Where finance and media intersect with reality


Spot Markets Live, 07/12/23 (Queen Mary cyberattack, Fertility crisis, Hard economic landings)

Comments in bold addressed to audience members

JR = Julian Rimmer (Resident Boomer and former EM markets pro turned writer.)

DGG = Dario Garcia Giner (Resident Zoomer and former corporate investigations pro turned meme stock watcher and in-house drone expert.)

10:30 JR: Good morning, Aloha and greetings fellow market wizards.

Good morning, Dario and welcome to Thursday 7th December

10:31 DGG: Good morning and aloha!

10:31 JR: Nunc tempus loquendi

Here’s news

Apparently I live in the happiest borough in the kingdom

Although I consider myself neither happy nor affluent

10:32 DGG: I’ve always been pleased in my bringing down the average of whatever event or place I’m attending

To those of you living under a rock: Grand Theft Auto has just released its new iteration – GTA 6

Quickly became the most viewed and liked trailer of all time

10:33 JR: It appears even though I do live under a rock (a rock in Richmond, the happiest of rocks)

I had seen this exchange between one of my villains and that hapless lickspittle, Cheong

10:34 DGG: For a boomer you know a lot of people on twitter

And someone snuck into Bohemian grove on a kiddie kayak

10:34 JR: What is Bohemian Grove?

10:34 DGG:
Who Rules America: Social Cohesion & the Bohemian Grove

10:34 JR: Still no idea

10:34 DGG: Central to conspiracy theorists – it’s essentially a frat club

With a large owl

In California

Though I prefer Richard Nixon’s take on it

10:35 JR: Strewth, a frat club with a large owl?

10:35 DGG: “The Bohemian Grove, which I attend from time to time — it is the most faggy goddamned thing you could ever imagine, with that San Francisco crowd.”

Which sounds more realistic

10:35 JR: Common sense approach

10:35 DGG: Markets miscellany!

Venezuela has a new official map that is being distributed to all public institutions as of yesterday

10:36 JR: This behaviour is textbook Russian imperialism

10:36 DGG: 2$ at whoever takes a WILD guess at what’s changed (hint, hint Essequibo)


So in all likelihood, Queen Mary’s was hacked

Something still not out in the press

As a reminder – our source informed us that QM IT personnel are working overtime to restore a loss in their IT systems after experiencing unidentified issues related to a cyberhack

We also heard that personnel in St. Barts are suffering from an almost total outage in their capacity to process laboratory data

While their testing hardware functions, it remained impossible for researchers to transfer the testing data into workable models on the university’s computer systems

10:38 JR: Are they testing something sensitive?

10:38 DGG: Perhaps there’s some finding that’s sensitive, I dno

St Barts is a top notch institution, they’re working on the real deal

Our source was given an estimate that these QM systems aren’t expected to be fully functional until the New Year at least

The extent to which any patient, student, or personnel data has been lost or exposed, if at all, is unclear

While QM didn’t specifically tell us a cyberhack had occurred – they basically did in so many words

They confirmed an outage in Barts Cancer Institute due to an “issue involving an isolated network”, and specified it was not a widespread issue across QM

“We have experienced an issue involving an isolated network that supports the Barts Cancer Institute and related activities, including some research activities.

We took all related systems offline as a precaution while we investigated the issue. Contingency plans are in place to enable research to continue.

“We have a team of network specialists working on understanding and resolving the issue as quickly as possible. None of the other University systems are affected.”

I have my doubts

In computer systems very little is ‘isolated’ – particularly if the ‘related systems’ that went offline led to the widespread research woes described to us by our source

10:40 JR: That (isolation) sounds unlikely esp with the NHS

10:40 DGG: We’ll keep you posted – the story is developing

We remind our watchers that customer data from the British Library recently went on sale on the dark web for around £600,000 – which included the personal data of J.K. Rowling.

JK Rowling’s personal data could have been compromised in British Library cyber attack

News Image

But, to be honest, things going on in cyberspace neither capture my imagination, nor my understanding

10:41 JR: It’s not my world anymore

10:41 DGG: Space space, however, does capture my imagination, while my understanding of it remains elusive

The secretive National Reconnaissance Office just announced it signed agreements with five commercial providers of electro-optical satellite imagery

Airbus U.S. Space and Defense, Albedo Space, Hydrosat, Muon Space and Turion Space were selected for the NRO’s Strategic Commercial Enhancements program, which seeks new and emerging types of electro-optical imagery beyond what the agency already procures from Maxar, BlackSky and Planet Labs under a 2022 contract known as the Electro-Optical Commercial Layer.

