sentiment Index (April)

·       Slovenia Business Confidence (April)

·       Russia Corporate Profits (February)/ Industrial Production (March)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Saudi Arabia Imports/ Exports/ Balance of Trade (February)

·       Qatar M2 Money Supply (March)/ Total Credit Growth (March)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Thursday, April 25, 2024

Global

·       The UN Security Council is scheduled to hold a briefing on the Middle East, followed by consultations on the Middle East (Syria). In the afternoon, the Security Council is scheduled to resume an open debate on the Middle East.  

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Brazil Current Account (March)/ Foreign Direct Investment (March)/ Federal Tax Revenues (March)

·       Canada Average Weekly Earnings (February)

·       USA GDP Growth Rate (Q1)/ GDP Price Index (Q1)/ Goods Trade Balance Adv (March)/ Initial Jobless Claims (April/20)/ Real Consumer Spending Adv (Q1)/ Pending Home Sales (March)/ Kansas Fed Manufacturing and Composite Index (April)

·       Argentina Consumer Confidence (April)

·       Colombia Business Confidence (March)

Asia

Political/Social Events –

·       The Beijing International Automotive Exhibition begins in Beijing.  Chinese and global automakers will be showcasing their latest models.

·       Today is Anzac Day, celebrating the unity of Australia, New Zealand, and the UK in defense efforts and honoring the military dead. Australian Prime Minister Anthony Albanese will visit Papua New Guinea, where he and Papua New Guinea's Prime Minister James Marape will commemorate Anzac Day. 

Economic Reports/Events –

·       South Korea Business Confidence (April)/ GDP Growth Rate Adv (Q1)

·       Japan Foreign Bond Investment (April/20)/ Stock Investment by Foreigners (April/20)/ Coincident Index Final (February)/ Leading Economic Index Final (February)

·       Indonesia M2 Money Supply (March)

·       Malaysia Inflation Rate (March)/ Coincident Index (February)/ Leading Index (February)

·       Hong Kong Imports/ Exports/ Balance of Trade (March)

Europe

Political/Social Events –

·       French President Emmanuel Macron will deliver a speech on the future of the European Union at the Sorbonne University in Paris, France.

·       Italy celebrates National Liberation Day, commemorating the end of Nazi fascism in the country.

·       Portugal celebrates Freedom Day, commemorating the Carnation Revolution in 1974 when, which threw off the military dictatorship.

·       In London, the CBI National Business Dinner is held.  The event is attended by senior figures from business, politics, and media. Traditionally addressed by a senior member of the government.

·       Venice becomes the first city in the world to charge a daily access fee to day-trippers (€5) to tourists on day trips to the Italian city. It does not apply to those staying overnight and only applies on 29 dates between today and July 14, when there is peak tourist activity.

Economic Reports/Events –

·       ECB Vice President Luis de Guindos gives a lecture at the Academia Europea Leadership in Barcelona, Spain.

·       Ireland Consumer Confidence (April)

·       Great Britain Car Production (March)/ CBI Distributive Trades (April)

·       Germany GfK Consumer Confidence (May)

·       France Business Confidence (April)/ Business Climate Indicator (April)/ Jobseekers Total (March)

·       Spain PPI (March)

·       Turkey TCMB Interest Rate Decision/ Overnight Lending and Borrowing Rate (April)/ Foreign Exchange Reserves (April/19)

·       Ukraine Interest Rate Decision

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa PPI (March)

Friday, April 26, 2024

Global

·       The UN Security Council is scheduled to hold a briefing on threats to international peace and security.

Americas

Political/Social Events –

·       Former British Virgin Islands premier Andrew Fahie, faces sentencing after being convicted of conspiracy to import a controlled substance, conspiracy to commit money laundering, interstate and foreign travel in aid of racketeering, and other charges.

Economic Reports/Events –

·       Canada CFIB Business Barometer (April)/ Manufacturing Sales Prel (March)/ Budget Balance FEV

·       Brazil Bank Lending (March)/ IPCA mid-month CPI (April)/ Net Payrolls (March)

·       Mexico Balance of Trade (March)/ Unemployment Rate (March)

·       USA PCE Price Index (March)/ Michigan Consumer Sentiment Final (April)/ Baker Hughes Oil Rig Count (April/26)

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       New Zealand ANZ Roy Morgan Consumer Confidence (April)

·       Bank of Japan board will meet to discuss and decide interest rates, Japan Tokyo CPI (April)/

·       Australia PPI (Q1)/ Import and Export Prices (Q1)

·       Taiwan Consumer Confidence (April)IL

·       Thailand Imports/ Exports/ Balance of Trade (March)

·       Malaysia PPI (March)

·       Singapore Industrial Production (March)

·       India Foreign Exchange Reserves (April/19)

Europe

Political/Social Events –

·       German Chancellor Olaf Scholz will meet NATO Secretary-General Jens Stoltenberg in Berlin, Germany, to discuss the situation in Ukraine and additional military support for the Ukrainian military.

