Weekend Edition.
Flammable moats.
“It’s the first thing I read every morning.” — David Barboza, founder of WireScreen and former Shanghai Bureau Chief for The New York Times.
1. Fortifying the American home has become big business, selling escape tunnels, secret arsenals and even flammable moats. A 2023 survey found that about one-third of American adults were prepping for a doomsday scenario, spending a collective $11 billion over 12 months. (Source: nytimes.com. Read the whole thing)
2. Americans turned much more pessimistic about the economy in April as President Trump’s trade war gained steam, according to a closely watched survey of consumer sentiment. The University of Michigan’s consumer-sentiment index, released Friday, nosedived to 50.8 in April from 57 last month. Sentiment has been falling steadily throughout 2025. Expectations for inflation also hit the highest level in 44 years, according to the survey. Sentiment is now at its second-lowest level in history, according to the survey. It was slightly lower in June 2022, when inflation was soaring thanks to snarled supply chains and pandemic buying. Back in 2022, the index touched 50, which was the lowest reading on record going back to 1952. (Sources: csa.isr.umich.edu, wsj.com)
3. Mortgage rates usually fall during periods of economic uncertainty. But during the past tumultuous week for the markets, mortgage rates ended essentially flat and dealt another blow to the housing market’s crucial spring selling season. The average rate on the standard 30-year fixed mortgage dipped slightly to 6.62% this week, according to a survey of lenders by mortgage-finance giant Freddie Mac. It was 6.64% a week earlier. Other news around tariffs and their impact on the economy didn’t help. Economic anxiety and extreme stock market volatility are emerging as destabilizing threats to a housing market that can’t catch a break. (Source: wsj.com)
4. Treasuries dropped in volatile trading yesterday, as market participants warned of growing strains in the $29 trillion market for US government debt. The 10-year Treasury yield climbed as much as 0.19 percentage points to 4.58 per cent, amid a deepening slump for an asset traditionally considered the global financial system’s premier haven. The yield later reversed some of those gains to trade at 4.48 per cent after Boston Fed President Susan Collins told the Financial Times the U.S. central bank “would absolutely be prepared” to deploy its firepower to stabilize financial markets should conditions become disorderly. (Source: ft.com)
5. Bloomberg:
Serious questions now exist around the wisdom of owning American assets that until recently were the envy of a risk-obsessed world.
Amid the manic moves, key trading patterns even bear soft echoes with emerging markets. All told, fear is spreading that Trump’s bid to rewrite the terms of global trade risks imperiling America’s privileged status in the financial system.
“You honestly feel like you’re seeing stuff wrong sometimes. You have to check the scaling on your graphs because prices are moving so quickly,” said Charlie McElligott, managing director of cross-asset strategy at Nomura Securities International Inc. “It’s just a constant stream of bells and popups on the desks right now. Automated messages like risk limits and risk alerts. It’s maximum overstimulation, maximum dopamine saturation.” (Source: bloomberg.com)
6. Caixin Global:
Shanghai’s bustling port came to an abrupt halt on Thursday, just one day after U.S. President Donald Trump’s punitive 125% tariffs on Chinese imports took effect — virtually wiping out shipments bound for the United States overnight.
Only days earlier, the port had been a hive of activity, with ships rushing to load containers ahead of the tariff deadline. On April 7 and 8, nearly half the vessels docked at Shanghai’s Yangshan and Waigaoqiao terminals were bound for the U.S., racing against the clock.
Containers that missed the narrow window now sit idle in stacks along the docks. Many shippers are either pulling cargo back or scrambling for alternatives, according to an employee at shipping giant Cosco Shipping Holdings at Yangshan terminal.
Major shipping lines are drastically cutting back on trans-Pacific routes. MSC, the world’s largest container shipping company, canceled six voyages in April alone. Premier Alliance — a partnership of three major Asian shipping firms — postponed the launch of a new route planned for May.
Shipping lines have canceled 26 sailings from China to U.S. coasts between April 14 and May 11, slashing container capacity by nearly 40% compared with early April, according to Huatai Futures. (Source: caixinglobal.com)
7. Financial Times (John Burns-Murdoch et alia):
The number of European travelers visiting the US has fallen sharply as political and economic tension and fears of a hostile border under President Donald Trump threaten the world’s most lucrative air routes.
Visitors from western Europe who stayed at least one night in the US fell by 17 per cent in March from a year ago, according to the International Trade Administration.
Travel from some countries — including Ireland, Norway and Germany — fell by more than 20 per cent, an FT analysis of ITA data showed.
