 Okay, very good morning to you. It's Monday the 8th of November. I hope you had a fantastic weekend and Going to go through quite a few different things actually in the briefing quite a focus on China following some trade data over the weekend We've also got a significant communist party meeting that's happening from Monday through Thursday So they've been updated what to expect from that as well as updates on the property market as well in mainland China Then we're going to talk about US politics UK politics and Brexit. We're also going to talk about Tesla and Elon Musk I'm sure you would have seen Elon Musk's Tweet that he did on Saturday asking through a poll what he should do is some of his stock options Coming up at the moment So we'll delve into that and then we'll look at COVID in Europe bit of an update That's probably worth looking at in compared to how Europe is at the moment When looking at the UK in the US and then the week ahead with main focal point being US CPI data Which we'll get on Wednesday where the headline is expected to have risen to five point eight percent From the same month a year ago. So Incredibly high number, but will that have a market impact? We'll explain in a moment I'm not going to share any charts this morning having a few technical issues with that So just going to get straight into the news and as ever any questions at all for me on anything I'm going to cover feel free to drop a comment below happy to help engage in and assist if I can so to kick things off, let's talk China and So I just go back to here So China posted a record monthly trade surplus in October as exports sure surged despite global supply chain disruptions This data came out over the weekend where exports rose 27.1 percent in dollar terms last month That was the 13th straight month of double-digit growth and that was above analysts expectations of 22.8 percent What was helping it booming global demand ahead of winter holiday season? Easing in a power supply crunch to have been impacting domestic scene as well an improvement in supply chains That had badly just been disrupted through the course of the initial coronavirus pandemic worth noting though that imports did missed analysts expectations and What analysts have said is that likely points to then overall weakness more in the domestic demand situation? Which as we will talk about in a moment being heavily impacted currently by what's been happening with the outbreaks of Covid across several Chinese provinces and this in the context of their zero Kind of policy against then that outbreak in in sense They just locked down immediately and aggressively zero tolerance policy So a few other things in China though to be aware of and the Communist Party meets for the first time in more than a year this week That's gonna be happening from basically today through Thursday Between each party Congress the Communist Party's central committee meets several times in meetings called plenums That cover different topics the agenda. No one actually really knows it's only revealed in a communique We'll get afterward so in the coming days But she as per the headline here is set to unveil a new doctrine that could let him rule for life That's not unexpected. That's very much been in the pipeline for a long time And people are aware of that as he looks to consolidate power For the long time and make appropriate changes to ensure that that takes place a couple of other things China related though To be aware of one was ongoing friction Of course with the US although in the trade data the biggest trading partner with China is still the US and vice versa One of the things here is that there's still this kind of trade Negotiation brewing in the background and so both are still trying to posture at this point in time the latest from China It's talked about China's military has built up mock-ups in the shape of US Navy aircraft carriers You can see it here in some satellite in imagery. It's quite amazing This is actually in the desert. It looks like they've just laid down some markings that just happened to be the exact same shape as the US Navy aircraft carrier So suggestions then possibly as training targets The mock-ups kind of reflect China's efforts to build anti-carrier Capability specifically against US Navy as tensions of course run high with Washington over the sovereignty Over Taiwan and in the South China Sea at the moment The other thing as I mentioned, of course that China is still trying to to deal with at the moment is is COVID China reported 50 new local COVID-19 infections on Saturday now 50 sounds Extremely low, but again as I just said with a zero tolerance policy takes one and they locked the whole town down essentially and so Authorities have said stringent curves will remain to disrupt the virus Domestic transmission as it stands at this moment in time. So that continues to happen Talking of COVID just quickly just just transition over to mainland Europe This is a chart that you probably haven't looked at in quite a while And as much as we've been seeing more positive trends developing the likes of the UK where case rates have declined quite quickly I'm looking at a seven-day ruling average here of daily new confirmed cases per million people The UK has dropped off a decent amount over the course of the last week or so The United States is pretty much a leveling at a fairly contained level But if you look at mainland Europe, there's some quite troubling signs at the moment We saw the Netherlands last week and as you can see here this green line go back into Re-establishing some quite stringent protocols Germany is another one that's seeing a very high uptick and as you can see here the most by far what we've had in In terms of daily new confirmed cases pretty much since the the pandemic begun And so the three German parties that are aiming for a coalition agreement next month will present proposals today So looking out for that on how they will address the spread of COVID-19 Which is getting quite aggressive at the moment in mainland Germany You can see here France Italy as well France seeing a slight uptick is the same But very much more acceleration being seen in Germany and Netherlands at this current point in time So worth bearing that in mind Quit that then that at Tesla you probably would have seen lots about this. I'll drop a link I did quite a lentily post on my kind of personal LinkedIn profile At the weekend, so I'll share the link in the video to this if you want to look at it in more detail but essentially You probably would have seen Elon Musk at the weekend do this which was a poll Where he said much is being made lately of unrealized gains being a means of tax avoidance So I propose selling 10% of my Tesla stock Do you support this and