[chartist kao]

soon many us big hedge funds will do this again

https://www.investopedia.com/terms/e/exc...hanism.asp

[chartist kao]

and us goes anti -global and delink from the whole world?

https://www.imf.org/external/np/exr/ib/2000/062600.htm

[chartist kao]

how the market benefit from the forex turmoil being
https://sbr.com.sg/financial-services/ne...ex-trading

[chartist kao]

how falling sgd affect our reserve

https://www.ceicdata.com/en/indicator/si...e-reserves


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[chartist kao]

bank of England squeeze the short sellers on gilts and pounds by buying into it
https://www.youtube.com/watch?v=kwvCqSUyp5A

[chartist kao]

https://www.investing.com/currencies/usd-sgd-chart

https://sslsecure.maybank.com.sg/cgi-bin...t_rate.jsp


https://www.cimb.com.sg/en/personal/bank...count.html

[chartist kao]

number 2 economy
china cut rates
https://www.youtube.com/watch?v=0igYCLnt8IA


number 1 economy
us raise rates

https://www.youtube.com/watch?v=OuJLMr0M3iA
the impact on yuan offshore
usd cny 7.125

[chartist kao]

sgd cny 4.97

https://oec.world/en/profile/bilateral-c...artner/chn

[chartist kao]

https://www.singstat.gov.sg/modules/info...onal-trade

https://www.investing.com/portfolio/?por...QwNQ%3D%3D

and the impact on sg's inflation and taxes collection

[chartist kao]

how policies affect a country's livelihood


Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found at https://www.ft.com/tour.
https://www.ft.com/content/e2dfb060-a578...e05d86990a

A top BlackRock executive defended an investing strategy that has plunged UK pension funds into crisis, blaming “turbulence induced by policy decisions” for the disruption.

Mark Wiedman, head of international and corporate strategy at BlackRock, said so-called liability-driven investing was going though “adolescent pains” after the UK mini-Budget last week.

A sell-off in the gilts market sparked by Kwasi Kwarteng’s tax cuts brought pensions funds to the brink of default because of LDI strategies that include the use of derivatives.

Counterparties demanded extra collateral as gilt yields rose sharply, risking a fire sale of assets as pension funds searched for cash to meet these margin calls.

“I think what it’s leading to is margin calls in a sector where people weren’t really paying attention to this question,” Wiedman told the FT’s Future of Asset Management North America conference in New York on Wednesday.

The turmoil prompted the Bank of England to launch an emergency £65bn bond-buying programme in an attempt to bring yields down and stabilise the market.

BlackRock, alongside the likes of Legal & General Investment Management, Insight Investment and Schroders, is a prominent player in the market for LDI funds, a strategy that helps pension fund clients match their liabilities with their assets, often using derivatives.

The amount of liabilities held by UK pension funds that have been hedged with LDI strategies has tripled in size to £1.5tn in the 10 years to 2020, according to the Investment Association.

“Here what we have is a relatively sleepy market that has had very few shocks, including during the financial crisis that’s suddenly going through turbulence induced by policy decisions,” said Wiedman.

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He said that BlackRock had higher levels of capital reserves than many of its peers, which “for a long time seemed too big”. An important question now, he added, is how much capital asset managers have allocated for covering margin.

“This is a market with a very small number of natural buyers called pension funds and the Bank of England, so when they have margin calls and there’s no one on the other side of the trade that creates a little bit of instability.”

Wiedman said that “temporary market disturbance within the UK” represented “adolescent pains” for LDI, but longer term, “the case for an LDI is actually really powerful”. In an environment of rising interest rates, it will continue to be a growth area, as corporate pension plans will continue to want to hedge their exposure to market volatility.

“I would say that might be the dawn of a new age for LDI, including in the dollar space,” said Wiedman. “We’ll see. It’s just that maybe people have under-provisioned margin calls for temporary shifts in valuations. I think given that assets and liabilities are moving I’m bullish on the LDI market.”

[chartist kao]

how the financial turmoil affects sg trades with uk and EU in 2023?


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https://www.ft.com/content/a14c4ae4-c513...a5e046703b

Germany has announced a €200bn “protective shield” for businesses and consumers struggling with soaring energy costs, the largest aid package adopted by a European government since the start of the energy crisis.

The centrepiece of the plan, financed by new borrowing, is an emergency cap on gas and electricity prices that have soared since Russia first slashed its gas exports to Europe over the summer.

“Prices must go down,” chancellor Olaf Scholz said on Thursday. “That is our firm conviction and the government will do everything it can to ensure that happens.” He described the package as a “double ka-boom” that would help everyone from pensioners to big industrial companies pay their energy bills.

“Germany is displaying its economic clout here in an energy war,” said Christian Lindner, finance minister.