The trend poses a threat to the US tourism industry, which accounts for 2.5 per cent of the country’s GDP. Some airlines and hotel groups have warned of waning demand for transatlantic travel and a “bad buzz” about visiting the US.
The total number of overseas visitors travelling to the US dropped by 12 per cent year-on-year in March, the steepest decline since March 2021 when the travel sector was reeling from pandemic restrictions, according to the ITA data. (Source: ft.com)
8. A recent plunge in oil prices, prompted by Donald Trump’s trade war, has started to deplete Vladimir Putin’s war chest. Moscow’s budget — about a third of which comes from oil and gas — may be as much as 2.5 per cent lower than expected in 2025 if crude prices stay at current levels. That would force the Kremlin to increase borrowing, cut nonmilitary spending or draw down its remaining reserves. The average price of Urals crude, Russia’s main export grade, has fallen to the lowest in almost two years, after the US president’s tariff announcements and an unexpected move by the Opec+ coalition to boost output. Urals was trading at about $50 a barrel as of Thursday, according to price reporting agency Argus. Russia planned its budget for 2025 based on Urals at $69.70 a barrel. (Source: ft.com)
9. Executives from cryptocurrency exchange Binance met with Treasury Department officials last month and discussed loosening U.S. government oversight on the company, while it was also exploring a business deal with a Trump family crypto venture, according to people familiar with the talks. The Binance executives asked Treasury officials in Washington to remove a U.S. monitor that oversees the exchange’s compliance with anti-money-laundering laws, some of the people said. The move would mark a first step toward returning the company, which in 2023 pleaded guilty to violating those laws, to the U.S. market. Binance has also been in talks to list a new dollar-pegged cryptocurrency from World Liberty Financial, a crypto venture backed by President Trump’s family, other people familiar with the discussions said. Listing the token, known as a stablecoin, could catapult it into a huge market and potentially bring in billions in profit for the family. (Source: wsj.com)
10. The Trump administration will end temporary protections for more than 10,000 people from Afghanistan and Cameroon, putting them on track for deportation in May and June, Department of Homeland Security officials said on Friday. Many of the Afghans affected by the decision had been allowed into the United States after the disastrous U.S. withdrawal from their country in 2021. Now, the Trump administration could send them back to a country under Taliban rule. The Afghans and Cameroonians had been living in the United States legally under Temporary Protected Status, which is meant to shield migrants from being returned to countries facing conflict or natural disasters. People who have the protected status are also allowed to work in the United States. (Source: nytimes.com)
11. The US military has launched an effort to determine who may be able to build a truly useful quantum computer within a decade, and what it may be good for. There are more than six dozen companies currently building quantum computers, but it is far from clear which of them will eventually produce devices that have a concrete impact on American industries and the economy. The US Defense Advanced Research Projects Agency (DARPA) has now started a programme to find out. (Source: newscientist.com)
12. Ed Luce:
When Zbigniew Brzezinski died, Kissinger was surprised how bereft he felt. The two had first met in Harvard 67 years earlier. “How central Zbig’s presence had been to my image of a world worth living in and defending hit home with an unexpected force,” Kissinger wrote to Brzezinski’s family on learning of his death. “I felt as if a sustaining pillar of the structure of the world I cared about had disappeared . . . We shared, I like to think, a cause, if not always our ambitions.” (Source: ft.com)
Quick Links: Putin’s secret dealmaker emerges from the shadows in Ukraine peace talks. Trump envoy Witkoff meets with Putin on war in Ukraine. Allies pledge €21 billion in weapons for Ukraine while denouncing Russian attacks. How Bosnia could break Europe. High-level talks to disarm Iran’s nuclear program to begin in Oman. Will Trump’s tariffs lead to an emboldened Beijing in the Taiwan Strait? Wuhan Covid lab planning ‘ominous’ new bat experiments. Documents reveal Trump’s plan to cut funding for NASA and climate science. Which country benefits the most from U.S. brain drain? Canada.
On a Lighter Note: Interesting interview with mathematician Tai-Danae Bradley, who is using category theory to try to understand both human and AI-generated language. A farmer looked at his land and, in his mind’s eye. saw the Landmand Golf Club. He built it—and everyone came. After yesterday’s round, Justin Rose remains atop the leaderboard at The Masters. Ludvig Aberg is five shots off the lead. Nick Dunlap shot a 90 on Thursday, one of the worst rounds ever played at The Masters. Yesterday, he shot a one-under-par 71. Weekend classic: Eric Clapton: “Layla”.