Economic Reports/Events –

·       Euro Area M3 Money Supply (March)/ Retail Sales (March)

·       Great Britain Gfk Consumer Confidence (April)

·       Hungary Unemployment Rate (March)

·       France Consumer Confidence (April)/ Unemployment Benefit Claims (March)

·       Spain Unemployment Rate (Q1)/ Retail Sales (March)

·       Slovenia Retail Sales (March)

·       Greece Total Credit (March)

·       Russia Interest Rate Decision/ CBR Press Conference/ Unemployment Rate (March)/ Business Confidence (April)/ Real Wage Growth (February)/ Retail Sales (March)/ GDP (March)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Zimbabwe Inflation Rate (April)

·       Ivory Coast Inflation Rate (March)

Saturday, April 27, 202 

Global

·       Nothing significant to report.

Americas

Political/Social Events –

·       The White House Correspondents’ Association Annual Diner is held in Washington, D.C. President Biden will address the audience.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       China Industrial Profits (YTD) (March)

Europe

Political/Social Events –

·       Slovenia celebrates the Day of Uprising Against Occupation, commemorating the day when the Liberation Front of the Slovene Nation was formed in 1941 to fight the Nazi occupation.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Today is Sierra Leon’s Independence  Day, celebrating when the country gained its independence from the UK in 19671.

·       Togo celebrates Independence Day, marking the day in when the Togolese Republic was established in 1960.

Economic Reports/Events –

·       Nothing significant to report.

Sunday, April 28, 2024

Global

·       G7 Climate, Energy, and Environmental Ministers meet in Torino, Italy.

Americas

Political/Social Events –

·       Mexico’s three presidential candidates will participate in the 2nd televised presidential debate, which will focus on economic development, infrastructure building, and employment.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Japan holds by-elections for three seats in the Diet’s lower chamber. The elections come at a time when the ruling Liberal Democratic Party and Prime Minister Fumio Kishida are at record-low poll numbers due to the handling of a political slush fund scandal.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       The Democratic Republic of Congo holds elections for provincial governors and vice governors.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

U.S. Regulatory Week Ahead

April 22 - 26, 2024

The regulatory world in Washington will be pretty quiet this week with the Passover holiday this week, and the U.S. Congress is out of session (although the Senate is expected to stay in town to vote on Tuesday on the $95 billion Ukraine/Israel/Taiwan aid package as well as a ban on TikTok).

This week, our focus will be on three potentially pivotal events at the Federal Trade Commission. The Open Meeting scheduled for Tuesday is particularly important. The FTC will deliberate on a rule to ban noncompete clauses in business contracts.    We anticipate the rule will be passed. This decision could significantly impact the financial services industry in the future. Stay informed and prepared for this potential game-changer. 

On Wednesday, the FTC is hosting an informal hearing on a proposed trade regulation rule concerning unfair and deceptive fees. This is part of a broader, coordinated effort strongly supported by President Biden and Consumer Financial Protection Bureau Director Rohit Chopra. The focus is on credit card and bank fees, and this rule could significantly alter the regulatory landscape in this sector. Stay tuned for updates on this important development.  

However, the biggest headline-grabbing event at the FTC this week may be what is discussed at an FTC closed meeting on Monday. There is speculation the Commission will be discussing a major pending merger – perhaps the Exxon/Pioneer Energy deal – and whether to block the deal. Of course, Open Meetings are confidential and none of us actually know what the agenda item, but we do know markets will be watching this one closely.  

Below is a listing of all the other major regulatory-related events this coming week:

U.S. Congressional Hearings 

U.S. Senate

• The Senate is in recess this week for the Passover holiday (except they are expected to return on Tuesday to vote on the Ukraine aid package and TikTok ban legislation).

House of Representatives

• The House of Representatives is in recess this week for the Passover holiday.

