So, they will have two?

Headline from The Wall Street Journal last week:
"Deutsche Bank Considers Forming ‘Bad Bank"
(Grants)

Interest rates really are lower

German and UK bonds are expensive, the US is fair value

All eyes on China - note the trade numbers

More no doubt later on defence, security, telecommunications, Belts and Roads, the Arctic...but note the trade numbers:

The US trade deficit was lower than expected in February (8 month low). Imports from China plunged 20%, reined in by additional tariffs. Meanwhile, US exports to China jumped 18% helped to rebalance the trade deficit. Will add approx. 0.5% to Q1 GDP growth estimates.

With various China indices up 17-39%, commentators switch to a more cautious view

There are some concerns that China may pause its policy easing; however, we (CSPB) do not interpret a Politburo statement released on Monday to mean that active monetary tightening is imminent. Chinese authorities remain committed to a proactive fiscal stance, and pairing a proactive fiscal stance with a tightening monetary attitude would be a departure from usual practice in China.

Goldilocks continues to buy equities

Credit Suisse Investment Committee Report. Meeting of 23 April
This is news as they have been "neutral" pretty much everything for a year or so from memory.

  • Given our (Credit Suisse Private Bank) conviction of a cyclical upswing in Q2 and the remarkable dovish shift of the major central banks, we recently decided to reinstate our positive view on global equities. The latest economic data releases and improving earnings revisions are confirming our decision.
  • Our base case suggests a Goldilocks environment where carry and, more generally, risky assets should show a positive performance despite richer valuations. Our preference, therefore, stays with equities, with subdued YTD inflows and low earnings expectations indicating further upside potential.
  • In fixed income, a spike in energy prices could lead to a further rise in inflation expectations, but real yield increases should for now be limited by loose monetary policies.

And no mention of "contagion" but...

The price of CDS on Argentine debt is now putting the default chances at 60% and yields on short-term government dollar bonds testing 20%. The economy is back in recession and inflation is above 50%. What's really got the market spooked is that former President Cristina Fernandez de Kirchner could make a comeback in the October election. (Bloomberg)

The "Century" Bond Argentina issued maturing in 2117 is trading ~65. Mmm...

Lest we forget
(from Jamie Douglas)

"I also always like to add the words of Ataturk, the Turkish Leader of the Gallipoli defences and later of modern Turkey. In 1934 he delivered the following words in a tribute speech to the fallen.

“Those heroes that shed their blood
And lost their lives.
You are now lying in the soil of a friendly country.
Therefore, rest in peace.
There is no difference between the Johnnies
And the Mehmets to us where they lie side by side
Here in this country of ours,
You, the mothers,
Who sent their sons from far away countries
Wipe away your tears,
Your sons are now lying in our bosom
And are in peace
After having lost their lives on this land they have
Become our sons as well”.

Terrific.
Life is good and we are all very lucky.