the poll at the moment has had over three and a half million votes and The majority of which 58% are saying yes at this point in time so a couple of things here for context because actually the Nasdaq future Gapped a little lover overnight and so definitely Tesla shares at the opening gonna be closely under under scrutiny and 10% what would that be akin to be valued at about around 21 billion US dollars based on the 170.5 million Tesla shares that Musk holds and his fortune obviously stands now at around 338 billion has come text and about one third Or one quarter of that consists of Tesla stock options, which he's free to exercise at any time The the kind of the way that his remuneration package has been constructed is the securities come from two big awards He received back in 2012 and 2018 and the older ones Options or contracts expire in August next year So 10 generally tend to have a 10-year lifespan The company is also recently disclosed that Musk has taken out loans Using his shares as collateral as well and with the sales must might want to repay some of those loan obligations Which are also on the agenda as well So there's definitely method to the madness of using a Twitter poll to survey public opinion of what he should do My belief as you if you follow the market Market maker podcast you would have heard me and peers talking about before is that we both don't believe Musk has any intention of sticking with Tesla for the long term and The idea being that you know his blood flows with a very entrepreneurial spirit and so he's taken Tesla through this meteoric rise which He's obviously had a really strong input into that process however as Tesla becomes more matured and starts operating like a kind of regular business at some point in time from an Operational perspective it's unlikely that's really going to float his boat and keep him interested for someone of his Characteristics and kind of like in a similar thing to what we've talked about before in the podcast between Steve Jobs being this you know groundbreaking innovator to someone like Tim cock Excuse me Tim Cook who otherwise is Taken Apple to this absolute next level, but it's very much just not really Reinventing the world too much, but just super well organized at developing Further diversification of the business for the product mixes and they're just running a super large organization really well And does that take someone other than you know must to achieve that for Tesla's longevity probably? The time he of course is quite key his options. He received in 2012 by said are set to expire And the share price as you know has risen like 35% or so in the last two weeks And the market cap of Tesla is now tracking at just over 1.25 trillion Which is obviously one of the largest companies in the world and has gone up in the last two years from a market cap of around 75 billion to 1.25 trillion so Absolutely optimal time to strike really to exercise some of these options because a lot of the share price at the moment One would argue is being a bit of a squeeze higher Less based on actual underlying fundamentals and so at some point this kind of exponential rise in their shares won't won't last forever So a good time to to make a move as far as Musk is concerned The problem he has of course is that by doing so and selling his shares How can he do that without it being too self-inflicting as the share price comes off that kind of Downplaced and the size of the payoff that he could have Inside the sales as they call them, which is when you get the senior members of a firm who as part of a filings for Big listed organizations to declare a transparency their shareholdings Typically a met quite negatively if someone at the top is selling their shares Usually it would be signs of they think the share price is very high. So therefore they want to exercise them with the most maximum Kind of impact for the value that they'll get for them or they think that you know, perhaps there's something not Not beyond further growth of that stock price. And so it can cause a bit of a lack of confidence. So I think the poll and itself then to counteract that is a bit of a master stroke It kind of creates dual optics to the degree of declaring your willingness to pay tax big tech or under a lot of pressure at the moment You've seen that unrealized gains being something that politicians in the US have been going after for some time particularly given the The scotans and meteoric rise of some of these tech firms Whilst also giving the impression, of course that you know big part of what fuels Tesla is a lot of retail Interaction with this stock and so therefore by publicly Posturing if you like to create the optics that you're giving the people the option of what you should do I think also satisfies that angle as well No, so no surprise then I think that the people have voted yes And you know, I think this now the reason why I think it's such a masterful move from Musk is that Although Tesla shares may come under some selling pressure Because of this news today. I think that's going to be perhaps fairly contained when I say fairly contained Even if they finish down 10% I still consider that contained because they're up 35% the last two weeks So to be quite frank, even if they came off 20% that wouldn't be that big a move in in context So don't look at them like you would in comparative to a normal Stock in in that extent in terms of a big big tech business But just having a look at then a few other things here If he executes then this the fact that he's come out and already said it I think then that that will alleviate Perhaps the shock and horror that might have led to a lot of retail traders just bailing on their long position The fact that he's kind of put the market on an advanced noticed also I think buys him some room for maneuver to exercise more of these as we go through into Q4 in the summer of next year Because of aforementioned reasons for him to play loan obligations to him to manage his His tax and and for him to maximize the amount that he can get out of the Tesla rally I think all of this is necessary and I think this is just a real kind of a Form of forward guidance in a way and forward guidance is adopted in order to offset and mitigate volatility and he's absolutely aware of this So yeah, that's the latest on on Tesla as I said I'll drop a link on the video and you can have a read of what I've kind of discussed in a bit more detail If you're interested all right But back to the macro quick look at the US on the political side of things We did see late on Friday the Democrats set aside divisions between progressors and centrists And they've actually passed a trillion dollar package on the infrastructure side of things And that's been given to Joe Biden