From Matthew Graham at Mortgage News Daily: Mortgage Rates Slightly Lower as Volatility Risks Increase

Mortgage rates were just slightly lower to start the new week. This leaves the average lender's top tier 30yr fixed rate almost dead center in the narrow range that's been intact since early September. ... If unemployment comes in lower than expected, rates would likely face upward pressure, potentially challenging the upper boundary of the recent range. On the other hand, a weaker/higher result should keep rates well within the range, perhaps near the lower boundary. [30 year fixed 6.29%]
emphasis added

Tuesday:
• At 8:30 AM ET, Employment Report for November.   The consensus is for 50,000 jobs added, and for the unemployment rate to be unchanged at 4.4%.

• Also at 8:30 AM, Retail sales for October will be released.  The consensus is for a 0.3% increase in retail sales.

D.C. Appeals Court Pauses Boasberg's Contempt Hearings On Trump Deportations

Via American Greatness,

A federal appeals court has granted an emergency motion sought by the U.S. Department of Justice (DOJ) to halt contempt hearings scheduled to start this week over the deportation of suspected Venezuelan gang members.

U.S. District Judge James Boasberg had scheduled contempt hearings for Dec. 15 and 16, over the Trump administration’s deportation of Venezuelan gang member under the Alien Enemies act in March of this year.

Boasberg had issued restraining orders on the deportation of two planeloads of suspected Tren de Aragua gang members, after the planes were already airborne.

When the Trump administration followed the written orders but not the judge’s oral instructions, which DOJ attorneys said were defective, and allowed the deportation flights to complete their mission to transport the detainees to a maximum security prison in El Salvador.

The Supreme Court had ruled that Boasberg lacked jurisdiction and vacated the orders but the judge still scheduled contempt hearings, which were temporarily blocked by the U.S. Court of Appeals for the D.C. Circuit, in a 2-1 ruling on Friday.

In its emergency motion, filed last week, the DOJ condemned Boasberg’s escalation of the matter and said, “This long-running saga never should have begun; should not have continued at all after this Court’s last intervention; and certainly should not be allowed to escalate into the unseemly and unnecessary interbranch conflict that it now imminently portends.”

The filing continued, “This Court should therefore again grant mandamus relief, this time foreclosing any further inquiry. The Court should also order the case to be reassigned given the strong appearance that the district judge is engaged in a pattern of retaliation and harassment, and has developed too strong a bias to preside over this matter impartially.”

Attorney General Pam Bondi called Boasberg’s actions “lawless judicial activism” and warned that the judge’s latest order threatened the separation of powers as well as attorney-client privilege.

Noon today: DOJ files petition to stop Boasberg’s retaliatory vanity hearings

6 PM today: D.C. circuit responds by stopping the hearings@AGPamBondi’s attorneys are not tired of winning pic.twitter.com/JBhp3uiziS

— Gates McGavick (@GatesMcgavick) December 12, 2025

In their emergency order, Judges Neomi Rao and Justin Walker emphasized that their stay is temporary and does not constitute a ruling on the merits of the case, saying, “The purpose of this administrative stay is to allow the court time to render a decision on the mandamus petition and the stay motion.”

DOJ lawyers also asked the court to bar testimony from two current and former senior Justice Department officials who had been ordered to appear for questioning this week.

Department of Homeland Security (DHS) Secretary Kristi Noem has been identified as the official who authorized the transfer of the Venezuelan detainees after being briefed about Boasberg’s order by DOJ lawyers and acting general counsel for DHS.

Tyler Durden Mon, 12/15/2025 - 14:25

Wealthy U.S. Investors Embrace AI Tools... But Don't Let Them Run Their Retirement Accounts

Despite the rapid expansion of AI-powered investing tools in 2025, most affluent American investors remain reluctant to hand over control of their retirement savings to chatbots. A new survey from InvestorsObserver shows that even as artificial intelligence becomes more embedded in portfolio analysis, market research, and trading platforms, trust in AI stops short when it comes to 401(k)s and long-term retirement decisions.

The survey questioned 1,050 experienced U.S. investors between the ages of 35 and 60, all of whom hold portfolios worth at least $500,000, including retirement accounts such as 401(k)s and IRAs. An overwhelming 88% said they would not allow an AI chatbot to manage their 401(k), underscoring a strong preference for human judgment when it comes to life savings.

While AI adoption in finance has accelerated in 2025—through robo-advisors, algorithmic rebalancing tools, and AI-driven portfolio simulations—actual reliance remains measured. Nearly two-thirds of respondents, or 64%, said they have never used AI chatbots for investment advice at all. Only 5% reported acting on AI-generated recommendations without independently researching the advice or consulting a professional.

That caution extends across multiple financial functions. Just 12% of investors said they would trust AI to handle retirement planning, and the same share would rely on it for tax optimization. At the other end of the spectrum, 19% indicated they would not allow AI to manage any financial task whatsoever, signaling persistent skepticism even among tech-aware, high-net-worth individuals.

At the same time, the findings do not suggest outright rejection of AI. A majority of respondents—59%—said they plan to use or continue using AI for financial guidance in the future. However, most see these tools as support systems rather than decision-makers, using them to speed up research, compare funds, analyze fees, or surface potential risks rather than to dictate portfolio moves.

“People are open to using AI chatbots to generate ideas, but when it comes to life savings in 401(k)s and IRAs, they want a human hand on the wheel,” said Sam Bourgi, senior analyst at InvestorsObserver. “Today, AI can inform retirement decisions, but it should not replace personal judgment or professional advice.”

This mindset reflects a broader shift toward hybrid investing models in 2025. Investors increasingly combine AI-driven insights with human oversight, relying on technology to process vast amounts of data while retaining control over contribution levels, asset allocation, rebalancing, and retirement timelines. The approach allows investors to benefit from efficiency and speed without surrendering accountability.

The survey suggests this caution may be well founded. As AI tools become more persuasive and widely available, they are not always more accurate, and unverified or context-poor outputs can lead to costly mistakes. For now, wealthy investors appear determined to keep AI in an assistive role—powerful, useful, but firmly supervised—when it comes to protecting their long-term financial future.

Tyler Durden Mon, 12/15/2025 - 14:05

Mexico Bends The Knee, Agrees To Fulfill US Water Treaty Commitments

Authored by Naveen Athrappully via The Epoch Times,

The United States and Mexico reached an understanding in which Mexico will meet its obligations under the 1944 Water Treaty and provide water to American farmers and ranchers, the U.S. Department of Agriculture (USDA) said in a statement on Dec. 12.

“Under the 1944 Water Treaty, Mexico is obligated to deliver 1.75 million acre-feet over five years to the United States from the Rio Grande River. The United States in turn delivers 1.5 million acre-feet of water to Mexico from the Colorado River,” the USDA said.

However, “Mexico’s persistent shortfalls in deliveries have led to severe water shortages for Rio Grande Valley farmers and ranchers, devastating crops, costing jobs, and threatening the local economy,” it said.

The valley is located in the southernmost part of Texas.

Mexico will begin releasing 202,000 acre-feet of water to the United States, with deliveries scheduled to begin this week, according to the USDA.

Since Mexico had not supplied the agreed-upon water volumes during the previous five-year cycle, the country has agreed to repay the outstanding deficit.

The two nations have reviewed a series of actions to meet treaty obligations and are currently negotiating the matter, with the intention of finalizing a plan by Jan. 31, 2026, the USDA said.

“Farmers across South Texas have been reeling from the uncertainty caused by the lack of water. Now they can expect the resources promised to them, thanks to President Trump’s leadership. I thank Mexico for their willingness to abide by the treaty and return to good standing with their past obligations,” Secretary of Agriculture Brooke Rollins said.

“Mexico has delivered more water in the last year than in the previous four years combined. Although this is a step in the right direction, President Trump has been very clear: if Mexico continues to violate its commitments, the United States reserves the right and will impose 5 percent tariffs on Mexican products.”

A Nov. 20 study published by Springer Nature detailed the water security issue in the Rio Grande-Bravo basin, which the United States and Mexico share.

The basin is experiencing “a severe water crisis demanding urgent attention,” it said, adding that water storage reservoirs, annual streamflow volumes, and aquifers have been “substantially depleted” over recent decades.

The study estimated that only 48 percent of the water directly consumed as a result of human activities is replenished by renewable sources. The remaining 52 percent of consumption has been unsustainable, leading to the depletion of aquifers, reservoirs, and river flows.

“The over-consumption of renewable water supplies is primarily due to irrigated agriculture, which accounts for 87 percent of direct water consumption in the basin,” the study says.

“At the same time, water shortages have contributed to the loss of 18 percent of farmland in the river’s headwaters in Colorado, 36 percent along the Rio Grande in New Mexico, and 49 percent in the Pecos River tributary in New Mexico and Texas.”

Last week, Trump threatened to raise tariffs on Mexican imports by 5 percent if the country failed to swiftly deliver the water it owes. He said the treaty violation was “seriously hurting” Texas agriculture and livestock.

Mexican President Claudia Sheinbaum highlighted the ongoing drought plaguing her country but vowed to help resolve the treaty issue.

In April, Trump threatened Mexico with possible sanctions and additional tariffs over the water treaty violation, and Mexico subsequently agreed to send more water to Texas.

In a Dec. 14 statement, Sid Miller, commissioner of the Texas Department of Agriculture, commended Trump for ensuring that Mexico honors the water treaty.

Producers in the Rio Grande Basin have been deprived of water they are legally owed for the past several years, he said. This has resulted in the loss of crops, industries, jobs, and livelihoods.

Mexico’s “willingness to come to the table speaks volumes about the improved relationship between Mexico and the United States, but sustained accountability will be necessary,” Miller said.

“Let me be clear: Texas farmers expect Mexico to fully meet its obligations—not just today, but for years to come. Water is the lifeblood of agriculture. President Trump understands that without water, there is no farming, no ranching, and no rural economy in the American Southwest,” he added.

Tyler Durden Mon, 12/15/2025 - 13:45

The Wealth Gap Widens: Survey Shows Rich Now Means $2.3 Million Net Worth

Authored by José Niño via Headline USA,

The benchmark for wealth in America has undergone a dramatic transformation. According to a report by Fortune, Americans now place the threshold for being considered wealthy at an average of $2.3 million - a 21 percent surge since 2021 that underscores how inflation and escalating expenses have fundamentally reshaped financial aspirations. 

Though generational perspectives on wealth differ, there’s broad consensus that true prosperity encompasses far more than dollars alone, extending to security, wellness, and life quality.

Back then, a seven-figure net worth seemed like the ultimate financial destination. But with inflation and tariffs driving up prices across the board, that once-impressive sum has lost much of its luster.

The reality check comes from a Charles Schwab report showing that Americans now peg the wealth threshold at an average of $2.3 million.

The financial services giant polled 2,200 adults ranging from 21 to 75 years old between April 24 and May 23, capturing insights across multiple generations. Survey participants indicated that achieving “financial comfort” requires approximately $839,000.

Though the $2.3 million figure represents a modest decline from last year’s Modern Wealth Survey result of $2.5 million, it still towers 21% above the $1.9 million benchmark recorded in 2021.

Survey participants also expressed that the wealth threshold appears to be climbing, with 63 percent indicating it takes more money to achieve wealthy status today than a year ago, pointing to inflation, economic deterioration, and increased taxation as primary culprits.

Brad Clark, founder and CEO of financial advisory firm Solomon Financial, noted these views align closely with feedback from his clientele. While the United States boasts numerous millionaires when all assets are tallied, he explained to Fortune, this calculation typically incorporates home equity, leaving investable assets below the million-dollar mark for most.

“With so many middle-class Americans being considered millionaires, it stands to reason that the average individual would consider $2.3 million to be wealthy, as it may seem out of reach,” Clark said.

Yet financial professionals emphasize that wealth doesn’t automatically translate to lavish living across all dimensions.

The $2.3 million benchmark is “not luxury for everyone, but security. It’s wanting to have a house, retire well, have family, and have one’s time,” William “Bill” London, a lawyer and partner at Kimura London & White who routinely handles high-net-worth families and individuals in divorces and estate cases, told Fortune. “Affluence is not about excess, but about reducing anxiety.”

The Charles Schwab data reveals generational divides in wealth perception, with Gen Z establishing lower benchmarks for both wealth and financial stability—$1.7 million and $329,000, respectively. Millennials and Gen Xers place the wealth line at $2.1 million, while baby boomers set it at $2.8 million.

