An inadvertent Christmas gift from France to Italy .... and it's getting trickier for the Fed ..

As we start the last full week before the Christmas break, two things being widely discussed across the financial media outlets catch the eye in particular. Two things beyond the usual avalanche of comment about Brexit and the trade war , that is. First up is Italy and news that the populist deputy prime ministers, Matteo Salvine of the League and Luigi Di Maio of Five Star, have both signed up to PM Conti's revised budget proposals. Italy will now submit a plan to the EU that will show a 2019 buget deficit-to-GDP ratio of 2.04% ....., a significant reduction from the original 2.40%. The market seems happy enough with Italy's new position, and the premium of the yield demanded on Italian 10y

The end of QE ? For now, at least ..... ref :- "Draghi calls time on eurozone stimulus experim

The European Central Bank may have been a little half-hearted by some standards in its forays into Quantitative Easing in the past but ECB President Mario Draghi finally embraced the concept much more forcefully in 2015. Having only truly arrived at the party later than some -- such as the US Federal Reserve and the Bank of England -- it's not surprising that the ECB is leaving it a bit later too ..... after yesterday, only the Bank of Japan parties on. Quantitative Easing is a method of stimulating spending and inflation (and therefore growth) by creating "electronic money", and boosting the economy by using it to purchase assets -- mostly but not exclusively government bonds -- t

Remember : "Nobody KNOWS anything" ? It certainly looks that way sometimes....

ref : - "Nine Reasons for the Sell-Off in US Stocks" , Bloomberg Markets If memory serves correctly we've wheeled out that old quote about nobody actually knowing anything for certain before .....actually, it was a famous observation about Hollywood from iconic screenwriter William Goldman but we often feel it could be equally well aimed at the markets. Early on Monday a perceived breakthrough in the US / China trade conflict and the prospect of fewer rate rises in the pipeline than the Fed had originally signposted had seen global equity markets marked higher. The bullish mood didn't follow through however, and yesterday the S&P 500 dropped by over 3.2% ..... which might make one question j

"The hard work begins now" says the fantastically-named Mr Brilliant

ref :- "US and China face hurdles after tariff truce" , The Financial Times, International Section To the uninitiated, Myron Brilliant might sound like the name of some 1970s glam-rock star, or maybe a WWE wrestler. Those who keep their ear to the ground (like all of us, of course) recognise him as the US Chamber of Commerce's head of international affairs, and he is not to be confused with the UK's equivalent, Simon Simply-Gorgeous (well .... not strictly true). Anyway, Mr Brilliant welcomed the postponement of the imposition of further tariffs agreed between the US and China and the commitment to further talks aimed at finding a more substantive resolution. Fair enough .... but Mr Brillian

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