The NRO has access to significant commercial sources of imagery under the EOCL contracts but it’s now looking to capture the next wave of technologies that have emerged in the industry in recent years, such as commercial non-Earth imagery, or the imaging of objects in space.

10:42 JR: Never heard of the NRO, so it’s done very well to remain secret

10:42 DGG: Hi Colin!

10:43 JR: Where is it? In space, i assume?

10:43 DGG: Something like that. I don’t think they’d tell me

I found a nifty little website, Julian

It lets you see the active trajectory of Starlink and OneWeb satellites in orbit

11:43 JR: I just want to know when the No. 65 bus is due

11:43 DGG:

News Image

You can’t have that, Julian

Something else caught my attention – a dubious online story about the number of burned or destroyed Starlink satellites

10:44 JR: @marks – they will look cheap forever, I suspect

10:44 DGG: If estimates from the website – which sources its information from public data at space-track.org, which is given to the latter by companies operating these satellites – are to be believed, over 200 Starlink sats have been lost in a remarkably short period over the summer

What’s going on?

10:44 JR: That’s careless

10:45 DGG:

“Starlink, a satellite constellation operated by aerospace company SpaceX, lost 212 satellites in the period spanning July 18th and September 18th, data compiled by satellitemap.space shows.

Data shows the number of burned-up satellites steadily increasing over the past three years, but a significant spike can be observed starting the month of July.

It’s unclear whether these satellites were scheduled to de-orbit or whether the burn-ups were a result of a failure. Cybernews has reached out to SpaceX for comment but has not received a response.”

Now – half of the redditor’s comments online actively try to debunk the original source – but none precisely say why or who debunked it

All these debunkers claim is the numbers of the website aren’t reliable, particularly as they don’t gel with a known astrophysicists’, Jonathan McDowell’s

While he IS an amazing source on Starlink, he also has no way of knowing whether a satellite is in service – just if its in orbit

And SpaceX has NOT replied to requests by media to confirm or deny the allegations

The story is important regardless because if you think constellations like Stasrlink are the future, mind that satellite losses and space junk will become valid arguments to limit atmospheric real estate

But if that hidden cost doesn’t put you off space companies, here’s six to invest in courtesy of Motley Fool

10:47 JR: It’s a cliché to say there’s a whole world out there I dont know about but this is a whole universe

Back here in the real world, down on the ground, where things are tangible….

We had a ding-dong, thrill-a-minute, rollercoaster session in the US last night

UST10YR hit 4.1% @ one stage

It would be a courageous move to short UST here on the eve of payroll data but it’s very clear at some point in 1Q23 there’s going to be some kind of inflation scare, however short-lived, and treasuries will see some kind of retracement. Irrespective of what the number is tomorrow, one would be tempted to short on the release itself. There’s a lot of travel-and-arrive in that 4.11% yield.

Andrew Bailey’s comments yesterday confirmed there’s a short squeeze in place with CFTC data registering an $800bn short, up from $650bn in July, presumably much of this, though, a function of the basis trade.

10:49 DGG: say what? there’s a short squeeze? Against what?

10:50 JR: Short squeeze is partly a function of that basis trade which comes in and out of fashion

The basis trade is a manoeuvre whereby HFs go long treasuries and then short the futures contract on those treasuries if they are trading at a premium. These positions are characterised by high leverage, though, to exploit tiny arbitrages.

The first sign of a reversal in the trend came last night with talk that the Japanese about to abandon YCC

Having worked so hard to stimulate some inflation in their system and weaken the yen, I’d be surprised if the BoJ does anything quickly but mkts as always frontload policy shifts very rapidly, even before they’ve started.

@marks – i dont think related

One consequence of the move in UST is mortgage applications have suddenly surged w a 14% monthly jump in the US as 30yr mortgages fell  from 8-7%

10:52 DGG: That’s a huge surge!