These disparities may stem from how different age cohorts view prosperity. Older generations like baby boomers tend to view wealth through the lens of stability, London explained, emphasizing property ownership, retirement income, and inheritable assets. Younger cohorts, conversely, prioritize experiences, debt elimination, and lifestyle autonomy.

“Millennials and Gen Z are justifiably pessimistic about the prospects of homeownership, which historically was the most common way for Americans to build wealth,” Markus Schneider, associate professor and chair of the economics department at University of Denver, told Fortune. “There are lots of reasons why millennials and Gen Z may feel less secure about the world than the boomers did when they were the same age, and that may also impact how they feel about their wealth.”

Tyler Durden Mon, 12/15/2025 - 13:05

"It's Outrageous": US Military Plane Nearly Collides With JetBlue Flight Off Venezuela

A US military aircraft narrowly avoided a collision with a JetBlue passenger jet in skies near Venezuela after crossing into the commercial plane's flight path without activating its transponder, according to air traffic control audio reviewed by The NY Times and others.

The JetBlue flight had departed from Curaçao, a Dutch Caribbean island roughly 40 miles off Venezuela’s coast, and was heading to New York’s John F. Kennedy International Airport when the near-miss incident occurred Friday. That it was headed for JFK from what's a popular seasonal tourist destination suggests that most of the passengers were Americans on board.

"We almost had a midair collision," the JetBlue pilot said in the recording. "They flew directly through our flight path … and they don’t have their transponder on. It's outrageous."

Illustrative: Imag via Lwashburn66/Reddit

The military aircraft was identified as a US Air Force aerial refueling tanker. The JetBlue pilot is heard in the audio confirming he was forced to halt its climb to avoid danger.

"We had traffic pass directly in front of us within about five miles - maybe as close as two or three miles," he described. "It was an air-to-air refueler from the US Air Force at our altitude, and we had to stop climbing."

Air traffic control also acknowledged that it was "outrageous" dealing with unidentified aircraft operating in the airspace. The following day on Saturday, air traffic controllers in Curaçao had warned three pilots about unidentified aircraft in the area as they were flying with transponders off. These were also believed to be US military aircraft, according to the NY Times.

The Trump administration has been threatening regime change targeting President Nicolás Maduro, and has been ramping up military flights right along Venezuelan airspace. Trump has lately said that land strikes could begin soon, but it might not be limited to Venezuela, suggesting anti-cartel operations in other parts of Latin America could ensue.

Recent polls have shown that a sizeable chunk of the American public, even the majority, views the possibility of a new US war in Venezuela in a negative light.

In scenario of a tragic incident involving civilian aviation, Americans would without doubt be furious.

Independent Max Blumenthal has accused the Trump administration of "playing with the lives of civilians" in the below commentary:

For weeks, the Trump admin's "Operation Southern Spear" has been playing with the lives of airline passengers traversing the Caribbean. Throughout November, the US military employed electronic warfare to jam the GPS of passenger airline pilots to force international airlines to quit flying to Caracas Colombia's Minister of Transport, María Fernanda Rojas slammed the cyberattacks targeting aircraft operating near Venezuela.

"Deceptive signals are being emitted—cyberattacks, signals intended to fool positioning equipment, GPS " Rojas declared on December 2. "To technologically sabotage an air operation anywhere in the world is a crime. We cannot allow that ."

On December 12, a US army refueling tanker flying without its transponder on nearly collided with a Jet Blue flight traveling from Curacao to New York “They don’t have their transponder turned on, it’s outrageous,” the JetBlue pilot told an air traffic controller. “We almost had a midair collision up here.” The Trump admin is engaged in borderline terrorism against civilian airliners and endangering travelers across the Caribbean – all to further a deranged regime change operation now focused on stealing oil tankers. How much longer before a flight is sacrificed for Marco Rubio's mania?

“Pasaron directamente en nuestra ruta de vuelo… No tienen su transpondedor encendido, es una locura”, dijo el piloto. https://t.co/VTGteOxPPX

— Telemundo51 (@Telemundo51) December 14, 2025

As of November, the FAA issued a high level security alert (NOTAM) for Venezuela, effective through February, warning 'do not fly'. However, civilian aircraft have been operating over the broader Caribbean, and if American military planes increasingly traverse the same area with their transponders off, this could pose a serious and continuing danger.

*  *  * ORDER BY TOMORROW!

Tyler Durden Mon, 12/15/2025 - 12:45

Today, in the Calculated Risk Real Estate Newsletter: Part 1: Current State of the Housing Market; Overview for mid-December 2025

A brief excerpt:

This 2-part overview for mid-December provides a snapshot of the current housing market.

Note that we are still missing some key pieces of data due to the government shutdown, such as housing starts and new home sales.

The key stories this year for existing homes are that inventory increased sharply (almost back to pre-pandemic levels), and sales are depressed and tracking last year (sales in 2024 were the lowest since 1995). That means prices are under pressure, although there will not be a huge wave of distressed sales since most homeowners have substantial equity and low mortgage rates. It now appears likely that existing home prices will be mostly unchanged year-over-year nationally by the end of 2025.

Realtor.com reports in the November 2025 Monthly Housing Market Trends Report that new listings were up 1.7% year-over-year in November. And active listings were up 12.6% year-over-year.

Homebuyers found more options in November, as the number of actively listed homes rose 12.6% compared to the same time last year. While this marks the 25th consecutive month of year-on-year inventory gains, active listing growth has slowed in each of the past six months (down from ~30% peak YoY growth in May and June). The number of homes for sale topped 1 million for the seventh consecutive month and remains close to midsummer levels. Still, nationwide November inventory is 11.7% below typical 2017–19 levels.

There is much more in the article.

Aussie PM Invokes 'Right-Wing Extremism' After Islamic Terrorist Attack, Vows Crackdown On Guns

In the wake of a Sunday mass shooting at Australia's Bondi Beach that left 15 dead and more than two dozen injured, Prime Minister Anthony Albanese has vowed to strengthen the country's gun laws. The massacre, which occurred during a Hanukkah event, was reportedly carried out by a father-son pair, Sajid Akram, 50, and Naveed Akram, 24 - with the older gunman having held a gun license for a decade while legally owning six guns. 

"The government is prepared to take whatever action is necessary. Included in that is the need for tougher gun laws," Albanese said.

Other government leaders also proposed restricting gun ownership to Australian citizens - a measure which would have excluded the older suspected gunman who has lived in Australia since 1998 on a student visa, and became a permanent resident after marrying a local woman, according to authorities - who did not confirm what country he had migrated from. 

Government leaders are also proposing the "additional use of criminal intelligence" in deciding who can obtain a firearms license - which "could hypothetically have meant that a 2019 investigation into the son's suspicious associates, confirmed Monday by Albanese, would have disqualify the father from owning a gun" CBS News reports.

New South Wales premier Christopher Minns said his state's gun laws would change, but did not outline how. 

"It means introducing a bill to Parliament to — I mean to be really blunt — make it more difficult to get these horrifying weapons that have no practical use in our community," he said. "If you're not a farmer, you're not involved in agriculture, why do you need these massive weapons that put the public in danger and make life dangerous and difficult for New South Wales Police?"

Of note, Australia enacted a suite of strict gun control laws roughly two weeks after an April, 1996 massacre in Port Arthur, Tasmani in which one man killed 35 people and wounded another 23, prompting then PM John Howard to "significantly strengthen laws relating to gun control in Australia." Under the National Firearms Agreement (NFA), gun ownership was explicitly made a privilege, while two federally-funded gun buybacks and voluntary surrenders led to the  collection of more than a million firearms which were then destroyed. In order to possess a firearm in Australia, a person must have a firearm license and demonstrate at least one "genuine reason" for ownership that doesn't include self defense.

Albanese, meanwhile, invoked 'right-wing extremism' during a press conference after the Islamic terrorist attack when asked about one of the alleged gunmen. 

JOURNALIST: Prime Minister, Mike Burgess warned you in February that antisemitism was the number one threat to life. Is that still the case and have you taken these threats seriously enough? And Acting Deputy Commissioner, if I may, it's my understanding that Sajid Akram moved to Australia in the late 90s, I believe from Pakistan. Is that correct?

PRIME MINISTER: On the latter the Minister will respond. We take ASIO's advice very seriously. We work closely with them. We receive regular updates as well. The Director-General of ASIO has warned about a range of threats, be it antisemitism, the rise of right wing extremist groups as well. And we continue to work closely with our security agencies

Watch:

Prime Minister Anthony Albanese says he takes ASIO’s advice very seriously, whether it relates to the threat of antisemitism and “right-wing extremist groups.” pic.twitter.com/ssl65pRSA8

— Australians vs. The Agenda (@ausvstheagenda) December 15, 2025

So, more gun control and they're on the lookout for 'antisemitism' and 'right wing extremist groups' after the Islamic terrorist attack. Right. 

*  *  * ORDER BY TOMORROW!

Tyler Durden Mon, 12/15/2025 - 10:45

Key Events This Very Busy Week: Jobs, Payrolls, CPI. Retail Sales And Central Banks Galore

With just days left in 2025, it's an extremely busy week for global markets, with a dense calendar of economic releases and major central bank decisions, including from the European Central Bank, the Bank of England and the Bank of Japan, which as DB's Jim Reid writes, all have a chance to be Scrooges or Santas in their meetings this week. Alongside these announcements, the data flow will be heavy: the US will finally publish delayed employment and inflation reports, while flash PMIs for December and will provide clues on global momentum. Meanwhile, overnight, China' econ data dump came in worse than expected with both fixed investment, IP and Retail sales both missing. 

It’s also an interesting time for global markets with long-end yields at or around multi-month or even multi-year highs (e.g. Japan and 30yr Europe) at the same time as the weakest AI stories are increasingly being punished rather than the pre-September period when AI all went up together. If that wasn’t enough, another notable Fed story came late on Friday, as President Trump suggested that NEC Director Kevin Hassett and former Fed Governor Kevin Warsh were his two favored candidates for the Fed Chair role. Hassett has been viewed as the frontrunner in recent weeks but following Trump’s interview his Polymarket odds fell from around 73% late on Friday to 52% this morning. Warsh has gone from 13% before the interview to 40% this morning. So, it's fair to say there’s a lot of unfinished business going into the last full trading week of the year.

For this week specifically, in the United States, attention will focus on tomorrow’s twin employment reports for October and November, delayed by the recent government shutdown. October’s headline payrolls are expected to show a decline of around -60k, largely due to federal layoffs with all the early year buy-out offers coming off payroll in October. November should rebound modestly with a gain of +50k (per DB). Private sector hiring is likely to remain steady in both months at around +50k (DB), slightly below the recent trend. The unemployment rate is forecast to rise to 4.5 per cent in November from 4.4 per cent in September (we will never know October), while average hourly earnings should increase by 0.3 per cent in both months, keeping year-on-year nominal compensation growth near 4.4 per cent. Hours worked are expected to stabilise at 34.3. Given the distortions caused by the shutdown, the household survey could be noisy, echoing patterns seen after the 2013 episode. For a cleaner read on labor market conditions, Thursday’s jobless claims will be important and given our economists believe this will come in at around +225k, they believe underlying hiring trends remain intact.

Inflation will also be in focus with Thursday’s US CPI release. Because October data were not collected, the report will center on year-on-year changes. Headline CPI is expected to hold broadly steady at 3.03%, while core inflation remains at 3.02%. Monthly headline gains across October and November should average +0.24%, slightly below September’s pace with core slightly above at +0.26%. Within the details, core goods prices are likely to show modest increases in household furnishings and apparel, while used car prices continue to decline. Core services will attract particular attention, especially rents, which are expected to rebound after September’s anomalous weakness. Airline fares and lodging should soften from their recent highs, though health insurance may surprise on the upside. Beyond jobs and inflation, Tuesday’s retail sales report will offer insight into consumer spending. DB expects a headline decline of -0.3%, driven by autos and lower fuel prices, but retail control — the component used in GDP calculations — should rise by +0.3%, signalling resilience in underlying demand. Friday’s final reading of University of Michigan consumer sentiment is expected at 54.0, with inflation expectations likely to matter more than the headline figure.

