In light of Green Turtles making a comeback, here are two turtles caught in the act off the coast of Marino Ballena National Park

Excellent from @katie0martin.ft.com on the dollar’s rapidly-dimming safe-haven appeal, and the very real rise of “barbell” hedging strategies (USD at one end and financial apocalypse assets at the other): FT: So long, American exceptionalism giftarticle.ft.com/giftarticle/...

I’d add that Britain has the most distant economic and institutional relationship with the EU of any country between the eastern border of Ukraine to the Atlantic coast of Ireland Everyone - Turkey, Ukraine, Switzerland - has a closer relationship so our status quo can’t last

Here is my 101 piece from way back when www.crisesnotes.com/central-bank...

Butterfly landing to feed on the tree sap in the Autumn sun. From my holiday in Sardinia

The return of Navelism coincided with a heated battle betwee proponents of the primacy of Inniepolitik and of Outiepolitik.

I finally upgraded by Intel MacBook Pro, and managed to save some euros by buying an MacBook Air in Germany. I got a QWERTY keyboard overlay. Problem - I am in the dark on a sleeper train and the overlay blocks the backlighting of the letters and my touch typing is not quite good enough

IMV Austin is @michaelpettis.bsky.social academic analogue where the US is in a state of saving-investment equilibrium, that is disturbed by foreign capital inflows. I've read enough Derrida in my life at this point that my eye twitches. For me capital inflow functions as a kind of Pharmakon

I doubt that anything resembling genuine AGI is within reach of current AI tools—Terence Tao mathstodon.xyz/@tao/1157223...

got my adhd upgraded to ad4k

Counter-argument: this is not Eurobonds. It is borrowing against the EU budget headroom. So it is zero-sum, assuming the MFF isn't going to get bigger by a corresponding amount (it won't) -> you are going to end up not spending that money elsewhere. It's not a trick you can repeat endlessly.

Lingering QE effects atrophied UK EU plumbing increasing reliance on the US. Rebuilding plumbing means dealing with these effects, that probably involves higher term premia, against the backdrop of heightened concerns of sovereign debt

Aujourd'hui c'est le solstice d'hiver dans l'hémisphère Nord. Les journées vont commencer à rallonger! Le soleil ne se lève à l'Est (centre de l'image avec Nord à gauche, Sud a droite) que lors des équinoxes. La position du lever change un peu tous les jours! (©Z. Al-Abbadi)

The curse of Rishi Sunak is that everyone has decided to pretend he didn’t happen and thus that Sunak proved that having an honest, hardworking non-lunatic in Number isn’t enough to overcome Brexit fundamentals So there’s a long queue of candidates whose pitch is “but I’m not Truss or Boris”

In response to the reappearance of MMT, I have, somewhat reluctantly, written up where the current crop of 'pop MMT' goes wrong. The short version: yes the central bank issues money; no this doesn't change anything. criticalfinance.org/2025/12/19/w...

Gobal monetary transmission is really regulatory microstructure. The role of US dealers is key. Gov spending creates reserves. Issuing bills introduces duration that QE cancels out. Dealer balance sheets, will be larger but less efficient because reserves / deposits cannot be repledged

My broken clock point for years has been that there is one entity in the EU that already exists and issues J&S liabilities—the ECB and notes & bank-reserves etc. If it issues liabilities with duration (call them sterilization bonds) vs. its assets (€guvvies), you get closer to the scale needed.

ACCIDENTALLY BOUGHT CHRISTMAS WRAITH. EVERYONE DEAD.

A quick explanation of how this borrowing to assist Ukraine will work. "Enhanced cooperation" means EU law is being used, but some Member States opt out. The process has been applied a few times before, but never before re the EU budget. 1/

SCOOP: Starmer and Carney are working on a new strategic partnership that could see Canada buy the U.K.'s 6th-gen fighter jet, forge critical minerals deals and resolve thorny trade and tariff issues, High Commissioner Goodale tells POLITICO as he steps down. www.politico.eu/article/cana...

so, that's not actually true? For example, I'm an experienced front-end web developer. I'm *also* someone who doesn't have time to keep up with every new tech that's invented in that space. So I can use an LLM to help me update my website, then review the code myself, before I actually use the code.

When engaging critically with a thinker, I try to reconstruct their argument. If I am uncertain about something, I might read more of their work or make an effort to contact the author for clarification. Sometimes the author doesn’t respond to inquiries from random men on the internet.

Great to see our idea to extend climate-based buy European conditionality extended to corporate car subsidies. It covers about 60% of the EU market and is a key lever to respond to the China shock. And given that the EU is revising its corporate car directive soon, it was an obvious move. 1/

This is also entirely consistent with @michaelpettis.bsky.social analysis. IMV there is more substance to his position then ‘wait (because we have no agency) for China to increase its consumption’.