10:53 JR: A lot of pent-up demand

Another factor, of course, with declining yields is oil

WTI <$70

Putin arrived in UAE (one of the few places in the world he can visit without being arrested by the ICC) trying to talk up oil.

@marks – 14% jump in mortgage applications in US

He did his little, short-stepping, short-arse, man-trying-to-get-to-the toilet-before-it’s-too-late walk down a lavender (not a red) carpet (I looked into this: ‘The lavender carpets are identical to the colour of the kingdom’s deserts and plateaus in the spring,” said the Saudi Press Agency, referring to the blooms on the country’s lavender, desert germander and basil plants and jacaranda trees’) was greeted by MbS and claimed…

10:55 DGG: Little bit of marketing flourish from the saudi press agency there lmao

10:55 JR:

‘We have stable and very good relations in terms of political interaction, economics, and in the humanitarian sector’

Which is an interesting use of the word ‘humanitarian’ coming from the Kremlin Ripper discussing his relations with that well-known dismemberer and dissolver of journalists and decapitator of juvenile dissidents, MbS.

10:56 DGG: I still think the Khashoggi thing was really weird

10:56 JR: As an aside, how many Muslims did The Kremlin Ripper take out during his presidential election campaign / Chechen war? The answer is tens of thousands, perhaps two hundred thousand.

10:56 DGG: He’s related to the arms trafficker and iran-contra Adnan Khashoggi is all you need to know

10:56 JR: Not many protests about those Muslims then

10:56 DGG: Saudis love him tho!

All my mates

10:56 JR:

10:57 DGG: What does that mean?

10:57 JR: There’s a deal of differentiation within that of course with the outlook for gold, silver, copper and uranium very different to that for iron ore and other bulks. 

10:58 DGG: Ah I see, so the guy is saying that low commodity prices shine a different light on the idea that we’ll get a soft landing

10:58 JR: Weakness in commodities is suggesting a hard landing

Is XBT a commodity?

10:58 DGG: Gotcha

10:58 JR: Digital gold?

Jamie Dimon added his tuppence ha’penny,

If I was the government I’d close it down” “The only true use case for it is criminals, drug traffickers, money laundering, tax avoidance.

10:59 DGG: Considering the story we had yesterday that the two biggest government-avoiding methods on the internet – Signal and TOR – were launched by the American security state – it makes sense that Bitcoin is similarly a covert American tool

10:59 JR: He forgot the subjunctive but let’s not hold that against him

The best approach to XBT is teleological: Don’t try and understand what it is but rather what it does.

10:59 DGG: Izabella has a long list of amazing coverage on the bitcoin mystery

I agree – I’m extremely bullish on bitcoin because I see its value as ideological

Which gives it a sheen much like gold

11:00 JR: ‘Hodlers going yolo all-in’ ?

11:00 DGG: Remember – the only real utility to gold is that it shines no matter what. Bitcoin is decentralised no matter what. There’s your tangible USP that will send it to the moon

Umm… sure, Julian


11:01 JR: We are less than one month since the BOE economic forecasts announced by Andrew Bailey

But, as Panmure Gordon point out, already all conditioning assumptions used in the Nov forecast (that saw no GDP growth in 2024) are, mark-to-market, too pessimistic.


1. Bank Rate was seen averaging 5.1% in 2024 – but financial markets are calling bluff (for all major central banks) & now see 4.8% for the year. That loosens financial conditions in real time & we are seeing this in how forward swaps are pricing UK debt products

2. Secondly, the Sterling Exchange rate is now more than 2% higher at 82 (largely a function of recent USD/EUR weakness) & this will mute the imported inflation impact into next year as less favourable currency hedges from Q4 2022 roll off.

11:02 DGG: Mark – I think if there is a DS interest, it’s already been integrated 😉

11:02 JR: 3. Thirdly, oil prices have moved sharply lower to average ~$70/bbl across the 2024 curve – having been at $81/bbl at the Nov MPR. This has clear passthrough benefits to expected transport CPI, but also the GDP deflator which is the big suppressant on the Bank’s real GDP estimates

4. Fourth, UK gas prices are now (for the 2024 curve) at their lowest in 22 months at 106p/therm. This is down from 142p/therm in late October. This will have a big downward impact on Energy Price Cap estimates from Q2 24 onwards.

