It’s been about a month since I last posted on the yield curve. Let’s take a current snapshot.
US Treasury Yields 1-Year to 30-Years

The 30-year long bond set a new record low end-of-day yield of 1.94% in late August.
Yields then went on a tear, with the 30-year scorching up to 2.37%. In that time, the yield curve remained strongly inverted throughout. Note the 1-year yield (pink line) was higher than the 10-year yield (orange line) through early October.
It was not until early November that the yield curve mostly uninverted. Only two small inversions remain now as shown in the lead chart.
US Treasury Yields 2000 – 2019-11-19

The larger picture shows not much has changed. Bounces in yields come and go.
Attitudes, however, have changed. People have written off the recession because of

There were no huge blows in the UK election debate. With Johnson so far ahead, a tie was a win for Johnson.
I watched the debate after it was over.
You can watch the debate by delay on ITV.
Halfway Notes I Sent to a Friend
I am watching the debate on a delay. I am about halfway through. There is hardly anything to crow about.
Both side will likely claim victory but I see little reason for any minds to change here.
The key thing for me is Johnson looks happy and smiling. Corbyn looks miserable, if that matters.

Finished watching the entire debate.
Accurate Summation

Also to the Point

Cheerleading

There was a ton of partisan clapping after every answer. They should disallow this.
Popularity

People are going to believe their guy won nearly all of the time.
But Corbyn is in a huge

Deutsche Bank plans 18,000 jobs cuts in robot strategy called "Operations 4.0".
Operations 4.0 Underway
Deutsche Bank says Operations 4.0 is already underway.
The plan is to Replace 18,000 Jobs With Robots.

Mark Matthews, head of operations for Deutsche’s corporate and investment bank, told Financial News that machine learning algorithms "massively increased productivity" and "redistribute capacity."

The London-based news organization said that Deutsche is pushing to "automate large parts of its back-office" via a new strategy called "Operations 4.0," as part of its $6.6 billion savings initiative over the next three years.

Matthews told FN that the machine learning tools helped to save "680,000 hours of manual work" and that it "so far used bots to process 5 million transactions in

Permits lept to the highest rate since 2007 as builder optimism sets in.
The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly announced the following New Residential Construction statistics for October 2019:
Building Permits
Privately‐owned housing units authorized by building permits in October were at a seasonally adjusted annual rate of 1,461,000. This is 5.0 percent above the revised September rate of 1,391,000 and is 14.1 percent above the October 2018 rate of 1,281,000. Single‐family authorizations in October were at a rate of 909,000; this is 3.2 percent above the revised September figure of 881,000. Authorizations of units in buildings with five units or more were at a rate of 505,000 in October.
Housing Starts
Privately‐owned housing starts

This election is no longer primarily about Brexit, it’s primarily about Corbyn.
Major Disconnect
A friend of mind writes "I saw a time series that shows that every single week of the year a majority in the UK would REMAIN if there were another referendum. It was a small majority, but a consistent one. It is therefore perplexing how a party that is not going to just deliver Brexit, but a hard Brexit is polling this well. There is a major disconnect."
Why is Johnson Polling So Well?
Here is my friend’s implied question: Why is Johnson polling so well?
For starters Johnson isn’t going to deliver a hard Brexit. It will be a negotiated Brexit. A withdrawal agreement will be signed. And despite Johnson’s rhetoric, I suspect that the WTO arrangement will be managed, and far better than the

Michael Pettis has some words of wisdom for those who believe China will soon overtake the US as the world leader.
"Having the smaller banks absorbed by the bigger ones, which seems to be Beijing’s new strategy, will mean that China, like Japan in the 1990s, will be dominated by huge zombie banks," says Michael Pettis at China Financial Markets in a series of Tweets.
The Tweets were in reference to the Wall Street Journal article Why China’s Smaller Banks Are Wobbling.

China’s banks come in various flavors. There are a handful of giants, and a few more medium-size banks that can also operate nationally. Below that lies a bigger cohort of city commercial banks, and more than a thousand tiny rural commercial lenders. Both city and rural banks have their roots in local credit unions, and

A survey of German firms found that 23% will withdraw production capacity from China or are thinking about doing so.
Nearly a quarter of German firms have given up on China. US firms ought to pay attention.
DW reports German Firms in China: A Quarter are ‘Planning to Leave’.