US Regulatory Meetings & Events

Federal Reserve Board and Federal Reserve Banks

• There are no significant events or speeches scheduled at this time as the Fed is in its usual “Blackout Period” in advance of the Federal Open Market meetings, which are being held on May 1 – 2, 2024.

U.S. Treasury Department

• There are no significant events scheduled at this time.

Securities and Exchange Commission

• Thursday, 2:00 p.m. – The SEC holds a closed meeting.

Commodities Futures Trading Commission

• Wednesday, April 24, 2:45 p.m. – CFTC Commissioner Christy Goldsmith Romero will participate on a panel at FIA’s Law & Compliance Conference titled AI and Machine Learning: The Unknown Future Rolls Towards Us at the Gaylord Hotel at National Harbor, Maryland.

• Thursday, April 25, 11:15 a.m. – CFTC Commissioner Kristin N. Johnson will participate in a panel on innovation in futures and derivatives markets at FIA’s Law & Compliance Division Conference. The panel will be moderated by Yvette Valdez at Latham & Watkins.  The event is at the Gaylord Hotel at National Harbor, Maryland.

• Friday, April 26, 5:00 p.m. – CFTC Chair Chairman Rostin Behnam will participate in a fireside chat at Syracuse University & Alumni Night in D.C. at the law firm of Morgan Lewis in Washington, D.C.

FINRA

• There are no significant events scheduled at this time.

Federal Deposit Insurance Corporation

• There are no significant events scheduled at this time.

Office of the Comptroller of the Currency

• There are no significant events scheduled at this time.

The Consumer Financial Protection Bureau

• There are no significant events scheduled at this time.

National Credit Union Administration

• There are no significant events scheduled at this time.

Federal Trade Commission & Department of Justice Antitrust Division

• Monday, April 22, 11:00 a.m. – The Federal Trade Commission holds a Closed Commission meeting.

• Tuesday April 23, 2:00 p.m. – The Federal Trade Commission holds an Open Meeting to consider a rule banning noncompete clauses in business contracts.

• Wednesday, April 24, 10:00 a.m. – The Federal Trade Commission holds an informal hearing on a proposed hearing on proposed trade regulation rule on unfair and deceptive fees.

• Friday, April 26, 12:30 p.m. – FTC Commissioner Alvaro Bedoya gives a speech at the Loyola University School of Law’s 24th Annual Loyola Antitrust Colloquium in Chicago, Illinois.

Farm Credit Administration

• There are no significant events scheduled at this time.

International Monetary Fund & World Bank

• There are no significant events scheduled at this time.

Trade Associations & Think Tank Events

Trade Associations

• Monday, April 22, 12:30 p.m.: The Institute for International Finance will hold a roundtable discussion with Dominique Laboureix, Chair of the EU’s Single Resolution Board, in Washington, D.C.

• Tuesday, April 23, 9:00 a.m. – The Institute for International Finance holds an online event entitled “New SEC US Treasury Central Clearing Rules – Practical Implications and Planning Considerations.”

Think Tanks and Other Events

• Wednesday, April 23, 10:00 a.m.: The Bipartisan Policy Institute will hold a Fireside Chat with Housing and Urban Development Acting Secretary Adrianne Todman.

Please let us know if you have any questions or would like to be added to our email distribution list. 

The Midwest Convenience Store & Energy Convention 2024

A Gathering of Some of America’s Greatest Small Business Entrepreneurs

I had the great privilege to speak at the Midwest Convenience Store & Energy Convention 2024 in St. Paul, Minnesota, this past week. The attendees really represent the heart and soul of American small business. It is truly amazing how critical what they do is to our daily lives, and I suspect many of us take it for granted the service they provide in keeping the broader economy flowing smoothly. We gas up, change our oil, get our coffee on the way to work, and maybe breakfast and lunch.

But I would argue they are also, in many ways, the first line of defense medically for us - where else do you go at any hour of the night to get medicines for your sick child or even yourself? You go to them first before a doctor’s office or even an “iffy” visit to an emergency room to deal with a sick family member. As one who had a chronically ill child for many years, I can attest to this fact.

My deep gratitude to the MCSC organizers for giving me the opportunity to not only speak at your convention but also spend time with your members and hear firsthand the many issues and ideas they have regarding politics and policy in this country. They are smart, common-sense folks—some of them running family operations that are more than a century old!

Recommended Weekend Reads

April 19 - 21, 2024

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list. 