5. Fifth, there was a stimulative Autumn Statement in mid-Nov with payroll & business investment incentives both constructive for disposable incomes & bringing forward investment activity. No blame accorded to the Bank (they can’t front run HMT) but also now an upside risk to GDP.

In summary: But overall this is encouraging and suggests if you were to run a real time update to the Bank’s economic model (on today’s assumptions) you would get materially more growth in 2024 than output in the November 2023 forecast.

The upshot: There is upside risk to UK gdp growth forecasts next year

Could we say the same about China?

11:05 DGG: Interestingly enough, we have some China news that isn’t as bearish as we’ve been recently seeing, courtesy of Marc Ostwald

For the first time in six months, China’s exports have grown in a relief for factories

11:05 JR: @colinc – perverse . who’d have thought with a war and OPEC cuts we’d have lower crude?

11:05 DGG: This suggested that factories are managing to attract buyers through discount pricing, enabling them to get over a prolonged slump in demand

The new trade balance stands at $68.4bn vs. expected $54.9bn.

In november, exports grew 0.5% vs. an expected flatline, even though imports declined -0.6% yoy

11:06 JR: @johndc77 – i did english at uni (a foreign language) so headline and core are concepts for broadsheet commentators not tabloid hacks like me
11:06 DGG: The mixed manufacturing data has kept calls for further policy support to shore up growth. For example, the official PMI showed new export orders shrank for a ninth consecutive month

“While the level of export volumes hit a fresh high, (they were) supported by exporters reducing prices,” noted Zichun Huang, China economist at Capital Economics. “We doubt this robustness will persist,” Huang cautioned, “as exporters won’t be able to continue cutting prices for much longer.”

However, they also left analysts wondering whether negative sentiment-based surveys have masked an improvement in conditions, they point to hard data to sustain dis: quicker than expected growth in Q3 and a run of mostly upbeat data from October

It may also show that policy support from Beijing is having some effect

Interestingly, China’s trade with its major peers, the United States, Japan, South Korea, and Taiwan are all up on October.

I did something I never thought I’d do yesterday Julian

11:08 JR: Speak freely

11:08 DGG: I was with my grandparents and engaged in a historic activity i’d only been told about

11:08 JR: Be careful, this is a family show, before the watershed

12:08 DGG: I watched a television show

11:08 JR: No!

11:09 DGG: On the TV!

Like, plugged in with the cable thingy!

11:09 JR: How degrading

How analogue

11:09 DGG: It spoke of the great fertility crisis in Spain

11:09 JR: It is my world after all

11:09 DGG: I remember how the topic of the fertility crisis was framed as a Western only issue since I was a child

Now, however, the crisis is clearly worldwide

On mother’s day, our Great and Supreme Leader Kim Jong Un apparently burst into tears begging NK women to have more babies

11:10 JR: ‘Begging’?


11:10 DGG: Well, not really. He was crying about something else. But he did speak on his concern about declining birth rates

This sounds like the one thing a dictator can’t command more of

11:10 JR: I don’t know about that

11:10 DGG: The same phenomenon is occurring even in Africa, where the world’s most dramatic fertility drops are taking place

“In the Sahel, for example, the region with the highest fertility rates, the number of children per woman has dropped from 7 to 5.7 since 1980. The most spectacular drop has been in North Africa, where the rate was cut in half in 37 years, from 6 children per woman to 3.”

11:11 JR: That’s a good sign, though, in Africa?

11:11 DGG: The world is going full cycle, Jonathan

11:11 JR: This is partly a function of educating women and improving health / medicine and, I guess, higher wealth

Although I’m not sure about the latter

11:11 DGG: I just think it’s leading us straight to our next ‘crisis’. From a crisis of overpopulation that has been in the media cycle since the 50s, we’re now going straight towards a crisis of underpopulation – slowing the growth rate of labour force, weakening output growth, and imperilling all sorts of pension and social security systems

We’ve seen the destruction of the western family with all the attendant consequences as a result of this crisis and it’s only just begun

I’m often told by fellow conspirators that the promotion of modern values like LGBTQ+ are part of some dodgy conspiracy to lower birthrates

11:12 JR: I blame George Soros

11:12 DGG: But if you saw a pond overflowing with minnows and you found the minnows had stopped reproducing, you’d think ‘classic, nature, sorting itself out’

No need for a dodgy conspiracy – there’s simply a process of nature by which humanity’s birthrates automatically adapt to our circumstances

The problem is the way we MAKE EVERYTHING A CRISIS

11:13 JR: Which is why it’s so low in Russia

11:13 DGG: (maybe)

It reminds me of my History module at university where we read letters by Enlightened philosophers to Kings and Queens of the period.