Berlin has accused Russia of “weaponising” its energy exports since it launched its full-scale invasion of Ukraine in February. Scholz said the suspected sabotage of Nord Stream 1 and 2, the pipelines under the Baltic Sea that connect Russia directly to Europe, had shown that “gas will not be delivered from Russia for the foreseeable future”.

Disruptions in the flow of gas from Russia since the summer have pushed up prices for the fuel to record levels and raised fears of a winter gas shortage in the eurozone’s largest economy.

Companies have cut production and consumers faced with rising inflation have reined in spending. A flash estimate published by Germany’s statistical agency on Thursday showed that inflation hit a 70-year high of 10.9 per cent in September.

A joint forecast by Germany’s leading economic institutes on Thursday predicted the country would slip into recession next year, with gross domestic product contracting by 0.4 per cent.

“We’re in an energy war for our prosperity and freedom,” said Lindner, adding that he believed Russia’s aim was to destroy “what people have personally built up over decades — we can’t accept that, and we will fight back”.

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The €200bn will be financed through new borrowing and channelled through the reactivated Economic Stabilisation Fund (WSF), an off-budget facility that was set up in 2020 to help companies such as Lufthansa survive the lockdowns and other public health measures imposed during the Covid-19 pandemic.

Lindner insisted that Germany would stick with its plan to reinstate the “debt brake”, a constitutional curb on new borrowing that was suspended during the pandemic, from next year, drawing a contrast between his government’s approach and that of the UK.

“We are not following the example of Great Britain by pursuing an expansive fiscal policy,” he said. The €200bn sum was only to be used to overcome the current crisis, he said.

“Even though we are setting up this protective shield, Germany is sticking to a fiscal policy based on stability and sustainability,” he said. “German sovereign bonds remain the gold standard in the world.”

Thursday’s announcement came just three weeks after Scholz’s government first unveiled plans for a brake on electricity prices, which would be funded by a new windfall levy on the profits of power companies.

A group of experts will work out the details of the gas price cap and present their recommendations in mid-October. It is expected that prices for a set, basic, volume of gas and electricity will be capped, with usage higher than that priced at market rates. Energy suppliers would be compensated by the state for having to sell their gas and electricity to consumers for a lower price.

Robert Habeck, economy minister, said a previously planned gas levy on all consumers that was due to take effect on Saturday would be scrapped. The levy was designed to help companies such as Uniper, which had been plunged into crisis after being forced to buy expensive alternatives to Russian gas on the spot market. But it was rendered moot by the government’s decision to nationalise Uniper earlier this month.

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Habeck insisted that despite the new aid measures, energy use must be reduced.

“We are seeing that consumption, particularly in the private sector, is not falling as much as it should,” he said. “While we’re willing to spend a lot of money to bring down prices, there is still a need to save energy.” 

The idea of a gas price brake has long been discussed in the German government but it is contentious with some economists. Stefan Kooths of the Kiel Institute for the World Economy said the fact that so much of Germany’s gas is imported meant any reduction in its price would require “massive subsidies which would then of course pump new purchasing power into the private sector”. That would stoke inflation, he said.

“That is destabilising . . . and problematic for lower income groups,” he added. “For them it’s a downright disservice”.

[chartist kao]

https://asia.nikkei.com/Economy/Banglade...hty-dollar

https://www.bloomberg.com/news/articles/...o-year-low

as dollar says it is the king of the world soon we see country starting to trade with other currency to avoid another dollar 1997's crisis

[chartist kao]

https://thenews.sg/news/indonesian-sover...vestments/



SINGAPORE : Indonesia’s sovereign wealth fund has garnered more than $20 billion of co-investments from funds including Singapore’s GIC and Abu Dhabi Investment Authority, and is actively looking at infrastructure assets, its top executive told Reuters.

“The money is there, but to find the right one at the right angle, the right dimension, the right amount of return, it’s not easy,” Indonesia Investment Authority (INA) Chief Executive Officer Ridha Wirakusumah said on the sidelines of the Milken Institute Asia Summit in Singapore on Thursday.

Indonesia’s youthful population, abundant natural resources and its position as the region’s largest economy is attractive to investors but poor infrastructure, red tape and corruption have hindered investments.

INA, Indonesia’s only sovereign fund, was launched in early 2021 with $5 billion from the government.

Unlike many other state wealth funds that manage excess oil revenues or foreign exchange reserves, the INA seeks to attract foreign co-investors to help fund economic development.

Ridha, a former banker, said the state investor had “live deals” in toll roads, airports and sea ports.

He said the fund is also seeking investments in water and logistics sectors, and digital infrastructure industry that includes fiber optics and data centers.