India

• A Short History of India in Eight Maps  The Economist

  In his decade in power Narendra Modi, India’s prime minister, has centralized the state to an unprecedented extent. Yet his ruling Bharatiya Janata Party(BJP) has failed to attract many voters in the more prosperous south. The regional divergence is not unique to the BJP. Throughout India’s long history, rulers have tried and failed to unite the subcontinent under central authority. The chief reason is India’s diversity, summed up in clichés about dozens of cuisines, hundreds of languages and thousands of gods. The clichés may be trite, but they are also useful. A whirlwind tour through 2,500 years of Indian history helps explain why.
  

• “Meet India’s Generation Z”  Foreign Policy

  India changes more in five years than many countries would in a quarter century. This is partly because it is still relatively young: The country gained independence just 76 years ago, and nearly half of its population is under the age of 25. As one would expect, then, much has happened in the five years since 2019, when Indian voters issued an overwhelming mandate to keep the Bharatiya Janata Party (BJP) and Prime Minister Narendra Modi in power.  But what do those aged 18 to 25 think about India’s future?
  

• “The Hindu Nationalist Foreign Policy – Under Modi, India is Becoming More Assertive”  Foreign Affairs

  As India enters into historic elections, and unlike in previous elections, foreign policy is a major issue. Today, more Indians care about their country’s place in the world than did so a decade ago, and the aspirations of average citizens are mirrored in their nation’s fortunes like never before. The BJP has used this new attention to craft a self-reinforcing message: if the party can catapult an “ordinary citizen” such as Modi to global prominence, it can do the same for a country that has languished in poverty and weakness. Similarly, if Modi can make India secure, prosperous, and widely respected, he can do the same for the Indian voter.

Geoeconomics 

• Quantitative Tightening Around the Globe: What Have We Learned? National Bureau of Economic Research

  This paper uses the recent cross-country experience with quantitative tightening (QT) to assess the impact of shrinking central bank balance sheets. We analyze the experience in seven advanced economies (Australia, Canada, the Euro area, New Zealand, Sweden, the UK, and the US)—documenting different strategies and the substantive reduction in central bank balance sheets that have already occurred. Then we assess the macroeconomic and financial impact of QT announcements on yields and a range of other market prices. QT announcements increase government bond yields, steepening the yield curve and potentially signaling a greater commitment to raising policy interest rates, but have more limited effects on most other financial market indicators. Active QT has a larger impact than passive QT, particularly on longer maturities. The implementation of QT has been associated with a modest rise in overnight funding spreads and a decline in the “convenience yield” of government bonds, but QT transactions did not significantly affect the pricing and market liquidity of government debt securities. Finally, we evaluate who buys assets when central banks unwind balance sheets, an issue that will become increasingly important if central banks continue to reduce their security holdings while government debt issuance remains elevated. We find that increased demand by domestic nonbanks has largely compensated for reduced bond holdings by central banks. This series of cross-country results suggest that QT has had more of an impact than “paint drying” but far less than simply reversing the effects of the quantitative easing programs launched during periods of market stress. Looking ahead, although QT has been smooth to date, frictions could increase in the future so that QT quickly evolves into more like watching “water boil.”

Europe

• EP Spring 2024 Survey: Use Your Vote - Countdown to the European Elections EU

  The Parliament’s Spring 2024 Eurobarometer reveals strong interest among citizens in the upcoming European elections (6-9 June) and awareness of their significance in the current geopolitical context. The survey sheds light on Europeans’ voting behavior, their attitudes toward campaign topics, and their preferences for the priority values for the next term of the European Parliament. It focuses also on citizens’ perception of the EP and EU, their perspective on life in the EU, as well as on their opinions about the EU within the current global context.

Russia

• The Impact of Semiconductor Sanctions on Russia American Enterprise Institute

  After Russia again invaded Ukraine in February 2022, the US and its allies restricted Russia’s access to semiconductors, aiming to disrupt the Kremlin’s defense industrial supply chains. Have these semiconductor controls worked? The secrecy of the Russian defense industrial base makes it difficult to answer this question fully, but this report examines the evidence to provide some tentative conclusions on the impact of tech export controls.

