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How billionaires’ secretive speculation threatens the next financial meltdownHere’s the recipe: Start with a few billionaires. Next, let them put trillions of dollars in unregulated pools of capital. Next, add a dash of pandemic speculation.

“What could possibly go wrong?

https://www.marketwatch.com/story/how-billionaires-secretive-speculation-threatens-the-next-financial-meltdown-11622056842


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Federal Prosecutors Have Asked Banks for Information About Archegos Meltdown.

“Banks that lent to Archegos, including Credit Suisse CS, Group AG, UBS, Group AG, Goldman Sachs Group Inc. and Morgan Stanley have been contacted for information… The firm’s collapse in March triggered more than $10 billion in losses across Wall Street…”

https://www.wsj.com/articles/federal-prosecutors-have-asked-banks-for-information-about-archegos-meltdown-11622075234


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There’s a massive child-care worker shortage [US] and the market can’t fix it.

“Unlike restaurants and other industries, child-care centers can’t raise pay to attract and retain workers — and President Biden’s American Families Plan doesn’t go far enough to address the problem.”

https://www.washingtonpost.com/business/2021/05/26/child-care-center-worker-shortage/


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Private Equity Targets U.K. Firms at Fastest Pace Since 2008 Crisis.

“Buyout firms have spent $18.3 billion on takeovers of publicly-traded British targets this year, according to data complied by Bloomberg. At this rate of investment, they will surpass the $27.5 billion of such transactions struck in 2019, which was a post-crisis high, the data show.”

https://finance.yahoo.com/news/private-equity-targets-u-k-101745570.html


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Dominic Cummings: PM discussed scrapping Bank of England independence as Covid struck.

“The Prime Minister’s former chief adviser said “emergency powers” were discussed to get funds from the Bank, amid fears that bond markets could collapse just as the Treasury needed access to record amounts of money.”

https://www.telegraph.co.uk/business/2021/05/26/cummings-pm-discussed-scrapping-bank-england-independence-covid/


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ECB must keep money taps fully open as crisis not over, Stournaras says.

“The European Central Bank must keep its money taps fully open, as the euro zone economy is still in the throes of the coronavirus pandemic despite progress in vaccination campaigns, ECB policymaker Yannis Stournaras said.”

https://www.reuters.com/article/ecb-policy/ecb-must-keep-money-taps-fully-open-as-crisis-not-over-stournaras-says-idUSL5N2NB4RR


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Fed taper talk thrusts emerging market funding source in firing line.

“Emerging economies from Peru to Romania are in the firing line as looming U.S. tapering raises the risk of outflows from local currency bond markets, hitting a vital funding source for governments striving to recover from the coronarvirus crisis.”

https://www.reuters.com/world/europe/taper-talk-thrusts-emerging-market-funding-source-firing-line-2021-05-25/


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Argentines defy lockdown and stage protests nationwide against President Fernández

“…the permanent trial and error (or error after error rather) policies of President Alberto Fernández with no achievements other than those obtained through terror and repression have resulted in more and more people having nothing to lose…”

https://en.mercopress.com/2021/05/26/argentines-defy-lockdown-and-stage-protests-nationwide-against-president-fernandez


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Colombian protesters march on capitals demanding economic aid, social change.

“Protesters were marching in provincial capitals around Colombia on Wednesday to demand government concessions on economic support for the poor and other issues, following almost a month of widespread protests.”

https://www.reuters.com/world/americas/colombian-protesters-march-capitals-demand-economic-aid-social-change-2021-05-26/


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Lack of irrigation water puts Chihuahua [Mexico] on brink of social and economic crisis

“A shortage of water for irrigation in Chihuahua could grow into an economic and social crisis as crops diminish, in turn slashing jobs and income. Chihuahua is one of 25 states suffering from drought…”

https://mexiconewsdaily.com/news/lack-of-irrigation-water-puts-chihuahua-on-brink-of-social-and-economic-crisis/


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Anger in Zimbabwe at Nehanda statue amid collapsing economy.