In 2021, INA set up a $3.75 billion toll road fund with Caisse de dépôt et placement du Québec, Dutch APG Asset Management and a unit of the Abu Dhabi Investment Authority.

This year, China’s Silk Road Fund agreed to invest up to 20 billion yuan ($2.78 billion) in INA.

“Indonesia needs infrastructure,” Ridha said. “It’s actually good for not only long term impact from the investments perspective, but also good for the social impact.”

($1 = 7.1945 Chinese yuan renminbi)
https://www.zaobao.com.sg/realtime/singa...29-1317962

[chartist kao]

3 days ago — The Dow Jones Industrial Average is more than 20% below its record, falling into a bear market for the first time in more than two years.

so are most global stock markets

[chartist kao]

https://www.cbsnews.com/video/dow-jones-...economy/#x

[chartist kao]

fed powell forced his us stock market into bear market vie over aggressive rate hikes
https://giphy.com/gifs/SWAG-cP1uaYc3WRKNfi9tmy

https://www.cbsnews.com/video/dow-jones-...economy/#x

[chartist kao]

first the army of two sides do not talk
https://www.politico.com/news/2022/08/05...n-00050175

and then the tsock markets of two sides
and then the market breaks now

the biggest seller can only sell to itside as the biggest economy trade to itself

[chartist kao]

we had hurricane all over the world stock markets and soon the global economy now they have

https://www.telegraph.co.uk/world-news/2...orm-path1/

[chartist kao]

when you think Boris Johnson did the most crazy things in uk 's history we have

https://chof360.com/liz-truss-is-embarke...-with-her/

[chartist kao]

uk's from brexit (A blow-by-blow account of the UK's tortuous route to Brexit, from the 2016 EU referendum to the present day.)till 2022

没有最疯狂，只有更疯狂.

[chartist kao]

can use to uk's pounds and gilts and economy after brexit

https://cepr.org/voxeu/columns/economic-...ock-market

[chartist kao]

more unexpected surprises to come until you have a rational leader over there

https://www.theguardian.com/business/201...exit-panic

[chartist kao]

will the us bear bring the us market to 2016's level to bring stability in the us market?
https://www.usatoday.com/story/money/mar.../86323890/

[chartist kao]

a stressed uk government induce a stressed uk assets

https://www.cnbc.com/2022/09/28/bank-of-...ogram.html

[chartist kao]

uk funds managers will bring the uk money to sg very soon if pounds and gilts continue to fall further

[chartist kao]

Asia including singapore suffered 7 to 8 years of volatility after 1997's crisis including 2000 us tech meltdown ,2001's911 ,2003's sar and economy hollowing out until 2005 things started to turn better until 2020 now we saw it in uk

LONDON—For British companies, the recent volatility in domestic currency and bond markets is compounding six years of extreme disruptions, starting with Brexit and stretching through the pandemic and the fallout from Russia’s war in Ukraine.

Executives say the recent market turmoil has dealt another blow to already fragile business confidence, threatening to crimp future investment and undermine growth in the world’s fifth-largest economy. Late last week, the government unveiled a deep tax-cutting plan that surprised markets—sending the U.K. currency briefly to an all-time low against the dollar and jacking up yields on government debt. The currency has since mostly recovered, but the higher yields threaten to lift borrowing broadly for businesses and consumers alike.

“It’s a never ending roller coaster, but there is never an up part,” said Andrew Murray-Watson, co-founder of closely held, London-based drinks company Brixton Gin. “The hardest thing for any business to deal with is uncertainty.”


The pandemic was particularly painful in the U.K., whose services-weighted economy was hit by lockdowns.
PHOTO: DINENDRA HARIA/ZUMA PRESS
He has been struggling most recently with the soaring prices of raw materials, which have risen 40% this year, he said. Inflation is climbing in most big markets, but the U.K. has so far racked up one of the highest among the world’s richest countries. As a result of all the new uncertainty, Mr. Murray-Watson said the gin maker was likely to put investments on hold for the next 12 months.

Sentiment among businesses was low before the government’s announcement and the market reaction. Business confidence for September was well below the long-term average and the lowest level since March 2021, when the economy emerged from a wave of Covid-19, according to a survey by U.K. lender Lloyds Bank.

Meanwhile, the level of business investment in the second quarter was 5.7% below where it was in the final quarter of 2019, just before the pandemic, and 7.4% below where it was before the Brexit vote, according to the Office for National Statistics.

The U.K. economy is forecast to record zero growth next year, according to the Organization for Economic Cooperation and Development, the third-lowest rate in the Group of 20 leading economies after Russia and Germany.