On policy, last week’s FOMC meeting delivered a 25bps rate cut and signaled a “wait and see” approach, while also launching $40BN in monthly T-Bill purchases, much sooner than expected. Chair Powell struck a dovish tone, emphasizing labo rmarket risks over inflation. This week’s Fedspeak will reinforce that message, with Governor Miran and New York Fed President Williams speaking today, followed by Governor Waller and Williams again on Wednesday. Atlanta Fed President Bostic closes the week on Friday. Miran, who dissented in favor of a larger cut, is expected to reiterate his view that shelter inflation will collapse in coming quarters.

In Europe, Thursday brings a cluster of central bank decisions. The ECB is expected to keep rates unchanged at 2 per cen , while the Bank of England is forecast to deliver its sixth cut of the cycle, lowering Bank Rate to 3.75 per cent on a narrow 5-4 vote. The Riksbank and Norges Bank will also decide on policy on the same day with both likely to stay on hold. Ahead of the BoE meeting, UK labor market data on Tuesday and CPI on Wednesday will be closely watched. Headline inflation is forecast to ease to 3.51% year-on-year, while core ticks up slightly to 3.46% (see our economist’s preview here). Retail sales and consumer confidence on Friday will round out the UK calendar. In Germany, the Ifo survey on Wednesday and consumer confidence on Friday will provide further insight into regional conditions as fiscal spending starts to ramp up. Across the Atlantic, Canadian inflation is out today which is interesting given the sharp move from pricing in a slightly easing bias earlier this month to almost a full hike by the end of 2026 now.

Across Asia, the Bank of Japan meets on Friday and is expected to raise rates by 25bps to 0.75 per cent, with a 94% probability priced in by markets. See our economist’s thoughts here. Japan’s nationwide CPI for November will also be released on Friday, with core inflation forecast to slow to 2.9% and core-core to 3.0%. Global flash PMIs for December, covering the US, UK, Japan, Germany and France, will be published tomorrow and will offer early signals on fourth-quarter growth trends.

Day-by-day calendar of events

Monday December 15

• Data: US December Empire manufacturing index, NAHB housing market index, China November retail sales, industrial production, investment, home prices, Germany November wholesale price index, Italy October general government debt, Eurozone October industrial production, Canada November CPI, existing home sales, housing starts, October manufacturing sales
• Central banks: Fed’s Miran and Williams speak

Tuesday December 16

• Data: US, UK, Japan, Germany, France and the Eurozone December PMIs, US November and October jobs reports, October retail sales, December New York Fed services business activity, September business inventories, UK October average weekly earnings, unemployment rate, November jobless claims change, Japan November trade balance, October core machine orders, Germany December Zew survey, Italy October trade balance, Eurozone December Zew survey, October trade balance
• Earnings: Lennar

Wednesday December 17

• Data: UK November CPI, RPI, PPI, October house price index, Germany December Ifo survey, Eurozone Q3 labour costs, Canada October international securities transactions, New Zealand Q3 GDP
• Central banks: Fed’s Waller, Williams and Bostic speak
• Earnings: Micron Technology
• Auctions: US 20-yr Bond (reopening, $13bn)

Thursday December 18

• Data: US November CPI, December Philadelphia Fed business outlook, Kansas City Fed manufacturing activity, October total net TIC flows, initial jobless claims, Japan November national CPI, France December business confidence, Eurozone October construction output
• Central banks: ECB, BoE, Riksbank and Norges bank decide on rates
• Earnings: Nike, FedEx, Accenture
• Auctions: US 5-yr TIPS (reopening, $24bn)
• Other: European Council (through December 19)

Friday December 19

• Data: US November existing home sales, December Kansas City Fed services activity, UK December GfK consumer confidence, November retail sales, public finances, Germany November PPI, January GfK consumer confidence, France November PPI, retail sales, Italy October current account balance, industrial sales, December consumer confidence index, economic sentiment, ECB October current account, Eurozone December consumer confidence, Canada October retail sales
• Central banks: BoJ decision, ECB’s Wunsch and Kocher speak

Finally, looking at just the US, the key economic data releases this week are the November employment report and the October retail sales report on Tuesday and the CPI report on Thursday. There are several speaking engagements by Fed officials this week, including events with Governor Miran on Monday and Governor Waller on Wednesday. 

Monday, December 15 

• 08:30 AM Empire State manufacturing survey, December (consensus +10.0, last +28.7)
• 09:30 AM Fed Governor Miran Speaks; Fed Governor Stephen Miran will participate in a moderated conversation with former Fed Vice Chair Richard Clarida at Columbia University's Institute of Global Politics. On November 21, Miran said, "All the information that we got [between the October and December FOMC meetings] should push one in the dovish direction." Governor Miran dissented against the Committee's decision at the December FOMC meeting, preferring to cut the Fed Funds rate by 50bp rather than 25bp. 
• 10:00 AM NAHB housing market index, December (consensus 39, last 38)
• 10:30 AM New York Fed President Williams (FOMC voter) speaks: New York Fed President John Williams will deliver keynote remarks during an event organized by the New Jersey Bankers Association. Speech text and Q&A are expected. On November 21, Williams said, "My assessment is that the downside risks to employment have increased as the labor market has cooled, while the upside risks to inflation have lessened somewhat." He also said, "I view monetary policy as being modestly restrictive, although somewhat less so than before our recent actions."
• 11:00 AM Fed Governor Miran speaks: Fed Governor Stephen Miran will appear on CNBC.

Tuesday, December 16 

• 08:30 AM Nonfarm payroll employment, November (GS +55k, consensus +50k, last +22k [September]); Nonfarm payroll employment, October (GS +10k); Private payroll employment, November (GS +50k, consensus +40k, last +83k [September]); Private payroll employment, October (GS +70k); Average hourly earnings (MoM), November (GS +0.35%, consensus +0.3%, last +0.2% [September]); Average hourly earnings (MoM), October (GS +0.30%); Unemployment rate, November (GS 4.5%, consensus 4.5%, last 4.4% [September]): 
  • We estimate nonfarm payrolls increased 10k in October and 55k in November. On the positive side, big data indicators showed a moderate pace of private sector job growth: we forecast private payroll growth of 70k in October and 50k in November. On the negative side, we expect a large drag from the DOGE deferred resignation program. That said, a surprisingly moderate increase in federal government separations in last week’s JOLTS report suggests that the hit to nonfarm payrolls could be more limited than we had previously expected. We now assume a 70k hit to October payrolls and an additional 10k hit to November. After factoring in increases in state and local government employment but a modest additional drag on federal hiring from the ongoing hiring freeze, we expect a 60k decline in government payrolls in October and a 5k increase in November.
  • The BLS did not collect responses for the household survey for October and therefore will not produce an unemployment rate for October. We estimate that the unemployment rate edged up to 4.5% in November, a low bar from the unrounded 4.44% in September. Continuing claims have rebounded slightly, and some furloughed federal workers who did not work during the reference week could be counted as unemployed even though the government shutdown had ended part of the way through the week.
  • We estimate average hourly earnings rose 0.30% month-over-month in October and 0.35% in November, reflecting neutral and positive calendar effects, respectively.
• 08:30 AM Retail sales, October (GS flat, consensus +0.1%, last +0.2%); Retail sales ex-auto, October (GS +0.3%, consensus +0.2%, last +0.3%); Retail sales ex-auto & gas, October (GS +0.4%, consensus +0.4%, last +0.1%); Core retail sales, October (GS +0.5%, consensus +0.4%, last -0.1%): We estimate core retail sales rebounded 0.5% in October (ex-autos, gasoline, and building materials; month-over-month SA), reflecting improvement in alternative measures of consumer spending and a slight tailwind from potential residual seasonality. We estimate headline retail sales were unchanged, reflecting a decline in auto sales and lower gasoline prices.
• 09:45 AM S&P Global US manufacturing PMI, December preliminary (consensus 52.3, last 52.2); S&P Global US services PMI, December preliminary (consensus 54.0, last 54.1)
• 10:00 AM Business inventories, September (consensus +0.2%, last flat)

Wednesday, December 17 

• There are no major economic data releases scheduled. 
• 08:15 AM Fed Governor Waller speaks: Fed Governor Christopher Waller will speak on the economic outlook at Yale University. Q&A and a livestream are expected. On November 17, Waller said, "I worry that restrictive monetary policy is weighing on the economy, especially about how it is affecting lower-and middle-income consumers. A December cut will provide additional insurance against an acceleration in the weakening of the labor market and move policy toward a more neutral setting."
• 09:05 AM New York Fed President Williams (FOMC voter) speaks: New York Fed President John Williams will deliver opening remarks during the FX Market Structure Conference organized by the New York Fed. A livestream is expected. 
• 12:30 PM Atlanta Fed President Bostic (FOMC non-voter) speaks: Atlanta Fed President Raphael Bostic will participate in a moderated discussion at the Gwinnett County Chamber of Commerce. Q&A is expected. On November 12, Bostic said, "It's definitely a close call. But in the final analysis, I view the signals from the labor market as ambiguous and difficult to interpret. They are not clear enough to warrant an aggressive monetary policy response when weighed against the more straightforward risk of ongoing inflationary pressures." He went on to say, "In these circumstances, moving policy near or into accommodative territory risks pumping fresh blood into the inflation beast and threatening to untether the inflation expectations of businesses and consumers."

Thursday, December 18 

• 08:30 AM Initial jobless claims, week ended December 13 (GS 225k, consensus 225k, last 236k); Continuing jobless claims, week ended December 6 (consensus 1,938k, last 1,838k)
• 08:30 AM CPI (MoM, two-month average), November (GS +0.20%); Core CPI (MoM, two-month average), November (GS +0.21%); CPI (YoY), November (GS +2.91%, consensus +3.1%, last +3.01% [September]); Core CPI (YoY), November (GS +2.88%, consensus +3.0%, last +3.02% [September]): We estimate that the core CPI increased by 0.21% month-over-month on average across October and November, which would lower the year-over-year rate to 2.9% on a rounded basis in November (vs. 3.1% in September and 3.0% consensus for November). While the BLS will not produce an October core CPI due to the government shutdown and therefore month changes will not be recoverable for October or November, our forecast reflects an estimated 0.25% month over month increase in October and a 0.16% increase in November. Our two-month forecast reflects an increase in used car prices reflecting the signal from auction prices (+0.5% on average across October and November), a slight increase in new car prices (+0.2%) reflecting an increase in dealer incentives, and a slight decline in car insurance prices (-0.1%) based on premiums in our online dataset. We forecast a net increase in airfares (+1%), reflecting a drag from seasonal distortions but an increase in underlying airfares based on our equity analysts’ tracking of online price data. We have penciled in upward pressure from tariffs on categories that are particularly exposed (such as communication, household furnishings, and recreation) worth +0.08pp on core inflation on average across October and November but downward pressure from delayed data collection on categories that typically experience steep holiday discounting in late November (such as apparel, household furnishings, and personal care) worth -0.04pp. We expect a rebound in the shelter components on net after an outlier-driven slowdown in the prior month (primary rent +0.24% on average across October and November vs. +0.20% in September; OER +0.23% vs. +0.13%). We estimate that the headline CPI increased 0.20% month-over-month on average across October (0.14% MoM) and November (0.27% MoM), reflecting higher food prices (+0.3% month-over-month on average across October and November) but lower energy prices (-0.1%).
• 08:30 AM Philadelphia Fed manufacturing index, December (GS 5.0, consensus 3.4, last -1.7)

Friday, December 19 

• 10:00 AM Existing home sales, November (GS +1.5%, consensus +1.2%, last +1.2%)
• 10:00 AM University of Michigan consumer sentiment, December final (GS 53.6, consensus 53.5, last 53.3): University of Michigan 5-10-year inflation expectations, December final (GS 3.2%, last 3.2%)

Source: DB. Goldman

Tyler Durden Mon, 12/15/2025 - 10:35

Hammer Drops On Clintons: Appear For Epstein Depositions Or Face Contempt Of Congress

Authored by Steve Watson via Modernity.news,

House Oversight Chairman James Comer is done playing games with Bill and Hillary Clinton, warning them that their endless delays in the Epstein probe will lead straight to contempt charges if they don’t comply.

With subpoenas issued months ago and the Clintons dodging every step, Comer’s latest ultimatum ramps up the pressure on the deep state darlings, exposing their ties to the convicted pedophile’s network amid calls for full transparency.

