Nick Ottens (Atlantic Sentinel) | 400,000 Americans are dead. Trump added $7 trillion to the debt. He told thousands of lies… Donald Trump’s presidency ends on Wednesday. He leaves behind an America that is more in debt, more isolated in the world, less generous and less safe
Nick Ottens (Atlantic Sentinel) | Dutch prime minister Mark Rutte has tendered his government’s resignation to King Willem-Alexander. With only two months to go before elections, and the government remaining in a caretaker capacity to manage the coronavirus crisis in the Netherlands, the resignation is largely symbolic. But smaller parties in Rutte’s coalition felt they had to take responsibility for what an inquiry described as an “unprecedented injustice” in the tax service, which wrongly accused more than 20,000 families of fraud.
Litecoin, Dash, and Binance Coin have also made double-digit gains in the dizzying rally, which comes amidst a string of positive headlines. PornHub made cryptocurrency the default payment option on Tuesday, the Federal Reserve committed to additional stimulus on Wednesday, and Elon Musk whipped up a social media frenzy on Sunday by asking MicroStrategy CEO Michael Saylor how to buy large amounts of Bitcoin.
2020 has been a historic year in many ways and when it comes to IPO activity, it is no different. This year, the world has seen the highest IPO capital raising activity in a decade, with USD 331 billion raised across 1,591 listings.
Azad Zangana (Schroders) | As promised at the previous Governing Council meeting, the European Central Bank (ECB) has today announced additional stimulus to aid the economic recovery. This follows the new restrictions introduced last month to stop the spread of the coronavirus. The pandemic emergency purchase programme (PEPP) will be expanded by €500 billion to a total of €1.85 trillion. Purchases will be extended to at least the end of March 2022.
Flosbach von Storch | National debt-to-GDP ratios have already reached historic highs. Gross national debt will likely exceed 260 per cent of GDP in Japan by the end of the year, and reach around 140 per cent in the USA and around 100 per cent in the eurozone. Concerns about the high level of debt being unsustainable in the long run are at least theoretically unjustifiable as long as interest rates and government bond yields remain close to zero. This is because zero interest rates allow practically any deficit or mountain of debt to be easily funded.
Peter Isackson | In a New York Times article that appeared just before this week’s interminable presidential cliff-hanger of an election, Lisa Lerer pondered how things might unfold after a Biden victory. She and the rest of the US punditry thought at the time that it might be decisive enough to define the future of the nation. Lerer cites Representative Pramila Jayapal’s speculation that Biden’s triumph could inaugurate an era of spectacular reform: “A White House victory would give Mr. Biden a mandate to push for more sweeping overhauls.”
The election count is continuing and the chances of the Democrat candidate reaching the White House are increasing. Although with a much tighter result than the polls predicted, Joe Biden wins in the key states of Wisconsin and Michigan, as well as being ahead in Arizona and Nevada. The latest recount gives Biden 264 and Trump 214. Despite the result, Donald Trump is announcing he will file several complaints in these key states, demanding new recounts and threatening to go to the Supreme Court.
With the counting still to be completed (some states like Pennsylvania and Michigan will continue to count votes until the end of the week), the candidates are very tied (238 Biden vs 213 Trump) against Biden’s victory that had been discounting the markets. Breaking all the democratic rules, Donald Trump calls himself the winner and asks that the postal ballot count be stopped (about 5 million votes), since it is a “fraud to the American public” and “an embarrassment to our country”.
Joe Biden is the clear favourite to win the US elections, with in addition a fair chance of a “blue wave”. In the opinion of Gilles Möec, chief economist at AXA IM, given the need of another fiscal push, in the short term, it is probably the optimal outcome for the market especially if the results come quickly. Questions on the long-term US policy stance will come later.