Tuesday Watch

Today's Headlines

Bloomberg:                 

• World Economy Is Headed for a Recession in 2023, Researcher Says.
• China to Scrap Inbound Quarantine in Dismantling of Covid Zero.
• South Korean Equities Eye Worst Year Since 2008 on Chip, Entertainment Stocks.  
• Modi’s Building Boom Setting Up India as Global Steel Savior.
• Toyota Hits Record November Output, But Shortages Loom.
  
• Iran Compels Jet to Land, Removes Family of Football Icon Ali Daei.
• Credit-Market Rebound Leaves Korea’s Weaker Firms Lagging Behind.  
• Stocks Rise in Asia, Currencies Mixed in Cautious Trading: Markets Wrap.   
• Oil Rises as China Loosens Travel Rules, US Battles Winter Freeze.
• Seattle-Area Substations Attacked as Threats to Power Grid Widen.
• Southwest Near Standstill as Over 80% of Flights Scrapped or Late.
  
• US Natural-Gas Supplies Constrained as Extreme Cold Freezes Pipes.  
• All The Ways That Crypto Broke This Year.
  
• Five Charts That Capture the State of Global Energy in 2022.   
• 2022 in Data and Graphics.

Wall Street Journal:

• The Christmas Electric Grid Emergency. Strain caused by climate policies left too many Americans shivering over the weekend. Worse is coming.
• Death Toll From Storm in Buffalo, N.Y., Region Rises to at Least 25.
• China Borders to Open Despite Surge in Covid Cases.
• Price Changes Show Inflation’s Uneven Reach.
• China Sends Warplanes Near Taiwan in Response to U.S. ‘Provocations’.
• TikTok Security Dilemma Revives Push for U.S. Control.
• FDA Fast-Tracks Review of Naloxone for Use Without Prescription.
• Drug Prices Reach New High—in the Millions.

CNBC:

• Airlines cancel over 12,000 flights during severe winter storms and scramble to rebook holiday travelers.
• Meat bans, soaring gold prices and ‘un-Brexit’? One bank’s ‘outrageous’ predictions for 2023.
• Here’s what lies ahead for China after zero-Covid failed.

Zero Hedge:   

• THE TWITTER FILES: How Twitter Rigged The Covid Debate.
• Netflix Customers Could Face Criminal Charges For Sharing Their Password.
• China Sends Record 71 Warplanes Near Taiwan In Show Of Force Aimed At US.
• Nio CEO Warns Of "Challenging" First Half To 2023 For The EV Maker.
• Fed Fight: Biden's BLS Lashes Out At Philly Fed Over Million-Job Revision. 
• The Left's Big Pitch: Embrace A Worse Life In The Name Of Equality.
• Footage Shows "Looting Across Buffalo" As City Plunged Into Chaos After Blizzard.
• "We Will Change Europe" - Polish PM Tells Italian Media He & Meloni Will Return Europe To A Union Of Homelands.
• Rogan Guest Goes Viral After Exposing "Subhuman" And "Appalling" Cobalt Mining Conditions In Congo.
• Will 2023 Be "Just An Average Recession In An Average Year" Or Will It Be Transformational?
• Tesla Suspends Ops At Shanghai Plant One Day Sooner Than Expected.
• With Most Markets Closed For Holidays, Asia Eeks Out Modest Gains.
• At Least 38 Dead As Winter Storm Chaos Sparks Driving Bans, Flight Cancellations Top 1,400.
• Swiss Government Rejects Third-Gender Option On Official Records.
• Why You Need To Start Paying Attention To The 'Twitter Files'.
• Putin "Ready" To Negotiate End To Ukraine War, But West Wants To "Tear Apart" Russia.
• Disinformation, Censorship, And Information Warfare In The 21st Century.
• Crematory Overrun In Beijing's Southeastern District, Burning 150 Bodies Daily: Reports.
• Google Execs Declare "Code Red" Over Revolutionary New Chat Bot.
• Dave Collum's 2022 Year In Review, Part 2: The War In Ukraine & How Does It End?
• Drowning In New Cases, China Finally Stops Releasing Daily Fabricated Covid "Data".
• The War On Christmas Is A War On America.
• Los Angeles County Follows City, Extends COVID-Era Eviction Moratorium.
• 1-In-6 Illinoisans Rely On Food-Stamps For Christmas Dinner.
• San Francisco Businesses Demand Tax Refund Over Drugs, Crime, & Homelessness Crisis.
• The Soaring Cost Of Christmas Dinner.
• Global Warming? It's Snowing In Miami At Packers-Dolphins Game. 
• Tesla Owner Stranded At Supercharger Station On Christmas Eve After Cold Weather Paralyzes Battery.
  