• The Five Futures of Russia: And How America Can Prepare for Whatever Comes Next Foreign Affairs

  Vladimir Putin happened to turn 71 last October 7, the day Hamas assaulted Israel. The Russian president took the rampage as a birthday present; it shifted the context around his aggression in Ukraine. Perhaps to show his appreciation, he had his Foreign Ministry invite high-ranking Hamas representatives to Moscow in late October, highlighting an alignment of interests. Several weeks later, Putin announced his intention to stand for a fifth term in a choiceless election in March 2024 and later held his annual press conference, offering a phalanx of pliant journalists the privilege of hearing him smugly crow about Western fatigue over the war in Ukraine. “Almost along the entire frontline, our armed forces, let’s put it modestly, are improving their position,” Putin boasted in the live broadcast.

China

• A Chinese Perspective on the Russia-Ukraine War: A Conversation with Dr. Zhao Hai CSIS ChinaPower Podcast

  In this episode of the ChinaPower Podcast, Dr. Zhao Hai joins us to discuss China’s views on the Russia-Ukraine war and its broader implications for China. Dr. Zhao provides an assessment of how he thinks China perceives the evolving situation on the ground, emphasizing China’s concerns about the risk of further escalation between Russia and the West, potentially involving the use of nuclear weapons. He argues that the Ukraine crisis has heightened U.S.-Russia competition and speaks to how China views the conflict as a sign of the world order shifting towards one of multi-polarity. He also shared his assessment of the United States engaging in enhanced proxy warfare in Ukraine that could be used in the Indo-Pacific in the future. 

• The CCP’s Role in The Fentanyl Crisis The Select Committee on The Strategic Competition Between the United States and The Chinese Communist Party

  The House Committee this week released an in-depth report on the Chinese Government’s role in the Fentanyl trade and its impact on the U.S.  The fentanyl crisis is one of the most horrific disasters that America has ever faced. On average, fentanyl kills over 200 Americans daily, the equivalent of a packed Boeing 737 crashing every single day. Fentanyl is the leading cause of death for Americans aged 18-45 and a leading cause in the historic drop in American life expectancy. It has led to millions more suffering from addiction and the destruction of countless families and communities. The report charges that beyond the United States, fentanyl and other mass-produced synthetic narcotics from the People’s Republic of China (PRC) are devastating nations around the world. It is truly a global crisis. The PRC, under the leadership of the Chinese Communist Party (CCP), is the ultimate geographic source of the fentanyl crisis. Companies in China produce nearly all of the illicit fentanyl precursors, the key ingredients that drive the global illicit fentanyl trade.

• Why China Remains Unlikely to Invade Taiwan The Interpreter

  The United States, and Washington DC in particular, is awash with expectations of war against China in the near future, most likely caused by a Chinese decision to forcibly annex Taiwan. Plenty of Americans — including senior military officers, academics, and politicians — think Chinese leader Xi Jinping sees war as the best option. Those making this argument typically say Xi is tired of waiting for unification to happen peacefully, sees a military window of opportunity, or has set a deadline for finishing the job. Some think China’s recent economic problems create an incentive for Beijing to launch a diversionary Taiwan war.
  

• China, Russia, and Iran Are Reviving the Age of Empires  Hal Brands/Bloomberg Opinion

  The ghosts of empire are haunting Eurasia. President Xi Jinping’s China is seeking to reclaim the power and privileges of the great dynasties that once bestrode Asia. President Vladimir Putin is channeling the memory and the methods of famous conquerors from Russia’s imperial past. Iran is using proxies, missiles, and other means to build a sphere of influence encompassing parts of the old Persian Empire. Not so long ago, much of the world was ruled by empires. If today’s revisionist states have their way, the future could resemble the past. 

The Economics of a Good Sleep

• Sleeping Our Way to Being Productive VoxEU

  Sleep is key to our physical and mental health. It also affects people’s employment and productivity. This column explores how the amount of weekly sleep influences employment, productivity, and the income of individuals in Germany. Each additional hour of sleep per week increases the probability of employment by 1.6 percentage points and weekly earnings by 3.4%. Sleep is partly the product of both public and private decisions and can be incentivized so that the negative economic effects of not sleeping enough are more salient to individuals.

• Americans Sleeping Less, More Stressed Gallup

  For the first time in Gallup polling since 2001, a majority of U.S. adults, 57%, say they would feel better if they got more sleep, while 42% say they get as much sleep as they need. This is nearly a reversal of the figures last measured in 2013, when 56% of Americans got the sleep they needed, and 43% did not. Americans’ perception that they aren’t getting enough sleep is borne out by the diminished number of hours of sleep they report getting per night.