As we reported last month, the Clintons outright refused to honor subpoenas demanding depositions on their connections to Jeffrey Epstein, prompting outrage from Republicans like Rep. Anna Paulina Luna who blasted Democrats for their sudden silence on the matter.

The subpoenas, dropped in August by Comer, originally set Hillary’s testimony for October 9 and Bill’s for October 14. Instead of showing up, their lawyers begged for delays, only to ghost the committee entirely—classic stonewalling from elites who think rules don’t apply to them.

Comer has repeatedly highlighted Bill Clinton as a “prime suspect” in the saga, pointing to over 20 flights on Epstein’s infamous Lolita Express, multiple jaunts to his private island, and at least 17 Epstein visits to the Clinton White House. These aren’t casual associations; they’re red flags screaming for accountability.

Republican House leader signals plan to begin contempt proceedings against Bill and Hillary Clinton https://t.co/IKFORKWxdy

— Fox News Politics (@foxnewspolitics) December 13, 2025

In a press release on Friday, Comer laid it all out: “It has been more than four months since Bill and Hillary Clinton were subpoenaed to sit for depositions related to our investigation into Jeffrey Epstein and Ghislaine Maxwell’s horrific crimes. Throughout that time, the former President and former Secretary of State have delayed, obstructed, and largely ignored the Committee staff’s efforts to schedule their testimony.”

He didn’t stop there, adding a clear threat: “If the Clintons fail to appear for their depositions next week or schedule a date for early January, the Oversight Committee will begin contempt of Congress proceedings to hold them accountable.”

A spokesperson for Comer doubled down to Fox News, confirming direct communication with the Clintons’ attorney: “We communicated to the Clintons’ attorney today that they must appear next week or provide a date in early January to appear for their depositions or we will begin contempt of Congress proceedings. They’ve been dragging their feet for over four months. Time’s up.”

This escalation comes hot on the heels of President Trump’s bold demand for the total release of Epstein files, dismissing the whole scandal as a “Democrat Hoax” meant to smear Republicans while shielding their own. 

Trump urged House Republicans to vote for declassification, declaring, “We have nothing to hide, and it’s time to move on from this Democrat Hoax perpetrated by Radical Left Lunatics in order to deflect from the Great Success of the Republican Party.”

Trump emphasized the need to keep the focus on GOP wins, warning that Epstein distractions shouldn’t overshadow them: “What I just don’t want is for Epstein to detract from the great success of the Republican Party… It’s a Democrat hoax.”

The Clintons’ defiance couldn’t be more telling, especially given Bill’s own admissions in his 2024 book Citizen: My Life After the White House, where he confessed to flying on Epstein’s plane for Clinton Global Initiative work and lamented, “I wish I had never met him,” claiming it wasn’t worth the scrutiny.

Yet, Epstein’s 17 White House visits right after Clinton’s 1993 inauguration paint a different picture—one of deep entanglements that demand answers, not excuses.

Comer’s subpoenas didn’t stop at the Clintons; they targeted other heavyweights like former AG William Barr, ex-FBI Director Robert Mueller, former AG Loretta Lynch, and former FBI Director James Comey, all potentially linked to the Epstein-Maxwell web.

In November, Comer fired off a letter to the Clintons’ lawyer insisting on in-person depositions, rejecting any virtual dodges. The spokesperson told Fox the Clintons “believe they are above the law and are trying to avoid giving depositions.”

With contempt proceedings now on the table and a potential House floor vote for full file release looming, the noose is tightening.

Meanwhile, Democrats Desperately continue to flog the dead horse of attempting to link Trump to the Epstein files.

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Tyler Durden Mon, 12/15/2025 - 10:05

 

 

I joined Dave Pederson on his new “Bigfoot” podcast to talk about a few Market Myths.

You may recognize his name. He is an award-winning documentary filmmaker and producer best known for Super Size Me and Americonned.

 

The post Money, Fear, and the Stories We Tell About the Economy appeared first on The Big Picture.

The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 39, up from 38 last month. Any number below 50 indicates that more builders view sales conditions as poor than good.

From the NAHB: NAHB/Wells Fargo Housing Market Index (HMI)

Builder confidence in the market for newly built single-family homes rose one point to 39 in December.

Here are the readings for the three HMI indices in December:

• Current sales conditions increased one point to 42.

• Sales expectations in the next six months rose one point to 52.

• Traffic of prospective buyers held steady at 26.

In a further sign of ongoing challenges for the housing market, the latest HMI survey also revealed that 40% of builders reported cutting prices in December, marking the second consecutive month the share has been at 40% or higher since May 2020. It was 41% in November. Meanwhile, the average price reduction was 5% in December, down from the 6% rate in November. The use of sales incentives was 67% in December, the highest percentage in the post-Covid period.
emphasis added

Click on graph for larger image.

This graph shows the NAHB index since Jan 1985.

The index has been below 50 for twenty consecutive months.

The post Healthcare Is Hard, Lying Republicans Make It Harder appeared first on CEPR.

Chile Turns Hard To The Right: Tough-On-Crime, Anti-Immigration Candidate Easily Wins Presidency

In an election where the decisive themes echoed mounting concerns in the Americas and Europe, a conservative who's vowed to crack down on illegal immigration and crime trounced his Communist opponent in Sunday's presidential election in Chile. The result confirms a major political current that now has many Latin American countries embracing right-wing politics. 

Jose Antonio Kast has promised to build physical barriers on the country's northern frontier (Esteban Felix - AP via El Pais)

With 98% of the votes counted, 57-year-old José Antonio Kast was coasting to a 58%-to-42% clobbering of Jeannette Jara, a member of the Communist Party. Kast, a devout Roman Catholic and father of nine, will replace incumbent leftist President Gabriel Boric. It was Kast's third presidential bid. Underscoring the comprehensiveness of his victory, Kast won all of Chile's regions, including historic leftist strongholds. 

“Chile will be free from crime again, free from anguish, free from fear,” said Kast in a victory speech at his campaign headquarters in the capital city of Santiago. "Chile needs order." He assured supporters he would clamp down on criminals and "lock them up." Supporters displayed banners with slogans like "Bye-Bye Illegals" and "Play Time is Over." 

Jose Antonio Kast embraces his wife at a rally in Chile

Crime weighed heavily in the contest, with 63% of Chileans saying it was their biggest worry. That's about double the global average. Illegal immigration (40%) is the second-biggest concern. The two worries go hand-in-hand, as a 50% surge in murders from 2018 to 2024 is largely the work of international criminal gangs. Chile has more than 300,000 illegal immigrants, many of them Venezuelan. 

At Kast's victory rally, supporters wore red "Make Chile Great Again" hats, and confirmed that crime helped flip the country into the right-wing country. "I grew up in a peaceful Chile where you could go out in the street, you had no worry, you went out and you never had problems or fear," 23-year-old engineering student Ignacio Segovia told Reuters. "Now you can't go out peacefully."

Kast will take office in March. Guiding off the inauguration date, he has repeatedly warned illegals of how many days they to self-deport, before his administration kicks them out. Self-deporation, Kast has said, will give them the opportunity to bring their possessions with them, while avoiding detention. "If you don't leave voluntarily, we will detain you, retain you, expel you, and you'll leave with what you have on," said Kast. Kast's looming victory had already had a striking effect, with wary illegal immigrants surging into Peru -- so much so that Peruvian President Jose Jeri declared a state of emergency in late November. Meanwhile, authorities along Chile's border say illegal entries have plummeted. 

This is Chile as thousand celebrate the election of a right wing government. Finally defeating the Unity for Chile coalition which includes socialists & communists.

Sick of crime, immigration & ideology, the people want their country back.

pic.twitter.com/HMx0xbA8Mk

— Bernie (@Artemisfornow) December 15, 2025

Writing on X, Argentinian President Javier Milei was exuberant about the "crushing victory" of Kast, whom he described as a friend, adding:

"One more step for our region in defense of life, freedom, and private property. I am certain that we will work together so that America embraces the ideas of freedom and we can free ourselves from the oppressive yoke of twenty-first century socialism...!!!"

Milei also posted a map depicting South America's large number of right-wing governments, saying, "The left retreats, freedom advances." Chile joins Argentina, Paraguay, Peru, Bolivia, Ecuador as countries with right or center-right governments. The Bolivian outcome earlier this year ended nearly 20 years of socialist rule.  

LA IZQUIERDA RETROCEDE
LA LIBERTAD AVANZA
VLLC! pic.twitter.com/TfXucNdCJY

— Javier Milei (@JMilei) December 14, 2025

Which country will be next? 

Tyler Durden Mon, 12/15/2025 - 09:15

Here's How Markets Have Performed Since The Start Of America's MAGA Experiment

By Eric Peters, CIO of One River Asset Management

MAGA: I remember 2017 well. It brought me to one knee. Trump had won the election in late 2016. The world braced itself for the chaos that was to come. Of course, we should all have known better. That’s not how markets work. Only rarely does an Artificial Superintelligence give investors extraordinary profits without inflicting ungodly pain. When it does give unearned gifts, it is to tempt us to foolishly bet on the obvious in some future market cycle. No ASI would ever operate in consistently predictable ways. Anyhow, over the course of 2017, the beginning of America’s MAGA experiment, here’s what happened in markets: 

• Dec 31 2016 - Dec 12 2017: S&P 500 +19.0% and VIX -4.12 at +9.92. Nikkei +19.6%, Shanghai +5.7%, Euro Stoxx +8.4%, Bovespa +22.6%, MSCI World +19.0%, MSCI Emerging +29.0%, Bitcoin +1711.8%, and Ethereum +8063.3%. USD rose +9.2% vs Turkey, +2.1% vs Brazil, and +0.7% vs Indonesia. USD fell -10.4% vs Euro, --7.4% vs Mexico, -7.3% vs Sterling, -5.2% vs India, -4.7% vs China, -4.6% vs Australia, -4.3% vs Canada, -3.8% vs Russia, -2.9% vs Yen. Gold +6.2%, Silver -3.9%, Oil +0.3%, Copper +19.7%, Iron Ore -20.1%, Corn -10.6%. 10yr Inflation Breakevens (EU +3bps at 1.28%, US -5bps at 1.92%, JP -12bps at 0.47%, and UK +5bps at 3.07%). 2yr Notes +64bps at 1.83% and 10yr Notes -4bps at 2.40%.

MAGA II: In 2017, the stock market grinded higher all year in an unprecedented fashion, so that by Dec 12, 2017, the VIX was below 10. Investors sold volatility aggressively, and the more they sold, the lower the VIX fell, reflexively. Which created the conditions for a series of volatility spikes that climaxed in Covid. In this first year of Trump II, we endured Independence Day, the VIX index hit 60, and we suffered so many policy flip flops that they barely affect the market at this point. Here’s how markets have done in the second stage of America’s MAGA experiment:

• Dec 31 2024 - Dec 12 2025: S&P 500 +16.6% and VIX -1.67 at +15.68. Nikkei +27.4%, Shanghai +16.1%, Euro Stoxx +14.3%, Bovespa +32.8%, MSCI World +19.9%, MSCI Emerging +28.0%, Bitcoin -2.5%, and Ethereum -4.0%. USD rose +20.8% vs Turkey, +5.6% vs India, and +3.3% vs Indonesia. USD fell -29.9% vs Russia, -16.1% vs Sweden, -13.3% vs Mexico, -12.3% vs Brazil, -11.8% vs Euro, -6.8% vs Australia, -6.3% vs Sterling, -4.2% vs Canada, -3.3% vs China, and -0.9% vs Yen. Gold +55.0%, Silver +101.7%, Oil -15.6%, Copper +28.8%, Iron Ore +1.3%, Corn -2.5%. 10yr Inflation Breakevens (EU +2bps at 1.79%, US -7bps at 2.27%, JP +31bps at 1.78%, and UK -50bps at 3.01%). 2yr Notes -71bps at 3.53% and 10yr Notes -39bps at 4.19%.