“The Zimbabwean government unveiled a statue of the liberation heroine and anti-colonialism figurehead Mbuya Nehanda in the capital, Harare, on Tuesday amid controversy about its priorities while the economy and health system collapse.”

https://www.theguardian.com/global-development/2021/may/26/anger-in-zimbabwe-at-nehanda-statue-amid-collapsing-economy


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No camel rides in Tunisian town as COVID slowly kills tourism

“”There are no tourists and the beach is empty. It is very sad,” said Tatiana Vasileva, one of the two Bulgarians.

“She had arrived in Tunisia two days earlier and joined a tour to El Jem arranged by her hotel.”

https://www.reuters.com/world/africa/no-camel-rides-tunisian-town-covid-slowly-kills-tourism-2021-05-25/


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Lebanese public sector workers go on strike amid worsening economic conditions.

“Public sector employees in Lebanon staged a strike on Wednesday across public administrations and schools, following an appeal by the General Labor Union and the Public Sector Employees’ Association, to demand an increase to wages and their purchasing power…”

https://www.arabnews.com/node/1865346/middle-east


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Iraq protests: One killed amid clashes between demonstrators and security forces.

“Clashes between security forces and protesters left one person dead and over a dozen injured Tuesday after hundreds of Iraqis took to the streets in Baghdad to protest a rise in targeted killings of prominent activists and journalists.”

https://www.euronews.com/2021/05/25/iraq-protests-one-killed-amid-clashes-between-demonstrators-and-security-forces


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Protests spread across once-quiet Oman as economy flounders.

“Protests over mass layoffs and Oman’s poor economy spread Tuesday to cities across the sultanate, underscoring the financial challenge ahead for this nation a decade on from its Arab Spring protests.”

https://apnews.com/article/middle-east-oman-business-economy-ae5878e023c603a37520c869c889b71a


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In the face of uncertainty, Indians are saving every penny for a rainy day.

“Interest rates are literally nailed to the floorboards, so the big money flowing into banks, experts caution, could be a sign of rising household stress.”

https://www.newindianexpress.com/business/2021/may/26/in-the-face-of-uncertainty-indians-are-saving-every-penny-for-a-rainy-day-2307593.html


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China’s $18 Trillion Ticking Time Bomb Threatens ‘V-Shaped’ Boom

“Xi faces [an epic balancing act] in 2021: making good on deleveraging pledges—which means allowing more defaults—while also proving to global investors that China’s giant bond market is a safe place to invest.”

https://www.forbes.com/sites/williampesek/2021/05/25/chinas-18-trillion-ticking-time-bomb-threatens-v-shaped-boom/?sh=5c54b448814a


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China bars banks from selling commodities-linked products to retail buyers

“China’s banking regulator has asked lenders to stop selling investment products linked to commodities futures to mom-and-pop buyers, three people with knowledge of the matter told Reuters, to curb investment losses amid volatile commodity prices.”

https://www.reuters.com/world/china/exclusive-china-bars-banks-selling-commodities-linked-products-retail-buyers-2021-05-26/


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Commodities Prices Soar As China Stockpiles

“… it is the Chinese government that has a record of driving up global commodities prices in the wake of a global crisis, stockpiling and hoarding to take advantage of beaten-down prices.”

https://www.forbes.com/sites/bryanrich/2021/05/26/commodities-prices-soar-as-china-stockpiles/?sh=5a44d7cc2c2e


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The Real Signal Commodities Are Sending on Global Inflation

“Bloomberg Economics’ model shows movements in commodity prices this year have been mainly driven by risk appetite, not fundamental demand or shortages of supply.”

https://www.bloomberg.com/news/articles/2021-05-26/the-real-signal-commodities-are-sending-on-inflation-chart


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Central Banks Face New Balancing Act With Their Huge Asset Piles.

“As officials juggle market expectations and governments’ preferences for cheap borrowing, it could take generations to unwind quantitative easing… Quantitative easing has been part of the monetary toolkit for so long now that the definition of “normal” has changed.”

https://www.bloomberg.com/news/articles/2021-05-26/central-banks-face-new-balancing-act-with-their-huge-asset-piles


You can read the previous ‘Economic’ thread here. I’ll be back tomorrow with a ‘Climate’ thread.

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