Throughout the early 18th century, everyone went on about the need to grow population as some perennial, national objective

Especially, Frederick II The Great of Prussia and Catherine the Great of Prussia

(my two fave monarchs btw)

What happened at the end of the 18th century? After the revolution?

11:14 JR: Not Charles III?

11:14 DGG: The same philosophers, and particularly the same rulers – Frederick and Catherine – immediately changed tack!!

I could read it in the letters!

Overpopulation was now a perennial issue of state! Moves should be made to reduce the birth rate! Crisis! Alarm!

We’re always at war with Eastasia, and Eurasia has always been our ally

11:14 JR: I could get a seat on the district line then

I was going to summarise DB’s auto outlook for 2024 but three lines in I lost the very impetus to continue breathing

11:16 DGG: Sometimes I lose that impetus just having to get out of bed, Julian

11:16 JR: So I may just C&P the conclusions so that you feel like you’ve extracted something of economic value

After lots of ups and downs for the sector in 2023, including some positive momentum on volume recovery, high hopes for EV adoption, resilient vehicle pricing, but also UAW labor negotiation and strikes, and EV/AV slowdown, we do not expect the 2024 environment to become materially easier. The European and US economies still remain uncertain, and global autos volumes seem to trend in the flat to down direction, essentially offering limited growth opportunities for OEMs and suppliers alike. Layered on top are inflationary labor costs that will persist into 2024 and EV liabilities that come from previous higher adoption expectations.

So why should investors look at the sector? Within the space there have been plenty of opportunities to make money in 2023 with STLA up ~50% YTD, Tesla at ~90% or ALV with a ~35% gain or also BMW up 35% at peak during the year. Overall, we argue for a selective exposure to the sector in 2024, and expect another tough year ahead for the Auto space. In this note, we offer a detailed perspective on volume, pricing, EV adoption curve, AV winners, as well as our early view of the playbook into 2024. Our top picks in Europe are BMW, Mercedes, FRVIA, ML and PIRC; in the US they are ALV, GT, MBLY; and Xpeng in China.

Best ideas into another challenging 2024 environment In Europe we prefer premium over mass. Our rankings still reflect a preference for OEMs over suppliers, rather expressing a lack of structural growth stories among suppliers in Europe than a strong OEM bias. In our base case pricing is tough for both while a shortfall in volumes that we see typically hits the suppliers more. We once again assume 2% negative net pricing for premium and 4% for mass market OEMs. In our top picks we look for price setting power through branding and strong models as well as 1offs and buy backs making it easier to show stable EPS despite the assumed pricing headwind. This leaves BMW and Mercedes, to a lesser degree P911 given the major model renewal and likely volatility this creates

11:17 DGG: John – but the carry learn is to always mistrust the urgency and relevance of your current set of priorities regarding birthrates (or anything, really)

11:17 JR: No mention of TSLA

11:17 DGG: Well – speaking of Tesla

11:17 JR: @johndc77 – i’d take foreigners. better food while youre being repressed

11:18 DGG: The new cybertruck has started being given out to YouTubers so we can all start enjoying some real reviews of the weird vehicle

I’m not gonna lie – it looks so cool

If I had more cojones (and any money at all) I’d buy one

Bible quotes in the comments! Love it!!!

11:18 JR: It seems to me, its only benefit can be measured when someone attacks you with a machine gun

11:18 DGG: A 9mm Julian, don’t think it takes much more ammo than that

Speaking of autos, Michigan has just installed a wireless charging public roadway for electric vehicles

11:19 JR: That sounds cool

I could lie on it and charge myself

11:19 DGG: These are powered by ‘copper inductive charging coils’ which allows vehicles with receivers to charge their batteries while driving idling or parking above them

11:19 JR: Great place to go dogging

11:19 DGG: While this is only a quarter-mile segment of road, it’s still an interesting development. I suspect it will likely be too inefficient for mainstream use – but rich people will surely love to have one at home in their garage!

