Global Macro Monitor

Didn’t today’s market feel like a rudderless sailboat ripped from its mooring and blown about by random gusts of wind (algos)?   We count the Dow crossed the unchanged line at least thirty times today.

The generals have have been taken out and shot and the leaderless market wandered aimlessly today.

We have little doubt — though not certain — the S&P500 will slice through its 200-day moving average like a “hot knife through butter.”   The 200-day is only 0.65 percent lower.   The big test is the correction low at 2532.69, which is 2.78 percent lower.

We will be out for the High Holy Ones and may weigh in sporadically, but doubt it.

North Korea

We want to leave you with our thoughts on Kim Jong Un’s recent visit to China.

We view this as negative for the Trump Administration’s goal to denuclearize the Korean  peninsula as Kim was able solidify China as a big brother.   When Trump and Bolton now threaten North Korea, they effectively also threaten China.

President Xi fears a unified Korea under Western influence more than he does a nuclear North Korea.

 “The very fact of this meeting alone, and certainly the tenor of the Chinese statement about it, really does increase Kim Jong Un’s leverage in the upcoming talks. It shows that Kim has a friend in Beijing,” said Adam Mount, a senior fellow and director of the Defense Posture Project at the Federation of American Scientists, where he covers US nuclear strategy, deterrence and North Korea. 

“It means the Trump team is going to be navigating really narrow straits here. It’s hard to overstate how dramatic this development is,” Mount said. – CNN, March 28

We remain very concerned the Trump Administration is not negotiating with the A-Team, and with Kim, now backed by China, the risk of a debacle when the two leaders meet at the upcoming summit has increased markedly.

Furthermore,  activity at North Korea’s nuclear facilities has ramped up recently,

TOKYO — Increased activity at a North Korean nuclear site has once again caught the attention of analysts and renewed concerns about the complexities of denuclearization talks as President Donald Trump prepares for a summit with Kim Jong Un in the coming weeks. Satellite imagery taken last month suggests the North has begun preliminary testing of an experimental light water reactor and possibly brought another reactor online at its Yongbyon Nuclear Research Center.  – CBS, March 28