The annual survey of 526 member firms in China found that 23% of them have either already decided to withdraw production capacity from the country or are considering it. A third of those companies have planned to leave China entirely. The rest say they will transfer part of their business and production overseas, largely to lower-cost countries in Asia.

Of the 104 companies that have decided to leave or are considering doing so, 71% cite the rise in production costs — particularly for labor.

The survey participants

As demonstrators occupy Polytechnic University throw Molotov cocktails, police threaten lethal force to stop the riots.
Hong Kong protests have been going on for 5 months now. The university is merely the latest escalation.

The Wall Street Journal reports Hong Kong Police Try to Storm University in Bid to Retake Campus From Protesters.

Large fires burned at a university here early Monday as police threatened lethal force and advanced on a group of increasingly militant pro-democracy activists armed with makeshift weapons who have occupied the campus for days.

Protesters inside the campus of Hong Kong Polytechnic University hurled Molotov cocktails as police tried to storm the grounds early Monday. The entryway and areas around the university’s perimeter were quickly engulfed in flames.

Looking for leaks? Consider the number of people Trump has in the room when he makes calls as well as the phone itself.
President Trump is looking for the source of leaks. Perhaps he should look in the mirror.

The Intercept reported on November 13 Trump Directed Diplomat to Ask Ukraine to Probe Biden in Overheard Cellphone Call

IN A JAW-DROPPING operational security lapse, President Donald Trump discussed his demand for Ukraine to open investigations of Joe Biden and other Democrats in a cellphone conversation with an American diplomat who was in a restaurant in Ukraine at the time, the House impeachment inquiry was told on Wednesday.

During that call with Gordon Sondland, the U.S. ambassador to the European Union, Trump spoke so loudly about “the investigations” that someone in the

The latest polls show increasing leads for the Tories. The trends by pollster are increasingly favorable as well.
Tories have gained ground In all the recent polls except for BMG which remained the same between polls,
But is the lead 6, 8, or 17? That’s how wide the difference are but the Survation poll at 6% is getting rather stale.
In contrast, the three most recent poll spreads by Deltapoll, YouGov, and Opinium are 15%, 17%, and 16% respectively.
YouGov Spotlight
YouGov does the most polls in general, and it also offers some regional breakdown that other pollsters generally don’t.
YouGov Tory Spread by Date and Region

For the 2017 actuals, I used 2017 United Kingdom general election in England
UK Election 2017 – England Only

Here are the 2017 United Kingdom General Election results.

Polls have mostly stabilized since the end of October. On average, Labour has lost a percentage point.
The above chart from Opinion polling for the 2019 United Kingdom general election.
The blue horizontal line represents the November 11 Brexit Party announcement that it would not compete in districts won by the Tory Party in 2017.
Since the end of October, the Tories, on average have gained about 1 percentage point over Labour.
A set of charts and tables I created shows these trends better.
Tory Party Poll Trends

Labour Party Poll Trends

Tory Party Polls Since October 30

Labour Party Polls Since October 30

Gains
The polls show a pickup by the Tories primarily at the expense of the Brexit Party
The polls show a pickup of Labour primarily at the expense of the Liberal Democrats
What

Pope Francis is fed up with deniers, so much so he is on the verge of declaring a new sin.
Pope Francis proposes Adding ‘Ecological Sin’ to Church Teachings.

Pope Francis, who has made the environment a signature cause of his pontificate, said he was strongly considering adding the category of “ecological sin” to the Catholic Church’s official compendium of teachings.

Pope Francis has stressed the importance of environmental protection since his election in 2013. He dedicated an entire encyclical, “Laudato Si,’” published in 2015, to the topic.

In that document, he called global warming a major threat to life on the planet and called for a reduction in the use of fossil fuels. He also blamed the global market economy for plundering the earth at the expense of the poor and future

The alleged star witnesses in the impeachment proceedings have turned into ashes.
The impeachment farce should have ended long ago. Instead, it lingers on and on and on.
The following video shows the alleged impeachment star witness hammered by Rep. Jim Jordan.