MarketWatch.com:        

• These are the China stories to watch in 2023.

NewsMax:

• Rasmussen Poll: 63 Percent Want FBI Probed for Censorship.

TheGatewayPundit.com:  

• BREAKING: Another Twitter Files Drop: How Twitter Rigged the COVID Debate. 
• Is Stanford University Involved in Bailing SBF Out of Jail?
• FBI Lawyer James Baker Wanted Trump’s Optimistic Tweet About Covid Deleted. 
• Update: 55 People Dead as Polar Vortex Batters US – Stranded Drivers Found Frozen to Death in Cars.
• Legendary LPGA Golfer Kathy Whitworth ‘Passed Suddenly’ While Celebrating Christmas Eve. 
• WATCH: Maricopa Elections Director Scott Jarrett Lied Under Oath In Kari Lake’s Historic Election Trial – Admits He Knew About Ballot Printing Issues “a Few Days After Election Day”.
• Massive Number Of People Moved Out Of Failed-State California In 2022 – More Than Any Other State. 
• In Case You Missed It… Bill Barr Screamed at Investigator Tony Shaffer Looking into Massive USPS Ballot Trafficking Report – Then Promptly KILLED the Investigation (VIDEO).
• Judge Peter Thompson Rules Elections with Broken Machines in 60% of Precincts and No Chain of Custody for Ballots Are Free, Fair and Certifiable.
• Arizona’s Law to Confirm Who Mails in Election Ballots (Signature Verification) Is Ignored to Steal Elections.
• Ordinary Americans Must Band Together to Take a Stand to Restore the Constitution and the Rule of Law. 
• Non-Profit Focused on Ending Cash Bail Shuts Down After Being Sued for Release of Offender Who Shot Man Days After Being Bailed Out.
• UPDATE: 37 Die in Weekend Freeze – More than All of the Global Warming Deaths This Year Combined.
• Thousands Lose Power After Three Substations Sabotaged in Tacoma, Washington.
• Elon Musk: “Almost Every ‘Conspiracy Theory’ That People Had About Twitter Turned Out To Be True” (VIDEO).

The Epoch Times:

• China Had Biological Weapons Ambitions Long Before Pandemic: House Intelligence Committee Member.

Twitter:

• @Heritage - WOKE PRIORITIES IN THE OMNIBUS. Here are just a few earmarks (a.k.a. your taxpayer dollars set aside for special interests or projects) we found in the 1,455 page spending bill that are funding the left’s extreme agenda using YOUR money.
• @RepDanBishop - My team and I are reading through the omnibus bill today - all $1.7 trillion and 4,155 pages of it. Follow along for some of the most egregious provisions in the bill. The omnibus passed the House with the help of 9 Republicans - Katko (NY) Jacobs (NY) Cheney (WY) Fitzpatrick (PA) Upton (MI) Davis (IL) Herrera-Beutler (WA) Kinzinger (IL) Womack (AR). 
• @CitizenFreePres - A list of the 21 Senate Republicans who voted in favor to pass the 4,000 page, $1.7 trillion spending bill... Notable: Susan Collins, Tom Cotton, Lindsey Graham, Chuck Grassley, Lisa Murkowski, Mitt Romney, Marco Rubio, Tommy Tuberville.
• @TPostMillennial - Elon Musk warns there's "great danger in training AI to lie" after ChatGPT prohibited from promoting fossil fuels. THOUGHT POLICE: Biden regime funds AI model to weed out "microaggressions" on social media.
  

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 912,074 Reports(+5,295 from prior week) Through December 16th, 2022.
  

SKirsch.com:

• Using the MGH numbers with our own VAERS queries, we have 247 cases per million doses from the MGH study divided by 5.97 cases per million doses from VAERS. 247/5.97 = 41. This suggests that the VAERS under-reporting factor (URF) is 41X.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New US Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
• Bloomberg.com:  International Travel Restrictions.  Case Graphs by State.
  
• NYTimes.com:  County Trends and Clusters. Local ICU Occupancy.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity(region).
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks. (graphs)
  
• Safegraph.com:  Commerce Patterns(graphs). 
• COVID Money Tracker. Tracking the Covid response.
  

Night Trading

• Asian indices are unch. to +.5% on average.
• Asia Ex-Japan Investment Grade CDS Index 133.75 +1.0 basis point.
• China Sovereign CDS 78.25 +1.5 basis points.
• China Iron Ore Spot 111.1 USD/Metric Tonne +.41%
  
• Bloomberg Emerging Markets Currency Index 47.8 +.01%.
• Bloomberg Global Risk-On/Risk Off Index 55.5 +.02%.
• Bloomberg US Financial Conditions Index -.45 -5.0 basis points. 
  