MAGA III: There is so much more to America than its politics. At its core, America is the greatest business enterprise the world has ever known. Politicians fight over the fair distribution of its spoils, while engaging in international policy experiments that shift from generation to generation. It appears we’ve entered a phase that’s more focused on the Western Hemisphere than Europe and Asia. Investors will look to historical periods for parallels. Perhaps they’ll find some that prove helpful. Definitive. I’m of the mind to keep mine open, searching our Artificial Superintelligence for signals, signs. Here’s how markets have performed since the start of America’s MAGA experiment in late 2016:

• Dec 31 2016 - Dec 12 2025: S&P 500 +207% and VIX +1.41 at +15.45. Nikkei +166%, Shanghai +26%, Euro Stoxx +61%, Bovespa +166%, MSCI World +154%, MSCI Emerging +60%, Bitcoin +9497%, and Ethereum +40147%. USD rose +1111% vs Turkey, +67% vs Brazil, +36% vs Chile, +33% vs Yen, +33% vs India, +29% vs Russia, +24% vs Indonesia, +23% vs South Africa, +9% vs Australia, +3% vs Canada, +2% vs Sweden, and +2% vs China. USD fell -13% vs Mexico, -10% vs Euro, and -8% vs Sterling. Gold +271%, Silver +288%, Oil +0.5%, Copper +115%, Iron Ore +21%, Corn +14.4%. 10yr Inflation Breakevens (EU +54bps at 1.79%, US +30bps at 2.27%, JP +119bps at 1.78%, and UK -1bp at 3.01%). 2yr Notes +235bps at 3.54% and 10yr Notes +174bps at 4.18%.

Tyler Durden Mon, 12/15/2025 - 09:00

Xi Blasts "Reckless" Projects Exaggerating Growth After China Reveals Dismal Macro Data For November

China’s economic momentum slowed broadly in November, with a marked weakening in consumer spending, adding pressure on Beijing to stabilize household and business demand in the world’s second-largest economy.

Industrial production (IP) growth edged down in year-on-year terms despite the notable improvement in export growth, with slower output growth in automobile and utilities industries more than offsetting faster output growth in the special equipment and pharmaceuticals industries. 

Fixed asset investment (FAI) maintained its double-digit year-on-year contraction in November on a single-month basis, though we would not over-interpret its recent slump as our study suggests that the NBS statistical correction of previously over-reported data has played at least as large a role as fundamental factors (e.g., the "anti-involution" policies and a prolonged property downturn). 

Retail sales growth dropped meaningfully in November despite a low base, reflecting slowing auto sales growth and the negative distortion from an earlier-than-usual start of the “Double 11” Online Shopping Festival (which had pulled forward some demand from November to October, similar to the patterns observed in June). 

Year-on-year services industry output index growth – which is on a real basis and tracks tertiary (services) GDP growth closely – moderated in November. 

Property sector weakness continued in November, while unemployment rates remained largely stable. 

Regarding the labor market, the nationwide unemployment rate and the 31-city metric (not seasonally adjusted) both remained flat at 5.1% in November. The latest data available suggests the unemployment rate of the 16-24 age group declined to 17.3% in October from 17.7% in September, while Goldman cautions that this indicator may have underestimated the labor market challenges that younger generation is facing amid weak domestic demand, persistent deflation and fragile private sector confidence, because of the definition change.

Incorporating October-November activity data, Goldman's GDP tracking model based on the production approach points to a small downside risk to our Q4 real GDP growth forecast of 4.5% yoy.

And with downside economic risks building, Bloomberg reports that Chinese President Xi Jinping lashed out at inflated growth numbers and vowed to crack down on the pursuit of “reckless” projects that have no purpose except showing superficial results.

“All plans must be based on facts, aiming for solid, genuine growth without exaggeration, and promoting high-quality, sustainable development,” Xi said last week, according to a report on Sunday in the People’s Daily, the Communist Party’s official newspaper.

“Those who act recklessly and aggressively without regard for reality, impose excessive demands, or deploy resources without careful consideration, must be held strictly accountable,” he said at the Central Economic Work Conference. 

Xi used stark language to call for quality in economic gains and listed examples of wrongdoing such as unnecessarily huge industrial parks, disorderly expansion of local exhibitions and forums, inflated statistics and “fake construction kickoffs.”

Access to data in China can be sensitive and controlled, making it hard for observers to assess the health of the economy, but Xi's latest remarks seem to suggest that he wants a revamp of the existing metrics used to evaluate local officials.

Finally, we note that the initial downturn in Chinese stocks was quickly bid back into positive territory after the 'bad data' as it appeared 'bad news' would be 'good news' from a 'most stimmies' perspective, but Xi's rant dragged stocks down to end the day in the red...

And as a reminder, we warned last week that the pace of money growth in China has slowed for a second month. If that’s sustained, global stocks could lose a hitherto supportive tailwind next year.

One snowflake doesn’t make a winter, but if M1 in China continues to pare back, that’s at least one tailwind global stocks won’t have next year.

Tyler Durden Mon, 12/15/2025 - 08:45

US Futures Recover Most Of Friday's Dump As "Bad News Is Again Good News"

Stocks are set to recoup some of Friday’s tech-driven losses, with a big week of data releases ahead, as the last full week of 2025 comes witgh a bang. Still, sentiment seems a little shaky, with rising signs of skepticism over AI and debate about the extent of rate cuts next year. As of 8:00am ET, S&P 500 futures and Nasdaq 100 contracts both rose 0.5% after Friday’s 1.1% cash market slump in which technology sector fell 2.9%. In premarket trading, Nvidia leads Mag 7 gains, climbing 1.1% with the rest of the group largely in the green. European stocks climbed 0.8%. 10-year Treasury yields ticked lower and the dollar index traded at session lows as the yen surged on renewed bets the BOJ would hike rates this week. Bitcoin rallied 1.3% to $89,652, adding to signs that risk sentiment is steadying. Today' key events include the December Empire manufacturing (8:30am) and NAHB housing market index (10am). Major releases later this week include November CPI Thursday. Fed speakers include Governor Miran (9:30am, 11am) and New York Fed’s Williams (10:30am).

In premarkt trading, Nvidia climbs 1.1% and is among leaders of a rebound in Magnificent Seven stocks after the group suffered a two-day drop amid concern over elevated spending and delays for projects tied to AI (Tesla +1.4%, Alphabet +0.7%, Amazon +0.4%, Apple +0.1%, Meta little changed, Microsoft is little changed).

• Mining stocks are higher amid a renewed advance in metals prices.
• Adobe (ADBE) slips 1.3% and ServiceNow (NOW) falls 4% after the pair were downgraded to underweight at Keybanc, which sees AI tools bringing a bigger hit to both software firms.
• Dole (DOLE) climbs less than 1% on light trading after the produce company agreed to sell port and port operations in Guayaquil, Ecuador, for $75m in cash.
• Entegris Inc. (ENTG) falls 2% after Goldman Sachs cut its recommendation on the semiconductor materials company to sell from neutral on slow wafer recovery.
• GXO Logistics (GXO) declines 2.2% after the logistics company said Brad Jacobs will step down as non-executive chairman of the board, effective Dec. 31.
• Immunome (IMNM) soars 27% after the biotech company announced positive topline results from its Phase 3 trial of varegacestat.
• iRobot (IRBT) falls 72% after the company filed for bankruptcy and proposed handing over control to its main Chinese supplier.
• Teradyne (TER) gains 3% after Goldman Sachs upgraded its recommendation to buy from sell, seeing an AI-driven demand uplift for the manufacturer of chip-testing equipment.
• ZIM Integrated Shipping (ZIM) rises 4% after Calcalist reported that MSC has submitted a bid to purchase the Israeli shipping company, without saying where it got the information.

In corporate news, Roomba maker iRobot filed for bankruptcy and proposed handing over control to its main Chinese supplier. Korea Zinc plans to build a smelter in the US at an estimated cost of around $7.4 billion, backed by investments from the American government, to produce key materials used in chip-making, defense and aerospace.

Traders are looking to delayed jobs and inflation data this week to help fill the void left by the US government shutdown as they build a picture on the economy and interest rates. Citigroup joined the upbeat chorus on the outlook for US stocks next year, while Morgan Stanley' Michael Wilson wrote that the “good is bad/bad is good” trade is back, and weak jobs data on Tuesday could boost stocks as it would raise the probability of more rate cuts. The jobs number will also be critical for bond traders, who are betting on two rate cuts next year — one more reduction than the Fed is indicating.

“We are now firmly back into a good is bad/bad is good regime,” Morgan Stanley strategist Michael Wilson wrote in a note. “Moderate” weakness in the labor market weakness “Is likely to be received in a bullish context by equity markets,” he said.

Citi strategists led by Scott Chronert said they expect robust earnings growth will deliver a 13% rally next year for the S&P 500. That implies double-digit gains for a fourth year running, and echoes optimistic forecasts by banks including Morgan Stanley, Deutsche Bank and Goldman. “We anticipate an incremental shift from AI enablers to adopters/users in 2026, setting the stage for increased productivity improvement commentary across corporates,” Chronert wrote. “A generally supportive Fed is a key assumption in our playbook.”

Economists project a 50,000 increase in nonfarm payrolls and a 4.5% unemployment rate, consistent with a sluggish, but not rapidly deteriorating, labor market (our full preview will hit later today). The US data will help answer the question entering 2026 of whether the Fed is close to being done easing, after three straight cuts, or if it has to move more aggressively. 

“We had the debate around closing our equities overweight, but we don’t believe the trend is yet ending,” said Philipp Lisibach, head of strategy and research at LGT Private Banking. “Exposure to AI continues to be rewarded, while rates and credit remain relatively unattractive. Equities still offer the most compelling risk-reward trade.”

As for the AI giants themselves, the debate among investors is whether to rein in exposure ahead of a potential bubble popping or double down on the game-changing technology. One big worry is rising depreciation expenses from the data center binge. Alphabet, Microsoft and Meta combined for about $10 billion in depreciation costs in 4Q 2023. That figure rose to nearly $22 billion in 3Q this year, and it’s expected to be about $30 billion by this time next year.

A final flurry of major central bank policy decisions is also due, with meetings at the Bank of England, the ECB and the Bank of Japan, among others.  National Economic Council head Kevin Hassett said he’d consider Trump’s policy opinions if he’s picked to lead the Fed, but rate decisions would stay independent. And Ukraine and the US are due to hold a second day of talks in Berlin on Monday about a plan aimed at ending Russia’s war, with allied security guarantees for Kyiv a central focus of the negotiations. 

In Europe, Stoxx 600 trades higher by 0.8%. Consumer stocks outperform on signs of better Chinese demand, while the health-care sector underperforms. Here are some of the biggest movers on Monday:

Juventus shares rise as much as 14%, the most in more than a year, after the Agnellis family’s investment vehicle Exor NV rejected an unsolicited bid by Tether Holdings to acquire the Italian football club.

• Kering climbs as much as 4%, leading luxury stocks higher, after China vowed to increase financial support for key consumption areas.
• Puma shares also rise as much as 4% on the news that China will strengthen coordination between the commerce and financial sectors to boost consumption.
• Argenx shares fall as much as 9.7%, the most in more than seven months, after the biotechnology company discontinued its late-stage studies into thyroid eye disease.
• Sanofi shares sink as much as 6.4% after its experimental multiple sclerosis drug got hit with two setbacks: a regulatory delay in the US as well as a failure in a late-stage clinical trial.
• Rheinmetall leads European defense firms down, with its shares as much as 3.1% lower, after Ukrainian President Volodymyr Zelenskiy said he could accept security guarantees from the US and Europe instead of NATO membership amid ongoing peace talks.
• Truecaller shares plummet as much as 29%, the most since 2023 and to a record low, after the Swedish caller ID platform guided for its 4Q ad revenues around 30% lower year-on-year.
• Schweiter Technologies shares fall as much as 14%, hitting their lowest level since 2005, after the maker of composite panels issued a profit warning that Zurcher Kantonalbank says was a surprise.

Elsewhere, Chinese indexes edged lower after the latest data showed retail sales growth was the weakest since Covid, while investment slumped further. Asian shares also dropped, tracking Wall Street’s losses on Friday, with South Korea — a poster child for AI exuberance — slipping 1.8%.

In FX, the Bloomberg Dollar Index is down 0.2% with the yen top of the G-10 leaderboard ahead of an expected BOJ rate hike on Friday. Kiwi lags after RBNZ Governor Breman pushed back on investor bets over a rate hike next year.