Here’s the short version of the exchange.
Star Witness Testimony
Jordan: You didn’t listen in on President Trump & Zelensky’s call?
Taylor: I did not.
Jordan: You’ve never talked with Chief of Staff Mulvaney?
Taylor: I never did.
Jordan: You’ve never met the President?
Taylor: That’s correct.
Jordan: And you’re their star witness.
Project Take Down Trump

Never-Ending Impeachment Process
The Democrats have managed to turn a grave process into a dully partisan one says Kimberley Strassel in Impeachment as Usual.

Democrats have

GDP Estimates are well below 1.0% following industrial production and retail sales estimates.
The GDPNow model forecast for the fourth quarter took a dive today to 0.3% from 1.0% a week ago. Similarly, the Nowcast model fell to 0.4% from 0.7%.
Pat Higgins at GDPow explains:
"The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2019 is 0.3 percent on November 15, down from 1.0 percent on November 8. After this morning’s retail trade releases from the U.S. Census Bureau, and this morning’s industrial production report from the Federal Reserve Board of Governors, the nowcasts of fourth-quarter real personal consumption expenditures growth and fourth-quarter real gross private domestic investment growth decreased from 2.1 percent and -2.3

Industrial production was down 0.8% in October with Manufacturing down 0.6%. Motor vehicles were down a whopping 7.1%.
Industrial Production and Capacity Utilization declined much more than expected 0.8%in October according to the Fed report. Economists at Econoday forecast a 0.4% decline.
Key Points
Industrial production fell 0.8 percent in October after declining 0.3 percent in September.
Manufacturing production decreased 0.6 percent in October. Much of this decline was due to a drop of 7.1 percent in the output of motor vehicles and parts that resulted from a strike at a major manufacturer of motor vehicles.
It’s not all strike-related. Weakness was across the board. Business equipment was down .06% month-over-month and a whopping 2.5% year-over-year.
Construction is down for the third

The quarterly report on household debt shows another record high. Delinquencies are up strongly as well.
Let’s dive into some stats and charts from the New York Fed Third-Quarter Report on Household Debt and Credit.
Key Points
Aggregate household debt balances increased by $92 billion in the third quarter of 2019, a 0.7% increase, and now stand at 13.95 trillion.
Balances have been steadily rising for five years and in aggregate are now $1.3 trillion higher, in nominal terms, than the previous peak (2008Q3) peak of $12.68 trillion. Overall household debt is now 25.1% above the 2013Q2 trough.
Mortgage balances shown on consumer credit reports on September 30 stood at $9.44 trillion, a $31 billion increase from 2019Q2. Balances on home equity lines of credit (HELOC) have been declining

The Cass Freight Index once again warns again of economic contraction.
Donald Broughton, founder of Broughton Capital and author the Cass Freight Index says the index signals contraction, possibly by the end of the year.
That’s just one one month away.
Six Key Points
With the –5.9% decline in October, following the string of declines in May through September (ranging from -3.0% to -6.0%), we repeat our message from the previous five months: the shipments index has gone from “warning of a potential slowdown” to “signaling an economic contraction.”
We acknowledge that: all of these negative percentages were against tough comparisons (some extremely tough), and the Cass Shipments Index has gone negative before without being followed by a negative GDP. However, demand is weaker across almost

At the semi-annual Congressional economic testimony, Fed Chair Jerome Powell was singing the praises of the US economy.
Despite serious economic headwinds and unsustainable US spending, Powell Says he Doesn’t See a ‘Day of Reckoning’ Coming for the US Anytime Soon.

“If you look at today’s economy, there’s nothing that’s really booming now that would want to bust,” Powell said in testimony before the House Budget Committee. “In other words, it’s a pretty sustainable picture.”

He added that the dollar’s status as the global reserve currency is helping forestall any trouble from the nation’s growing debt load, which just surpassed $23 trillion.

“We are the strongest country, we have the best institutions, we have the best labor force,” he said. “We have such strengths, and I think possibly

The BLS released its measure of the CPI today. The Atlanta Fed also released its "Sticky Price" CPI. Let’s analyze.
Consumer prices jumped a higher than expected 0.4 percent today according to the BLS Consumer Price Report for October, primarily due to energy.

