Cooler Days Ahead

Happy Friday,

NYC's heat wave broke with a bang last night as Mother Nature & the calendar remind us Fall lies ahead.

Jackson who and G 7 what? Who cares when China's in da house with a well timed reminder that it takes two to tango.

Perversely, this latest action may help concentrate minds for the upcoming Sept talks (unless Trump cancels) as the momentum seems clearly on Beijing's side.

It’s good to see the President take outside counsel on trade/econ; his team did not inspire confidence on last Sunday's talk shows. Mr. Market must have watched the same shows; selling off not on China tariff news but on Trump retaliation fears. Watch early August lows (2840ish on SPY, 1.50% on 10 yr UST).

My hope for the two big pow wows this weekend? Some embrace of Blackrock's well timed pitch for the melding of monetary & fiscal policy... this has to be the way forward.

Europe & Germany in particular need to embrace this approach; Germany’s political conversation is finally shifting as well it should: fiscal room clearly exists, growth is weak, rates are at generational lows & the banking sector is imploding.

China's refrain from aggressive stimulus makes German action all the more necessary & suggests more Fed action as well while reinforcing the Fed's growing focus on global factors, including the duration bullies.

Speaking of the Fall, check out this BTV clip from last night's Asian Open show - better days may lie ahead.

Enjoy the cool weather!

Jay and Jamie