Brexit contributed to higher costs for importers in the U.K.
PHOTO: KIRSTY WIGGLESWORTH/ASSOCIATED PRESS
Amid the litany of challenges, shares in British companies have broadly underperformed peers in Europe and the U.S. in recent years. The FTSE 250, an index that includes mainly British midcap companies, has gained 3.75% since the June 2016 Brexit vote and offered a total shareholder return, which includes dividends, of 19.86% over that period. The MSCI Europe Mid Cap, an index that measures companies of a comparable size across the continent, is up 11.5%, with a return of 36%. The S&P midcap 400 is up 48% and returned 63.41%.

British businesses were divided about Britain’s 2016 referendum to leave the EU. The vote to split sent the pound sharply lower, a descent from which it never fully recovered. That contributed to higher costs for importers.

After the divorce took place on Dec. 31, 2020, many businesses have complained about increased paperwork and costs associated with trading with the bloc, and cite the reduced availability of foreign workers. Brexit supporters say the split will eventually boost prospects by lowering regulatory hurdles and allowing Britain to set its own trade policies.

The pandemic, meanwhile, was particularly painful in the U.K., whose services-weighted economy was hit by lockdowns. More recently, the war in Ukraine has sent energy and food prices soaring.

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JD Wetherspoon PLC, one of Britain’s largest pub chains, recently said it planned to sell 32 pubs amid deteriorating sales. "’The multiplying villainies of nature do swarm upon us,’ as Shakespeare once said,” said Tim Martin, the company’s founder and chief executive, and one of the most outspoken Brexit proponents among U.K. business.

“That’s what it feels like,” he said in a text, responding to a question about the yearslong trouble for British business.

The U.K. government says its fiscal plans will help boost growth. Many companies say they are unconvinced. Top business figures including the chief executive of Virgin Atlantic Airways and the chairman of grocery giant Asda Stores Ltd. have criticized the move in recent days.


For Nimisha Raja, the CEO of Nim’s Fruit Ltd., many of the difficulties of doing business in Britain started with Brexit. The move hurt sterling, increasing the cost of importing fruit, and introduced paperwork that means some sales to the bloc are no longer worth the effort.


U.K. business confidence for September was well below the long-term average and the lowest level since March 2021.
PHOTO: KIRSTY WIGGLESWORTH/ASSOCIATED PRESS
In the past year, Nim’s Fruit, which makes snacks made of dried fruits and vegetables, has also been hit by higher energy costs. The company’s natural-gas bill has jumped to £7,500, equivalent to $8,293, a month from about £2,500 a month last fall. It went as high as £18,000 each of four months straight. Now, the company’s borrowing costs are rising, too. The central bank has been raising interest rates to tackle inflation, but the sharp selloff in U.K. government bonds in the wake of the tax-cut announcement threaten to pressure rates higher more generally.

Ms. Raja says Nim’s Fruit is putting expansion plans on hold until it gets more certainty for planning. “Growth requires investment, and right now we are holding on tight to our purse strings,” Ms. Raja said.

While a weaker pound makes British exports more competitive abroad and foreign revenues more lucrative, many businesses here are reliant on foreign inputs that become more expensive.

Aston Martin Lagonda Global Holdings PLC, the iconic British car maker, is a case study in that Catch-22. It exported around 82% of its vehicles in the first half of this year, 27% to the U.S., according to the company. The 20% fall in the pound against the dollar boosts the pretax profit on a $170,000 sports car sold in New York when converted back into pounds. But 71% of the manufacturer’s suppliers are based abroad, mainly in Europe, meaning the pound’s decline increases its costs.

Aston Martin said “the company has considerable cash flow, revenue and assets in foreign currencies and seeks to manage currency risk through hedging where feasible.”

Julian Abel said his business, The Nowt Poncy Food Co., has stopped making detailed business plans because conditions are changing daily. The company, which makes curry sauces, wants to install new semi-automated production. Aside from its cost, it would need new staff at a time when wage demands are rising with the increase in the cost of living.

“We’re in survival mode here,“ Mr. Abel said, ”keeping costs as low as we can and just ticking over sales-wise.”

[chartist kao]

2023 to 2025

global distressed sales in assets soon as global liquidity dry up!

https://www.oaktreecapital.com/insights/...ers-3q2022

[chartist kao]

in asia we waited for about 10 years after soros attacked pounds in 1992 until liquidity dry out until we started the game again in 2005

The tale of George Soros breaking the Bank of England is legendary on the global stock market. He did it by betting a huge amount of money against the pound sterling in 1992, causing the currency to devalue rapidly. He then bought it back for a lot less money than he sold it for, earning $1 billion in the process.9 Feb 2022

[chartist kao]

how to help the uk home loan borrowers ride through the us rate hike in this winter

[chartist kao]

3 oct 2022 uk pounds and gilt again under attacked after

https://www.managementstudyguide.com/bla...f-1992.htm