Key Points
The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in October on a seasonally adjusted basis after being unchanged in September, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.8 percent before seasonal adjustment.
The energy index increased 2.7 percent in October after recent monthly declines and accounted for more than half of the increase in the seasonally adjusted all items index; increases in the indexes for medical care, for

Bolivia’s President Evo Morales was ousted in a coup. What happened?
Military Coup
The US wanted Leftist President Evo Morales gone.
Guess what? He’s gone.
The Guardian reports Many Wanted Morales Out. But What Happened in Bolivia was a Military Coup.

On Sunday the head of Bolivia’s military called on Evo Morales to resign from the presidency. Minutes later Morales was on a plane to Cochabamba where he did just that. These facts leave little doubt that what happened in Bolivia this weekend was a military coup, the first such event in Latin America since the 2009 military coup against Honduran president, Manuel Zelaya. (The 2012 and 2016 impeachments of Paraguay’s Fernando Lugo and Brazil’s Dilma Rousseff are widely viewed as “parliamentary coups.”)

The mainstream press has bent over

I joined Daryl Jones for the 25th episode of Hedgeye | In The Arena.
I had the pleasure of chatting with Hedgeye’s Daryl Jones last week on a number of topics.
Here’s a link to the Hedgeye page One-on-One with Mish Shedlock: "I Would Hide Out in Gold & Treasuries" where you can play or download the podcast. It’s about 52 minutes long.
Topics
Inflation or Deflation Debate: There is a lot of hidden inflation
Favorite Asset Classes: Gold and Treasuries
Good Reason to Expect Recession: Greenspan doesn’t
Rate Cut or Hike What’s Next: It’s clear what they want to do
Central Bank Independence: I would abolish the Fed in a second
US election.
To spill the beans a bit, the inflation has primarily been in assets.
I propose another deflationary bust is up next.
Mike "Mish" Shedlock

Google has access to the health records of millions of people in 21 states. Most patients are uninformed.
The Wall Street Journal reports Google’s ‘Project Nightingale’ Gathers Personal Health Data on Millions of Americans.

Google is engaged with one of the U.S.’s largest health-care systems on a project to collect and crunch the detailed personal-health information of millions of people across 21 states.

The initiative, code-named “Project Nightingale,” appears to be the biggest effort yet by a Silicon Valley giant to gain a toehold in the health-care industry through the handling of patients’ medical data. Amazon.com Inc., Apple Inc. and Microsoft Corp. are also aggressively pushing into health care, though they haven’t yet struck deals of this scope.

Google began Project Nightingale

The Brexit Party will not field candidates in seats won by the Tories in 2017. A new YouGov Poll calculates the impact.
Here is the latest YouGov Poll.
Most sites do not show the unweighted numbers. My chart does.
YouGov Question
There will be a UK general election on 12 December 2019. The candidates that will stand in your constituency are not yet known for certain. You may face a choice between the following parties and candidates. Given these parties and candidates, how do you intend to vote in the upcoming election?
Headline Voting Intention – Weighted Response
Westminster Voting Intention – prompting for parties and candidates standing in respondent’s constituency. [Weighted by likelihood to vote, excluding those who would not vote, don’t know, or refused]
UK General Election Polls

Developers keep building housing for seniors. The problem is, seniors don’t want it.
Senior housing faces a budding glut as Boomers Prefer to Stay Home.

The rise of technologies that help the elderly stay in their homes threatens to upend one of commercial real estate’s biggest bets: Aging baby boomers will leave their residences in droves for senior housing.

“People don’t want to go to a place where there’s only a bunch of other old people,” said James Crispino, head of the senior practice at design firm Gensler.