Just park in, starts charging, boom

What is dogging?!

11:20 JR: Ah, Zoomer, you have much to learn

11:20 DGG: teach me wise(?) master

11:20 JR: car-based coitus

11:20 DGG: What?! lmao

11:20 JR: You can power up all your ‘gadgets’

11:21 DGG: I don’t think anyone has referred to road sex as car based coitus since the 18th century

11:21 JR: Moving swiftly along…

Top Wines 2023 No.3

Castelgiocondo, Brunello di Montalcino, 2010 by Marchese de Frescobaldi

Has any wine ever tripped so mellifluously off the tongue?

It means ‘playful castle’ in Italian I think,

Which certainly stimulastes a fertile imagination like mine. I’ve been drinking this wine since its release in 2015 and have a very strong emotional attachment to it

Which means I will probably die with at least one bottle of it in my cellar (or my coffin.) 100% sangiovese, ripe, dark cherry fruit and chocolate, a hint of tobacco and now, 13 yrs in, developing tertiary notes of liquorice.

Bottled poetry

So, Dario, your latest hero?

11:23 DGG: Hero number 9 – Palmer Luckey

11:23 JR: Who he? he who?

11:23 DGG: Once known as the founder of Oculus Rift in 2012, Luckey rose to billionaire status when Oculus was acquired by Meta for $2bn in 2014

How’s that for your nominative determinism, Julian?

11:24 JR: No kidding

11:24 DGG: But Luckey has since turned his sights elsewhere

He’s joined Peter Thiel in the launching of heavy criticism of the United States Department of Defense’s policy for sales, which effectively have been crowding out any bidder for their upcoming projects that aren’t already a part of the pre existing massive, lethargic military industrial complex

His defence company, Anduril, has made significant headway and cinched several contract wins with the Defense Department, notably on border security

He’s gonna have the rare distinction of launching 2 unicorns in his life

11:25 JR: Where’s the heroism, though?

11:25 DGG: While Luckey’s Anduril still centres on making high-tech equipment, rather than any analogue-high-tech hybrid, he gets kudos for revolutionising the Western defence bidding system

Opening it up to innovation from smaller, private funded players, and as such, helping us guarantee we aren’t under some Chinese boot in the decades to come

11:26 JR: That’s a noble cause

11:26 DGG: I mean he’s certainly making a good buck

11:26 JR: Ok, he’s better than Mearsheimer in any case

Ok, my latest villain…

is Charles Saxe-Coburg-Gotha

11:27 DGG: He rings a bell

11:27 JR: Known to some British people as King Charles

11:27 DGG: Ah!

11:27 JR: When I say, some people, I mean genuflecting peasants with no self-esteem

11:27 DGG: lol

11:28 JR: As a devout republican, I was obliged to leave the country for a whole week this spring as Britain indulged in the most anachronistic and mediaeval of rituals, the coronation.

And there it was, the mediaeval scene, intact for several millennia, the peasantry in thrall to the divinely-appointed

11:28 DGG: As a devout contrarian and monarchist, I was still obliged to temporarily turn republican so I could laugh at the majority while they engaged in a deliciously old fashioned and traditional ceremony

11:29 JR: If you elevate someone else, you abase yourself, especially when it’s for no good reason except for the accident of birth.

It’s not as though he represents continuity, tradition oer the model family the self-styled Windsors claim to be. They are so dysfunctional they make my family look conventional.

And we are not the Waltons I can assure you

Charles claimed he wanted a scaled-down, pared-back ceremony but, of course, there’s no point being crowned if you don’t make a bloody great fuss of it

He makes no real secret of his disdain for the general public and thinks his opinions are generally more important than others hence his private lobbying of ministers and his interference in public affairs.

11:30 DGG:
 Who Was the "Grim Reaper" at the Coronation? Identity Revealed

Let’s not forget the weird grim reaper!

11:30 JR: So as he lowers himself into a bath this morning, lovingly prepared by his valet, Sir Alan Fitztightly, I would like someone to whisper in his ear, ‘Not My King’.

And on that chippy, resentful, misanthropic note

Nunc tempus taciendi

11:30 DGG: Don’t you just love SML

Goodbye all!

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