• Volatility Index(VIX) futures 23.4 -1.2%. 
• Euro Stoxx 50 futures +.60%.
• S&P 500 futures +.59%.
• NASDAQ 100 futures +.71%.

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• None of note
  

After the Close:

• None of note
  

Economic Releases 

8:30 am EST

• Wholesale Inventories MoM for Nov. is estimated to rise +.4% versus a +.5% gain in Oct.
• Advance Goods Trade Deficit for Nov. is estimated at -$96.8B versus -$99.0B in Oct.
• Retail Inventories MoM for Nov. is estimated to fall -.1% versus a -.2% decline in Oct.
• The FHFA House Price Index MoM for Oct. is estimated to fall -.7% versus a +.1% gain in Sept.
• The S&P CoreLogic CS 20-City MoM SA for Oct. is estimated to fall -1.15% versus a -1.24% decline in Sept.
• The S&P CoreLogic CS 20-City YoY NSA for Oct. is estimated to rise +8.0% versus a +10.43% gain in Sept.
  

10:30 am EST

• The Dallas Fed Manufacturing Activity Index for Dec. is estimated to fall to -15.0 versus -14.4 in Nov.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Japan Industrial Production report and 2Y T-Note auction could also impact trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

BOTTOM LINE: Asian indices are modestly higher, boosted by commodity and industrial shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed.  The Portfolio is 50% net long heading into the week.

Today's Headlines

Bloomberg:

• JPMorgan Says Globalization’s Demise Is Major Theme for 2023. 
• US Speeds Up Timeline in Delisting Threat For Chinese Companies.
  
• Speculators Slash Bets Against the Yen as BOJ Leaves Carry Traders Gasping.
• Millions of Americans Urged to Cut Power Use and Keep Grid Stable.
• New England Grid Asks Members to Voluntarily Curtail Power Usage.    
• Duke Energy Curbs Energy Load in Carolinas on Christmas Eve.
• Tennessee Valley Authority Orders New Round of Rolling Blackouts.
• US Declares Texas Grid Emergency in Arctic Blast. 
• Oil Passes Natural Gas as Main Fuel for Power Plants in New England.    
• Taliban Ban Women From Working for Domestic, Foreign NGOs.
• Elon Musk Warns Against Margin Debt on Risk of Market ‘Mass Panic’.  
  
• The FTX Trade That’s Tempting Oaktree and Baupost: Credit Weekly.
• 2022 in Data and Graphics.
• Here’s 2022 Summed up in Four Charts.

Wall Street Journal: 

• Putin, Isolated and Distrustful, Leans on Handful of Hard-Line Advisers.
• The House Pretends to Call in Sick. Some 230 Members vote by proxy to spend $1.65 trillion.
• Stock Selloff Hits Life Insurers’ Fastest-Growing Product.
• This Former Auto Executive Is Now CEO of a Billion-Dollar Online Pharmacy.

Barron's:

• Had bullish commentary on (MAT), (COST), (ISRG), (CMG) and (SG).
• Had bearish commentary on (CAKE).

Fox News: 

• UFC Hall of Famer dead at 45: ‘One of the most important fighters to ever compete’.
• Kari Lake responds after judge rejects challenge to Arizona election outcome.

CNBC:

• Airlines cancel 10,000 flights during severe winter storms and scramble to rebook holiday travelers.
• FDA changes Plan B packaging to clarify that it is not an abortion pill.
• Tesla suspends production at its Shanghai plant, according to an internal notice.

Zero Hedge:

• THE TWITTER FILES: Clandestine Government Agency Edition.
• Utilities Impose Rolling Blackouts As US Power Grid In Emergency Amid Cold Blast.
• Pentagon Considers Training Ukrainians On Patriot Missiles Inside The US.
• The 3 Biggest Themes Of 2022 In Charts.
• NatGas Production Collapses As Deep Freeze Paralyzes US.
• Average Global Optimism Plunges For 2023.
• Feverishly Racing Toward Our Own Destruction...
• Matt Taibbi Reflects On "Repulsive, Horrifying, Dystopian" World Run By 'Anti-People'.
• Goldman's 2022 Year In Review: What Mattered And What's Next.
• Credit Suisse Sues, Files Criminal Complaint, Against Financial Blog "Harshly Critical" Of The Bank.
• Why The Next Decade Will Not Be Like The Previous 40 Years. 
• "I'm Truly Sorry For What I Did" - SBF's Girlfriend Confirms They Conspired To Steal From FTX Customers.
• How The Just Passed $1.7 Trillion Spending Bill Will Impact The US Economy In 2023.
• British Woman Arrested For Silently Praying Near Abortion Clinic.
• Anything Mao Can Do I Can Do Better: Xi Jinping.
• Scientists Develop Gelatinous Robots To Crawl Through Human Body To Deliver Medical Payloads, Diagnose Illnesses.
• Pelosi's Office Was Directly Involved In Failed Jan. 6 Security, Texts And Emails Reveal.
• Inflation, Recession, & Declining US Hegemony.
• China's Post-Zero-COVID Surge Is Infecting 37 Million People Per Day.
• Unleashing Clean Fusion Power Is America's Best Defense Against Tyranny.
• Global Energy Crisis Forces Japan To U-Turn On Its Nuclear Policy.
• Rates, Teslas and put call ratio(nal)s. 
• Stocks set for worst year since '08 as Grinch steals Santa Rally - Newsquawk US Market Wrap.
• Tech Stocks Tumble Towards 2nd Worst December Ever; Bonds Worst Week Since April.

MarketWatch.com:     

• How a Santa Claus rally, or lack thereof, sets the stage for the stock market in first quarter.
  
• What to expect for the stock market in 2023 after the biggest decline since the financial crisis.
  
• The party is over in commercial real estate. Here’s what to expect in 2023.

NewsMax: 

• Judge Rules Against Lake, Confirms Hobbs as Governor.

TheGatewayPundit.com:

• BREAKING: Judge Dismisses Kari Lake’s Election Lawsuit – Lake to Appeal Ruling.
• Gov. Kathy Hochul on Winter Storm: “The Effects of Climate Change are Wreaking Havoc Everywhere”.
• Liberal City Enacts Anti-Pollution Order – You Can No Longer Burn a Wood Fire to Stay Warm.
• BREAKING: Secret Back Channel Between FTX and White House Closed the Day After FTX Filed for Bankruptcy.
• Jan 6 Report Hides Any Mention of Pipe Bomber Who Was Cause of Shutting Down Congress That Day.
• JUST IN: Another Twitter Files Drop: Twitter and “Other Government Agencies”.
• UPDATE: Now Indiana Michigan Power Customers Told to Cut Electricity Usage, Face Rolling Black Outs During Sub-Zero Freeze.
• BRAZIL UPDATE: Military Movements Continue – “The Armed Forces Have to Act”.
• Radio Hosts Leave After Soros-Backed Takeover Of Hispanic Radio Stations – “They Want To Silence And Censor Hispanic Conservative Voices”.
• 18 Republicans Vote to Give $11.3 Billion to FBI to Target Domestic Extremists and Build the FBI a New Multi-Million Dollar Facility.
• Obama Judge Ronnie Abrams Recuses Herself from FTX Case Due to Husband’s Conflicts After Setting Low Bail for SBF, Ellison and Wang and Setting Them Free.
• Top Thai Neurologist and WHO Expert Panel Member Warns of COVID-19 mRNA Vaccine Link to Fatal Heart Problems. 
• UK Medical Doctors Demand the Government Investigate the COVID-19 mRNA Vaccine (VIDEO). 
• Sam Bankman-Fried Seen Chillin’ Like a Villain in the Business Class Lounge at JFK Before Flying Back to Parents’ Home.

The Epoch Times:

• China Estimates 248 Million People Infected With COVID in 20 Days: Reports.
• Senate Finance Committee Demands Answers From Automakers on Possible Ties to Xinjiang Forced Labor.

Twitter:

• @unusual_whales - The increase comes as most Americans are also experiencing higher expenses due to the costs of goods increasing. In November, the prices of groceries increased by 12% year-over-year, per CNN.
• @zerohedge - CDC Funding Decisions Based Largely On Politics, Not Science.
• @Heritage - WOKE PRIORITIES IN THE OMNIBUS. Here are just a few earmarks (a.k.a. your taxpayer dollars set aside for special interests or projects) we found in the 1,455 page spending bill that are funding the left’s extreme agenda using YOUR money.
• @RepDanBishop - My team and I are reading through the omnibus bill today - all $1.7 trillion and 4,155 pages of it. Follow along for some of the most egregious provisions in the bill. The omnibus passed the House with the help of 9 Republicans - Katko (NY) Jacobs (NY) Cheney (WY) Fitzpatrick (PA) Upton (MI) Davis (IL) Herrera-Beutler (WA) Kinzinger (IL) Womack (AR). 
• @CitizenFreePres - A list of the 21 Senate Republicans who voted in favor to pass the 4,000 page, $1.7 trillion spending bill... Notable: Susan Collins, Tom Cotton, Lindsey Graham, Chuck Grassley, Lisa Murkowski, Mitt Romney, Marco Rubio, Tommy Tuberville.

