字幕表 動画を再生する 英語字幕をプリント Hello and welcome back to the note. It's been a fairly ugly end to the week. Quite a sharp sell off in the US stock markets to end Friday. Let me now try to put that into perspective. Well, taking a look at first is the oil price, obviously something that has preoccupied many people for a while now, that very very sharp tumble in the latter half of 2014. What is intriguing is that there's been huge volatility ever since then. But we've basically gone flat ever since the beginning of 2015. It doesn't feel like that. There's been this intense volatility we've tended to over compensate for that. Now, if we take a look at this next chart, you can see that that plays to one of the more important nature's of the oil market. It may be very volatile, but in the long term, oil price and the gap between demand and supply for oil - that's using numbers from the IEA - are remarkably close. The price gets very high when demands outstrips supply the most, as it did in 2007, 2008, and the price gets very low when supply outstrips demands by the most last year. That could imply that the oil price is very sensitive to changes in oil and in demand and supply, perhaps more accurately, it means that demand and supply actually respond quite quickly to changes in the oil price. This means, I would suggest, given that there is concern about whether the oil price is about to fall once more, that we should always keep an eye on that for the long term. There is no particular reason to think that oil prices will stay low for a very long period because the way the market works is that we can expect demand and supply to adjust. Now, moving on to the news that was moving the market today, we heard about US retail sales and as you can see, these were really pretty sharply good results. A 3% annual growth as you can see after quite a slow clip most of last year, it does look as though the consumer is buying stuff not at the rate we saw 10 or 15 years ago, but still plainly ticking up, plainly reason for some comforts. Now, why therefore would we have seen the sell off that we saw in the stock market? One argument is that because we've seen strong macro-data today, that has worried people that the Fed is more likely to raise rates sooner rather than later. That's something that the stock market doesn't want to see. However, if you look at the Fed funds future's market, it isn't showing any particular rise in the expectations on rates, that it's still seen as barely 50-50 shot that we'll have even one rate rise by the end of this year. However, now let's take a look at the bonds markets. And here we do have one signal that might have worried people very much. This is the yield curve, many people are rather frightened of bond market technology, it's terminology. It's fairly straightforward. This shows you the gap between the yields on the 10 year treasury and the 2 year treasury. When that gap is lower, or in other words when the yield curve is flatter, that means that investors generally expect rates to rise less in future inflation, to rise less in future and growth to be slower in future. In other words, a flatter yield curve is a bearish signal. And when the yield curve actually becomes inverted when the 10 year drops below the 2 year, that is a classic recession indicator. We've seen the yield curve flatten very sharply the last few days, and as of today, it is now as flat as it has been at any point since the end of 2007 on the dawn of the financial crisis and the great recession. Somehow or other the bond market at the moment is spooked and worried about a recession despite what is broadly positive data. That may be the best explanation for why stocks are having a bad time of it and why it's now almost a year since we saw the all time high in the S&P 500.