Morning Macro 21st October
The Nasdaq and gold both make new all-time highs while yields edge lower, with the U.S. 10-year now trading below 4.00% at 3.97%. Also, the OIS is now pricing 51bp cuts by year end (last meet Dec 10th) so starting to sniff out the chance of a third cut.
The collapse of First Brands alone has triggered more than $4 billion in losses, hitting funds managed by Blackstone, PGIM, Franklin Templeton, CIFC, and Wellington. Yet, despite these setbacks, leveraged loan issuance surged to a record $404 billion in the third quarter of 2025, pushing the overall market to an estimated $2 trillion in size. (Chart 1, Pitchbook LCD, LSTA)
Total size of the global private credit market:
2007: $300B
2025: $3–4T ($2T US)
This time it’s different! (Chart 2, @topdowncharts)
UK government borrowing in the financial year to September 2025 was £99.8 billion; this was £11.5 billion, or 13.1% more than in the same six-month period of 2024!
Japanese yen falls as Takaichi wins key vote to become next prime minister, Japan’s first female PM.
Bitcoin/Nasdaq correlation faltering (Chart 3, Bloomberg)
The ratio of margin debt to money supply is higher than at any time except February and March 2000. – (Chart 4, Cypress Capital)
No key data today.