In rates, treasury futures held small gains accumulated during European morning as the region’s bonds advanced. Global bond yields also lean lower. Gilt prices outperform 10-year equivalents from the US and Germany with the BOE set to cut rates by 25bps on Thursday. US yields are 1.5bp to 2.5bp richer across the curve with front-end tenors lagging slightly, flattening 2s10s spread by around 1bp. 10-year near 4.16% is 2.3bp lower on the day, slightly outperforming German and UK counterparts. IG dollar bond issuance slate empty, with this week expected to be the final window for any companies looking to raise capital in the debt markets before year-end. Treasury auctions this week include $13 billion 20-year bond reopening Wednesday and $24 billion 5-year TIPS Thursday. The week is packed with US economic data releases, including the delayed November jobs report on Tuesday. 

In commodities, crude oil prices are now lower after failing to hold onto opening gains.  Fed rate-cut bets also helped lift the price of gold on Monday. The yellow metal climbed for a fifth day to around $4,345 an ounce, approaching a record high; silver outperforms, higher by 2.9%. Bitcoin gains 1.5%. 

US economic calendar includes December Empire manufacturing (8:30am) and NAHB housing market index (10am). Major releases later this week include November CPI Thursday. Fed speakers include Governor Miran (9:30am, 11am) and New York Fed’s Williams (10:30am).

Market Snapshot

• S&P 500 mini +0.5%
• Nasdaq 100 mini +0.5%
• Russell 2000 mini +0.7%
• Stoxx Europe 600 +0.8%
• DAX +0.5%
• CAC 40 +1%
• 10-year Treasury yield -2 basis points at 4.16%
• VIX +0.6 points at 16.37
• Bloomberg Dollar Index -0.1% at 1205.59
• euro little changed at $1.1745
• WTI crude -0.2% at $57.35/barrel

Top Overnight News

• Affordability pressures are weighing heavily on the White House heading into next year’s midterm elections. They’re also offering cautious hope in Mexico and Canada that the U.S. won’t abandon its trilateral trade pact as the three countries enter a high-stakes review. Politico
• Trump is reportedly not certain his economic policies will translate to midterm wins, while he said his US investments haven’t fully taken effect and stated that by the time they have to talk about the election, which is in another few months, he thinks their prices are in good shape: WSJ
• White House economic adviser Hassett said he would consider US President Trump’s policy opinions, but added that the central bank would remain independent if he were to become the next Fed chair: BBG
• Apollo Management took bets against technology companies vulnerable to AI, in which it is betting against several large loans to software makers and cutting exposure to the sector, according to FT.
• SpaceX is moving forward with an insider share sale that values it at about $800 billion, setting up what could be the largest initial public offering of all time. WSJ, BBG
• Volodymyr Zelenskiy signaled Ukraine may step back from its long-term goal of joining NATO if it can secure bilateral security agreements with the US, Europe and other states. It’s holding a second day of talks with the US in Berlin. BBG
• Fannie and Freddie have snapped up more than $50 billion of home loans as Trump administration officials seek to drive down mortgage rates. BBG
• The European Commission is expected on Tuesday to reverse the EU's effective ban on sales of new combustion-engine cars from 2035, bowing to intense pressure from Germany, Italy and European automakers struggling against Chinese and U.S. rivals. EV makers say reneging on ban would yield more ground to China. RTRS
• China’s economic momentum slowed broadly in November, with a marked weakening in consumer spending, adding pressure on Beijing to stabilize household and business demand in the world’s second-largest economy. Retail sales (+1.3% vs. the Street +2.9% and vs. +2.9% in Oct), industrial production (+4.8% vs. the Street +5% and vs. +4.9% in Oct), and investment (both fixed asset investment and property investment deteriorated in Nov). WSJ
• Vanke, one of China’s largest real-estate companies, made a renewed effort to muster bondholder backing for an onshore debt repayment due this week and avoid a default after the state-backed developer's plan was rejected, rekindling concerns about the nation's crisis-hit property sector. RTRS
• Japanese companies seem keen to raise wages again next year, despite many bracing for a tariff hit to profits, a central bank report shows days ahead of its next policy meeting. The findings will likely reinforce expectations that the central bank will raise interest rates to 0.75% from 0.5% this week. WSJ
• BoJ officials are likely to start selling the central bank’s pile of exchange-traded funds as early as next month, according to people familiar with the matter, a process expected to take decades to complete. RTRS

Trade/Tariffs

• US and Mexico reportedly struck a deal on Friday to settle the Rio Grande water dispute, which eases the bilateral tensions which had been stoked after US President Trump’s threat of an additional 5% tariff on Mexico if it did not provide additional water to help US farmers.
• China’s Central Financial and Economic Affairs Commission Deputy Director said they will expand exports and increase imports in 2026.
• China's Customs allows dairy import products from Norway.
• An Indian Trade Official said India is engaging with Mexico on higher tariffs to protect its own trade interests. Said Mexico's primary target is not to hit Indian exports.
• India has proposed a "preferential trade agreement" with Mexico.
• India's Trade Secretary said India and the US are close to a "framework" deal but won't give a timeline.
• EU plans a crackdown on very dangerous Chinese products sold on online platforms, including Alibaba (9988 HK) and Shein, according to FT.
• France said conditions for an EU vote on a Mercosur deal are not yet met, despite recent progress, while France calls for the EU-Mercosur December meeting to be pushed back to continue work on mirror clauses.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were mostly pressured at the start of a risk-packed week and following on from the tech-led declines stateside amid a rotation out of AI, while participants digested economic releases, including the BoJ Tankan and Chinese activity data. ASX 200 retreated with the declines led by mining, materials, resources and tech  sectors, with the mood in Australia also sombre following a terror attack on Bondi Beach targeting a Jewish celebration. Nikkei 225 underperformed ahead of a widely anticipated BoJ rate hike later this week, while the quarterly BoJ Tankan survey showed sentiment of Large Manufacturers was at the highest in four years, which supports the case for a rate  hike. Hang Seng and Shanghai Comp were subdued after the latest Chinese activity data disappointed and house prices continued to contract, with tech and biotech leading the declines in Hong Kong, while losses in the mainland were contained after reports that China is to issue ultra-long-term special government bonds in 2026 to fund major national strategies and security initiatives, as well as large-scale equipment upgrades and consumer goods trade-in programs.

Top Asian News

• China is to issue ultra-long-term special government bonds in 2026 to fund major national strategies and security initiatives, as well as large-scale equipment upgrades and consumer goods trade-in programs.
• China stats bureau spokesperson said China’s economy stabilised and improved in November, but the impact of changes in the external environment has deepened, and the conflict between strong domestic supply and weak demand is prominent. The spokesperson also noted that some industries and firms face difficulties, while authorities will step up counter-cyclical and cross-cyclical adjustments. Furthermore, it was stated that household consumption capability and confidence need to be further improved, with efforts to be made to stabilise jobs, boost income growth, and release consumption potential.
• China Vanke’s (2202 HK) proposal for a one-year delay of repayment for a bond due December 15th was rejected by bondholders, which leaves a five-day grace period to make the CNY 2bln bond payment and avoid a potential default.
• Hong Kong’s Democratic Party voted on Sunday to dissolve amid pressure from Beijing and previous alleged threats of severe consequences, including possible arrest if they did not disband, according to The Guardian.
• BoJ is likely to begin selling its ETF holdings as soon as January, according to Bloomberg.
• RBNZ Governor Breman said the economic outlook has evolved broadly in line with expectations, and the forward path for the Official Cash Rate published in the November monetary policy statement indicates a slight probability of another rate cut in the near term. However, she added that if economic conditions evolve as expected, the official cash rate is likely to remain at its current level of 2.25% for some time. Breman also commented that there continues to be signs that growth is recovering and financial market conditions have tightened since the November decision, beyond what is implied by the central projection for the OCR.
• BoK said NPS agrees to extend its currency swap agreement for another year, with Bloomberg reporting that the NPS is to take a flexible approach to strategic FX hedging.
• China NPC Standing Committee to hold a meeting between December 22-27. NPC Standing Committee to review draft revision to foreign trade law.

European bourses (STOXX 600 +0.7%) opened on a stronger footing and traded at elevated levels throughout the morning. Upside, which comes despite a broadly lower APAC session, where Chinese stocks were subdued after the latest Chinese activity data disappointed. European sectors are broadly in the green, with a cyclical bias as Autos leads whilst Healthcare underperforms; the latter has also been dragged down by losses in Sanofi (-4%) after the Co. flagged delays in an FDA decision for Tolebrutinib.

Top European News

• Swiss SECO forecasts: US Tariff reduction has strengthened outlook 2025. Sees 2025 GDP (sports adj.) at +1.4% (prev. exp. +1.3%). Sees CPI +0.2% (prev. exp. +0.2%). 2026. Sees GDP (sports adj.) +1.1% (prev. exp. +0.9%). Sees CPI at +0.2% (prev. exp. +0.5%) 2027. Sees GDP (sports adj.) +1.7%. Sees CPI at +0.5%.
• UK's OFCOM launches a probe into BT (BT/ LN) and Three, following UK-wide outages in the summer

FX

• G10s are mixed against the Dollar with clear outperformance in the JPY, whilst the Kiwi lags vs the USD after RBNZ’s Bremen said that the forward path for the official cash rate published in the November monetary policy statement indicates a slight probability of another rate cut in the near term.- DXY is a touch lower on the day, but likely a function of JPY strength (see below). No specific macro catalysts for the greenback as the week kicks off, but late on Friday, US President Trump said he was leaning towards Kevin Warsh or Hassett to lead the Fed. DXY trades within 98.29-98.48 parameters. The session is likely to focus on commentary from Fed's Miran, expected to explain his dissent in last week's FOMC meeting, while the influential Williams will speak on economic growth.
• JPY is the clear outperformer in the G10 FX space, where the BoJ is set to raise rates for the first time since January 2025. Japan's Tankan survey overnight bolstered the case for a hike in Friday's meeting, where the reading suggested overall business sentiment improved in Q4 and inflation expectations stood pat at 2.4% for the 1, 3, and 5-year horizons. Markets currently assign a c. 80% probability that the BoJ lifts rates by 25bps on Friday. USD/JPY began trundling lower after hitting the psychological 166 level, and 21DMA at 155.96, to a session low of 154.96.
• PBoC set USD/CNY mid-point at 7.0656 vs exp. 7.0569 (Prev. 7.0638)

Fixed Income

• USTs are currently firmer today by a handful of ticks, and reside at the upper end of a 112-06 to 112-12 range. Overnight trade saw US paper saunter higher, but lacked a clear driver – no hints provided from a yield perspective either, with rates lower to a similar magnitude across the board. Markets now await Fed speak from Miran and Williams, and the former is expected to release an explanation of his dovish dissent last week. Then the focus will turn to key US data in the coming days, namely NFP and CPI.
• Bunds are also in the green, albeit to a lesser extent than peers; currently within a 127.45 to 127.64 confine. Earlier, German Wholesale Sales M/M printed in-line with expectations, whilst Y/Y rose from the prior; the inner report pinned the rise to “higher prices of food, beverages and tobacco”. Elsewhere, focus has been on geopolitics whereby Zelensky suggested that Ukraine is willing to drop NATO membership ambitions, in favour of security guarantees. Negotiations between Ukrainian and US officials will continue in Germany later today.
• Gilts also gain in today’s session, in line with peers. Nothing really much from a UK perspective this morning, aside from UK Rightmove House Prices, which continued to show contractions. An exec at the firm said, “with market conditions supporting higher levels of activity, and a hopefully more certain economic environment, we forecast a better year for price growth in 2026 with a strong rebound in activity to kickstart the year”. The docket is very thin from a UK perspective, but will pick up starting from tomorrow, where a slew of key data will precede a BoE rate decision on Thursday.