now to sign into law Couple of things to be aware of here. This isn't all of the packages done and dusted It's just the infrastructure one so Democrats still have a lot of work to do on the second pillar of Biden's domestic agenda, which is the sweeping expansion of social safety nets and programs to fight climate change And the value of that of course is 1.75 trillion That bill did clear a procedural hurdle On Saturday over the weekend, which will enable Democrat leaders to quickly schedule a final vote when the time comes But that's the key one of course, which has been highly contentious even amongst Democrats Don't forget as well something that got kicked kicked down the road for a later day Is also getting ever closer once again, which is the debt ceiling Remember they delayed that before and voted for a short-term kind of resolution Which was at Congress faces then the looming December 3rd deadline for the debt ceiling So a lot of pressure still remains on Joe Biden at the moment. So we continue to watch that with great interest On UK politics Brexit, this is something that came out over the weekend And this is the Irish Foreign Minister who basically has said that the EU could abandon the entire Brexit agreement with the UK If London goes through its threat to suspend parts of the withdrawal deal or article 16 Which you might have read about quite a bit of Recently London has dismissed concessions from Brussels made last month that would simplify Irish sea customs checks saying they do not go far enough and is refusing to accept the oversight of the deal from Obviously the European courts of justice The ECJ and that's what the friction is at the moment. So it continues to be on the Northern Ireland protocol But the kind of words are getting more feminist at the moment between the two sides Particularly over Europe's response here to some of the threats We were hearing of last week about the UK considering seeking legal advice on alternatives And particularly the idea of the impact of triggering article 16 all right, let's have a look at the week ahead and Just a quick look over the calendar Really, it's it's a much more quieter week than certainly what we had last week with the hog central bank fed Bank of England Payroll extravaganza Today is pretty quiet overall You've then got on Tuesday You're looking out for the US PPI number You also get then German trade data in the morning Wednesday is the main focal point This is when you're going to get US CPI and you also get initial jobless at the same time a day earlier than Normal because there's a national holiday happening I think it's veterans day in the US on Thursday markets open But it's a national public holiday. So government offices are shut And then you get UK GDP on Thursday, and then you've got University of Michigan sentiment coming out the preliminary number for November on Friday as well So they're kind of your main things, but let's have a look at the the kind of the main star on the billing Which is US CPI and as you can see here It is expected to have risen to five point eight percent from the same month the year ago on Wednesday That would put us over that peak that we saw Around the period of the financial crisis and put us up at a multi-decade high going back to the late 80s nine early 90s That would mark a step up of course from the five point four percent reading We had in September which was already the higher since 1990 Core CPI just to put it back into a little bit of context though Though the headline reading will be five point eight percent the core year and years expected at four point three percent Up from four percent previously Economists and policy makers will obviously scrutinize this very carefully Given any further signs of inflation pressures are broadening out beyond some of the most sensitive to pandemic related disruptions to see To try and ascertain how long lasting or how far these inflation pressures will become but the Fed acknowledged more directly last week Remember we have the Fed meeting of course They said the risk that inflation will continue rising and highlighted severe supply chain disruptions and the fueling today's price pressures so to me reaction effect to what is a pretty Milestone historic high reading of CPI could well be quite tempered as far as market reaction is concerned Because what the Fed so what is the Bank of England other central banks have said is that inflation might well have further to run on the Upside, but we remain so the fact that it will be Somewhat transitory and as a reflection of severe supply chain disruptions And so the fact that this number comes out up in the high five percent numbers Is is a very worrying figure in isolation, but in context I don't think it's as big a deal now that we've had the Fed so recently As I said to get University of Michigan on Friday We should improve given waning COVID numbers as I just showed you on that chart and generally strengthening incomes that we've had Rising gasoline prices and the general concern there over the rising cost of living Could put a cap on that improvement according to analysts at ING as far as the UK calendar is concerned I mentioned you've got UK GDP on the Thursday The economic rebound is expected to have slowed sharply in Q3 Economists have said the Bank of England forecast in its latest monetary policy report the output growth slowed to 1.5% in the three months to September down from 5.5% Expansion in the previous quarter and well below what it had previously expected and again hence one of those reasons why they held off from Hiking rates last week They said last week the weaker near-term outlook mainly reflects the impact of supply constraints both domestic and global Although UK demand is expected to be a bit weaker as well So again given how telegraphed and transparent the information is being from the bank given the meeting just last week That GDP number I don't think it's gonna have a massive impact on on markets or overall sentiment for sterling at this point As far as earning is concerned just to wrap things up US earnings Rumble on however, if you're an index stock trader, there's nothing really too much to be worried about However, there are some interesting names kind of retail Favorites that will be coming out includes AMC Roblox coming out aftermarket today. They've got Palantir coming out pre-market on Tuesday coinbase aftermarket on Tuesday as well So a couple of interesting names that I'm sure will generate some headline buzz door-dash and others as well all coming out You can you can ascertain this this graphic on my my Twitter handle, which you can find below All right, that is it gonna leave it there that you guys get on with the day Have a good one and have an excellent week ahead. Take care