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 912,074 Reports(+5,295 from prior week) Through December 16th, 2022. 

SKirsch.com:

• Using the MGH numbers with our own VAERS queries, we have 247 cases per million doses from the MGH study divided by 5.97 cases per million doses from VAERS. 247/5.97 = 41. This suggests that the VAERS under-reporting factor (URF) is 41X.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New US Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
• Bloomberg.com:  International Travel Restrictions.  Case Graphs by State.
  
• NYTimes.com:  County Trends and Clusters. Local ICU Occupancy.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity(region).
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks. (graphs)
  
• Safegraph.com:  Commerce Patterns(graphs).

Stocks Modestly Higher into Final Hour on Seasonality, Technical Buying, Energy/Retail Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Slightly Lower
  

• Sector Performance: Mixed
  

• Volume:  Light

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 21.1 -4.0%
• DJIA Intraday % Swing 1.23%
  
• Bloomberg Global Risk On/Risk Off Index 54.5 +2.6%

• Euro/Yen Carry Return Index 146.0 +.6%

• Emerging Markets Currency Volatility(VXY) 10.8 +.7%

• CBOE S&P 500 Implied Correlation Index 44.3 -2.2% 

• ISE Sentiment Index 98.0 +23.0 points
  

• Total Put/Call .97 -22.4%

• NYSE Arms .95 +20.3%

Credit Investor Angst:

• North American Investment Grade CDS Index 81.1 -1.6%
  

• US Energy High-Yield OAS 382.6 -1.5%
• Bloomberg TRACE # Distressed Bonds Traded 362.0 -22.0
  

• European Financial Sector CDS Index 103.3 -1.3% 
• Credit Suisse Subordinated 5Y Credit Default Swap 449.09 unch.
  

• Italian/German 10Y Yld Spread 210.0 basis points -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 133.4 +.09%
  

• Emerging Market CDS Index 240.26 unch.
  

• China Corp. High-Yield Bond USD ETF(KHYB) 27.33 unch.

• 2-Year Swap Spread 28.5 basis points -.75 basis points
  

• TED Spread 45.0 basis points -2.0 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -30.5 basis points -.25 basis point
  
• MBS  5/10 Treasury Spread  139.0 -1.0 basis point
  
• Bloomberg US Agg CMBS Avg OAS 119.0 -1.0 basis point
  
• Avg. Auto ABS OAS .91 -5.0 basis points
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.8 +.01%
• 3-Month T-Bill Yield 4.28% -2.0 basis points
  

• China Iron Ore Spot 110.4 USD/Metric Tonne -.1%
• Dutch TTF Nat Gas(European benchmark) 84.97 euros/megawatt-hour -7.6%

• Citi US Economic Surprise Index -5.80 +.6 point

• Citi Eurozone Economic Surprise Index 69.0 +.5 point
  

• Citi Emerging Markets Economic Surprise Index -19.8 -.5 point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 229.73 +.00:  Growth Rate +11.3% -.0 percentage point, P/E 16.7 +.1
  
• Bloomberg US Financial Conditions Index -.42 +7.0 basis points
  
• Yield Curve -57.75 basis points (2s/10s) +1.5 basis points
• US Atlanta Fed GDPNow Forecast +3.66% +93.0 basis points
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.52% -20.0 basis points: CPI YoY +6.69% unch.
  
• 10-Year TIPS Spread 2.23 +3.0 basis points
  
• Highest target rate probability for March 22nd FOMC meeting: 55.7%(+0.0 percentage points) chance of 4.75%-5.0%. Highest target rate probability for May 3rd meeting: 47.7%(-.1 percentage point) chance of 4.75%-5.0%.
  

US Covid-19:

• 154 new infections/100K people(last 7 days total). 8.9%(+.9 percentage point) of 1/14/22 peak(1,740) +14/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -75.0%(+.4 percentage points) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -20 open in Japan 
• China A50 Futures: Indicating -4 open in China

• DAX Futures: Indicating +59 open in Germany

Portfolio:

• Higher:  On gains in my commodity/industrial/utility sector longs and emerging market shorts
  

• Disclosed Trades:  None
  

• Market Exposure: 25% Net Long