The aging-in-place technology trend marks a challenge to the numerous real-estate developers who have been rushing to build senior housing to accommodate the roughly 72 million Americans born between 1946 and 1964, representing about 20% of the U.S. population. In about one

The UK general election polls are flawed in numerous ways, but that does not necessarily mean they are wrong.
The above polls are from Wikipedia Opinion Polling for the 2019 United Kingdom General Election.
I removed columns for Area (all Great Britain) and poll size. I also removed columns for UKIP, Change UK, and Other (all polling zero) to present a better looking chart.
To understand one of the major flaws in the polls, we must first understand the population.
UK Percentage Makeup

All of the above polls were conducted in Great Britain, the political entity. This is the first major mistake because some of the political parties exist in only one country.
Regional Parties
SNP: Scotland Only – The Scottish National Party is a social-democratic political party in Scotland. The SNP

A study says Ignoring women costs $700 billion dollars a year in lost profits. I say bullshit.
Obvious Bullshit
Please consider an article by Emily Cadman, on Bloomberg, Ignoring Women Costs the Financial Industry $700 Billion a Year.

The male-dominated finance industry is missing out on more than $700 billion a year in revenue by failing to listen to or tailor products for women, according to management consultancy Oliver Wyman.

“Women are arguably the single largest under-served group of customers in financial services,” Jessica Clempner, the report’s lead author, said in a statement Tuesday. “Firms are leaving money on the table by not listening to and understanding their women customers.”

No Link to Study
The article did not post a link to the study. Bloomberg seldom does. This

Speculative loans in China are souring rapidly. Ruzhou, a city of one million people provides examples.
Struggling to keep its economy growing, the city of Ruzhou spent big, but is now asking its health care workers for cash to stay afloat.

Begging Nurses for Money
The New York Times asks How Bad Is China’s Debt?

Ruzhou, a city of one million people in central China, urgently needed a new hospital, their bosses said. To pay for it, the administrators were asking health care workers for loans. If employees didn’t have the money, they were pointed to banks where they could borrow it and then turn it over to the hospital.

Ruzhou is a city with a borrowing problem — and an emblem of the trillions of dollars in debt threatening the Chinese economy.

Local governments borrowed for years to

Nigel Farage will not field Brexit candidates in any districts won by the Tories in 2017. What’s it mean?
Unilaterally Backed Down
After making numerous threats and demands, Nigel Farage unilaterally backed down in 317 constituencies won by the Tory Party in 2017.
It was a huge climb down given Boris Johnson offered nothing in return.
Yesterday, in Johnson and Farage In Secret Deal? Who Forced Whom? I commented "Today’s video allows Farage to save face. Farage can claim he got Johnson to bend even if he didn’t."
The video is one in which Johnson strongly emphasized that he would not extend the transition period beyond 2020. But that is the same thing he has said all along. By emphasizing that position at precisely the right time, he may have helped Farage climb down.

Leave Split Reduced

China lead the world’s largest one day sales event with Alibaba’s annual "Single’s Day" shopping event.
Alibaba’s annual "Single’s Day" shopping event tops Black Friday sales, in the US by a mile. Black Friday is the day after Thanksgiving.
Reuters reports Alibaba Singles’ Day Sales Hit $12 billion in First Hour.

Chinese e-commerce giant Alibaba Group Holding Inc said on Monday that sales for its annual Singles’ Day shopping blitz hit 84 billion yuan ($12 billion) within the first hour, up 22% from last year’s early haul of 69 billion yuan.

Akin to Black Friday and Cyber Monday in the United States, Singles’ Day has been promoted as a shopping fest by Alibaba Chairman and CEO Daniel Zhang since 2009, growing rapidly to become the world’s biggest online sales event.

Also known as

The number of Job Openings is down since the beginning of the year. Hires are up
The BLS released its report on Job Openings and Labor Turnover (JOLTs) for September on November 5. The release is for the nonfarm sector.
The above chart shows hires vs openings.
Three Key Points
Since January, openings are down from 7.625 million to 7.024 million, a net of -601,000 total.
Since January, openings are down 7.88%
Since January, hires are up from 5.829 million to 5.934 million per month.
Over the 12 months ending in September, hires totaled 69.9 million and separations totaled 67.4 million, yielding a net employment gain of 2.5 million.
Point number 4 is from the JOLTs report.
All Nonfarm Employees

Employment Level

BLS Benchmark Revisions
Wait a second. What about Benchmark Revisions?