Good piece from Pettis. Europe has to make a move. Intervening on the euro is impossible as the ECB would never do so. It could also stoke a currency war, as China already intervenes heavily and Trump in some ways has lowered the USD exchange rate - on purpose or as a side effect. 1/

And the medium-term trade-off here can be absorbed in significant part by fiscal (yes, I know it's unpopular at the moment but Europe has capacity to spend more in a way that most regions don't). This should be different from '00s China shock, because it's effectively buying in *domestic capacity*.

Interesting to compare the fortunes of the trade associations of solar and wind

Europe's energy import dependence is set to rise to 70% in the early 2030s. Following a renewables based energy transition this will fall to around 20% in 2050 (versus roughly 50% in a slow transition scenario) windeurope.org/data/product...

Second year of child A being in the creche, happily my immune system is doing much better this year

Closer alignment with EU would likely be seen as a hostile move in Washington. This is dicey, as UK straddled being economically integrated with the EU (which we have now ruptured) and the UK operates as a force multiplier with the US (against a backdrop of war in Europe)

Relative to other countries China’s domestic market is mahoosive. Relative to the industrial capacity China built the domestic demand is too small. It managed to decouple what a country produces from what its population can earn. It has consequences!

This is bad for the UK too, see SAFE and the outsized price tag for participation functions as a shadow valuation of EU membership, against the backdrop of fears for EU cohesion. France is being painted as the ‘bad cop’, IMV these fears extend beyond Paris

Charles, our director, is one of the most astute observers of European politics. His latest piece is no exception: a fascinating and sharp analysis of the paradox of French power: weak at home, stronger than ever in Europe. www.cer.eu/insights/par...

The Federal Reserve said today that it’s going to be buying $40bn of Treasury bill a month to ensure that the US financial system has enough liquidity. Here’s an old AV post on why, and why it matters: www.ft.com/content/df3a...

Faced with China's distortions, US tariffs, and the IRA rollback, should the EU stay in the clean tech race or throw in the towel? A hugely important paper - with a lot of novel data - tackles that question. By Elisabetta, @imlucascarvalho.bsky.social @etiennehoera.d-64.social and Philipp Jäger

Great Bradsher piece on how the renminbis dramatic undervaluation is supercharging China‘s export explosion. Germanys trade deficit with China has surged more than 120% this year. But cutting red tape will surely restore Europes competitiveness! www.nytimes.com/2025/12/07/b...

Also, they should have been thinking about this for a long time.

Winter fog at sunset for day 4 #ArtAdventCalendar

Whilst agreeing with overall framing of the global economy, lMV Pettis argument falls flat in the UK case when it is swept in with the “anglos”. Deep and flexible capital markets? Yes, but it has a distorted maturity demand profile based on long duration. Quite different to the US and Canada.

The fact that four hostile drones tried to hit Zelenskyy’s plane & it’s barely a blip in the news cycle should terrify everyone. We’ve been dragged so deep into the chaos era that an attempted strike on a world leader doesn’t even break through. When this becomes normal, the world is in real danger.

The single market is a bargain: you open your markets, you get access to everyone else’s, and you accept that governments won’t secretly rig the game. But the “no rigging” bargain also handcuffs governments just when everyone is rediscovering industrial policy. 1/3

I thought this was fairly well established, but: here's another new study showing that wind and solar complement each other and make for a more stable grid when combined.

open.substack.com/pub/backofmi... "It can be noted that supply and demand don’t have an obvious role in this model, which appears to drive some people crazy...for the very best locations, pricing will be almost completely inelastic to supply"

Britain has set a new wind generation record. "At 7:30pm on 11 November wind turbines...provided enough clean electricity to power more than 22 million homes" "Wind was delivering 43.6% of all power on the system which means three quarters of Britain’s homes were effectively running on wind alone"

Missed this big news last week: A bid for a stake in Germany's gas network collapsed because the bidder (Italian energy firm Snam) is 1/3-owned by Cassa Depositi e Prestiti, an Italian investment vehicle, which is 35% owned by State Grid Corp. of China

The first episode of House of Cards was broadcast on this day in 1990.

Numbers that aren’t divisible by two seem odd to me.

“But one is that the Tories retained power over 14 years in part because of their divisions not despite them... shape-shifted in ways that helped them defy political gravity and win elections.” Bingo! Boris Johnson ejecting centralists/liberal/one nation tories sent them in a tail spin

Ah yes, Hallowe’en. Where the doors of the underworld open and all sorts of eldritch creatures spill out

Most of you have seen this, but in these troubled times, I would like to ask that you open.substack.com/pub/sankaran...