Commodities

• WTI and Brent initially started the week positively following better Chinese demand, but have failed to sustain a bid higher, as US envoys meet with European and Ukrainian officials in Berlin. Benchmarks dipped to a trough of USD 57.32/bbl and USD 61.07/bbl, respectively, at the start of the APAC session, before gradually bidding higher to a high of USD 57.62/bbl and USD 61.50/bbl. Despite the improved Chinese oil demand and reports of Iran seizing a foreign tanker, benchmarks have fallen into the European open and are currently trading near session lows.
• Spot XAU has started the week on the front foot as ETF flows, central bank buying, and XAG short squeeze continue to support the yellow metal. After Friday's liquidation selloff to a trough of USD 4257/oz, XAU bounced in the latter part of last week. The yellow metal opened at USD 4304/oz and gradually trended higher throughout the APAC session and thus far, remains at session highs of USD 4350/oz with ATHs just c. USD 30/oz away.
• 3M LME Copper, among most markets, got caught up in the tech-led selloff on Friday but has rebounded as the European session gets underway. Despite the selloff on Friday, ANZ analysts note that "demand for the metal continues to beat expectations despite the fall in China's economic growth", adding that the bank is bullish with the expectation that the market will move further into a deficit in 2026.
• India's November gold imports at USD 4.02bln (prev. USD 14.7bln); oil imports at USD 14.12bln (prev. USD 14.8bln).
• Russia's Nornickel sees a global nickel surplus at more than 200KT in 2025 and 2026, sees the global Palladium market balanced in 2025, sees a deficit at 0.2 MoZ, including investments.
• The US asks the EU to exempt US gas from methane law obligations until 2035.

Geopolitics: Middle East

• Israel’s military conducted a strike on Gaza, which killed senior Hamas commander Raed Saed, while the Israeli military said it put a planned strike on a southern Lebanon site on hold after the Lebanese Army requested access.
• Two US Army soldiers and a civilian US interpreter were killed in Syria, while the Syrian government said the attacker was a member of Syrian security forces with extremist views. It was later reported that US President Trump said they will retaliate against ISIS and that there will be a lot of damage done to the people who attacked the troops in Syria.

Geopolitics: Ukraine

• US President Trump said a lot of progress is being made on Russia and Ukraine, while he responded that they don’t want it now, and it would be complex when asked about the idea of a free economic zone in the Donbas region.
• Ukrainian President Zelensky said services have been working to restore electricity, heating and water supply to regions following Russian strikes on energy infrastructure. Zelensky also commented that there won’t be a peace plan that everyone will like and there will be compromises, while he also stated that US and European security guarantees, instead of NATO membership, are a compromise from Ukraine’s side and that security guarantees should be legally binding.
• Ukrainian presidential adviser said Ukraine and US teams meeting on peace proposals in Berlin lasted more than five hours on Sunday and will continue on Monday, while US special envoy Witkoff said a lot of progress was made during the talks.
• Ukrainian military said it struck a Russian oil refinery in the Krasnodar region and a Russian oil depot in the Volgograd region, while Ukraine’s Navy said a Russian drone attack hit a Turkish civilian vessel carrying sunflower oil to Egypt on Saturday.
• Russian Defence Ministry said Russian forces captured Varvarivka in Ukraine’s Zaporizhzhia region, according to RIA.
• EU's Kallas said new sanctions on Russia's shadow fleet will be decided today. Adds that the EU has delivered 2mln artillery rounds to Ukraine this year. Will not leave the EU summit without a decision on funding for Ukraine.
• Lithuania's Foreign Minister said he expects the EU to widen the Belarus sanctions regime to include hybrid activity. Ukraine needs something like Article 5 in terms of security guarantees, with a nuclear deterrent.
• Russia's Kremlin said Ukraine not joining NATO is a key question but subject to special discussion. Expects the US to update Russian officials on the proposals from the Berlin talks.
• Washington reportedly still wants Ukraine to cede the Donbas region to Russia, via Sky News Arabia citing official familiar with the negotiations.

Geopolitics: Other

• US envoy John Coale said Belarusian President Lukashenko agreed to do all he can to stop weather balloons flying into Lithuania, while Coale also stated that the US will remove sanctions on Belarusian potash and that around 1,000 remaining political prisoners in Belarus could be released in the coming months.
• US President Trump said land strikes against Venezuela will start happening and don’t necessarily have to be in Venezuela.
• US President Trump said on Friday that he had a very good conversation with the Thai and Cambodian PMs, while he added that they agreed to cease all shooting effective that evening and go back to the original peace accord. However, it was reported over the weekend that Thailand’s PM Charnvirakul said his country has not reached a ceasefire agreement with Cambodia and the Thai military will continue fighting on the disputed border.
• Philippine Coast Guard said three Filipino fishermen were wounded and two fishing boats suffered significant damage from high-pressure water cannon blasts by Chinese Coast Guard ships in the South China Sea, while it called on China’s Coast Guard to adhere to internationally recognised standards of conduct.
• China sanctioned the former chief of staff of the Japan Self-Defense Forces, in which it froze properties, prohibiting transactions with, and barring visas for former Japanese official Iwasaki.

US Event Calendar

• 8:30 am: Dec Empire Manufacturing, est. 10, prior 18.7
• 10:00 am: Dec NAHB Housing Market Index, est. 39, prior 38
• Central Banks (All Times ET):
• 9:30 am: Fed’s Miran Delivers Talk on Inflation Outlook
• 10:30 am: Fed’s Williams delivers Keynote Remarks
• 11:00 am: Fed’s Miran Appears on CNBC

DB's Jim Reid concludes the overnight wrap

We’ve launched our big 2026 Global Financial Market Survey with many questions on your views for the year ahead. It includes, after a two-year gap, asking you your favourite Xmas song. Where you think the S&P 500 or Mag-7 ends up creates nothing like the controversy of the announcing your favourite Xmas song. You can complete the survey here. It closes on Wednesday. All help filling in very much appreciated.  

Welcome to the last full week of the year. It's started with me sneezing, eyes watering and completely bunged up. The flu? No! Just a kids Xmas party last night where unbeknownst to me they had a cat. I'm very allergic to them. The cat actually had the right idea and had already left for the evening due to the noise. Sadly, I had to endure the noise and the cat's airborne residue.

So not the greatest start to the week for me and just when you thought it was safe to wind down for Christmas, the coming week is shaping up to be a significant one for global markets, with a dense calendar of economic releases and major central bank decisions. The European Central Bank, the Bank of England and the Bank of Japan all have a chance to be Scrooges or Santas in their meetings this week. Alongside these announcements, the data flow will be heavy: the US will finally publish delayed employment and inflation reports, while flash PMIs for December and will provide clues on global momentum.  

It’s also an interesting time for global markets with long-end yields at or around multi-month or even multi-year highs (e.g. Japan and 30yr Europe) at the same time as the weakest AI stories are increasingly being punished rather than the pre-September period when AI all went up together. If that wasn’t enough, another notable Fed story came late on Friday, as President Trump suggested that NEC Director Kevin Hassett and former Fed Governor Kevin Warsh were his two favoured candidates for the Fed Chair role. Hassett has been viewed as the frontrunner in recent weeks but following Trump’s interview his Polymarket odds fell from around 73% late on Friday to 52% this morning. Warsh has gone from 13% before the interview to 40% this morning. So, it's fair to say there’s a lot of unfinished business going into the last full trading week of the year.

For this week specifically, in the United States, attention will centre on tomorrow’s twin employment reports for October and November, delayed by the recent government shutdown. October’s headline payrolls are expected to show a decline of around -60k (DB forecasts here and below), largely due to federal layoffs with all the early year buy-out offers coming off payroll in October. November should rebound modestly with a gain of +50k (DB). Private sector hiring is likely to remain steady in both months at around +50k (DB), slightly below the recent trend. The unemployment rate is forecast to rise to 4.5 per cent in November from 4.4 per cent in September (we will never know October), while average hourly earnings should increase by 0.3 per cent in both months, keeping year-on-year nominal compensation growth near 4.4 per cent. Hours worked are expected to stabilise at 34.3. Given the distortions caused by the shutdown, the household survey could be noisy, echoing patterns seen after the 2013 episode. For a cleaner read on labour market conditions, Thursday’s jobless claims will be important and given our economists believe this will come in at around +225k, they believe underlying hiring trends remain intact.

Inflation will also be in focus with Thursday’s US CPI release. Because October data were not collected, the report will centre on year-on-year changes. Headline CPI is expected to hold broadly steady at 3.03%, while core inflation remains at 3.02%. Monthly headline gains across October and November should average +0.24%, slightly below September’s pace with core slightly above at +0.26%. Within the details, core goods prices are likely to show modest increases in household furnishings and apparel, while used car prices continue to decline. Core services will attract particular attention, especially rents, which are expected to rebound after September’s anomalous weakness. Airline fares and lodging should soften from their recent highs, though health insurance may surprise on the upside. Beyond jobs and inflation, Tuesday’s retail sales report will offer insight into consumer spending. We anticipate a headline decline of -0.3%, driven by autos and lower fuel prices, but retail control—the component used in GDP calculations—should rise by +0.3%, signalling resilience in underlying demand. Friday’s final reading of University of Michigan consumer sentiment is expected at 54.0, with inflation expectations likely to matter more than the headline figure.

On policy, last week’s FOMC meeting delivered a 25bps rate cut and signalled a “wait and see” approach. Chair Powell struck a dovish tone, emphasising labour market risks over inflation. This week’s Fedspeak will reinforce that message, with Governor Miran and New York Fed President Williams speaking today, followed by Governor Waller and Williams again on Wednesday. Atlanta Fed President Bostic closes the week on Friday. Miran, who dissented in favour of a larger cut, is expected to reiterate his view that shelter inflation will collapse in coming quarters.

In Europe, Thursday brings a cluster of central bank decisions. The ECB is expected to keep rates unchanged at 2 per cent (see our econ preview here), while the Bank of England is forecast to deliver its sixth cut of the cycle, lowering Bank Rate to 3.75 per cent on a narrow 5-4 vote. See our economist’s preview here. The Riksbank and Norges Bank will also decide on policy on the same day with both likely to stay on hold. Ahead of the BoE meeting, UK labour market data on Tuesday and CPI on Wednesday will be closely watched. Headline inflation is forecast to ease to 3.51% year-on-year, while core ticks up slightly to 3.46% (see our economist’s preview here). Retail sales and consumer confidence on Friday will round out the UK calendar. In Germany, the Ifo survey on Wednesday and consumer confidence on Friday will provide further insight into regional conditions as fiscal spending starts to ramp up. Across the Atlantic, Canadian inflation is out today which is interesting given the sharp move from pricing in a slightly easing bias earlier this month to almost a full hike by the end of 2026 now.

Across Asia, the Bank of Japan meets on Friday and is expected to raise rates by 25bps to 0.75 per cent, with a 94% probability priced in by markets. See our economist’s thoughts here. Japan’s nationwide CPI for November will also be released on Friday, with core inflation forecast to slow to 2.9% and core-core to 3.0%. Global flash PMIs for December, covering the US, UK, Japan, Germany and France, will be published tomorrow and will offer early signals on fourth-quarter growth trends.

Asian equity markets have kicked off the week notably lower after a difficult US session on Friday. Across the region, tech-focused exchanges are the poorest performers, with the KOSPI (-1.34%) and the Nikkei (-1.36%) leading the losses, followed by the Hang Seng (-1.15%). Mainland Chinese stocks are outperforming a bit due to less AI exposure and after a series of disappointing economic indicators (details below) may be raising stimulus odds. The CSI (-0.41%) and the Shanghai Composite (-0.31%) registering minor losses due to reduced exposure to the global AI market. The S&P/ASX 200 (-0.72%) is also trading lower. S&P 500 (+0.31%) and NASDAQ 100 (+0.24%) are both bouncing back a bit though.

Returning to China, the economic slowdown intensified in November, with retail sales increasing by only +1.3% last month compared to the same period last year, significantly below Bloomberg's forecast of +2.9% growth, and a decrease from the +2.9% rise recorded in the previous month. Industrial production rose by 4.8% in November year-on-year, falling short of the anticipated 5% increase and marking the weakest growth since August 2024. Business investment remained weak in November, with fixed asset investment declining by -2.6% year-on-year, exceeding expectations of a -2.3% drop. This decline has worsened from the -1.7% decrease observed from January to October, representing the most significant downturn since the pandemic began in 2020. A separate report indicated that new home prices in China continued to fall, decreasing by -0.39% m/m in November, compared to a -0.5% decline in the previous month, suggesting that we're still waiting for a recovery in demand even with government assurances that they will stabilise the sector.

Recapping last week now and US equities saw a mixed week, with the S&P 500 reaching a new all-time high on Thursday but slumping by -1.07% on Friday to end the week -0.63% lower. Concerns about the sustainability of AI-related spending weighed on tech with the NASDAQ down by -1.62% (-1.69% Friday) and the Mag-7 by -1.86% (-0.75% Friday). Oracle (-12.69%, -4.47% Friday but rallying off the day’s lows) and Broadcom (-7.77%, -11.43% Friday) plunged after their earnings reports. But there was rotation towards more blue-chip stocks, with the Dow Jones (+1.05%, -0.51% Friday) holding onto a sizeable weekly gain.  

