Investment Conclusion
No changes in the Wealth Protection Portfolio this week. It appears at the end of this report.
- Japan: Still sticking to Long Yen but expect things to get worse for Takaichi and the LDP. Takaichi being a lame duck from the outset may ultimately be good for the Yen as political weakness will limit the scope for some of her foolhardier polices – both fiscal and monetary. But near term the breaking of the mould of Japanese politics and the divorce of the LDP and Komeito could create uncertainty that may weaken the yen.
- Russian Assets: the deal to confiscate Russia’s Euroclear assets and use them as collateral for loans to Ukraine will be finalised by end October. Standby by for Russian retaliation against the assets of international corporations still active in Russia. Names like Unilever, Raffeinhausen, Nestle and Mondelez stand out.
- France. Lecornu Bis is doomed to failure. The problem is now very clearly Macron. He has to go. When he does the far right - (le Rassemblement National) - will win the Presidential and legislative elections. But the extreme left (La France Insoumise) will do well too. That will consummate the fragmentation of French politics. The ensuing regime will be of a very different ilk to (say) Meloni in Italy. It will wave two fingers at EU fiscal rules. It will fracture the German French axis. Stay short 10 yr French Sovereign Bonds.
- Shipping: a dull week of stabilisation at low levels of container freight arriving in the US. Throughput for Chinese ports to other destinations than the US accelerated to double digit yoy growth. Drewry Global Container Cost Index was down slightly by 1%.to US$1,651 per 40ft container