The rates space saw a significant curve steepening as the FOMC delivered a third consecutive 25bp cut. While the Fed signalled a possible pause in early 2026, dovish hints supported 2026 rate cut expectations. Fed fund pricing for December 2026 was little changed over the week but down by -7.4bps from its peak on Tuesday, with 56bps of rate cuts now priced for 2026. The next cut is 54% priced by March. Front-end Treasury yields declined, with the 2yr yield falling by -3.8bps to 3.52% (-1.8bps Friday). By contrast, the 10yr yield (+4.9bps to 4.18%; +2.7bps Friday) and the 30yr yield (+5.3bps to 4.84%; +4.5bps Friday) both posted their highest levels since September, bringing the 2s10s slope to its steepest since January 2022, just before the Fed started its post-Covid hiking cycle. Meanwhile, recent money market tightness eased as the Fed also announced the commencement of reserve-management purchases of Treasury bills.  

In Europe, government bonds sold off amid rising global term premia and hawkish comments by the ECB’s Isabel Schnabel. 10yr bund yields rose +5.9bps to 2.86%, their highest weekly close since March, with OATs (+5.3bps) and BTPs (+6.3bps) similarly higher. The OAT outperformance came as the French parliament approved the social security budget. In the equity space, Friday’s -0.53% decline left the STOXX 600 little changed on the week (-0.09%).

Germany’s DAX (+0.66%, -0.45% Friday) outperformed, in part helped by a Bloomberg report that German lawmakers are set to approve €52bn in defence orders next week, with Rheinmetall climbing +5.66% as a result. In the UK, the FTSE 100 (-0.19%, -0.56% Friday) wasn’t helped  by a soft monthly GDP reading on Friday (-0.1% vs +0.1% expected). Meanwhile, European credit outperformed the US, with HY spreads tightening by -1bps in contrast to a +11bps widening across the Atlantic.

In commodities, Brent crude prices fell -4.13% to $61.12/bbl, to within one dollar of their 2025 lows seen back in May. In contrast, gold rose by +2.43% to $4,300/oz as investors returned to safe haven assets. Bitcoin (+1.12% on the week) managed to reclaim the $90,000 level despite a -2.89% decline on Friday.

Tyler Durden Mon, 12/15/2025 - 08:32

Altos reports that active single-family inventory was down 2.5% week-over-week.  Inventory usually starts to decline in the fall and then declines sharply during the holiday season.
The first graph shows the seasonal pattern for active single-family inventory since 2015.
Click on graph for larger image.

The red line is for 2025.  The black line is for 2019.  
Inventory was up 13.7% compared to the same week in 2024 (last week it was up 15.3%), and down 5.6% compared to the same week in 2019 (last week it was down 4.1%). 
Inventory started 2025 down 22% compared to 2019.  Inventory has closed most of that gap, however inventory will still be below 2019 levels at the end of 2025.
This second inventory graph is courtesy of Altos Research.
As of December 12th, inventory was at 775 thousand (7-day average), compared to 795 thousand the prior week.  
Mike Simonsen discusses this data and much more regularly on YouTube

Hanukkah Security Ramped Up Across West After Sydney Terror Attack Shocks World

Major cities across the Western world are ramping up security around Hanukkah events after a terrorist attack killed 16 people and wounded 38 at a Jewish celebration on Sydney's Bondi Beach over the weekend. The attack was one of the deadliest terror incidents in Australia in decades and came just days after a Trump administration official warned that the Biden-Harris regime had allowed 18,000 "known and suspected terrorists" into the U.S.

Taken together, from the Bondi Beach terror attack to Christmas market attacks in Europe, and even the Afghan national who killed one U.S. National Guard member and seriously wounded another just blocks from the White House last month, what is unfolding across the West is the dire consequence of nation-killing open border policies (promoted by Democrats) backfiring into colossal security failures.

Authorities in Berlin, London, New York, Warsaw, and across France announced heightened police presence at synagogues, public menorah lightings, and Jewish institutions.

Berlin intensified security at the Brandenburg Gate menorah lighting, New York deployed additional protection citywide, Warsaw increased armed guards at its main synagogue, and France ordered reinforced security at Jewish sites through this week and into next.

"We have long planned comprehensive security for tonight's Hanukkah event at the Brandenburg Gate — in light of the events in Sydney, we will further intensify our measures and maintain a strong police presence there," a spokesperson said on X.

London's Metropolitan Police told The Times of Israel that it had increased security but did not want to provide full details.

"While there is no information to suggest any link between the attack in Sydney and the threat level in London, this morning, we are stepping up our police presence, carrying out additional community patrols, and engaging with the Jewish community to understand what more we can do in the coming hours and days," a police spokesperson said.

France's Interior Minister Laurent Nunez told local police to reinforce security around Jewish places of worship from Sunday through next Tuesday, a ministry spokesperson told Reuters.

At Warsaw's main synagogue in Poland, armed security was doubled for the Sunday evening event.

Meanwhile, in the U.S., New York City Mayor Eric Adams said on X that additional security forces were being deployed for Hanukkah celebrations and synagogues across the metro area.

"We will continue to ensure the Jewish community can celebrate the holiday in safety — including at public menorah lightings across the city. Let us pray for the injured and stand together against hatred," Adams said.

All of this is a symptom of mass migration failure driven by liberal elites across the West, whose suicidal empathy has jeopardized national security.

Political strategist and analyst from the UAE, Amjad Taha, warned on X:

I said it on 14 December 2024. And it happened on 14 December 2025. Yes, my country, the UAE, banned them. I said it clearly to the Jewish community at a Bondi Beach restaurant in Australia: when a government allows antisemitism, it invites terror. It leads directly to Muslim Brotherhood– and Islamist jihadist–inspired violence.

Today, in Western Sydney, you have glorifiers of the Sudanese Muslim Brotherhood–led army, the same people who celebrated October 7 and who are now justifying terrorist attacks. This did not come out of nowhere. This is the inevitable result of hatred that is tolerated, normalised, and protected.

In Israel, Jews are attacked. In Australia, Jews are attacked. So tell us, honestly: where do you want this nation to go? A society that cannot protect its Jewish citizens is a society losing its soul. Antisemitism is not protest. It is not opinion. It is the gateway to terror.

Humanity MUST STAND with the Jewish community now. Silence is no longer neutrality. It is surrender.

I said it on 14 December 2024. And it happened on 14 December 2025. Yes, my country, the UAE, banned them. I said it clearly to the Jewish community at a Bondi Beach restaurant in Australia: when a government allows antisemitism, it invites terror. It leads directly to Muslim… pic.twitter.com/mUd7ugCTjO

— Amjad Taha أمجد طه (@amjadt25) December 14, 2025

The UAE's Foreign Minister issued a dire warning to the West in 2017:

7 years ago, the UAE’s Foreign Minister issued a warning to the West.

His words now sound more prophetic than ever. pic.twitter.com/ytKwcngCeP

— Visegrád 24 (@visegrad24) December 14, 2025

Last week, National Counterterrorism Center Director Joe Kent warned the House Homeland Security Committee that the Biden-Harris regime flooded America with 18,000 "known and suspected terrorists"...

.@NCTCKent: "So far, NCTC has identified around 18,000 known and suspected terrorists that the Biden administration let come into our country." pic.twitter.com/XPrHdKMICK

— Rapid Response 47 (@RapidResponse47) December 11, 2025

Disgust is brewing across the West toward liberal elites, including Democrats in the U.S., who threatened national security by importing large numbers of unvetted migrants in pursuit of a new voting base. The days of anyone challenging open border policies and being dismissed as a "racist" by Democrats are over. Time to ramp up deportations.

Tyler Durden Mon, 12/15/2025 - 07:45

Over 10,000 Illegal Immigrants Arrested In Los Angeles In Last 6 Months: DHS

Authored by Kimberly Hayek via The Epoch Times (emphasis ours),

Federal immigration authorities have arrested more than 10,000 illegal immigrants living in Los Angeles since June, the Department of Homeland Security said on Dec. 11.

Law enforcement officers shoot non-lethal munitions, as people march as part of the ongoing protests against Immigration and Customs Enforcement (ICE), in Los Angeles, on June 11, 2025. Leah Millis/File Photo /Reuters

The arrests include aliens with criminal histories, including those convicted of murder, kidnapping, sexual assaults, and other violent crimes, according to officials.

Officials underscored that their operations have been consistently undertaken amid assaults on agents by protesters who have thrown projectiles and firebombs, as well as attempted to interfere with agents in the middle of detaining suspects.

“In the face of violence from rioters and demonization by sanctuary politicians, DHS law enforcement has made over 10,000 arrests in Los Angeles since operations began in June. Some of the most heinous criminal illegal aliens arrested include murderers, kidnappers, sexual predators, and armed carjackers,” Assistant Secretary Tricia McLaughlin said in a statement.

She said that California Gov. Gavin Newsom and Los Angeles Mayor Karen Bass failed the people of California, alleging that the state allows criminals to roam free.

“Thanks to our brave law enforcement, California is safer with these thugs off their streets,” McLaughlin said. “Instead of thanking our law enforcement for removing criminals from their communities, Gavin Newsom and Karen Bass repeatedly demonized our brave law enforcement during these operations.”

Among the criminal illegal aliens arrested are Alireza Hashemi, from Iran, convicted of rape, aggravated assault, domestic violence, burglary, and driving under the influence, according to the statement.

Andres Velasquez-Ocampo, from Mexico, was convicted of armed carjacking, vehicle theft, and vandalism, it said.

Juan Carlos Tamayo, from Mexico, was convicted of homicide, conspiracy to commit homicide, and multiple counts of attempted murder, it stated.

Ambartsoum Pogosium, from Armenia, was convicted of kidnapping, homicide, fraud, burglary, larceny, and forgery, it said.

Rene Reyes-Miranda, from Cuba, was convicted of a sex offense against a child, sex offender registration violation, harassing communication, cocaine possession, robbery, burglary, larceny, probation violation, property crimes, possession of stolen property, and possession of burglary tools, the statement said.

Akop Jack Kantrozyan, from Armenia, was convicted of identity theft, burglary, multiple counts of conspiracy to commit a crime, larceny, multiple counts of fraud, receiving stolen property, shooting at an inhabited dwelling/vehicle, possession of a firearm, grand theft of access cards, violation of parole, battery, and conspiracy to defraud the United States, it said.

Everado Garcia Martinez, from Mexico, was convicted of vehicle theft, armed carjacking, and amphetamine possession, according to the statement.

Jose Manuel Perfecto Hernandez Corrales, from Mexico, was convicted of possession of stolen property and attempting to import methamphetamine into the United States, it said.

Yonic Telles-Sosa, from Mexico, has been previously removed from the United States on five occasions. He received a final order of removal in 2013 and has been convicted three times of knowingly and unlawfully entering the United States, robbery, marijuana possession, and aggravated sexual assault of a child, it said.

Mohamed Chekchekani, from Kenya, was convicted of facilitating interstate commerce in aid of a racketeering enterprise, larceny, stolen property, and drug possession, it continued.

During the operations, civil rights organizations, such as the ACLU Foundation of Southern California, filed a lawsuit in July alleging that raids violated constitutional rights.

A federal judge issued a temporary restraining order in July blocking arrests without probable cause, a ruling upheld by an appeals court in August despite DHS efforts to have it overturned.

California officials announced an online portal earlier this month so that the public can report suspected misconduct by federal agents, with the goals of documenting potential rights violations and providing legal support for illegal immigrants facing arrests and deportation.

A statement from Newsom’s office said that federal agents have broad authority to enforce federal laws, including federal immigration laws, but that they must do so lawfully.

“We’re not going to stand by while anyone—including federal agents—abuses their authority in California,” Newsom said. “This new portal gives Californians an easy and safe way to speak up, share what they see, and help us hold people accountable. No one is above the law.”

Agents faced an 8,000 percent increase in death threats since the start of deportation operations, according to DHS data.

In a June raid on illegal marijuana cultivation sites in Southern California, federal agents arrested as many as 75 illegal aliens, and at least one U.S. citizen was arrested for impeding law enforcement.

Tyler Durden Mon, 12/15/2025 - 07:20